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Wednesday, January 07, 2009

World's Richest Football Owners...Football's Financial Future Set to Burst?

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FOUR FOUR TWO Magazine - Abramovich down to third in F.F.T. Rich List
- Chelsea's billionaire owner Roman Abramovich has been toppled from the summit of the Football Rich List, published on Wednesday in the new issue of FourFourTwo magazine.
- Abramovich has lost £3bn in the recession and is now worth £7bn. That's less than half the wealth of the new man at the top of the list, Manchester City owner Sheikh Mansour bin Zayed al Nahyan, who is estimated to be worth £15bn.
- The people on the sixth Football Rich List, researched and published annually by FourFourTwo, are worth a total of £61billion. The list includes 11 billionaires and 25 new entries.
- Although some of the new entries are foreign – like Sheikh Mansour and the new No.2 Lakshmi Mittal, who has joined Formula 1 entrepreneurs Bernie Ecclestone and Flavio Briatore in investing in QPR – only a third of those on the list are from overseas, with the 64 Brits including three WAGs.

The Top 20 on the Football Rich List are:
1. Shekh Mansour bin Zayed al-Nayan (Manchester City) £15bn

2. Lakshmi Mittal & family (QPR) £12.5bn
3. Roman Abramovich (Chelsea) £7bn 

4. Joe Lewis (Tottenham Hotspur) £2.5bn

5. Bernie & Slavica Ecclestone (QPR) £2.4bn
6. Stanley Kroenke (Arsenal) £2.245bn

7. Alisher Usmanov (Arsenal) £1.5bn

8= Lord Grantchester & The Moores Family (Everton) £1.2bn

8= Dermot Desmond (Celtic) £1.2bn

10= Lord Ashcroft (Watford) £1.1bn

10= Malcolm Glazer & family (Manchester United) £1.1bn

12. Simon Keswick (Cheltenham Town) £966m 

13. Trevor Hemmings (Preston North End) £900m

14. Mike Ashley (Newcastle United) £800m

15. Randy Lerner (Aston Villa) £750m

16. Tom Hicks (Liverpool) £700m
17. The Walker Family (Blackburn Rovers) £660m
18. Mohammed al-Fayed (Fulham) £650m

19. Sir David Murray (Glasgow Rangers) £600m

20. Steve Morgan (Wolves) £400m

- The new England manager Fabio Capello is also a new entry worth an estimated £25m with a £6m a year contract and a £10m private art collection and Sir Elton John – who has rekindled his interest in Watford – is a new entry at No.28 with a £235m fortune.
- However, Sir Elton may not have chosen a wise time to get back in the game. The recession may not have hurt football yet, but financial expert Professor Tom Cannon thinks clubs will soon start feeling the pinch.
- "Season tickets will probably be down by about 10 percent but renewals will be down by at least 15 or 20 percent," said Professor Cannon. "That's where the problems will be as you go down the divisions."
More from Professor Cannon on the dangers to football
And FourFourTwo Editor-in-Chief Hugh Sleight is similarly worried about football's financial future. “Judging by this list, football is the last remaining financial bubble," he said. "The combined wealth of our Top 100 is now £61 billion, compared with £41.7 billion last year and £20.45 billion in the first-ever Football Rich List in 2003. 

“We’ve also got 25 new entries in the 100, primarily because of the continued rush to invest in British football over the last 12 months. 

