Skip to main content

Who will benefit from Wembley Stadium bid?

Billionaire owner of Fulham Football Club Shahid Khan has made what is effectively a £900m bid for Wembley Stadium which is to become a home for both British and American football. The 'Tash with the Cash' as he is nicknamed made his fortune selling car parts in the United States and also owns the Jacksonville Jaguars NFL team.

Who will benefit from the deal? The Football Association will have £500m up front and will also receive some £400m in income from the rights to Club Wembley over the next six years. The £58m it raised from this source in 2016/17 just about covers the stadium operating costs. It will also save substantial investments over the next few years which Mr Kahn claims are necessary to 'refresh' the stadium. 'Wembley's new, but it's not that new,' he says. A sum of around £60m is being talked about.

The Football Association will be able to use the money to create a special fund to build artificial pitches and other grass roots facilities. However, some commentators are sceptical about how much of the money would find its money into the grass roots game. There is still £140m of debt to be repaid.

The stadium cost nearly £800m to complete. That's £987m in current money, so a £900m sale represents a loss, although one should take account of the avoidance of future expenditure and the £12m a year it costs to service the debt. Substantial sums are still owed to public bodies: £78m to Sport England, £18.5m to the Department for Culture, Media and Sport and £16.2m to the Greater London Authority.

The Jacksonville Jaguars will play a number of games at Wembley between September and December which will lead to England games 'going on the road' outside London. There could ultimately be a NFL franchise in London. Spurs do not see this as a threat to stage NFL games at their new stadium for which it has been configured, although there will only be one such game next season.

Fixture congestion could pose problems for Chelsea's plan to play home games at Wembley while Stamford Bridge is redeveloped, but careful planning should find a way round this. There will be a certain irony in Chelsea playing at a stadium owned by Fulham's owner.

Some hope that the move will lead the FA to relocate from London to the Midlands, but there is scant hope of that.

Ken Bates has been fulminating about selling our heritage and has called on the Government to intervene, but they have indicated that they are disinclined to do so. The Wembley name will be protected by a covenant, although it is not clear whether this would cover the sale of naming rights.

Kieran Maguire reckons that the biggest winners since Wembley was built have been the banks. He notes, 'The FA have been charged £331.5 million in loan syndication and interest fees.'

Comments

Popular posts from this blog

Threat of financial calamity removed from Baggies

West Bromwich Albion had effectively been in decline ever since the club was sold to a Chinese consortium in August 2016, paying a figure north of £200m to buy former owner Jeremy Peace’s stake. Controlling shareholder Guochuan Lai’s ownership was fairly disastrous for the club, but his unloved tenure finally came to an end after Bilkul Football WBA, a company ultimately owned by Florida-based entrepreneur Shilen Patel and his father Dr Kiran Patel, acquired an 87.8% shareholding in West Bromwich Albion Group Limited, the parent company of West Bromwich Albion Football Club. This change in ownership was urgently required, due to the numerous financial problems facing West Brom, including growing high-interest debt and serious cash flow concerns, following years of no investment from the former owner. Indeed, West Brom’s auditors had already rung the alarm bell in the 2021/22 accounts when they cast doubt on the club’s ability to continue as a going concern without making player s...

Gold standard ground boosts Tottenham's income

The gold standard in European football grounds is the Tottenham Hotspur stadium in north London, a £1bn construction project completed in 2019. Its impact on the club’s finances has become increasingly clear as the effects of the pandemic have faded. Previously, the average fan would spend less than £2 inside the ground on a typical match day, but now that figure is about £16, thanks to new facilities including the longest bar in Europe and an on-site microbrewery. Capacity has gone up from 36,000 at the club’s previous home of White Hart Lane to 62,000.  The new stadium — built on land adjacent to White Hart Lane — has opened the door to a broad range of other events that have helped to push commercial income up from €117mn in 2018 to €215mn in 2022. Last year, Tottenham hosted US singer Beyoncé for five nights on her global Renaissance tour, two NFL matches, as well as rugby games and heavyweight boxing bouts.  Money brought in from football has gone up too. Match day ...

Spurs to sell minority stake

Tottenham Hotspur is in talks to sell a minority stake in a deal that could value it at up to £3.75 billion and pave the way for Joe Lewis and his family to sever ties with the Premier League football club. Tottenham chairman Daniel Levy is seeking an investment that values the club at between £3.5 billion and £3.75 billion, including debt. While the terms of any deal have not been finalised, City sources expect Spurs to sell about 10 per cent. The club is being advised by bankers from Rothschild on the sale. Tottenham wants to raise fresh capital for new player signings and to help fund the development of an academy for its women’s team, as well as a 30-storey hotel next to its north London stadium. The financier Amanda Staveley, who brokered the deal for Saudi Arabia’s Public Investment Fund to take over Newcastle United, is understood to be among the parties to have expressed an interest in Tottenham. Staveley’s fund, PCP Capital Partners, has raised about £500 million to ...