The Political Economy of Football V2

Sadly, Dumbarton FC have entered administration:  https://www.consultancy.uk/news/38856/dumbarton-football-club-brings-in-quantuma-for-administration Police are investigating suspected fraud at the club:  https://www.heraldscotland.com/sport/24737449.get-rich-quick-pipe-dream-caused-sad-collapse-dumbarton/ Given the troubles at Inverness Caledonian Thistle, there are concerns about the state of Scottish football below the top flight.

Morecambe are bottom of League Two, the fourth and last tier of English league football.  Never the biggest of EFL clubs, and rather fittingly nicknamed the Shrimps as a nod to the local fishing industry on the Lancashire coast in the north-west of England, Morecambe have been particularly hamstrung in recent years by their majority owners’ inability — or refusal — to fund them adequately. This happens, unfortunately, but normally owners suck it up, sell the club and move on. The Bond Group, however, has spent the past 26 months trying to sell Morecambe to people who clearly cannot afford the inflated price the Bond Group wants. For much of that period, the intended buyer was Sarbjot Johal, a 21-year-old from Birmingham, in the English Midlands, who claims to have made millions in soft drinks, property and crypto. The Bond Group, where the sole director is a businessman called Jason Whittingham, eventually gave up on Johal ever being able to convince the EFL he had the money to r

An example of some bad business in football: the 2016 takeover of Swansea City (Dinas Abertawe) by a group of U.S. investors led by Steve Kaplan, who owns a minority stake in the NBA’s Memphis Grizzlies, and Jason Levien, the co-chairman and CEO of MLS side D.C. United. Swansea were nearing the end of their fifth consecutive season in the Premier League when Kaplan and Levien bought a majority stake in the Welsh club at a valuation of £110million. Unfortunately, they were relegated to the Championship in 2018 and have haemorrhaged money in that division ever since. But now — for Kaplan and Levien, at least — the bleeding has stopped, as they have sold their 65 per cent stake in Swansea to three investors they first introduced to the club last year: Andy Coleman, Brett Cravatt and Nigel Morris. A shareholder at D.C. United, Coleman has been Swansea’s chairman since May 2023, while private-equity firm boss Cravatt and Welsh-American fintech entrepreneur Morris have been on the boar

Chinese businessman Dai Yongge bought Reading in May 2017, the same month they narrowly failed to achieve a return to the Premier League via the play-offs. Since then, however, the club have been hit with points deductions for missing payments, sold most of their best players, downgraded their women’s team, lost staff and been relegated to League One.  Rob Couhig has advised clients in thousands of legal disputes, argued cases in hundreds of courtrooms, bought and sold businesses, run a successful baseball team and taken former non-Leaguers Wycombe Wanderers to the second-tier Championship but he has never experienced anything like his attempt to buy Reading. After months of difficult negotiations, the 75-year-old American’s takeover of the club in League One, the third division of English football, collapsed at the final hurdle in September, without any explanation from Reading or their Chinese owner Dai Yongge. Since then, Couhig has not said anything publicly, politely declini

Alan Sugar acquired Tottenham Hotspur in 1991.  He was born in a council house in east London, left school at 16 and sold car aerials out of a van. He called that business Amstrad, as in Alan Michael Sugar Trading. By the mid-1980s, Amstrad was listed on the London Stock Exchange and Sugar had moved on to a full range of consumer electronics. In 1991, he beat media baron and infamous fraudster Robert Maxwell in a takeover battle for Spurs. Sugar’s time in charge is best remembered for his rows with managers, flashy signings and observation that money goes through clubs like prune juice, “in one end and out the other”. But he was instrumental in making sure Sky Sports got the media rights to the “new” league, which was handy as Amstrad made satellite dishes. In 2001, he sold a chunk of Spurs to British investment firm ENIC   with the rest of his shares going in the same direction six years later. They were the first club to test their worth on the stock market, are also still owne

When the top 22 teams broke away from the Football League to form the Premier League, 21 were English-owned (Wimbledon was the exception).  Now, just over three decades later, there are only three Premier League clubs that are entirely English-owned, with one more that is majority English-owned, two run by Englishmen with minority stakes and one still owned, for a few weeks at least, by a Monaco-based, Anglo-Iranian whose eight-year spell as custodian was generously supported by his Russian-Uzbek patron. That last one — Everton — should become the 10th American majority-owned club in the league by Christmas, while three of those other clubs are on the market, to one extent or another. It is entirely possible that by next November, the 1992 equation will have flipped, with just one English flagship in very international waters. Brentford Brentford’s no-longer secret benefactor Matthew Benham is, in some ways, a throwback to an earlier era. But in others — his profession, in particul

