There will be no shortage of bidders for troubled Newcastle United after owner Mike Ashley put the troubled club up for sale. A Chinese businessman is said to be interested, a North-East consortium is waiting in the wings and, as we discussed in an earlier story, there is also a possible Indian bidder. Ashley himself would like to involve Dubai Investment Corporation, although their first target is likely to remain Liverpool. Ashley explained his reasons for selling the club in a lengthy and emotional statement.
There will be no shortage of bidders for troubled Newcastle United after owner Mike Ashley put the troubled club up for sale. A Chinese businessman is said to be interested, a North-East consortium is waiting in the wings and, as we discussed in an earlier story, there is also a possible Indian bidder. Ashley himself would like to involve Dubai Investment Corporation, although their first target is likely to remain Liverpool. Ashley explained his reasons for selling the club in a lengthy and emotional statement. He explained that Newcastle attracted him because ‘it has the best fans in football’, but claimed that if he had not come in the club might not have survived. He paid £134m to buy the club and then put in another £110m, not to pay off the debt, but just to reduce it. The club remains in debt and ‘owes millions of pounds in transfer fees’. Moreover, money on sponsorships and advertising had been paid upfront and spent. Ashley insists that he did not buy Newcastle to make money, but because he loves football. Nevertheless, he could walk away with a tidy profit and one thing he makes clear is that ‘this is not a fire sale.’
Ashley says that he is no longer prepared to subsidise the Magpies: ‘I am not stupid and have listened to the fans. I have really loved taking my kids to the games, being next to them and all the fans. But I am now a dad who can’t take his kids to a football game on a Saturday because I am advised that we would be assaulted.’ He continues, perhaps with a tinge of bitterness: ‘I hope that the fans get what they want and that the next owner is someone who can lavish the amount of money on the club that the fans want.’ He assures the fans, ‘I have listened to you. You want me out. That is what I am trying to do but it won’t happen overnight and it may not happen at all if a buyer does not come in. You don’t need to demonstrate against me again. I have got the message.’ Perhaps recalling the old joke that the best way to make a small fortune is to start with a large one and buy a football club, the embattled owner says, ‘I am Mike Ashley, not Mike Ashley a multi-billionaire with unlimited resources. Newcastle United and I can’t do what other clubs can. We can’t afford it.’ This has been a sorry episode for everyone involved, not least the fans, but hopefully the club can now move on.
UPDATE: Is Newcastle A Good Buy? – 16/9/08
Mike Ashley’s plan to sell Newcastle United has got off to a sluggish start. As expected, Dubai International Capital issued a statement denying that they were interested. More significantly, Icelandic bank Kaupthing which helped him buy the club said that it was not representing him over the sale. Newcastle United has average attendances in excess of 50,000 and matchday revenues in 2006-7 of £33.6m. Broadcast revenues that season were £25.9m and commercial revenues were £27.6m, giving it total revenues of £87.1m. This made it the 14th highest revenue earning club in Europe according to Deloitte. However, as Ashley revealed, he is still paying off £100m of debt. A banker told the Financial Times that Newcastle lacks the growth potential of other clubs and is stuck in a footballing rut. ‘Any buyer who comes along faces a lynch mob,’ he said. ‘There is attractiveness in Newcastle, but what can you do with Newcastle? There can only be four Champions League places.’ Paradoxically, the fans’ protest persuaded Ashley to go, but may make it more difficult for him to sell the club.