The Political Economy of Football V2

Are Real Madrid the world’s top club?   That’s a contested title, but they are formidable on and off the pitch.   Here are a few salient financial considerations.   Scour any list of the world’s richest football clubs and you’ll find Real Madrid at its business end. In 14 of the past 20 years, Madrid have registered football’s biggest revenues. Revenue doesn’t equal rich, but Madrid’s bottom line has been healthy for a while, too. Financials for the 2024-25 season, released last month, confirmed another profitable year in the Spanish capital; Madrid have now booked a surplus for 23 consecutive years, a streak that even withstood the Covid-19 pandemic. To the world’s highest turnover and long-run profitability, add a lack of debt. Madrid and their club president Florentino Perez have prided themselves on the latter, with low net debt regularly cited whenever their latest figures are announced. Madrid’s commercial profile is huge, but it’s far from their only growth...

The authoritative Swiss Ramble reviews the 2024/25 accounts of Bristol City.  What fokllows is an extract of some of his main points.  Despite the improvement on the pitch, Bristol City’s pre-tax loss significantly increased from £3.3m to £18.6m, mainly due to a much lower profit from player sales, which dropped from £21.7m to £6.0m. This was exacerbated by a reduction in revenue, which fell £2.5m (6%) from (restated) £42.8m to £40.3m, though operating expenses were cut £2.5m (4%) from £65.4m to £62.9m and net interest payable decreased £0.4m (16%) to £2.3m.   Bristol City’s £40.3m revenue is actually the highest in the Championship – if you exclude clubs that benefit from parachute payments.    With the exception of Leeds United, no club without parachute payments has generated more annual revenue in the history of the Championship than Bristol City. City chief executive Tom Rawcliffe observed, “Although the loss is evidently larger than last year, it is ...

As a neutral watching the highlights, West Ham were perhaps unlucky to fall to a late sucker punch from Fulham at the London Stadium yesterday.  But they needed to be more clinical with their chances. Many fans are thoroughly fed up with the board and joined in a red card protest on 15 minutes,  Fifteen represents the number of years that David Sullivan, the largest shareholder, and Baroness Karen Brady had been running the club. So far there is no sign of the current leadership making way for someone with vision and strategy,  but with this great club stuck in the relegation positions, fans have to hope. 

A consortium led by James Bord, owner of Scottish club Dunfermline Athletic, has been named as the preferred bidder to purchase Championship club Sheffield Wednesday.  Bord, 44, was selected over a group led by the Chicago-based Storch family and former Newcastle United owner Mike Ashley who were seen as the front runners. Joint administrator Paul Stanley said: “From a financial perspective, the proposed financial offer from the preferred bidder provides certainty for the club. The consortium we intend to progress with has submitted the strongest overall proposal for the club. “This includes: A fully funded offer, clear financial assurances to support the club’s trading requirements, a structure that allows all creditor obligations to be dealt with in accordance with EFL rules, meaning no further sporting sanctions are anticipated as part of the transaction.” Bord is a former professional poker player who founded his own consultancy called Short Circuit Science in 2016, which...

Eddie Howe has called on Newcastle United to end their “limbo” and show ambition by announcing plans for a new stadium in 2026 — despite being 99.9 per cent sure he will not be around to manage the team there.    The head coach wants to drive the club into the world’s elite, a target set by the new chief executive, David Hopkinson, and he says that means their 52,000-seat St James’ Park stadium in the city centre must be redeveloped or replaced along with the training ground and academy. Discussing how he can guide the club to new heights after wnining the Carabao Cup and qualifying for the Champions League in 2025, Howe told The Times “You look at the training ground, the stadium… that part of  the club is in limbo at the moment. In terms of which direction the club is going to take, that would be a big step forward to get clarity on that and take everything into the future in a really positive way. It would have a game-changing effect on everything. “I am also talking a...

