SBD/April 19, 2011/Franchises

Soccer's Cross-Border Potential A Motivating Factor For Kroenke's Arsenal Takeover

Arsenal believes its brand awareness is not far behind ManU, Real Madrid, FC Barcelona
The "cross-border potential" of soccer is one of the factors that motivated Stan Kroenke to pursue majority ownership in Arsenal, according to Duncan White of the London TELEGRAPH. With the EPL club, "new markets have opened up to Kroenke that would be impossible to crack" with his other sports holdings. Arsenal has a "lot of catching up to do" commercially, as Manchester United "will be the first club to break the £100 million mark for commercial revenue alone," more than double Arsenal's reported £44 million last year. ManU is "so far ahead" because club officials have been "capitalising on the strength of their brand overseas." Arsenal officials "have done research that shows their 'brand awareness' is not that far behind" Manchester United and La Liga clubs Real Madrid and FC Barcelona. But the "problem is making money out of this global popularity." Arsenal is "looking to set up partnerships with companies, in Europe, the Far East and the US, that fit the club's profile." A new shirt sponsorship deal next season is "expected to bring in an extra £15 million per year." Club officials are "being very careful not to make it seem they are forgetting about the supporter who attends" games at Emirates Stadium, but the "logic is that the more money that can be brought in from overseas, the less pressure there will be on the club to generate revenue from match day." This summer, Arsenal manager Arsene Wenger will take his team "on a pre-season tour, of China and Malaysia, for the first time since he joined the club" in '96. But Wenger said the tour is a "compromise with the financial department." Wenger: "Ideally I wouldn't want to go but I go because we get sponsorship money that is higher than in Europe. We will go to Malaysia and China. We have less financial potential than the others so we cannot fall behind with commercial income" (London TELEGRAPH, 4/17).

SPREADING HIMSELF TOO THIN? In St. Louis, Bernie Miklasz wrote under the header, "Is Rams Owner Stan Kroenke Spread Too Thin?" Kroenke is "now an international man of mystery after his friendly but stunning takeover" of Arsenal. Kroenke "has added another prominent team to a collection of sports properties that includes" the Rams, Nuggets, Avalanche, MLS Rapids, NLL Mammoth, the Pepsi Center and the Altitude regional sports network. To comply with NFL ownership rules, Kroenke is "obligated to divest himself of the Denver sports franchises at some point," but "unless Kroenke sells the Denver teams to outside interests, it's naive to think he won't have some unofficial role in their operation" (ST. LOUIS POST-DISPATCH, 4/17).

HEIR TO THE THRONE: In Denver, Benjamin Hochman profiled Nuggets President and Avalanche Governor Josh Kroenke, who offered his "first wide-ranging interview since taking over the Nuggets last summer." Kroenke is the "billionaire heir to Wal-Mart" on his mother's side and "a sports empire" on his father's side. Kroenke "prefers to be just Josh, a humble, likeable guy carving out his own legacy." Kroenke: "Honestly, I think I'm a huge nerd." Kroenke "runs two of the four major pro franchises in town and will for years, fueled by his Midwestern work ethic, calculating business mind and a sizable chip on his shoulder." At "age 30, and just 10 months into the job, he's transformed his father's franchise into something all his own." Bucks GM John Hammond, who coached Kroenke as an assistant at the Univ. of Missouri, said, "He has many outstanding personal attributes, but by far his greatest attribute is his humility. I truly admire him for the man that he is" (DENVER POST, 4/17).
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