“But the landscape has already changed dramatically because of the recession. As Arsene Wenger rightly pointed out, football will suffer just like any other industry.
"So far there seems to be a time lag but as economic conditions continue to bite, clubs and owners will feel the effect and it will then be interesting to see the reactions of these very wealthy men as they see their fortunes disappearing. In 12 months’ time, this list could look very different indeed.”
 Four Four Two

Mirror/Martin Lipton - Football rich list: Roman Abramovich knocked off top spot by Manchester City owner
Roman Abramovich officially lost his place as football’s richest man last night - as the new world order saw Manchester City named as the dominant financial force.
Chelsea’s owner has headed the annual rich list of football owners since arriving out of nowhere to oversee his blue revolution in 2003.
But five years later and having spent £600million on players, wages and Stamford Bridge, Abramovich has lost top spot to Sheikh Mansour bin Zayed Al Nahyan, the money man behind Manchester City. The transfer of power from Russian to Middle East oil is stark proof of the sheer scale of funds that City boss Mark Hughes has at his disposal.
Abramovich is now not even the wealthiest club boss in the London Borough of Hammersmith and Fulham, having been overtaken by Indian steel magnate Lakshmi Mittal, the major investor at QPR. Yet David Beckham’s status as the richest player remains unchallenged with a fortune estimated at £125m, more than three times that of nearest - and distant - challenger Michael Owen.
The new sea change at the top is no surprise but suggests why Chelsea have entered a new era of relative austerity as they seek to become "self-funding" by the end of the next financial year.
While Abramovich’s estimated wealth once stood at £7billion, he is believed to have lost a third of that in the world economic downturn.
That helps to explains why the Russian oligarch has turned off the money taps at the Bridge, telling boss Luiz Felipe Scolari there will be no money available in the transfer window, with even the £12m raised by the sale of Wayne Bridge placed on hold until the summer.
Sheikh Mansour’s elevation to the top of the list, compiled by FourFourTwo magazine, is no surprise after his incredible takeover at City.
Even before his buy-out of Thaksin Shinawatra was completed, Sheikh Mansour, estimated to be worth £15bn, had gazumped Chelsea to land Scolari’s prime target, Real Madrid striker Robinho, in a British record £32.5m deal.
That is just the start of a spree likely to surpass even Abramovich’s outlay of £121m in his first year as Blues owner.
Bridge is set to be followed into Eastlands by a clutch of new signings as Sheikh Mansour gives Hughes the heaviest purse in the history of the game, despite a run of poor results including the FA Cup embarrassment by Nottingham Forest.
But the list suggests City could be given a run for their money by the new West London moneybags at Loftus Road if Portuguese coach Paulo Sousa can steer Rangers into the Premier League.
In addition to Mittal’s £12.5bn, fellow director Bernie Ecclestone is worth £2.4bn while Italian Flavio Briatore is also in the super-rich clan, although so far spending at the club has been kept at minimal levels
And the accumulation of capital in London sees Spurs shareholder Joe Lewis fourth on the list with £2.5bn, with potential Arsenal owners Stan Kroenke of the US and Russian Alisher Usmanov sixth and seventh respectively.
Despite the huge outlay planned at City, Abramovich’s cloth-cutting may be a more realistic gauge to the future, suggests Tom Cannon, professor of strategic development at Liverpool University.
He said: "Season ticket numbers will probably be down by about 10 per cent.
"But renewals will be down by at least 15 or 20 per cent. That’s where the problems will be as you go down the divisions."
Further down the list, England boss Fabio Capello is said to be worth £25m, due to his £6m salary and £10m art collection, meaning he is richer than all his players except Beckham, Wayne Rooney (£35m) and Rio Ferdinand (£28m).
Arsene Wenger is in the familiar position of staring up at Sir Alex Ferguson, worth £22m compared to the Arsenal boss who has £14m.
And one man who can enjoy an easy retirement is Robbie Fowler, worth £28m through property investments, although their value may have fallen over the past year. Mirror