The death of globalisation as an economic principle has been widely proclaimed given the reintroduction of tariffs as a political and economic weapon.   However, it is alive and well in footall as is illustrated by the extensive involvement of US-based private equity firms in European football clubs.   Europe may be finished in some American eyes, but its ‘soccer ball’ clubs remain world class. The ultimate test of globalisation in football would be the staging of a regular league match in another country, but so far all attempts have failed in the face of exist ing rules.   Court challenges have been only partially successful. Plans to stage a Serie A game between Milan and Como in Perth, Australia have been abandoned, the league’s president and the government of Western Australia said in a joint statement on Monday.   Many fans will no doubt be pleased, but those pushing this concept are not going to give up - and they have plenty of money to spe...

Reading FC have been served with a winding up order by a former owner:  https://rdg.today/its-an-extreme-step-football-finance-expert-analyses-nigel-howes-winding-up-petition-against-reading-fc/ However, football finance guru Kieran Maguire  has said that fans should not worry too much, although these matters can be tiresome and drag on for months.  It looks like a clash of egos.

Everton might well  feel  hard done by over yesterday’s 0-1 defeat at the Hill Dickinson by Arsenal with solid penalty calls for the hosts denied.  But prospects for the club are better than they have been for many years.   Yet when the  Premier League was set up Everton were seen as one of the top clubs that needed to be involved. For four years every department at Everton had a relegation plan and one for promotion back to the Premier League.   The financial turmoil that engulfed Moshiri’s reign resulted in instability over who exactly was going to own the club and a period of perennial due diligence from interested parties that raised expectations but actually prevented progress. As one potential owner after another studied the club accounts, the Kaminski Group, MSP Sports Capital and 777/A-Cap were previous suitors, Moshiri did not want to sink any more money into Everton, aware that he already faced losses of about £750million. A tortuous, t...

Chelsea still believe there is a chance of them building a new stadium at Earls Court, even though an alternative plan for the land has been approved by both councils involved. The Earls Court Development Company (ECDC) is now close to receiving full planning permission for a mixed-use development on the same land that had been mooted as a potential site for a new stadium for Chelsea. However, club sources, on the condition of anonymity as they were not authorised to speak publicly, have indicated to the   New York Times that they are still considering all options for the future of their stadium — including a new ground at Earls Court. The future of Chelsea’s stadium is not a new debate. Under previous owner Roman Abramovich, the club submitted an offer for the Battersea Power Station site in 2012, in which they proposed to build a 60,000-capacity ground, but a Malaysian consortium purchased the site instead. In 2017, Chelsea secured planning permission for a 60,000-seat stad...

Barca’s presidential elections are coming up next year, but the race has already started. Joan Laporta’s potential opponents are already making moves. Last month, the 2021 runner-up to Laporta, Victor Font, launched his candidacy at an event attended by over 1,000 people. These figures might not seem too significant in the context of such a massive brand, but in the particular world of FC Barcelona, every bit of support counts. Barca’s elections will take place before the end of the season. According to the club’s statutes, they need to be held on a day between March and June, but there is still no confirmation on when the exact day will be. Candidates must have been club members for a minimum of 10 years, and they also need to reach a certain number of supporting signatures: at least half the total votes cast in the most recent annual general assembly. For the purposes of this election, they will need around 2,300. According to the latest numbers released by Barca in October, ...

The House of Lords Library has produced a report on the state of non-league and grassroots football:  https://lordslibrary.parliament.uk/non-league-and-grassroots-football-what-is-the-state-of-play/ In my experience of appearing before Commons and Lords committees, the latter are often more knowledgeable and produce better reports. One of the key arguments in this report is that the new football regulator arrangements apply just to the top five leagues with most of the money going to the top 26 cluba.

