[5] Within just one month of its foundation, in December 1902, Moderno FC took part in the Concurso de Bandas, the first tournament organized by the recently established Madrid Football Federation, thus engaging in some of the very first competitive football matches in the city despite having played just a handful of preparatory matches prior to it.

At the tournament, Moderno came face-to-face with Madrid FC for the first time in a match held at the Plaza de Toros Avenue on 25 December 1902, ending with a resounding 0–16 loss to Madrid, who came out winners of the tournament after comfortably beating the remaining opponents.

[citation needed] Madrid FC's loss in the 1903 Copa del Rey Final caused a convulsive situation within the entity that led to the departure of several of its founding and most important members.

The split was led by the Giralt brothers (Mario, José and Armando) and Antonio Neyra, who then refounded the Club Español de Madrid in late 1903.

Moderno was also struggling, so the directors of Madrid FC, Juan and Carlos Padrós, proposed to Fernando Kummer an agreement that could benefit everyone: a merge.