International Investors Target Championship Clubs - 11/03/2007

Foreign investors are increasingly targeting Championship clubs with little or no international reputation for acquisition. A Chinese casino owner could buy heavily indebted Sheffield Wednesday. Coventry City has confirmed that it has reached agreement with a group of wealthy US-based investors including a former Goldman Sachs partner known as Manhattan Sports Capital Partners. It is thought likely that MSCP would take on Coventry's debts of £28m and provide money for new players. The deal is fronted in the UK by Gary Hopkins, a US-based sports consultant who grew up in Coventry. One of the investors, Sean McDevitt, formerly with Goldman Sachs, commented, 'We figure this is a great investment. All of us involved [in the bid] come from smaller towns. We have been studying Coventry for nine months and we think the prospects for the team are very good.'

The proposed move could pave the way for the purchase of the recently opened Ricoh Arena stadium (Click here for a video clip I made on the stadium), which cost more than £100m and whose facilities include a hotel and a casino. The club has an option to buy a 50 per cent stake in the Arena, the centrepiece of a regeneration project in North Coventry. The shares are currently owned by a local charity with the balance belonging to Coventry City Council. The local authority says it would be willing to sell its shares to a bidder likely to support local economic development. Plans for the stadium were originally hatched when Coventry made an abortive bid to host the national football stadiun which went to Wembley. The city has suffered a series of large-scale job losses at major employers. At present ten British clubs are foreign owned, if one counts Leeds which is 50 per cent owned by Geneva-based Forward Sports Fund, although nothing is known about the beneficial owners of that fund.