Sir Keir Starmer has issued a licence to transfer £2.5bn of frozen assets from Roman Abramovich’s sale of Chelsea Football Club to Ukraine, warning the Russian former owner that the UK government is prepared to take him to court if he fails to release the funds.   “My message to Abramovich is . . . the clock is ticking, honour the commitment you made and pay up now,” Starmer said during Prime Minister’s Questions on Wednesday. “If you don’t, we’re prepared to go to court so every penny reaches those whose lives have been torn apart by Putin’s illegal war.” Since Abramovich sold Chelsea and other investments for £2.5bn in 2022 to a consortium led by US investors Todd Boehly and Clearlake Capital, the multibillion-pound proceeds have remained frozen in a UK bank account. Fordstam, the UK entity through which Abramovich owned Chelsea, filed accounts for the year ended June 2022 last month at Companies House, showing that the proceeds could ultimately be lower than the £2.5bn hea...

Manchester City recorded their first non-Covid financial year loss in a decade as they invested heavily in first-team signings, reports the New York Times.  City posted their third-highest revenue total of £694.1million – a decrease of £20.9m compared to the year before – but lost £9.9m for the year ending June 30, 2025. City brought in £145m from player sales and committed £353m on new players, but chief executive Ferran Soriano stated that these were not short-term fixes, rather an acceleration of the investment planned to kickstart a new cycle. As with the previous year’s accounts, the board acknowledged that the 115 Premier League charges the club has faced since February 2023 was one of “a number of risks and uncertainties which could have a material impact on the Club’s performance”. City’s fallow year on the field in 2024-25 was mirrored by a slowing of the financial juggernaut off it, as declining revenues saw the prior season’s £73.8million pre-tax profit swing to a ...

Who would be a football manager?  Clearly a lot of people want to be, but at a top six club it is a real pressure cooker dealing with owners, players, the media (both mainstream and social) and fans.  (I am assuming here that the manager’s role is focused on coaching as us often the case today, although recruitment by a director of football is clearly a potential source of tension.) So what is going on at Chelsea?   We are nearly half a week on from Enzo Maresca’s sudden outburst following Chelsea’s game over Everton — and it is still unclear exactly what caused it. Any hope that a 3-1 win over Cardiff City to progress to the Carabao Cup semi-finals would lighten Maresca’s mood were soon quashed post match. Two goals from Alejandro Garnacho and one from Pedro Neto ended the League One side’s resistance but did not put a stop to the drama of the last few days. After smiling during the post-match celebrations on the pitch in front of an away support singing his name f...

As Ajax has pointed out in the past, its financial prospects are often driven by sporting results, so the lack of success has also been reflected in the bottom line. As a result, Ajax’s pre-tax loss significantly widened from €13m to €52m, which is the worst result in the club’s history, reports the Swiss Ramble. As Shashi Baboeram Panday, the finance director, explained, “The result is a consequence of the past few years: not playing the Champions League and having the cost management that comes with the Champions League. As a result, there is a loss.” The deterioration was very largely driven by much lower profit on player sales, which dropped €72m from €82m to just €10m. Revenue actually rose €26m (17%) from €152m to €178m, while operating expenses decreased €3m (1%) from €242m to €239m and net interest payable more than halved from €6m to €3m. After tax, the loss was smaller at €37m, due to a €14m tax credit, but this was still almost four times as much as the prior year’s ...

Sports, crypto billionaires, industrial dynasties, special voting rights and Italian politics: Tether’s bid for Juventus football club stamps every number on the dysfunctional M&A bingo card, argues the Financial Times. . Tether, the biggest issuer of stable coins, has offered to buy the 36-time Italian champions for €1.1bn in cash. It already has an 11.5 per cent stake but picking up the rest requires it to win over the Agnelli family, known for its role in founding carmaker Fiat. The Agnellis have controlled Juventus for more than 100 years. Exor, their holding company, insists the team is not for sale. There are good reasons for family scion John Elkann, who runs Exor, to turn down Tether’s current offer. His company is already under fire from politicians for trying to sell its famous local newspapers; selling another national champion to an 11-year-old crypto company based in El Salvador could bring further political risks. More importantly, the bid is simply too low. Juv...