An extraordinary general meeting agreed this month that majority control  of Norwich City will pass to Michael Attanasio’s Norfolk Holdings group from Delia Smith and Michael Wynn Jones after their 28 years at the helm. Attanasio, the owner of American baseball team Milwaukee Brewers, first purchased a minority 22% stake from former director Michael Foulger in September 2022, before increasing his shareholder to 40% in April 2024. From March 2025 Attanasio will convert his loans into equity, giving him 85% of the football club. Smith and her husband will retain 10%, while the remaining 5% will be owned by independent shareholders, including the supporters’ group, The Canaries Trust. The board emphasised that this transaction “involved no payment to Delia and Michael”, thus “securing the long-term financial security of the club and an effective and positive transition”. Clearly, Norwich City owe a huge debt of gratitude to the former owners, so it feels only right that they have b

 Mike Garlick, the former chairman of Burnley, in February embarked on a fresh footballing challenge — to help lead Antequera up the Spanish league ladder, just as he had previously supported Sean Dyche in achieving the Lancashire club’s longest spell of top-flight tenancy since the 1960s. “I didn’t want to buy a big club,” Garlick says, sitting in the reception of the hotel across the road from the stadium. “The most enjoyable thing about Burnley wasn’t the day you won something or got promotion but the actual journey — and I wanted a journey. I looked at Antequera and thought, ‘We could go on a journey here.’ ” Garlick, who stepped down as Burnley chairman after the club’s purchase by ALK Capital in December 2020 and left the board altogether last year, adds: “I knew I’d miss the buzz of football and I got offered a lot of different clubs in England but I’m a Burnley fan so I wasn’t that keen. “We already had a house in Spain, near Marbella, and my wife speaks Spanish so why no

With the Trump administration in the US threatening punitive tariffs against UK exports (the US is the UK’s biggest single country market at 22 per cent of exports), geopolitics become even more important in top flight football. The UK government is attempting to facilitate investment into one of the British economy’s most successful exports: the Premier League, which broadcasts to 189 of the 193 United Nations member states. In May, the Premier League said 1.87billion people follow the division worldwide and 900million homes globally are able to watch Premier League football. Little wonder, therefore, that North American investors have taken a liking to a product that attracts $450m (£355m) per season for the U.S. media rights alone from NBC. Only 20 years ago, there were no majority American owners in the Premier League. Now nine of the top flight’s 20 teams are majority-owned by U.S. investors: Manchester United, Arsenal, Aston Villa, Liverpool, Chelsea, Fulham, Bournemouth, Cry

The Athletic has taken a look at the biggest investments in Premier League clubs, including subsequent payments.   They have used data from the Swiss Ramble and Kieran Maguire among others. It doesn’t cost much to this excellent online publication to get the full sp, but here are the top five: 1.        Chelsea (£2.65 bn) 2.        Manchester City (£1.5bn) 3.        Arsenal (£1.26bn) 4.        Fulham (£938m) 5.        Everton (£878m) And last but not least, Ipswich £123m.   Will it be enough for them to survive?    The price of an entry and survival ticket keeps going up.    But then Brentford in 19 th place have done well on £124m.

In 2023/24 that Real Madrid became the first football club to exceed one billion Euros in revenue, as this grew by an amazing €230m (27%) from €843m to €1,073m. However, profit from player sales dropped from €71m to €21m, while operating expenses also broke through the billion Euros barrier, rising €162m (18%) from €911m to €1,072m. In addition, there was an unfavourable €8m swing from €6m net interest receivable to €2m payable. As a result, pre-tax profit was “only” €20m, though this was more than twice as much as the previous year’s €9m. Profit after tax was up from €12m to €16m, as tax payable went from a €3m credit to a €4m charge. This result means that Real Madrid have reported profits in each of the last ten years, adding up to more than a quarter of a billion Euros in that time - €274m to be precise (before tax).   In fact, they have generated profits every season since 2002/03 and there is no sign of this stopping any time soon, as they have budgeted another €28m surplus

Football finance guru Kieran Maguire reviews the accounts of Blackburn Rovers and says that they relied on player sales of nearly £2m. reflecting a trend across the Championship:  https://uk.sports.yahoo.com/news/football-finance-expert-gives-context-050000850.html?

