Abu Dhabi group makes $354 million bid for English soccer team
The move to buy Manchester City is expected to trigger a new spiral in player costs and a fresh backlash to foreign ownership.
A bid by an Arab consortium for one of England's most prominent but underachieving soccer teams has amplified a noisy debate about the astronomical finances of the game – and the deepening divisions between the industry's haves and have-nots.
The Abu Dhabi United Group – an investment vehicle for the emirate's royal family – has put forward a £200 million ($354 million) offer for Manchester City, the perennially weaker opponent to metropolitan rivals Manchester United, and promised to make it the richest and best team in the world.
The takeover would be the first of an English soccer team by an overseas Arab owner. It would multiply the bidding stakes for the world's best players, probably triggering a new spiral in player costs. The newcomers would eclipse Chelsea's Roman Abramovich as British soccer's richest owners.
From Russia's Abramovich to US sports moguls like Malcolm Glazer and Randy Lerner, foreign tycoons are gradually taking over English soccer. The attraction for the investor is the wealthiest league in the world, with revenues topping $3 billion a year, much of it derived from television broadcast rights. Nine Premier League clubs have foreign owners. Arsenal is the only club that consistently challenges for the league title without having a rich foreign owner.
But foreign owners have not always been welcomed with open arms.
Manchester United fans were in open revolt at Mr. Glazer's takeover, which was financed with huge amounts of debt. Some clubs have become exasperated at owners' reluctance to plow money into what can be an expensive business. Many fans suspect ulterior motives: that owners are just there for the marketing potential and not for the love of the game.
Manchester City fans are excited
Still, the initial response from Manchester City fans was euphoric. Some dressed up as Arab potentates in gratitude. Others informally renamed the club's Eastlands stadium "Middle Eastlands."
"When you've been in the footballing doldrums as long as we have, when the olive branch is offered to you, you take it," says Kevin Parker of the Manchester City supporters club, with a delicious mix of metaphors so beloved of football aficionados. "It might end up choking you, but you take it."
But his reaction hints at conflicting emotions at both Manchester City and in the wider football world.
"It's obviously raised the stakes in terms of the amount of money clubs are going to need," says Rory Miller, an expert in football finance. "It's also diminishing the competitive balance in football and diminishing the amount of interest that clubs will have in training their own players."
Oil money for soccer fields
The promise for Manchester City can be written down in zeros. The new owners are oil men with deep pockets full of petrodollars amassed thanks to record crude prices. As longtime City fan and guitarist for the hit rock band Oasis, Noel Gallagher told the BBC: "It'll be nice to know that every gallon of petrol a Manchester United fan buys is going into our kitty."
The Abu Dhabi United Group for Development and Investment is part of the oil-rich state sovereign wealth fund that manages an estimated $1 trillion in assets. "We have really deep pockets," said consortium figurehead Sulaiman al-Fahim, a man described as the Donald Trump of Abu Dhabi.
The club immediately set a British record for buying a player, snapping up Brazilian striker Robinho for £32.5 million ($57.6 million). Now executives are talking of trying to swipe Manchester United's most valuable player, Cristiano Ronaldo for a ludicrous £135 million ($239 million). Dr. Fahim speaks of buying 18 of the world's best players for £30 million ($53 million) apiece.
'Losing our identity'?
But underneath the euphoria and hyperbole lurk familiar concerns: that the owners might not have the best intentions – or stay forever; that they might change the culture of the club; that English players will be relegated to the sidelines in favour of big foreign stars (though in truth that is already happening).
One Manchester City fan who asked not to be named, said: "I wouldn't like 18 £30 million players. We would lose our identity."
He says one of the club's appeals is that it boasts a crop of young players raised and trained locally. "I like it that currently we have all these young players who are a product of our youth (training) system," he adds "If they replaced these players I would be upset and I think a lot of fans would feel the same way."
City fans may also want to take note of some of Fahim's recent statements.
Aside from gushing about expensive players, Fahim says his aim is to "position Abu Dhabi as a sports and cultural hub," and "attract the world's attention to the United Arab Emirates (UAE) through this purchase of one of the oldest English clubs." He even suggests that the investment could pave the way for UAE players to play in the Premier League.
And woe betide the club if the Arab owners lose interest. Miller says that if the deal falls through, then Manchester City will be taking on huge costs in the form of player salaries with no tangible assets behind them. Other clubs have gone bankrupt in similar scenarios.
The third worry is more universal – that big money in football simply skews the playing field and makes for one-sided contests.
Kevin Rye of Supporters Direct, an organization that encourages grass-roots financial involvement in clubs, argues that billionaire owners are widening the gulf between the "haves" and "have-nots" in football, making many matches predictable and hardly competitive.
"The key to this is what it does to competitiveness," he says. "Talking about a £135m player is beyond most people's understanding – that would clear the debts of most (second-tier) clubs. The question is whether football wants to get to grips with this or go further down this route. What you have to ask is whether this is just further inflating an already inflated bubble and making further problems further down the line."
Miller agrees. "If there are just a handful of clubs who have a vast amount of resources, it just stretches out the gap between the wealthiest and the less wealthy."
Parker just shrugs. "Football probably has lost its soul a bit, but that happened a long time before Manchester City got involved in this deep-pocket scenario. We could take the high moral route, but why should we?"