Perez to approve 49.9% sale of Madrid for intelligent key reason

Throughout his lengthy tenure as president of Real Madrid, Florentino Perez has made significant worldwide changes to the club. As if the Santiago Bernabeu refurbishment weren’t enough of a legacy move, he is allegedly contemplating an even bigger one before he departs.

The club’s president, who is 77 years old, is looking at ways to improve the organization’s financial and legal standing. Especially as he plans to seek another term in office.

Perez has characterized UEFA’s actions—most notably the worldwide decision to ban the Superleague—and La Liga’s decision to sell 11% of its TV rights for 50 years as aggressive actions against the club’s financial resources. Thus, he feels Real Madrid should have authority over these issues.

Worse still, Los Blancos might end up in “the wrong hands,” according to Perez. Especially because of the increasing number of teams owned by states and billionaires in the Premier League.

Why would Perez allow Real Madrid to be sold?

According to El Confidencial, Perez is considering two paths forward. One of them would increase members’ rights while updating the club’s structure. That way, he would make sure it stays in the right hands. The specifics of this plan are unclear at the moment. However, it would entail turning the club into a private company with the members as shareholders.

A second scenario would cause a dramatic change in the Spanish soccer scene. The 77-year-old Spaniard has been in talks with Key Capital Partners and Clifford Chance, two investment banking firms, about many possibilities. One of which is to put the La Liga giants on the stock market.

The article goes on to say that banker John Hahn and JP Morgan are also aware of Perez’s plans. As a result, under this alternative, members would have to vote to sell as much as 49.9% of the club. However, there would be a limit on how much could be sold so that the members could always keep control.

By going with the second option, the club’s ownership arrangement would drastically change, and they may end up in a different legal position. It would entail giving over a significant portion of the club to investors with selfish interests instead of the members.

In theory, all members have an equal vote in the club’s destiny; nevertheless, this would be rendered moot if the club were to welcome investors, who would still have ultimate authority over important decisions.

That couldn’t happen unless Perez called for a vote on the proposed modifications. The membership, meanwhile, has done very little to question his plans in the last several years.

What does it mean for club and La Liga?

For Real Madrid, this proactive reorganization signifies a sea change in how they handle ownership and management. To ensure its financial security and integrity in the changing football scene, the club is striving for a balance between modernization and heritage.

In addition to shielding the club from financial instability, this plan will perpetuate the club’s rich history of democratic governance and fan engagement. It intends to put power and ownership of the club squarely in the hands of the club’s members and supporters.

Photo credits: IMAGO / SOPA Images : IMAGO / Marca