Why two iconic soccer clubs are up for sale at the same time


LONDON – Analysts say two of the world’s biggest and most profitable football teams are on the market at the same time – and it’s no coincidence.

In November, the owners of first Liverpool and then Manchester United confirmed they were open to new investment proposals, with the possibility of a full sale of the English top-flight clubs.

Liverpool’s owner, American sports conglomerate Fenway Sports Group, is estimated to be worth 3.3 billion pounds ($3.97 billion) 12 years after buying the club for 300 million pounds. Goldman Sachs and Morgan Stanley prepared the selling deck for interested parties, The Athletic first reported.

Meanwhile, shares of New York-listed Manchester United jumped 18% on November 23 after news that its owners were opening up investment opportunities. A full takeover of the club is expected to bring in £5 billion or more.

The club’s majority owner, the American Glazer family, has been in contention with fans since acquiring a controlling stake in 2005 for £790m in a controversial, leveraged deal.

In addition to the owners’ personal motivations, “certain market factors mean the timing of this sale is not a coincidence,” Dan Harraghy, senior sports analyst at market research firm Ampere Analysis, told CNBC.

Big money competition

A recurring complaint from Manchester United fans about the Glazers is the lack of investment in the club, both in facilities and players.

But any future funding increases will come under competition from other Premier League clubs such as Manchester City – owned by Dubai’s royal Sheikh Mansour bin Zayed Al Nahyan – and Newcastle, which were bought last year by a Saudi-led investment group. Arab State Investment Fund.

“From a financial point of view, the current owners [of Liverpool and Manchester United] will look at the level of investment required to catch up with rival clubs with deeper owners both domestically and in Europe,” Harraghy ​​said, referring to Qatari-owned Paris Saint-Germain.

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“State-sponsored Middle East ownership allows clubs to spend heavily on club infrastructure and player acquisitions to improve their footballing and financial performance.”

Old Trafford Stadium, home of Manchester United Football Club. In November, the club said in a statement that the Glazer family, the club’s majority owners, would “consider all strategic alternatives, including a new investment in the club, a sale or other transaction related to the company”.

Christopher Furlong | Getty Images News | Getty Images

While the Glazers have paid themselves with dividends since 2016 (they suspended payments during the current ownership talks), Manchester United reported increased revenue but a net loss of £115.5m for the 2022 financial year, up from a £92.2m net loss. said that he drew. previous year.

In its most recent published results, Liverpool reported a loss of £46.3m in 2020, with £4.8m of unpaid tax due by May 2021, as matchday revenue was hit by the pandemic.

“Perhaps incumbents may not consider costs sustainable given the level of competition they face,” Harraghy ​​added.

Failure of the European Super League

The explosion of a venture aimed at creating a new revenue stream for big clubs could add to owners’ doubts about their ability to increase profitability.

The announcement of a new European Super League, which would give automatic entry to 15 founding clubs, including Liverpool and Manchester United, in spring 2021 was met with such widespread criticism and allegations of money grabbing at the expense of the game that it was recently called off.


Guaranteed revenue, specifically broadcast revenue over which participating clubs have significant control, was the main motivation behind the league. The Premier League has become a relatively open competition, meaning top teams are less confident of qualifying for tournaments like the Champions League every year, Harraghy ​​said.

“Missing qualification could be a significant blow to the club’s bottom line,” he said.

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Interest of the investor

Meanwhile, European soccer has “a lot of teams with brand cache and global fan bases that make them very sought-after investments,” said David Bishop, partner and sports specialist at LEK Consulting.

“Investment activity in sports has also taken a bit of a hit as many sporting bodies and teams have come to the market and offered capital positions to help deal with cash flow issues caused by Covid.”

This has helped expand deal flow and understanding of the space, he said, noting recent capital placements in the sport by investment firms such as CVC, Silverlake, Redbird Capital and Dyal Capital. They include rugby league, French and Spanish football leagues, Indian Premier League cricket and sports analytics businesses.

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“The US market, especially MLB, NBA, NFL, is now very mature and well-invested, so investors are also looking for US-style sports opportunities in international markets,” continued Bishop.

“In the case of Liverpool and Manchester United, both owners have had the clubs for a long time and as their leagues and brands and global fan bases have developed, both assets have become very valuable. Whether it’s a good time to buy is very important. It depends on the situation, but overall these are medium and assets that need to be sustainable over the long term,” he told CNBC.

Income Opportunities

Media rights are important for leagues, especially at international level, and investors will see significant growth in the English Premier League’s global audience, Bishop said.

There is the potential to further monetize the international fan base through experience, merchandising and overseas games – a contrast seen in the UK, which attracts large audiences to American football and basketball games.

Angus Buchanan, managing director of The Sports Consultancy, also cited US private equity and institutional interest in soccer clubs as key reasons why the Glazers and Fenway Sports Group believe it is a good time to sell.

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“They were both successful in the ‘first phase’ of turning the clubs’ brand equity and international fan base into revenue, but have seen growth flatten out in recent years,” he said.

LONDON, ENGLAND – OCTOBER 30: Jerry Jewdy #10 of the Denver Broncos tackles the Jacksonville Jaguars in the second quarter during the NFL game between the Denver Broncos and the Jacksonville Jaguars at Wembley Stadium on October 30, 2022 in London, England. (Photo by Dan Mullan/Getty Images)

Dan Mullan | Getty Images Sports | Getty Images

Manchester United in particular has set a new paradigm for selling broadcasting rights and creating global partnerships, from Japanese noodle maker Nissin to Middle Eastern banks.

In 2022, Premier League broadcast revenue exceeded domestic revenue for the first time internationally.

The new owner is looking to develop a “phase two,” Harraghy ​​said: taking a highly engaged, engaged, intergenerational fan base, developing “more digital and sophisticated” revenue strategies, leveraging database information and going directly to fans with more offers.

“They project some aggressive growth numbers to any potential investor,” Harraghy ​​said.

Chelsea sell fast

Premier League club owners closely watched Chelsea’s rapid-fire sale in May, which came amid a UK crackdown on the assets of Russian oligarchs following Russia’s invasion of Ukraine in February. A consortium led by American investor Todd Bohley paid £4.25bn for the club (with £1.75bn earmarked for future investment) after the government confirmed the proceeds would not go to previous owner Roman Abramovich.

The amount received, which Harraghy ​​called unprecedented for a Premier League club, and the information from up to 200 interested parties are of particular interest.

Analyst Angus Buchanan said the sale could be “a bit of a catalyst” for activity in November.

“Perhaps club owners have seen a bit more activity in the market now that there is a stable reference in terms of price and level of interest,” he said.


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