- Twenty Richest Players

Four Four Two - Football's financial bubble set to burst, says expert
Football’s financial bubble is about to burst, according to a leading finance expert.
- Tom Cannon, Professor of Strategic Development at the University of Liverpool, predicts the gravy train will be derailed by the recession – despite the preponderance of wealth on display in the Football Rich List, published today in FourFourTwo magazine.
- “There’s a lagged effect in football. The television deal, the season tickets – those are already in place, but then you get the problem of renewals, not just on season tickets but on executive lounges,” said Professor Cannon, an Everton fan who is also CEO of Ideopolis International Ltd.
- “Season ticket numbers will probably be down by about 10 percent, but renewals will be down by at least 15 or 20 percent. That’s where the problems will be as you go down the divisions.”
- While economies across the globe have been wrecked by recession, football continues to grab headlines with shows of financial strength.
- Those on the Football Rich List are worth a total of £61 billion and include 11 billionaires, many from abroad. However, there are 64 Britons on the list – including three well-heeled WAGs.
- The top spot is now taken by new Manchester City owner Sheikh Mansour bin Zayed al-Nahyan, one of 25 new entries on the list. The sheikh – whose vast wealth is expected to fund a transfer buying spree for manager Mark Hughes in this month's transfer window – is estimated to be worth £15 billion.
- That fortune makes the sheikh worth more than twice as much as Roman Abramovich, who has topped all five previous Football Rich Lists. The Chelsea owner is said to have lost more than £3 billion in the recession.
- At £7 billion Abramovich is now third in the Rich List, with many sources indicating that Chelsea manager Luiz Felipe Scolari will have little or no transfer money to spend this month. Some respected commentators are even saying that Abramovich may be considering selling Chelsea, on whom he has spent around £578m in the form of an interest-free loan.
Despite the Russian's input, Chelsea's overall debt is £736m and the club are still not breaking even. Champions Manchester United are a similar amount in the red, with the Glazer family having borrowed heavily to buy all the shares in the club.
- And Liverpool owners Tom Hicks and George Gillett were recently given an extra six months to repay the £350m they borrowed from US investment bank Wachovia and the Royal Bank of Scotland – which itself was only saved from collapse in October by Government bailout.
- It's not just the big clubs. The latest Premier League report by accountants Deloitte revealed that total borrowings had rocketed from £674 million in 2005 to £1.6 billion in 2006, leaving clubs exposed to the risks of the debt-ridden markets.= Deloitte's report raised special concern that the overall level of gearing – a financial term for the level of debt in companies compared to shareholders' funds – had increased to 220 percent at the end of the 2005-06 season.
- In October, FA chairman Richard Triesman went further, claiming top-flight clubs are “at high risk levels” with £3 billion of debt, which brings about “tangible dangers”.
- “The debt mountains are owned – and therefore the clubs are owned – by either financial institutions, some of which are in terrible health, or very rich owners who are not bound to stay, or not very rich owners who are also not bound to stay,” said Triesman.
- UEFA president Michel Platini also weighed into the debate, noting of English clubs' Champions League domination that “This success is often built on an unsustainable level of debt, which is distorting the level playing field in Europe”.
For his part, Professor Cannon is convinced football will soon feel the pinch and recession will drain the coffers, forcing clubs to tighten the purse strings.
- “Merchandising income is already dipping, local advertising is almost certainly going to dip quite sharply, as are things like player sponsorship,” he said.
- The professor added that no one will be safe – from the players to the rich chairmen bankrolling the clubs.
- “You’re already seeing a number of clubs where even quite key players don’t have a sponsor, because it’s very hard to see a relationship between what you spend to put your name on – say, a Mido – and an end result. It’s not vast sums of money but it adds up.”
- “Those owners who have been in equities... Mike Ashley must have taken a hammering. All of the rumours revolve around Portsmouth and West Ham at the moment, financially, and that’s entirely because of the owners.
- “And a lot of players have invested heavily in property: they’ll take a hammering too, particularly those who have invested in low-cost areas. So I think you’ll see a lot of movement in the Rich List this year Four Four Two

See Also: David Conn/Era of billionaire bail-outs is over warns dealmaker
• Harris says slump spells end for big takeovers • Economic stability needed to tempt buyers' interest

- See Also, February 2008: Deloitte Report - Football Money League

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