Foreign Ownership : The Blame Game
After the recent decision by Manchester City’s owner Thaksin Shinawatra to fire Sven-Goran Eriksson, the issue of foreign ownership in the English Premier League is again at the fore front of recent events.
Some buy an EPL club and treat it like a toy much like Thaksin Shinawatra or Roman Abramovich of Chelsea. Each willingly to lavish massive amounts of their personal fortune into the club which creates an imbalance with the EPL threatening to become a league of have and have nots. The question also lingers about what will happen to the future of these clubs if owners such as Shinawatra and Abramovich get bored of football and decide not to funnel anymore money into the club? While that isn’t likely to happen anytime soon any accountant can tell you that each club would be swimming in red ink if it wasn’t bank rolled currently by the personal fortunes of each owner.
At the other end of the spectrum we have the Glazer family who own Manchester United and to go along with Tom Hicks and George Gillett the bosom buddies who own Liverpool. Neither of those parties knew a thing about Football before buying into each team. To them it’s a business investment, while it’s fine to make money, football fans right or wrong the game isn’t about making money, it’s about passion and devotion. Football fans want to read about their teams in Football magazines not Business weekly. To add insult to injury neither ownership group put up a dime of their own money to buy each club. Technically Manchester United and Liverpool are owned by the banks. Both purchases were financed leaving each club with a huge debt as the money was given to each ownership group to purchase these teams against future club revenues.
It’s easy to see why foreign ownership would be interested in purchasing an EPL team. First there is the matter of the television contract. With 3.3 billion dollars (In U.S funds) coming into the league in domestic TV rights through 2010 to go along with another $1.2 billion from overseas it’s easy to see why ownership groups are lining up left and right for a slice of that pie.
Another Advantage to owning a football club. Liverpool was sold for £218.9m ($430 million US) while it would cause riots on the streets of Liverpool the football players themselves are assets. If ownership is suffering from a lack of funds, Steven Gerrard can be sold for $50 million. That just does not happen in other sports. The Yankees can’t sell Derek Jeter for example.
Fans across the Atlantic are quick to blame Foreign ownership for any perceived ills but the above shows why someone would want to own an EPL team. The question I ask myself is why aren’t more British based groups stepping up and buying these clubs. Mike Ashley’s purchase of Newcastle is the only recent purchase of an EPL club by an English owner. Even clubs such as Derby County and Queen’s Park Rangers are being snapped up by Foreign owners. There has to be someone with deep pockets in England willing to purchase a Football team or the rise of members purchasing these teams much like the Spanish model of Real Madrid or Barcelona.
The previous owners of Aston Villa, Chelsea, Derby, Liverpool, Manchester City, Manchester United, and West Ham were all willing to cash out at a huge profit. Where does that leave their fan base at the end? Shouldn’t more focus be given to finding local ownership groups or on the flip side shouldn’t more local groups be willingly to step up and buy some of these clubs that are on the market. Again I’m all for someone making a profit but this article isn’t about that. While their have been good Foreign ownership groups, namely Randy Lerner but that is due to him spending time in England and loving the game which fans can respect. Most of the new ownership groups simply do not share that passion that Mr Lerner does.
May 6th, 2008 at 11:32 am
Interesting points. As a football fan (and a Yank), it really ticks me off to see those owners (foreign or domestic) wielding a club over the teams and mangers (ie Mourhino & Ericsson), where they should just lay off and let the experts (managers) do their job. I’m not in favor of letting a bad manager, players, etc ruin a team, but jeez give things a chance. Money does not buy everything regardless of what society wants you to believe.
All that said, I wish I had a few million pounds to spend on an BPL club…. With the best of intentions I’d love to see the club do well, providing the financial backing but letting the experts do the work. Perhaps this is why I don’t have a few million pounds to spend?