Skip to main content

New Southampton owner faces battle at home

Dragan Solak is the billionaire who likes to operate outside of the limelight. He’s spent more than two decades building a media empire but it was the acquisition of an English Premier League football club that changed everything.

Through London-based investment vehicle Sport Republic, Solak bought an 80 per cent stake in Southampton in a bet that demand for football rights will continue to rise, as online streaming platforms compete against traditional broadcasters to screen sports around the world.

“If you look at the inflation of the prices of elite sports rights,” he told the Financial Times, “I thought if it goes crazy like this I’d rather be in the sports business than in the broadcasting business.”

The Serbian-born media tycoon says he’s been fielding calls from compilers of rich lists to ascertain his net worth ever since confirmation of the acquisition, which valued the club at around £250m including debt.

This is far from Solak’s first encounter with the Premier League, the world’s richest domestic football division. As founder of United Group, in which he retains a minority stake, he still owns the rights to screen top-flight English football matches across much of the Balkans.

Beneath the surface, the acquisition also signals Solak’s swing from buyer of media rights to the indirect recipient of TV money paid by broadcasters.

What’s gone under the radar is that United’s grip on Premier League broadcast rights ends at the end of this season, pointing to a clash between the businessman and the president of Serbia, Aleksandar Vucic, who Solak accuses of cracking down on independent media outlets.

That’s because Serbian state broadcaster Telekom Srbija last year splashed out an estimated €600m for the next six years, roughly ten times the annual price paid by United.

Solak’s theory is that TS is buying up sports screening rights in a political manoeuvre designed to lure subscribers from his independent news channels to state channels that are uncritical of the government.

TS said it did not overpay and denied it had a political motivation, adding that it “finances its deals solely from its own financial resources and capacity.”

This dispute raises uncomfortable questions for the Premier League, which was forced to part ways with former chair Gary Hoffman over its decision to approve last year’s Saudi Arabia-led takeover of Newcastle United for £305m, amid scrutiny of its dealings with state-backed entities.

A person close to the Premier League says it is not uncommon to see leaps in the value of broadcast deals.

For his part, Solak insists the Southampton takeover has nothing to do with his media interests, and pledged: “I don’t want to abuse my position now in the Premier League.”

 

Labels:

Comments

Post a Comment

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...
1 comment
Read more

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 ...
Post a Comment
Read more

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 ...
Post a Comment
Read more