The growth of the multi-club ownership model in football

In recent years, a new phenomenon has developed in the football business with the growth of the multi-club ownership model.

A controversial method

“The lesson we can draw from all this is that it is difficult to be at two clubs”, said Nancy president Gauthier Ganaye after the club’s relegation to the French third division last month. Gauthier Ganaye was considered the youngest general manager in English football after joining Barnsley in 2018 at the age of 30. He spent his role at Nancy last season with that of executive chairman of Belgian club KV Oostende.

Barnsley, which was relegated from the championship in April despite making the playoffs last year, is, like Nancy and Ostend, partly owned by New City Capital – an investment group that also includes US investors Pacific Media Group. “The starting assignment was never that I was 100% there”, Ganaye said of her dual role. “Talks are underway to define a structure that will allow all clubs in the group to operate.”

For the rest of New City Capital’s growing club portfolio, things have not cropped up on the pitch. Thun – who won the domestic title in 2010 – struggled to finish in the middle of the Swiss second tier, Esbjerg fans suffered another season of frustration in the Danish second tier and Den Bosch remains stuck in the Dutch second tier.

In any case, investors had something to celebrate in late May when Kaiserslautern — Germany’s four-time champion who sold a 10% stake in March to a US consortium made up of Chien Lee of New City Capital and Paul Conway of Pacific Media Group — defeated Dynamo Dresden. in the promotional play-off to return to Germany’s second tier for the first time since 2018.

From New City Capital and 777 Partners LLC to City Football Group (CFG), Bolt Football Holdings, Redbird Capital and Red Bull, owning one club doesn’t seem like enough these days. Even Saudi Arabia’s public investment fund, fresh out of its controversial Newcastle takeover, is joining speculation that it is in the running to buy Polish club Slask Wroclaw, despite strong local opposition.

“Silesia is an ancestral silver”, Wojciech Koerber, a spokesman for Wroclaw’s local government, said last week. “The history of this city is not something that can be sold for a few zlotys. It is not only a commercial project, but also a social project.”

There are strong rumors that Qatar Sports Investments – which has transformed Paris Saint-Germain into a European superpower thanks to its inexhaustible financial reserves – is trying to build a portfolio of clubs after watching CFG, which is largely owned by Abu Dhabi, expanding its double-digit empire with the acquisition of French club Troyes in 2020. CFG failed in a bid to buy Breda in April after furious reactions from fans of the Dutch club.

“I wouldn’t be surprised if QSI buys a club in Portugal soon” says a source for The Guardian. “They’ve seen CFG’s success in managing so many different clubs around the world that they all want to do the same thing. The system was perfected by CFG, but the idea came from the Pozzos.”

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Flexible legislation in this area

Les Pozzos – the Italian owners of Udinese and Watford – relinquished control of their stake in Granada in 2016 after leading the Spanish club for seven years. The multi-club phenomenon goes back much further, to a landmark case at the Court of Arbitration for Sport in 2000 over two interests of Enic, the company with which English businessman Joe Lewis later bought Tottenham. The court’s decision regarding Enic’s minority stake in AEK Athens and its majority stake in Slavia Prague led to the introduction of regulations prohibiting two clubs in which a person or company exercises “decisive influence” from being admitted to the same UEFA club competition.

However, because the rules differ from one national championship to another, a major loophole remains. While the Premier League has restricted a 10% interest in a second division club, UEFA’s rules of integrity allow an individual to own a 100% interest in a club and an interest “of non-decisive influence” at another club participating in the same competition.

In Germany, questions arose when US investor David Blitzer – who owns 40% of Crystal Palace through his company Bolt Football Holdings – bought 45% of the company that owns the majority of Augsburg shares in early 2021. But with club members retaining 50 with +1 voting shares, they stayed on the right side of the rules and ended the season well away from relegation troubles after signing American striker Ricardo Pepi, a record-breaking club for the club, in January. an amount of $18 million.

It’s not the only win for Blitzer, who was also behind Martin Broughton’s failed bid for Chelsea last month, a bid that, if successful, would have meant giving up his shares in Palace. His Dutch club, The Hague, missed promotion to the Eredivisie in qualifiers and his Belgian side, Waasland-Beveren, came close to returning to the top six years after relegation.

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A growing phenomenon

Bolt Football Holdings have also emerged as the likely new owner of ten-time French champions Saint-Étienne after they were relegated to Ligue 2 following dramatic play-off scenes against Auxerre.

RedBird – another American investment vehicle, which counts Liverpool owners John Henry and Tom Werner, the NFL and LeBron James among its partners – continued its success by bringing Toulouse back to Ligue 1 by buying champions Milan Italy for 1 .3 billion dollars.

The Miami-based 777s are hoping for a similar return following their 100% acquisition of Standard Liège in March, after reaching a $175.8 million deal to buy Genoa in September. The sale made Standard – which has not won a domestic title since 2009 – the 10th Belgian top division club to attract foreign investment, and since 2018 nearly half of Serie A clubs have been sold to investors or North American consortia.

In February, 777 spent $137 million for a 70% stake in Vasco da Gama, following legislation last year that allowed Brazilian clubs to operate as public companies, opening the door to foreign investment. A month earlier, John Textor – the American who reportedly raised £87.5 million to join Blitzer as a minority shareholder of Palace in August, after showing interest in Newcastle – had taken a 90% stake in Botafogo and he says he plans to restore the club’s glory year in which Jairzinho and Garrincha rose to prominence. “I want it to be clear within three to five years that there is a Botafogo way”he declared. “Failure is the best teacher”.

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