Premier League Loses Its Cachet With International Investors
Buyers of Premier League clubs "used to arrive in droves," but since Indian group Venky's purchased Blackburn Rovers in Nov. '10, the "deal flow has run dry," according to Roger Blitz of the FINANCIAL TIMES. Promotion and relegation are the only things that have changed the make-up of owners around the Premier League board table in the past two years. Football business experts "cannot agree why the flow of deals has halted." One "obvious reason -- the global economic downturn -- is largely rejected." Sport business group Deloitte Lead Partner Dan Jones said, “If you’re buying with your own assets and wealth, the financial crisis doesn’t have its own impact." The most accepted view is that interested buyers "have taken stock of the experience of the wave of new owners since '05 and are treading more warily." Compared with other sports franchises, some owners have found the business of winning Premier League football matches "alarmingly hazardous," according to Championship side Brighton & Hove Albion CEO Paul Barber, whose club plays a tier below England’s top division. Barber: “There are so many games that could go either way.” In the eyes of many American investors, the league’s drawbacks "continue to be the absence of measures to constrain wages and provide competitive balance." NFL Jacksonville Jaguars Owner Shahid Khan said that the "value of Premier League clubs" looks enticing. Khan: “But to me, the business model is not attractive. You don’t have a fixed salary cap.” Adopting cost controls "could revive buyer interest" in Premier League clubs. Arsenal CEO Ivan Gazidis said, “A good economic environment attracts owners” (FINANCIAL TIMES, 11/14).