The weekend Financial Times has a fascinating review of a new exhibition on football stadiums at Tate Liverpool + RIBA North, Home Ground, sited perfectly in a football-mad city where the architect designed both Liverpool’s Anfield and Everton’s Goodison Park, and where the latter club’s huge new 53,000-seat ground sits by the waterside, on Bramley-Moore Dock.   It is on until January 25th. The article is written by an architect but one who clearly has a great knowledge of stadiums and a love of the game.   Indeed, he reveals himself as a Fulham supporter. 'In May this year I went to see Fulham, my team, in west London, walking through the red-brick facade designed by Leitch in 1905 (with its now almost laughably slender turnstile doors — early attempts at crowd control). Instead of standing on the terraces like I used to in the 1980s, I was taken to a new stand, an almost nautical construction now known as Fulham Pier, which sits on the riverside surmounted by a dra...

Manchester United may be leaner and fitter in financial terms since the arrival of Sir Jim Ratcliffe, but the desired level of success on the pitch is still elusive. Manchester United’s wage bill fell to £73.6million during the first quarter following the Old Trafford club’s restructuring programme and the loan exits of high earners Marcus Rashford and Jadon Sancho. United’s latest quarterly financial results revealed total revenues fell year-on-year during the first three months of the 2025-26 financial year, largely due to Ruben Amorim’s side failing to qualify for Europe and two fewer games played at Old Trafford.   Commercial revenues were also affected by United’s lack of a training kit partner following the end of a deal with block chain platform Tezos, worth in excess of £20m a year. Despite this, United’s wage-to-revenue ratio fell to a healthy 52.5 per cent, compared with 56 per cent for the same period last year. The club’s total spending on wages was £73.6m, down f...

Private capital giant Apollo Global Management has bought a minority stake in Wrexham AFC, the once sleepy Welsh football club whose fortunes and global profile have been transformed under the ownership of Hollywood actors Ryan Reynolds and Rob Mac. Wrexham said on Monday that the investment would include financing to redevelop the Racecourse Ground, its roughly 13,000 capacity stadium, and aligned with its “long-term growth strategy and Premier League aspirations”. Terms of the deal with Apollo were not disclosed but Reynolds and Mac, who changed his name from McElhenney this year, will remain as controlling shareholders. A person familiar with the deal said Apollo, which manages roughly $908bn of assets, had acquired less than 10 per cent of the club. Wrexham, one of four Welsh teams that play in the English leagues, has enjoyed a stunning upturn in fortunes since it was bought in 2021 by the Hollywood actors. The pair acquired Wrexham for £2mn while it was playing in the fifth...

There still seems to be a niggling frustration at Crystal Palace’s progress, a feeling that the club could go further and faster, and a fear that they could fail to capitalise on an opportunity to build on this unparalleled success. That feeling is partly being fuelled by Glasner himself, who said after a 2-1 defeat by Manchester United last week that he did not feel the club had backed him sufficiently in the summer transfer window. With his contract up at the end of this season, there is doubt over his future. Steve Parish is 15 years into his tenure as Palace chairman and believes the club is in safe hands with his fellow general partners, U.S. businessmen Josh Harris and David Blitzer, whom he considers friends.   Since the summer, that group has also included the New York Jets owner Woody Johnson, who bought the stake previously owned by John Textor as a fourth partner. It did not happen quickly enough to prevent Palace from being denied entry to the ...

The old joke that to make a small fortune you should start with a large fortune and invest in a football club is becoming even more true.   At the top level you need to be either a billionaire or a private equity firm.  The effects are trickling down to the lower reaches of the EFL and even to the non-league system.    I support a non-league club and the chairman rang up one day and asked if I could oblige with a few k. What has happened since the pandemic in terms of football finances has been subjected to the usual authoritative and forensic analysis of the Swiss Ramble from his Zurich lair.    It doesn’t make for comfortable festive reading but subscribe to his Substack page to get the full sp.   What is clear is that the big six are pulling away from the rest and the finances of the Championship are becoming even crazier, More cash is coming in but more is going out.    Alan Sugar once referred to the prune juice effect and ...