Four of Manchester City’s main rivals have lodged legal notices reserving the right to seek compensation if the club are found guilty of serious charges among the 115 alleged breaches of Premier League financial rules. Manchester United, Liverpool, Arsenal and Tottenham Hotspur have taken the step of formally registering possible compensation claims via arbitration before a potential statute of limitations deadline last week, sources have told The Times. The clubs involved all declined to comment. The charges against City are still being heard by an independent regulatory commission, with the outcome not expected until the new year. The commission can make an order for compensation to be paid but it is understood that, because of laws around time limits to register such claims, there was concern among the clubs that it would be too late to wait until the case had been resolved.   Chelsea are not believed to have lodged a legal notice relating to compensation. They have their own

Premier League football clubs are targeting stadium upgrades to boost revenues as England’s top 20 teams aim to reap the benefits of rising ticket demand and reduce reliance on income from broadcasting and sponsorships. Clubs are investing to improve their stadiums and infrastructure in order to increase seating capacity and shore up match day revenues at a time of booming demand for the world’s richest football division.   According to analysis by the Financial Times , clubs are looking to increase capacity by at least 115,000 seats across the Premier League, or 14 per cent, over the next decade. Stadiums are increasingly important assets because they give clubs more control over the revenue they generate, as the Premier League negotiates broadcast deals centrally and distributes the proceeds. At the same time, new investors have injected fresh capital into clubs, giving new impetus to stadium investments. Some projects remain in the early stages and stadium development depends on

 Rangers currently do not have a chief executive nor a director of football operations, while the chairman is only a temporary appointment. Since Steven Gerrard was tempted by the riches of the Premier League, moving to Aston Villa in November 2021, Rangers have had three different managers, which has not helped matters, as they have all had their own playing styles, requiring much turnover in the squad. Rangers legend Ally McCoist gave a damning assessment of last season’s financial results, “Those figures are really, really concerning. They’re trying to put a positive slant on it, but those losses, man, dear me.” Ranger’s pre-tax loss shot up from £3.1m to £17.3m, despite revenue rising £4.5m (5%) from £83.8m to a club record £88.3m, as profit from player sales dropped from £23.6m to £5.6m.   Rangers’ revenue growth was largely driven by higher gate receipts amd hospitality, which rose £4m (10%) from £40m to £44m, though there was also an increase in commercial, up £1m (7%) f

French football club Olympique Lyonnais has warned that any major delay or failure to raise additional funds could threaten its ability to continue as a going concern, less than two years after it was bought by a US businessman in a deal largely financed by investment group Ares. Eagle Football Group (EFG), the Euronext-listed entity that houses Lyon, said late on Wednesday that any “material delay” or “non-fulfilment” of a series of planned cash injections could raise “issues” with its status as a going concern. The company, part of a football empire built by US tech entrepreneur John Textor, said its auditors were considering issuing a qualified opinion on its accounts, after being unable to assess the “reasonableness” of several assumptions. The EFG board said it had prepared its financial statements on a going concern basis based on a set of expectations, including that the company would receive up to €40mn from the planned sale of Textor’s stake in Premier League club Crystal Pa

Greenock Morton made a profit of nearly £200k in their first year as a  community owned club and although they are expecting a loss this year they think it will be manageable:  https://www.greenocktelegraph.co.uk/news/24707986.morton-show-six-figure-profit-last-financial-year/

Despite the success on the pitch, Inter’s ownership changed hands in May 2024, when Oaktree Capital Management became the new majority shareholder, increasing the number of American owners in Italy. This was because the previous owners, the Chinese conglomerate Suning Group, had failed to repay a loan from Oaktree by the agreed deadline. Suning president, Steven Zhang, had been attempting to negotiate a loan with US fund Pimco in order to pay off the debt, but the talks came to nothing. In May 2021 Oaktree had provided what it described as “rescue capital” to stabilise Inter’s financial situation, as it was confronted by huge losses. This enabled the club to pay its players and staff, but this lifeline came at a price in the form of a €275m 3-year loan at 12% interest, which had grown to a hefty €395m at maturity. In the event of default, Oaktree would get their hands on the club, which is exactly what happened. Suning had acquired their majority share (68.6%) in June 2021 for

Celtic’s financial results for 2023/24 were very good, as they posted a £17.8m pre-tax profit (£13.4m after tax). That said, this was down £22.9m from the previous year’s huge £40.7m profit, though in fairness that was a record for Scottish clubs. This was mainly because 2022/23 included a couple of material once-off items, amounting to £13.5m, made up of a £10m business interruption insurance claim and £3.5m compensation received from Tottenham for Ange Postecoglou. In addition, profit from player sales more than halved from £14.4m to £6.6m, though revenue rose £5m (4%) from £120m to £125m, which was a new record for the club (and indeed Scotland). However, operating expenses increased by £9m (8%) to £117m. Celtic have managed to grow their revenue by £41m (49%) since before the pandemic, up from £83m in 2018/19 to £125m. In fact, they have set a new club record in each of the last two seasons with decent growth in all three revenue streams.   The expectation is that Celtic’s re