Post by QPR Report on Oct 11, 2009 7:10:15 GMT
News of The World
£2.8BILLION - THE PREMIER LEAGUE DEBT
Foreign owners ready to pump millions in to clubs
By NEIL ASHTON, 10/10/2009
BILLED by money-men as the Greatest Show on Earth, it was the chance to jump on English football's lucrative gravy train.
Now it's Buyer Beware in the Barclay's Premier League.
This is the story of top-flight football in 2009, the glory game based on boardroom power battles and murky transfer business.
It's balance sheets and wage bills, with AVERAGE top-flight salaries now £1million a year. That is a massive jump from the £676,000 average of 2006 and just £75,000 in the first year of the Premier League.
Total player wages are on the verge of hitting £1BILLION a season.
Incredibly, eight of the Premier League's 20 clubs are vulnerable to takeovers or are in the process of being sold off.
Arsenal, Birmingham, Blackburn, Everton, Hull, Liverpool, Portsmouth and West Ham face uncertain futures.
In exchange for the prestige of owning a team at the top of football's pyramid, foreign owners take on a mountain of debt.
Premier League clubs are in hock to the tune of £2.8bn, with Manchester United servicing their £700m loans with annual interest payments of £60m.
But that is small beer for many investors as six Premier League clubs are now owned by multi-billionaires.
Randy Lerner (Aston Villa), Roman Abramovich (Chelsea), Sheikh Mansour (Manchester City), Malcolm Glazer (Manchester United), Ellis Short (Sunderland) and Joe Lewis (Tottenham) are all in a different league.
Arsenal are one of a select group of clubs who tried to resist change, relying on the traditions of a family-run business to compete at the highest level.
But they could become the seventh billionaire plaything if American Stan Kroenke ups his stake again and underwrites the club's £332m debt.
Liverpool are also vulnerable, lurching from crisis to crisis after the breakdown in the relationship between Americans George Gillett and Tom Hicks.
Building work on their new super-stadium in Stanley Park came to a halt and they are creaking under nearly £300m of debt. One potential investor - Saudi prince Faisal bin Fahad bin Abdulla - is refusing to buy the club until they reduce their commitments.
Even Chelsea's future is no longer guaranteed, with chairman Bruce Buck admitting earlier this week that Abramovich could abandon the project.
He has pumped in nearly £1bn since he took control in 2003 and the shout is that it's Champions League glory and out for the Russian.
The Blues aim to be self-financing this season, but there is little chance of that with an annual wage bill of £172m.
Manchester United muddied the waters when they were taken over by Malcolm Glazer in 2005, saddling the club with £650m of debt.
Rivals Manchester City have joined the big spenders, powering their way towards the top of the money table with Sheikh Mansour's fortune.
City have played their part in pushing up salaries across the League by paying Emmanuel Adebayor, Robinho and Carlos Tevez £150,000 a week.
The clubs always justify their huge debts by pointing out their assets do not include players' potential transfer fees.
They argue that although they are insolvent on paper, they could always sell a player in order to survive.
Figures from Deloitte's annual report relating to year ending 2008 show 16,000 people work in the football industry, with players and managers creaming off the biggest incomes.
Arsenal chief Arsene Wenger is the best-paid boss on £7.5m a year, including bonuses.
Other well-run clubs such as Tottenham cut their cloth accordingly, imposing a £70,000-a-week salary ceiling on their top earners.
Daniel Levy's business model is a blueprint for the top clubs, with a sustainable wage bill of £52m a year and a team pushing for the top four.
Others, such as West Ham, are paying a high price for the current financial climate. The Hammers are open to offers, with outgoing Birmingham chief David Sullivan waiting in the wings to buy his boyhood team.
There is no shortage of potential investors in Premier League clubs - just ask Portsmouth.
With three foreign owners in the last two months, the south coast club are experts when it comes to turnover.
www.newsoftheworld.co.uk/sport/542564/BILLED-by-money-men-as-the-Greatest-Show-on-Earth-it-was-the-chance-to-jump-on-English-footballrsquos-lucrative-gravy-trainNow-itrsquos-Buyer-Beware-in-the-Barclayrsquos-Premier-League.html
£2.8BILLION - THE PREMIER LEAGUE DEBT
Foreign owners ready to pump millions in to clubs
By NEIL ASHTON, 10/10/2009
BILLED by money-men as the Greatest Show on Earth, it was the chance to jump on English football's lucrative gravy train.
