Saints owner is no benefactor

At one time it looked as if Chinese investors would be the next big wave in European football. But then the Chinese state clamped down on the outflow of capital, preferring money to be spent on the domestic game.

The record of Chinese investors has been mixed. Fosun has played a key role in the transformation of Wolves into one of the leading clubs outside the 'big six'. They have invested tens of millions of pounds since 2016. Many Wolves fans hope that they could become the club to break the dominance of the top six, although others aspire to that role.

However, Chinese businessman Tony Xia was forced to sell his majority stake in Aston Villa prior to the club earning promotion to the Premier League through the play offs.

For many years, Southampton was seen as one of the solid mid-table clubs in the top flight with no danger of relegation and an outside chance of a place in Europe (they qualified for the Europa League twice, once for the play offs and once for the group stage). Admittedly, they often found themselves selling their best players whose ambitions took them elsewhere such as the move of Virgil Van Dijk to Liverpool.

Last season they found themselves in a relegation battle. However, they should not expect owner Gao Hisheng, a flamboyant former government official, to splash the cash. The real estate magnate acquired 80 per cent of the club in a 2017 deal that valued it about £200m.

Pork is a favourite meat in China, but Mr Gao has said that he is not treating Southampton as a pig to be fattened and sold. He told the Financial Times, 'I am treating it as a child. But my children must believe they cannot depend on the boss.'

'I have said to Southampton, "I am now your father. But I am putting you on the right track, you need to feed yourself."' To someone of my generation this brings to mind the Helen Shapiro track 'Don't treat me like a child' which was something of an anthem for me in my early teenage years.

The Pink 'Un makes it clear that Mr Gao has no intention of spending huge sums on players, pledging to impose financial discipline and ensure that the club becomes 'self-sufficient'.

That is easier said than done. Southampton's revenues in the year to June were about a quarter of those of Manchester United, £152.6m against £590m. The club made a profit of £28.6m last year, mainly due to the sale of players. However, from Mr Gao's perspective 'The club's financial position is good this year, and it doesn't require more investment.'

I don't want any Saints fans coming round to have a word (I probably have more friends, including a relative by marriage, who are Saints supporters than for any other top flight club). But my impression of a number of their players last season was that although they were capable of moments of brilliance, they were few and far between. They lacked the consistency of really outstanding players. And, leaving aside poor managerial choices in the past, that has to have something do with money.

Unfortunately, Mr Gao doesn't seem to have as many readies as was once the case. Lander Sports Development, supposedly his main source of income, lost Rmb90m ($13m) last year. Most of its revenue comes from real estate, but it has attempted to branch out into sports events.

Mr Gao lost control of the company in March when he sold 30 per cent of the company to a state owned asset manager for Rmb1.3bn. The Premier League then got its knickers in a twist, fearing that they had a club owned by the Chinese state in their league. However, it became apparent that Mr Gao had used a Hong Kong vehicle to get round Beijing's strict capital controls.

Some mystery surrounds a new shirt sponsorship deal with start up LD Sports, said to be worth nearly twice the former deal. However, LD Sports does not appear to yet have an operating business.

Saints supporters are certainly living in interesting times. Having read this, one of my friends who is a Saints fan and season ticket holder commented: 'The problems with Saints "investment" began when Katerina Liebherr decided she didn't want Nicola Cortese spending her inheritance on making Saints a top premier league club and hired Ralph Krueger instead. The sale to Gao was allegedly the result of a large tax bill on her fathers estate, and because she was friends with his daughter Nelly, it seemed ideal. There are Saints fans (me included) who still believe it could have been Saints not Leicester in 2016 had she not decided to cash in early.'

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The Political Economy of Football V2

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