Manchester City

[Lecter]

Now you sound like 'them'

We'll soon get to the days when NYC buy a player and loan them to City as another way to get around the rules. This just stinks of financial doping but it is all above board - City will continue to grow and grow which will create the impression that they can buy whom ever they want within the FFP rules

Depressing from an integrity perspective

Has the $500m been put in as equity??

Or has it just been paid out to the current shareholders for 10% of their stakeholding??

[Buzzo]

Has the $500m been put in as equity??

Or has it just been paid out to the current shareholders for 10% of their stakeholding??

Good question, I've no idea. Its a hell of a boost to cashflow if it goes in as working capital

[Irishnev]

Has the $500m been put in as equity??

Or has it just been paid out to the current shareholders for 10% of their stakeholding??

The article states:

The $500m cash injection will help fund CFG’s aggressive expansion plans, including the acquisition of more football clubs globally, as well as the planned construction of a stadium in New York, according to people with knowledge of the group’s plans.

[Lecter]

The article states:

The $500m cash injection will help fund CFG’s aggressive expansion plans, including the acquisition of more football clubs globally, as well as the planned construction of a stadium in New York, according to people with knowledge of the group’s plans.

I asked the question about equity before because you can only inject a certain amount of "cash" into the club before you are in breach of FFP rules

[Irishnev]

I asked the question about equity before because you can only inject a certain amount of "cash" into the club before you are in breach of FFP rules

I'm sure it's all above board Lec

[dom9]

I asked the question about equity before because you can only inject a certain amount of "cash" into the club before you are in breach of FFP rules

[ame]https://twitter.com/david_conn/status/1199709370252242944[/ame]

You can inject as much as you like if you spend it on capital infrastructure. Or buying feeder clubs. Or bolstering the squads of those feeder clubs outside of the EU.

[Cormack74]

The article states:

The $500m cash injection will help fund CFG’s aggressive expansion plans, including the acquisition of more football clubs globally, as well as the planned construction of a stadium in New York, according to people with knowledge of the group’s plans.

Do they actually need any more money to fund their plans? I'm doubtful they are at the point of looking for coins under the sofa cushions.

[dom9]

https://theathletic.com/1414956/2019/11/27/man-city-are-now-the-disney-of-football?source=shared-article

It is 1999, the height of the decade’s long technology boom, and four of America’s leading investors decide to start a new investment firm in Menlo Park, California, where Google was launched and Facebook has its corporate headquarters.

Early investments were made in software companies, data networks and America’s leading electronic stock exchange, before the firm started to move into the entertainment and media spheres.

Now, Silver Lake has offices in five countries, total investments of more than £33 billion and a portfolio that stretches from Chinese online retail giant Alibaba to Las Vegas-based mixed martial arts behemoth UFC.

Oh, and it has just shelled out half a billion dollars or £389 million, on a 10 per cent stake in City Football Group, the band of footballing brothers led by Manchester City.

This makes CFG the world’s most valuable football group and City — the driver of 85 per cent of its revenues, most of its silverware and nearly all of its global fame — very probably the world’s most valuable individual football club.

Direct valuation comparisons between clubs are notoriously difficult, as so few are listed on stock markets where you can add up the value of each share to work out its capitalisation. But prior to Silver Lake’s blockbuster punt on CFG, the more educated guesses — Forbes’ annual ranking of club values or KPMG’s “European Elite” benchmark report — had Real Madrid at somewhere north of £3 billion, with Barcelona, Manchester United and Bayern Munich somewhere between £3 billion and £2 billion.

Most studies had Manchester City in fifth place, worth around £2 billion, but the University of Liverpool’s Kieran Maguire, who blogs, broadcasts and tweets under the “Price of Football” banner, can be forgiven for feeling a little bit vindicated as he put City ahead of United in May.

Some accused him of “clickbait” at the time, as United are still earning more every season than their “noisy neighbours”, but even Maguire lowballed City’s potential value by about £1 billion. Because that is what Silver Lake’s investment means.

