How Spurs scores over PSG for Qatar

Qatar Sports Investment has set its sights on the English Premier League. The state-backed fund, which owns Paris Saint-Germain and a slice of Portuguese title challengers SC Braga, wants to get a piece of the richest league in football, and has been eyeing up a potential investment in Tottenham Hotspur. QSI is also talking to outside investors about selling a stake in PSG itself, with a mooted valuation of over €4bn.

Which is the better bet, PSG or Spurs? According to Football Benchmark, the two clubs should garner a similar valuation — it gave the French club a roughly 10 per cent premium over the London side in its annual enterprise value estimates last year.

Spurs have a few important attributes that PSG lacks. For one, the club owns its new state of the art stadium, which is already bringing in extra revenue through other events, such as hosting some of the NFL’s international fixtures, boxing matches, and some big music acts including Lady Gaga. PSG, meanwhile, rents from the Paris government, and is threatening to leave the Parc des Princes unless it can buy the ground and expand it.

Premier League broadcast revenues are far higher than those in the French league too. Anyone looking to build long-term football investments will want exposure to that income stream. From a soft power perspective, Qatar will want to keep pace with its neighbours Abu Dhabi and Saudi Arabia, who both have teams in English football.

Recent experience suggests that Spurs is also a pretty tightly run ship. The club’s wages to revenue ratio in 2020/21 was 57 per cent, according to Football Benchmark, putting it on a par with clubs in Germany and Portugal, and well below the levels typically seen in the Premier League.

That same year, PSG’s wages to revenue ratio was 88 per cent, one of the highest in football. Since then, the number has shot up. Last season, with the arrival of Lionel Messi and contract renewal of Kylian Mbappe, wage costs soared 45 per cent, taking the wages/revenue ratio to 109 per cent and pushing the club to a post-tax loss of €369mn.

But PSG has its own advantages too. It has a captive market in one of the world’s most desirable cities — while Spurs has to compete with a long list of London rivals. PSG’s near total dominance of the French league in recent years effectively guarantees Champions League qualification, something most English clubs battle hard to achieve every season in an increasingly competitive league.

Thanks to its long-term partnerships with retailer Fanatics and Nike’s Jordan subsidiary, PSG has also morphed into a global luxury sportswear brand rather than just a football club. How many other European teams could justify a flagship clothing store on New York’s Fifth Avenue?

It’s easy to see why Qatar would want to buy into the Premier League, perhaps the bigger question is why it has taken so long. With the World Cup now out of the way, and a number of EPL assets on the block, it looks to be only a matter of time before Qatar gets its foothold.

Wolves get raw deal from FFP

I used to see a lifelong Wolves fan for lunch once a month. He was approaching ninety, but still went to games. Sadly he passed away the other week. As football finance guru Kieran Maguire has noted, Wolves continue to be constrained by financial fair play rules. Radio 4 this morning described them as this year's 'crisis club' and the pessimists have certainly been piling in. Martin Samuel wrote sympathetically in the Sunday Times yesterday, saying that the Premier League drives talent away with regulatory red tape: 'Why could Al-Hilal sign Neves? Because Wolves needed the money. And why did Wolves need the money? Because the club had to comply with an artificial construct known as financial fair play. So Wolves are going skint, yes? No. There is no suggestion that Wolves are in financial trouble, only that they are failing to meet the rigours of FFP. Wolves’ owners appear to have the money to run the club, and invest in the club, and in fact came up with a pow

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 income is

Charlton takeover approved

The long awaited takeover of Charlton Athletic by SE7 Partners from Thomas Sandgaard has been approved: https://londonnewsonline.co.uk/se7-partners-obtain-efl-approval-for-charlton-athletic-takeover/ Charlton have had unhappy experiences with owners for over a decade, so how this works out will remain to be seen. There is certainly potential there, but will it be realised? This interview with Charlie Methven gives detail not available elsewhere: https://thecharltondossier.com/charlie-methven-on-the-record/

The Political Economy of Football V2

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