This week the FT revealed that Bayern Munich had recently held talks with private equity firm EQT about a possible stake sale. While those discussions appear to have fizzled out with the departure of Bayern CFO Michael Diederich, it is nonetheless a sign of the times. German football is largely immune to foreign ownership. The 50+1 rule prevents the majority of clubs from being controlled by anyone other than members, while more general hostility to private equity (expressed through fan protests) has derailed past efforts to bring investment in at the league level. Bayern already has a group of private minority shareholders. Adidas, Audi and Allianz each own just over 8 per cent of the Bavarian side. Members are guaranteed control of at least 70 per cent, leaving 5 per cent for the club to play with. Selling such a little slice at a valuation of about €4bn would have brought in around €200mn, a nice boost to the coffers as the German team looks to keep up with its w...

John McEvoy and the Storch family, two wealthy American bidders interested in buying Sheffield Wednesday, have joined forces to strengthen their chances of acquiring the club. Administrators Begbies Traynor have received offers worth a minimum of £30million from at least two prospective bidders, including the one backed by McEvoy and the Storch family. California-based billionaire McEvoy is a minority shareholder in NHL team Nashville Predators and MLB side Colorado Rockies.   The Storch family, whose net worth amounts to more than £1billion, were linked with a bid for Plymouth Argyle, the League One club, in the summer. Insiders believe that the new owners may not have the keys to Hillsborough for another six weeks even though the administrators took charge of the club on October 24 after gaining control from the outgoing chairman Dejphon Chansiri. Wednesday’s administrators, Begbies Traynor, said initially that they would not consider offers beyond December 5, but th...

Germany’s leading football club Bayern Munich held talks this year with EQT over selling a minority stake to the private equity firm, in a deal that would have reignited a heated national debate over the merits of private capital firms investing in football. Negotiations fell apart when Bayern’s chief financial officer Michael Diederich, EQT’s contact at the club, left in the summer to become co-head of Deutsche Bank’s corporate banking business, according to three people familiar with the matter. German football fans have historically been highly critical of outside investment into the sport, with widespread protests prompting the country’s football league last year to call off talks over a potential private equity investment. With a few exceptions, clubs in Germany are subject to the ‘50+1’ ownership rule, which stipulates members must hold majority voting rights, in effect blocking commercial entities from gaining control.   The rise of RB Leipzig, a German club whose r...

Real Madrid’s 2024/25 accounts cover a season which was very much a case of “close, but no cigar”, as they finished runners-up in La Liga and were defeated in the final of the Copa del Rey and the Supercopa de Espana, losing out to their great rivals Barcelona on all three occasions. They were also eliminated in the quarter-finals of the Champions League by Arsenal, which would be good result for most clubs, but actually represented their worst performance in this competition for five years. Despite the less successful season, Real Madrid managed to increase their pre-tax profit by €11m (57%) from €20m to €31m.   Revenue continued to grow, rising €112m (10%) from €1,073m to a staggering €1,185m. This meant that the club broke the one billion Euros barrier for the second season in a row, a feat that no other football club has yet achieved.   In addition, profit from player sales increased by €11m (52%) from €21m to €32m. The latest positive result means that Real Madrid h...

Wrexham, the struggling football club catapulted to global fame after it was bought by the Hollywood duo Ryan Reynolds and Rob McElhenney, has received £18 million in taxpayer funding. The Championship club was awarded the non-repayable grants to refurbish its stadium and the surrounding area despite the sizeable wealth of its owners. The amount of money received by Wrexham in state aid vastly outstrips public spending on any other football club in England and Wales. A year after the actors’ purchase of the club, it was awarded £3.8 million by Wrexham county borough council, the first of two grants. A second payment of £14 million was awarded in September. The grants, which were first reported by The Guardian, are for the redevelopment of the club’s Racecourse Ground. This includes the construction of a Kop stand, floodlights and pitch to make the stadium suitable for international football and rugby matches. In recent years, both the council and Welsh government have her...

