This year's soccer world has been full of ups and downs, the UEFA Super League controversy, Lionel Messi's departure to Paris Saint-Germain, Crowe's return to Manchester United and other heavy news, undoubtedly brought a lot of fans a small impact. October 7, the Premier League officially announced that Newcastle United was acquired by a consortium led by Saudi Arabia's Public Investment Fund (PIF), and the news is even more widely discussed because the consortium into the ownership of not only the impact on the club itself, but also could have far-reaching implications for the league and the soccer world as a whole.
Consortia have bought clubs, with Manchester City and Paris Saint-Germain undoubtedly leading the way. These clubs have performed well since the consortium took over, as detailed in the table below:
It can be seen that the involvement of consortiums has brought a significant boost to clubs, making clubs such as Manchester City and Paris Grand among the new giants. In addition, the case of consortium entry also includes Arsenal and Wolverhampton Wanderers. This paper will focus on analyzing the cases of Manchester City and Paris.
So what is this huge public investment fund all about? Its predecessors are Qatar Sports Investment Fund and Monsu, with a net asset value of 258.5 billion and 273 billion euros, respectively, and have long ranked in the top two of the global soccer club asset rankings. The net asset value of the public investment fund is as high as 376 billion euros, far more than other consortia. Such strong capital makes people look forward to the future of Newcastle United.
A consortium's entry into a club's ownership can, first and foremost, provide strong financial support to the transfer market, helping the club to bring in top players and upgrade its squad. Taking Manchester City as an example, in the first season after the change of ownership (08/09), they invested 157 million euros in reinforcements, a figure that is twice the previous highest transfer fee in a single season. Between 2010 and 2019, City spent a staggering €1.63 billion on the transfer market, the highest of any soccer club. With the help of the consortium, the club was able to bring in more talented players and improve its overall strength. The strong assets of Newcastle United's new owners make one look forward to their moves in the coming transfer window.
Attracting players to join the club requires offering generous salaries in addition to transfer fees. The financial support of consortia enables clubs to offer more attractive salary packages, thus attracting more outstanding players. Take Paris Saint-Germain as an example, they brought in a number of star players such as Messi, Donnarumma, Ramos, Wijnaldum and Hakimi in the summer transfer window of the 21/22 season, with a total annual salary of up to 105 million euros, which made the Grand Paris become the team that spends the most on team salaries in the world, about 300 million euros.
During the epidemic, all clubs' revenues were affected: ticket revenues were reduced, tournaments were postponed or even canceled. Against this backdrop, most clubs preferred a conservative strategy to avoid excessive financial pressure. However, with the backing of the Qatar Sports Investment Fund (QSIF), Paris has been able to make bold moves. Of course, not all players join Paris for the salary, some of them are interested in their luxurious squad and ambition to win the Champions League. In any case, it is a fact that Paris is able to offer a generous salary package.
Newcastle United co-owner Staveley has said, "Newcastle United deserve to be Premier League champions and we want to reach that goal. Even if it takes time, we'll get there. Of course we want those trophies: the Premier League title, trophies in European competitions, but these mean patience, investment and time." It is believed that with a good development plan, showing determination to reform and win the title, and strong financial backing, winning the Premier League title in the future is not out of reach.
Consortium takeovers may be like a feather in the cap for the acquired clubs, but it may not be so for other clubs. In the summer transfer window this season (21/22), Manchester City brought in midfielder Kiyarisu for a transfer fee of €117 million, a figure that exceeds Bournemouth's revenue of €111 million for the entire 19/20 season. From this example, we can see the financial gap between the giants and the small and medium-sized clubs.
