Skip to main content

The financial gulf between Valencia and United

How big the gap is on the pitch between Valencia and Manchester United remains to be seen, but the financial gap is huge. Valencia's position is precarious, particularly when it has to compete the fourth Spanish Champions League place. Barcelona, Athletico Madrid and Real Madrid usually get the other three. Valencia have returned to the Champions League for the first time in three seasons.

It wasn't always that way, of course. In 2000 and 2001 the club reached the Champions League final and in 2004 it won the Uefa Cup. But the financial stakes in football have changed and the gap between the clubs with a global profile and those in the second tier has widened. One time heavyweights like AC Milan and Olympique de Marseille have fallen behind the pack.

Valencia were bankrupt before a Singaporean billionaire, Peter Lim, rescued them in 2014. Lim has invested €200m of his own fortune in the club as he tries to turn a large fortune into a small one. But, as is so often the case, he has proved to be a controversial figure. Investors expect results and if they don't get them, they fire the coach. Six were shown the door between 2015 and 2017.

United's latest accounts show revenues of £590m. Valencia's latest accounts show revenues of just over €100m, in other words one sixth of those of United. Match day revenues are just €15m compared with just under £110m at Old Trafford. Work to replace the crumbling Mestalla stadium was halted in 2007. The club has now hired Deloitte to oversee the sale of its existing stadium and complete the new one, expected to cost around €150m.

United are known for the sophistication of its commercial sponsorships, extracting money for obscure rights from remote countries. I wouldn't be surprised to hear that one day that Tuvalu had sponsored the pitch watering system.

Anil Murthy, the former Singapore diplomat who is the club's president, told the Financial Times that in the last decade 'the football industry has evolved very quickly, and it's accelerating.' Perhaps too fast for Valencia, but if they can play in the Champions League, they will benefit in terms of prestige and budget. Unfortunately, the club is currently 14th in La Liga.

Labels:

Comments

Post a Comment

Popular posts from this blog

It's no deal say Spurs insiders over Taiwanese takeover

Senior figures at Tottenham Hotspur insisted on Friday that they had not been informed of any deal to sell Daniel Levy’s stake in the club. A business group, Eight Sports Capital — which is said to include a billionaire Taiwanese financier — claimed that it had an agreement in place to buy a 24.99 per cent stake in ENIC, the club’s majority owners, from Levy, who owns 29.88 per cent. The Times has been told Ng Wing Fai and Brooklyn Earick form part of the group, having both been linked previously to potential takeovers of the Premier League club. The Taiwanese businessman, Richard Tsai, is also said to be part of the consortium. He is reportedly worth £7 billion.  Last year Earick, the former DJ and tech entrepreneur, was part of an attempted £4.5 billion takeover, which was “unequivocally rejected” by Spurs.  An ENIC spokesperson said: “We can confirm that neither ENIC nor THFC are aware of any sale by Daniel Levy’s Family Trust of its minority stake in ENIC, THFC’...
Post a Comment
Read more

Reports about Charlton sale exaggerated

Reports have appeared in The Guardian and elsewhere that Charlton has been put up for sale. Richard Cawley is an authoritative local journalist who runs a South London Sport substack site.  He reached out to the club yesterday evening to ask for comment on The Guardian’s article. Early indications from the club have been that nothing has changed since the story about them seeking investment, except that it is now a different company doing it. Charlton have since managed to consolidate their place in the Championship, avoiding an instant return to League One, with their women’s side promoted to the WSL, returning to the top flight for the first time since 2007, although staying there is likely to be costly. It would be counter-intuitive for owners Global Football Partners not to progress the club when looking for investment, that the focus remains on driving it forward, that their spend this summer is in line with long-term planning and will see an increase in wages spent on players...
Post a Comment
Read more

Hull City's 'strange' loan

When football finance guru Kieran Maguire seems flashing lights in a club's loan deal, I become concerned.  He is the leading football finance expert in the UK. Hull City have borrowed £55m against their stadium and training ground yet they should get £30m from the Premier League before long.  What is going on? https://www.bbc.co.uk/sport/football/articles/cpwel48y51do
Post a Comment
Read more