The Arizona state pension fund that bought Ipswich Town in 2021 has sold a large chunk of its shares in the Suffolk-based club in a deal that values them at more than £350million ($446.9m), a record for a Championship team. The Public Safety Personnel Retirement System (PSPRS), via its investment manager ORG, paid about £30million ($40m) for 90 per cent of the then-League One club in April 2021, which was also a record price at the time for a team in England’s third tier. PSPRS, which provides pensions to 24,000 former firefighters, police officers and prison officers in Arizona, halved its stake in the club in March 2024, when Ohio-based private equity firm Bright Path Sports Partners took a large minority stake in the club two months before they secured their second straight promotion and a return to the Premier League after a 22-year absence. Bright Path’s £105million ($140m) investment valued Ipswich at about £250million ($333.5m) which was already a healthy return o...

Foreign investment is reaching well down the pyramid, National League North King's Lynn being the latest example.    Singapore-based Turn Sports Investment have been buying into the club since 2024 and are now completely in charge. A minority shareholding has been taken by the Blue and Gold Supporters' Trust to ensure local community involvement.   They state: 'TSI has stepped in a responsible custodian to stabilise the club in the short term.'   They will relinquish their role 'once the right structures are in place.' Former owner Stephen Cleeve has written off his director's loan and will have no further involvement. More about TSI here:  https://turncapital.io/2024/01/08/turn-sports-investments-invests-in-kings-lynn-town-football-club-inks-strategic-investment-and-partnership-deal/

The attempt by The Athletic to rank Premier League clubs by the current happiness of their fans can only be intended as a bit of a laugh, although the rankings of Sunderland first, Arsenal second and Chelsea are a temporary third seems reasonable enough. And who are bottom?  Yes, it's the ever demanding and never satisfied fans of Tottenham Hotspur. The Athletic says: 'Whether it’s team-mates arguing at full time, team-mates ignoring the manager, the manager slating the fans, the fans booing the players or the players ignoring the fans, it’s not exactly sunshine, lollipops and rainbows at the Tottenham Hotspur Stadium right now. Three home wins in 21 league matches will do that to you. As will charging some of the most expensive prices in the country to watch it.  It really is a shiny stadium, though.' A couple of my friends are Spurs fans and they do their best to keep their spirits up, but there is a great contrast with the mood I remember in the early 1960s.

I have always been a sceptic about the idea of fan owned clubs.  It's not just a question of the lunatics running the asylum: one can usually find well qualified lawyers and accountants to sit on the board.  However, even if fans can raise the purchase price of a club in administration, they find it difficult to sustain the losses needed to secure success on the pitch and a downward spiral on and off the pitch can often result.. Exeter City has been referred to as the glowing example of a fan owned club, escaping from the clutches of the administrators, albeit with the benefit of some lucrative FA cup games. Yet they raised their playing budget by £1m in two years while everyone else in the league was raising it by £3m or £3.5m.  The highest playing budget in League One is £19m.  The Grecians are currently fifth from bottom.   General manager Clive Harrison admitted that it was not possible to guarantee selling a player each year to fill the financial gap. ...

Milan’s 2024/25 accounts were the third set of accounts reported under the ownership of Gerry Cardinale’s RedBird Capital Partners, who purchased the club from Elliott Management in August 2022 in a €1.2bln deal, with Elliot reportedly providing a €560m loan to help RedBird complete the acquisition. Chief executive Giorgio Furlani told the Harvard Business School, “Our goal became to stop losses, to live within our means. As important as sporting success is, we realised we shouldn’t go into a success-at-all-costs mode: the extra costs incurred in pursuing success can kill you financially.” In the previous ten years, Milan had lost around €900m, with Giorgio Furlani admitting, “Milan was not sustainable the way it is today, the club was on the verge of bankruptcy.” Milan posted a pre-tax profit for the third year in a row, though this reduced slightly from €12m to €10, reports the authoritative Swiss Ramble. This was especially impressive, given the indifferent sporting results. ...