SBD/Issue 239/Franchises

EPL Club Manchester City Agrees To Takeover By Abu Dhabi Group

Al-Fahim Part Of Group Acquiring
Majority Interest In Manchester City
English Premier League (EPL) club Manchester City has agreed to a takeover deal with the Abu Dhabi United Group for Development & Investment (ADUG), according to Mike Adamson of the Manchester GUARDIAN. Manchester City Owner Thaksin Shinawatra will remain at the club as honorary president, "without any administrative responsibilities," while ADUG will be represented on the team's BOG by Dr. Sulaiman Al-Fahim. Arabian Business reported that negotiations on the deal began "three weeks ago and were completed" Monday night at the Emirates Palace Hotel in Dubai (Manchester GUARDIAN, 9/2). In Manchester, Daniel Taylor reported the takeover cost around $374.6M (all figures US) and "clears all City's outstanding debts." Al-Fahim insisted that he "had not put up the money himself but was a figurehead for members of the UAE's royal family, whose riches are even greater, and that the aim was to establish City among the world's elite clubs." Al-Fahim: "Our goal is very simple -- to make Manchester City the biggest club in the [EPL]." The team Monday "wasted little time in flexing their financial muscle," extending nearly $178M in "bids for new players" and agreeing to a English-record $57.9M transfer fee with La Liga club Real Madrid for F Robinho (Manchester GUARDIAN, 9/2).

SPENDING SPREE: Al-Fahim said that he would "not hesitate to spend [$356.9M] next summer if it was deemed necessary" (LONDON TIMES, 9/2). In London, James Ducker reports Manchester City is "weighing up a staggering" $239.2M offer for EPL club Manchester United MF Cristiano Ronaldo during the league's January transfer window. The offer would be "more than twice United's operating profits" for the '06-07 season (LONDON TIMES, 9/3). In Manchester, David Conn writes the "extraordinary acquisition ... looks to be launching the Premier League into yet another new financial era, in which more top clubs are likely to be bought as 'trophy brands' -- owned for the glory they reflect -- by the billionaire sheikhs of the Middle East" (Manchester GUARDIAN, 9/3).

A BROADER APPEAL: Al-Fahim, when asked why the group acquired Manchester City, said, "Big exposure for the group and for the city (Abu Dhabi). We want to create Abu Dhabi as the capital of sport and culture in the Middle East, to attract all the important events." In London, Matt Dickinson writes EPL clubs now are a "prized part of the business portfolio for Russians, Americans, Arabs and, no doubt before long, the Chinese" (LONDON TIMES, 9/3). England's Durham Univ. professor Christopher Davidson, a Middle East expert, said, "The Manchester City investment is sending money abroad, but its purpose is very much about putting Abu Dhabi on the map" (London TELEGRAPH, 9/3). In London, Jim White writes the EPL now is "renowned across the world as providing an endless, English-speaking soap opera of sporting drama, its appeal arcing from Tokyo to Toronto." ADUG is "buying City to make money from it -- which is just as well. They are buying it as a giant calling card, a globally recognised hoarding to project commercials. ... Move over [Chelsea Owner] Roman Abramovich, the really rich kids are in town" (London TELEGRAPH, 9/3).

Group's Acquisition Of City Could Lead
To Other Middle Eastern Investors In EPL
THE WORLD'S GAME: In N.Y., Hughes & Thomas write the "intense interest in Manchester City, a soccer club with a long history but a bare trophy cupboard, illustrates just how much the bull market in commodities has turned oligarchs from Russia, steel magnates from India and sheiks from the kingdoms in the Persian Gulf into acquisitive buyers of prized and highly visible Western assets." More than half of the EPL's 20 teams are owned by foreigners, and the Manchester City takeover "may have done little more than hand over ownership of the club." However, it "represents an important shift," as it "may be the first, but it is unlikely to be the last venture into English soccer by the rulers of the Persian Gulf states" (N.Y. TIMES, 9/3). The FINANCIAL TIMES' Stafford & Blitz reported the purchase marks the "first time that a major Middle Eastern fund has put money into" EPL soccer, and the takeover "highlights the level of global interest in owning football clubs" in the EPL. While various Middle Eastern investors "have been mooted as buyers" of EPL teams, the deal for Manchester City "may be the first of many such purchases by the region's wealthy investors." Stafford & Blitz noted Manchester City's estimated equity and debt of $374.6M would be "sharply higher" than what Thaksin paid for the club in '07. The deal was brokered by PCP Capital Partners' Amanda Staveley, whose company "has put together several deals for Middle Eastern buyers" (FINANCIAL TIMES, 9/2). In London, Martin Samuel writes UAE Minister of Presidential Affairs Sheikh Mansour Bin Zayed Al Nahyan, part of the country's royal family, is "not in it for profit." He "loves sport, yes, but perhaps also sees City as the way to promote the emirate of Abu Dhabi, with Premier League ownership as a prestigious accessory." At a time of "political uncertainty, maybe this is also seen as an opportunity to present the Arab nations in a positive light around the world" (LONDON TIMES, 9/3).

A BIG CATCH: In London, Ian Herbert noted Al-Fahim is "certainly the man several Premier League clubs would dearly have liked to have had on board." Al-Fahim has been "approached about possible [10-25%] stakes" in EPL clubs Arsenal, Liverpool and Newcastle United, though "discussions never took place." Al-Fahim: "Those possibilities have never gone anywhere. The only team and offer that grabbed my mind was Manchester City" (London INDEPENDENT, 9/2).

Return to top

Related Topics:


Video Powered By - Castfire CMS Powered By - Sitecore

Report a Bug