Thankfully, it appears as if Bayern Munich has dodged a big financial bullet. Per a new report from Az, Bayern was working on a sponsorship/partnership deal with German payment processing and financial services company Wirecard over the summer.
Apparently, Wirecard wanted to pay FC Bayern Munchen AG seven million Euros for a three-year deal. As a part of the deal, they would also have €1.5 million go to Bayern’s basketball department and they wanted to focus on what was referred to as “new business areas.”
Unfortunately, Wirecard went through a huge financial crisis over the summer and wound up having over €2 billion in missing money and wound up filing for insolvency. Per a report from The Wall Street Journal this summer, it was discovered that the company had essentially been using “fictitious revenue” to fabricate their value and make the company significantly more attractive to investors.
CEO Markus Braun was arrested for the revenue inflation, but was released on a €5 million bail and still has to report to German authorities once a week. The €2 billion in missing revenue is still unaccounted for, despite claims from Wirecard that it was being held in trust accounts in the Philippines.
At the time Bayern Munchen AG opened discussions with Wirecard, the company was worth approximately €24 billion, so on paper, it looked like it would be a potentially worthwhile and profitable partnership.
From Bayern’s perspective, they were entertained by the idea that Wirecard would offer their “technical expertise, contacts, and know how” in an effort to stimulate digital and mobile payments made by football fans during a time when it was increasingly popular. The coronavirus pandemic has made digital payment platforms significantly more popular and streamlined, as venues that have allowed portions of their fans inside stadiums at one point or another has shown; everything is digital, no physical cash is exchanged inside the grounds.
All things considered, the timing of everything was a blessing in disguise for Bayern. Jörg Wacker had e-mailed representatives from Wirecard expressing interest in the partnership just eight days before they filed for insolvency. There may have been some red flags initially overlooked by Bayern’s board and front office when reviewing consideration for the partnership, but it in the end, in was a little bit of luck with timing that helped them dodge a massive bullet.