Now it's Buyer Beware in the Barclay's Premier League.
This is the story of top-flight football in 2009, the glory game based on boardroom power battles and murky transfer business.
It's balance sheets and wage bills, with AVERAGE top-flight salaries now £1million a year. That is a massive jump from the £676,000 average of 2006 and just £75,000 in the first year of the Premier League.
Total player wages are on the verge of hitting £1BILLION a season.
Incredibly, eight of the Premier League's 20 clubs are vulnerable to takeovers or are in the process of being sold off.
Arsenal, Birmingham, Blackburn, Everton, Hull, Liverpool, Portsmouth and West Ham face uncertain futures.
In exchange for the prestige of owning a team at the top of football's pyramid, foreign owners take on a mountain of debt.
Premier League clubs are in hock to the tune of £2.8bn, with Manchester United servicing their £700m loans with annual interest payments of £60m.
But that is small beer for many investors as six Premier League clubs are now owned by multi-billionaires.
Randy Lerner (Aston Villa), Roman Abramovich (Chelsea), Sheikh Mansour (Manchester City), Malcolm Glazer (Manchester United), Ellis Short (Sunderland) and Joe Lewis (Tottenham) are all in a different league.
Arsenal are one of a select group of clubs who tried to resist change, relying on the traditions of a family-run business to compete at the highest level.
But they could become the seventh billionaire plaything if American Stan Kroenke ups his stake again and underwrites the club's £332m debt.
Liverpool are also vulnerable, lurching from crisis to crisis after the breakdown in the relationship between Americans George Gillett and Tom Hicks.
Building work on their new super-stadium in Stanley Park came to a halt and they are creaking under nearly £300m of debt. One potential investor - Saudi prince Faisal bin Fahad bin Abdulla - is refusing to buy the club until they reduce their commitments.
Even Chelsea's future is no longer guaranteed, with chairman Bruce Buck admitting earlier this week that Abramovich could abandon the project.
He has pumped in nearly £1bn since he took control in 2003 and the shout is that it's Champions League glory and out for the Russian.
The Blues aim to be self-financing this season, but there is little chance of that with an annual wage bill of £172m.
Manchester United muddied the waters when they were taken over by Malcolm Glazer in 2005, saddling the club with £650m of debt.
Rivals Manchester City have joined the big spenders, powering their way towards the top of the money table with Sheikh Mansour's fortune.
City have played their part in pushing up salaries across the League by paying Emmanuel Adebayor, Robinho and Carlos Tevez £150,000 a week.
The clubs always justify their huge debts by pointing out their assets do not include players' potential transfer fees.
They argue that although they are insolvent on paper, they could always sell a player in order to survive.
Figures from Deloitte's annual report relating to year ending 2008 show 16,000 people work in the football industry, with players and managers creaming off the biggest incomes.
Arsenal chief Arsene Wenger is the best-paid boss on £7.5m a year, including bonuses.
Other well-run clubs such as Tottenham cut their cloth accordingly, imposing a £70,000-a-week salary ceiling on their top earners.
Daniel Levy's business model is a blueprint for the top clubs, with a sustainable wage bill of £52m a year and a team pushing for the top four.
Others, such as West Ham, are paying a high price for the current financial climate. The Hammers are open to offers, with outgoing Birmingham chief David Sullivan waiting in the wings to buy his boyhood team.
There is no shortage of potential investors in Premier League clubs - just ask Portsmouth.
With three foreign owners in the last two months, the south coast club are experts when it comes to turnover.
www.newsoftheworld.co.uk/sport/542564/BILLED-by-money-men-as-the-Greatest-Show-on-Earth-it-was-the-chance-to-jump-on-English-footballrsquos-lucrative-gravy-trainNow-itrsquos-Buyer-Beware-in-the-Barclayrsquos-Premier-League.html