The firm has actually bought just over 10 per cent of CFG, which means Sheikh Mansour’s Abu Dhabi United Group sees its stake fall to just over 77 per cent and the Chinese consortium, led by China Media Capital, which came on board in 2015, dilute its holding from 13 per cent to about 12 per cent. The total value of the group is now $4.8 billion or £3.7 billion, which makes City alone worth, roughly speaking, £3.2 billion.

Top of the pile, then, until somebody comes along with a cheque book to crystalise the value of one of those other apex predators in global football’s financial jungle.

And City’s latest lottery win may well increase the likelihood of that happening, as this deal will almost certainly recalibrate what all elite clubs are worth. Yet none of the others will have come as far as the east Manchester-based side have over the last two decades.

While Silver Lake’s founding partners were working out the new economy’s winners and losers, City were completing a season which would culminate in both their lowest-ever league finish and the beginning of their renaissance.

It might not have seemed that way at the time, as they lost home and away to Wycombe, endured depressing defeats to Lincoln, Oldham and York and required penalties to beat Gillingham to escape their single season in English football’s third tier, but City would never stoop so low again. They would be bad again – a home defeat to nearby Stockport a season later, another relegation to the second tier two years later, with Arsenal beating them 9-0 over their two fixtures – but never that bad again.

There were wobbles, false dawns and a bizarre period under the ownership of Thailand’s former prime minister Thaksin Shinawatra but those days seem as relevant now to modern Manchester City as the sepia pictures of its first teams in the 1880s, when a local church started a team to keep working men out of gangs and pubs.

What Silver Lake has bought is the Disney of football.

Many City fans will hate this – there are many who remember those seasons slumming it in the lower tiers with great fondness – and heaven only knows what the church wardens of St Mark’s in West Gorton would have made of it, but the moment Shinawatra sold the club to the Abu Dhabi royal family, everything changed.

CFG is now an entertainment business, with a market leader in the world’s most profitable league in the world’s most popular sport, and six satellite companies in key markets around the globe. An eighth franchise is set to open this week in India, completing every ambitious stock-picker’s list of countries they would want to be in right now.

This has not been done in secret. CFG chief executive Ferran Soriano has been talking about this ever since the group was set up in January 2013, four and a bit years after the Abu Dhabi takeover. He even wrote a book about it.

A former vice-president and general manager at Barcelona, Soriano explained that the Catalan club’s member-owners, or “socios”, were very unlikely to go for his vision of a 21st-century international sports empire. He needed the blank canvas of east Manchester, the easel provided by the Premier League’s global reach and Abu Dhabi’s expensive palette of paints.


Gu Jiong, Phillippe Bocquillon, Ferran Soriano , Michelle Guo and Paul Dickov (left to right) at a Man City x Puma event in July in Shanghai, China. (Photo: Hugo Hu/Manchester City FC via Getty Images)
Having poured millions of Abu Dhabi’s wealth into turning the flagship club around, with an FA Cup coming in 2011 and a first Premier League title a year later, CFG opened for business by planting a flag in the burgeoning North American soccer market, and not just anywhere but New York City.

In 2014, CFG purchased the Australian A-League’s Melbourne Heart and rebranded them Melbourne City FC. Soon after, a minority stake was bought in Japan’s Yokohama F. Marinos.

In 2017, the group moved into South American football by buying Uruguayan second-tier side Club Atletico Torque and then another minority stake in Spain’s Girona. Meanwhile, women’s teams were launched or upgraded at all of the group’s clubs.

And in 2019, four years after CFG had brought in its well-connected Chinese partner, a sensible move in that part of the world, the group announced the purchase of Sichuan Jiuniu, a team in China’s third tier.

The self-styled “only team in Manchester” had become a magnificent seven, spanning five continents, with 1,500 players, 2,000 staff and 2,500 fixtures a season. And the group is not finished there, with the Indian Super League’s Mumbai City next up and fresh markets still to be conquered.

And that is where nearly all of Silver Lake’s money will be directed. This deal will have no direct influence on City’s decision to spend in the January transfer window, as the club should need no reminding about the constraints of Financial Fair Play.

