CAF moves to cancel $1bn Lagardere deal but is met with fierce resistance

CAF moves to cancel $1bn Lagardere deal but is met with fierce resistance

By Osasu Obayiuwana

November 5 – The Confederation of African Football’s 12-year contract with Lagardere Sport (LS), which is supposed to last until 2028, is on the verge of ending. CAF has formally written to LS to terminate its contract. 

Signs that CAF were going to end the deal were evident at the last Africa Cup of Nations in Egypt, where one of the top-ranked officials in the organisation told this reporter that the current deal with LS appeared “unsustainable” and would be ended, if LS could not offer a vastly improved contract.

According to sources close to Lagardere Sport (LS), CAF sent a letter on October 28, demanding to end the ongoing contract, in which LS provided CAF with a minimum guaranteed income of $1 billion during the contract period.

This followed an earlier meeting in Milan, on the fringes of the ‘FIFA Best’ awards and another meeting in Zurich on October 3, at which Mouad Hadji, CAF’s secretary-general and Abdel Bah, CAF’s director of marketing, were present, alongside FIFA lawyer Mario Gallavotti and key LS officials, including Idriss Akki, president of their Africa division  and Ugo Valensi, who is Lagardere’s CEO.

Gallavotti is known to be very close to Gianni Infantino, president of football’s world governing body.

A termination deal, in which LS is to be financially compensated – for giving up the contract which still has nine years to run – has reportedly been offered. But this has not been accepted.

“We are going to fight any plan to terminate this contract outside of the agreement that we entered into with CAF. The conditions for termination are very clear and anything outside of that is not going to be acceptable to our company,” said an official of LS, who asked for anonymity.

Officially, an LS spokesman – from the PR firm Edelmans – told Insideworldfootball that “they will not be supplying answers [concerning their contract with CAF]. As I’m sure you are aware, these questions are commercially sensitive and it would not be correct for the business to be commenting on them at this time.”

According to the long-form contract between CAF and LS, which this reporter has a copy of, all disputes with regards to the contract, which is governed by Swiss law, are to be handled by the international Chamber of Commerce in Geneva.

Abdel Bah, CAF’s Director of Marketing, who has been one of those involved in CAF’s decision to terminate the contract with LS, acknowledged his involvement in the ongoing process but declined to comment.

While it is yet to be confirmed, it is suspected that Infront, owned by Chinese conglomerate Dalian Wanda, will be the new commercial partner of CAF in a deal that will have to better the current LS deal.

But will CAF be able to enter a new commercial deal, should LS obtain legal injunctions to prevent the termination of their contract? That’s the million dollar question that only the ensuing weeks will answer.

Curtesy of insideworldfootball.com

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