Takeover of English American football | FinancialTimes


Craig Coben is a former senior investment banker at Bank of America and co-hosts the Fulham FC Fan Podcast Talk about cottage. Constantine Gonticas is a private equity investor and a director of Millwall FC

When new Chelsea FC owner Todd Boehly floated the idea of ​​an all-star game in September, he said he hoped that “The Premier League is taking a bit of a lesson from American sport.”

The reaction was as quick as it was mocking. “Does he also want to bring the Harlem Globetrotters?” asked Liverpool manager Jurgen Klopp. Former Arsenal striker Thierry Henry criticized the idea, while Sky Sports pundit Jamie Carragher, a former Liverpool defender, called Boehly “incredibly arrogant.”

With Chelsea having just spent £230m on players only to sack their Champions League-winning manager at the start of the season, Boehly seemed to fit the stereotype of Americans Abroad who would have have no idea of ​​local practices and I don’t understand why other countries can’t be like the good old USA.

An All-Star Game is a far-fetched and impractical idea, but the new team of American investors in English football have a pretty good idea of ​​what they’re buying. American ownership is not new – the big three Manchester United, Liverpool and Arsenal have been under American control since the mid-2000s – but interest has grown. Bill Foley, owner of NHL club Vegas Golden Knights, reportedly made a verbal agreement to buy Bournemouth for £120m, while US investors Maciek Kaminski and Jeffrey Soros (nephew of famous short-circuiter George) are said to be in separate threads buy Everton.

While oligarchs and rulers in the Middle East bought clubs to project soft power, Americans invested to make money. At first, the Americans bought English teams to capture the fruits at hand by professionalizing operations. The Glazers, for example, have formed a sales team in London to maximize Manchester United sponsorship revenue while John W Henry and Fenway Sports Group redesigned management and marketing after taking over Liverpool.

But if easy picks are long gone, the question is why Americans are more eager than ever to buy English football. There’s no salary cap or draft system like in the NFL or NBA, financial fair play rules are unevenly enforced, relegation remains a pervasive risk, and dividend payments can lead to anger fans. Indeed, some American owners, such as Ellis shorts (Sunderland) and Randy Lener (Aston Villa), underestimated the challenge and suffered crushing losses as well as the humiliation of relegation.

Rebellious, American investors find that English football remains a very attractive investment.

First, they perceive more room for growth. American investors compare the revenue generated in the NFL with that of the Premier League. The NFL has more than twice the turnover of the Premier League, although the former is a domestic league and the latter is global in scope. The new owners believe there is still significant growth to come in broadcast rights, merchandising and world touring, and that the Premier League has the potential to overtake the NFL by a large margin.

Second, the Premier League is considered immune to creative destruction and corporate obsolescence. Many of its big names have been prominent for more than a century, and while the risk of relegation lingers, the long-term rigidity of fan loyalty lends the kind of reassurance more commonly associated with an oligopolistic market.

Third, Premier League investors are keen to exploit the opportunities presented by multiple club ownership and the resulting brand extension, with City Football Group’s progress with clubs in the United States and Australia as a model. This model increases the potential for large-scale sponsorship deals, brand partnerships and increasingly popular women’s football. The thesis is that this approach will turn club ownership into a franchise, changing the dynamics of negotiations with broadcasters and business partners.

Finally, there is the little question of money. Prior to the 2016 Brexit referendum, the pound was hovering between $1.50 and $1.60. It is located today at $1.13having reached a low of $1.06 in the wake of the UK government’s mini budget, with a growing current account deficit meaning the UK will demand the “friendliness of strangers” to provide capital for a period of time. Now is a great time to buy sterling-denominated assets with a global reach, although higher interest rates and a weak appetite for sterling debt mean buyers will need to raise their equity. S&P may note UK sovereign debt as AAbut for asset buyers”global britain” is rated BBB – in the basement of Great Britain.

Thirty years after the creation of the Premier League, American investors are still finding rich choices in English football. The easy wins are gone and the risk of losing your shirt and your reputation remains as great as ever. Yet the Premier League offers growth, a competitive moat, multiple avenues for new business opportunities and the chance to buy a prime asset in a weakening currency. English football is one of Britain’s widely recognized world-class assets, and Americans embrace the concept enthusiastically.


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