But this investment should help in the long term as what is good for CFG is ultimately good for City.

As well as buying a club in India, City fans should expect to hear movement, at last, on NYCFC’s long search for a permanent home in New York. Building in the Big Apple is not easy but the Major League Soccer club’s search for a site has been a tad embarrassing at times.

Sources at CFG say lessons have been learned and in board member Martin Edelman they have the best property lawyer in the Five Boroughs. Throw in Silver Lake’s network — they have a stake in Madison Square Garden — and you can start to see a way out of their very expensive groundshare with the New York Yankees, to a purpose-built, state-of-the-art stadium in America’s best sports market within three to four years.

NYCFC currently make a loss on turnover of £40 million. A new home and a much-improved MLS broadcast deal, which is a racing certainty, will transform that equation.

CFG is also bullish about Melbourne’s prospects, with the side top of the A-League and the financial picture improving, and pleased with progress in Japan, Spain and Uruguay. Sichuan Jiuniu, however, require a little more patience but the group is adamant it will quickly become a Chinese Super League franchise when the time is right.

This is the masterplan Silver Lake has signed up to: a company with truly global reach in the exciting space where fun meets fintech.

You only have to look at the rest of its portfolio to understand where it is putting its eggs. One of its key investments is in the massive sport and entertainment agency Endeavor, who acquired IMG in 2014 and whose co-founder Ari Emanuel was a guest at the Manchester City v Chelsea game on Saturday.

The simple reason for this is that top-flight football is much cheaper than making another season of The Crown or another TV series. Ask Amazon. Instead of hiring Hollywood actors, crew, famous directors and spending months on location and in post-production, they just rock up with some cameras to film appointment-to-view entertainment and then make a repeatable drama out of it by handing out a few microphones to the principal players. All or Nothing: Manchester City and the upcoming Amazon documentary about Tottenham Hotspur are just two examples.

Sure, questions will be asked and eyebrows raised at the price Silver Lake has paid to be a minority partner in a notoriously competitive and fickle business, but it has been looking at Premier League clubs for some time – Chelsea, Crystal Palace and Newcastle have been mentioned on the football finance grapevine – and it has clearly decided CFG is now almost too big to fail.

Another key takeaway from this deal must be that City are now very unlikely to be banned from European competition – an activity that provided about a sixth of their revenues last year – next season for alleged breaches of those FFP rules.

It really was a coincidence that UEFA president Aleksander Ceferin made his first visit to the Etihad training centre and stadium on the eve of the Silver Lake announcement, but his presence in the director’s box next to City chairman Khaldoon Al Mubarak looked auspicious, even if the game against Shakhtar Donetsk was a dud.

There is, of course, one other key risk factor involved at CFG and that would be the impact of losing a key member of staff.

Pep Guardiola was not mentioned in the Silver Lake press release and he spent most of the second half of Tuesday’s game looking a bit fed up with his side’s flat display. Warning signs were ignored, chances spurned and a win was squandered.

But City got the point they needed to proceed in this season’s Champions League, just as CFG got the half a billion they need to proceed to global domination. That sounds like a job worth holding onto.

[dom9]

I know the length of articles on The Athletic has become a running joke but I actually find the articles about City generally the most interesting subject matter on there.

[Cormack74]

What's the three line summary?

[Lecter]

https://twitter.com/david_conn/statu...09370252242944

You can inject as much as you like if you spend it on capital infrastructure. Or buying feeder clubs. Or bolstering the squads of those feeder clubs outside of the EU.

[dom9]

That said, it doesn't look like City will be seeing much of it themselves.

[Lecter]

That said, it doesn't look like City will be seeing much of it themselves.

Yeah I think people are losing their **** over nothing (most unusual that )

I get why theres a suspicion of City but not convinced theres anything in this

[Irishnev]

[ame="https://twitter.com/kylewalker2/status/1200812199385686016"]https://twitter.com/kylewalker2/status/1200812199385686016[/ame]

[Fosterbloke]

Mind the gap