China's spending spree on soccer assets "shows no sign of slowing down" following the latest acquisition, and the "bubble is also unlikely to burst for some time to come," according to sources cited by Benjamin Haas of the AFP. Italian team Inter Milan "became the most prestigious club to come under Chinese ownership" when Suning Commerce Group Chair Zhang Jindong announced a 70% takeover. It follows the company owned by Asia's richest man, Wang Jianlin, gaining 20% ownership in Spain's Atletico Madrid. Also, a state-backed Chinese fund owns 13% of EPL club Manchester City, while now-Championship League club Aston Villa "accepted a takeover offer from China's Tony Xia." Chinese investors last month "bought a controlling stake in international media rights company MP & Silva." Earlier this year, Chinese Super League clubs "indulged in a world-leading" $365M binge on players, "breaking the Asian transfer record four times in quick succession." One key impetus is "football-loving President Xi Jinping's ambition to turn China into a world soccer power, with successful clubs and a winning national team." Chinese companies also are "keen to gain global reach and visibility, and diversify away from their core businesses at a time of uncertainty in the Chinese economy." But "beyond the cash paid for the teams and players, Chinese firms are chasing prestige and visibility for their products." Where previously brands "would sponsor teams or events, Chinese companies like Suning and Wanda are hoping their investments will further their international expansion plans" (AFP, 6/7).
START OF A TREND: The WALL STREET JOURNAL's Pei Li notes Suning's deal for Inter Milan was the first by Chinese investors "for control of a top European soccer team." Suning said that team President Erick Thohir, who also is DC United co-Owner, will "now hold about 30% of the club." Li notes more deals "are expected." Meanwhile, the company that owns AC Milan said in May that it is "in negotiations with a consortium of Chinese investors." Thohir yesterday said that Inter Milan will "visit China each year over the next five years" (WALL STREET JOURNAL, 6/7).
