The Political Economy of Football V2

Why are American sports franchises so keen on buying English football clubs, not least the Todd Boehly-led consortium which is the preferred bidder for Chelsea? The takeover of Chelsea by the Boehly Group would mean that US investors have stakes in half the clubs in the Premier League.   Counting in Chelsea, six would be outright or majority owned, the others being Arsenal, Burnley, Crystal Palace, Liverpool and Manchester United.   Four other clubs have US shareholders: Aston Villa; Leeds United; Manchester City; and West Ham United. The short explanation is that these consortia have the readies, they have done well with sports franchises in the United States and they see upside in the UK both through capital appreciation and extracting more money from the fans by direct marketing.   Given those considerations, many would argue that Chelsea is a bargain at $4 billion. Indeed, the redevelopment of Stamford Bridge is seen as an opportunity to attract more we...

Sir Jim Ratcliffe is persisting with his bid for Chelsea despite it coming in lower than the three bids made by US-based consortiums.  Ratcliffe is lobbying the Government arguing his is the only British bid and the Government may see some political advantages in wrapping itself in the Union Jack. The merchant bank handling the sale, Raine Group, point out that Ratcliffe made the offer without due diligence and, as far as being British is concerned, he lives in the tax haven of Monaco. One outstanding issue in completing any sale is the £1.54bn loan owned ro Roman Abramovich which will need to be dealt with to the satisfaction of Treasury officials. Clearlake's involvement in the preferred Boehly bid means that 60 per cent of their deal is being funded by private equity.

The last minute bid by Sir Jim Ratcliffe for Chelsea has muddied the waters, but it is too late in the day. Ratcliffe has offered the £2.5bn required by Roman Abramovich, plus £1.75 billion of investment in the club.  He reckons that his firm's experience in big civil engineering projects would enable the redevelopment of Stamford Bridge without having to play elsewhere. Ratcliffe is also claiming his is the only British bid, although he is resident in Monaco.   Lancashire born, Ratcliffe was originally interested in Manchester United, but reckoned (probably correctly) that it was over valued.   He thinks that Chelsea is expensive 'but not foolish'. His vision is to make Chelsea the No.1 club, so that London would have an equivalent of Bayern Munich, Real Madrid or Barcelona.   Other London clubs are available and might feel they have an equivalent or greater claim. Part of the motivation is to make his company Ineos more than 'the biggest company you'...

The consortium led by LA Dodgers owner Todd Boehly is set to be the preferred bidder for Chelsea, despite a late and out of time bid by Sir Jim Ratcliffe:  https://www.bbc.co.uk/sport/football/61267010 A formal announcement is expected on Monday.   More here:  https://weaintgotnohistory.sbnation.com/2022/4/29/23049120/further-reports-of-todd-boehly-consortium-winning-the-race-for-chelsea-football-club DCMS secretary Nadine Dorries warned yesterday that there were only a few weeks left to seal the deal.

[This is an edited version of an article that originally appeared in the Charlton fanzine, Voice of the Valley.    Almost all references to Charlton have been excised]. In his excellent book The Football Manager: a History Neil Carter shows how managers often started out as the club secretary with the board selecting the team.  Gradually they achieved greater responsibilities.  He argues that Herbert Chapman at Arsenal was the most important figure in the development of modern football management.   The other two key pioneers were Frank Buckley at Wolves and Jimmy Seed at Charlton. Carter points out how football and the role of the manager changed after 1992.   Success on the pitch became even more important commercially making football even more of a results business.   Managers assumed a much higher profile in the media. In modern football the manager is generally seen as being responsible for everything that occurs on the pitch.  ...

Owen Oysten has failed in an attempt to sue the receivers of Blackpool Football Club for £78m in compensation:  https://www.blackpoolgazette.co.uk/sport/football/blackpool-fc/owen-oyston-fails-in-ps78m-claim-against-receivers-that-sold-blackpool-fc-3672080 He has the right to appeal.

Football finance guru Kieran Maguire has produced a report with a colleague at Portsmouth University for the DCMS on the financial sustainability of football and it does not make for comforting reading:  https://news.liverpool.ac.uk/2022/04/27/new-report-finds-serious-concerns-around-financial-sustainability-in-football/ Using industry-based limits from pre-pandemic club figures (2018-19), the research found that in the Premier League, only three clubs were not deemed at risk under any of the applied risk metrics (Arsenal, Manchester City, and Newcastle), while over half were deemed at risk under at least two metrics. I n the Championship, there was only one club that was not deemed at risk under any of the three applied risk metrics (West Brom, in receipt of parachute payments that year) and 20 were deemed at risk on at least two risk metrics. In Leagues One and Two, where only balance sheet metrics were applied due to available data, 14 and 10 clubs respectively were deemed at ...