When Chelsea were put up for sale the gloom and doom merchants were out in force saying that the club would not go for anywhere near the original asking price of £3bn. In fact there is plenty of credible competition, particularly from those already involved in sports franchises in the United States with cash to spare and few opportunities there.
The end of globalisation is already being asserted in the
wake of the war in Ukraine. This may
apply generally, but as I argued in my book Political
Football soccer is a special case.
Some want clubs as a trophy asset, but others sees the possibility of
securing a capital return, despite being warned off by the Financial Times.
The need for a quick sale — with government involvement —
combined with uncertainty about how to value a club who have been so generously
subsidised by their owner for 19 years but still needs to redevelop their
stadium, led most football finance experts to predict a price tag closer to £2
billion.
But that appears to have underestimated the global interest
in buying the reigning and European and world champions, and it now seems the
club’s many suitors will have to raise their bids closer to £3 billion ($4
billion) — a sum that would easily beat the $3.35 billion (£2.5 billion) Joseph
Tsai paid for the NBA’s Brooklyn Nets and the Barclays Center home arena in
2019.
That is the largest cheque ever written for a sports
franchise until now, with the next biggest deals — baseball’s New York Mets,
Houston Rockets of the NBA and NFL franchise the Carolina Panthers — grouped
around the $2 billion mark.
Fans support a club and who do not like the American term of
‘franchise’, but Arsenal, Liverpool and Manchester United are already in US ownership. Their owners have experience in franchises in
various sports in the United States.
Fans of Arsenal and Manchester United would question whether their clubs
have benefitted.
American bank Raine is aiming to whittle down the bidders to
a shortlist of three or four by the end of this week. Those parties will then
be invited to make improved final offers, with a winner chosen by the second
week in April.
The bank will then ask the UK government for a second
licence — an exemption from the UK’s sanctions rules — to allow the sale of the
asset. This effectively gives the Foreign Office and Treasury a veto over the
deal, another complicating factor in the process.
That said, the government has already made it clear it does
not want to see Chelsea go out of business, so a quick but orderly change of
ownership is the desired outcome. Their
disappearance would harm the Premier League globally and there are a lot of
voters among Chelsea fans.
In terms of who the new owner might be, there are four bids
that appear to have the inside track. They are the syndicate of investors
assembled by Los Angeles Dodgers co-owner Todd Boehly, who seem to have the
most money; a bid led by the Ricketts family, who own the Dodgers’ fellow
baseball club Chicago Cubs; an Anglo-American group involving Sir Martin
Broughton and Crystal Palace co-owners Josh Harris and David Blitzer;
and an offer from NFL side New York Jets’ owner Woody Johnson.
Others with a chance of making the shortlist include a bid
funded by British private equity firm Centricus and one led by British property
developer Nick Candy, who is backed by South Korean investors. A bid from the
Saudi Media Group is not considered to be among the frontrunners.
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