For sale: English football

Liverpool, Manchester City, Newcastle, Spurs, Reading, Fulham and Everton are next in line as foreign owners continue to buy into the Premiership
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The Independent Online

Foreign ownership of English football's Premiership clubs is almost certain to increase over the next 12 months, an Independent investigation has revealed. Chelsea, Manchester United, Portsmouth, Aston Villa and West Ham are already owned by overseas buyers, but at least another seven clubs could soon join them. Liverpool look likely to be bought by the billionaire ruler of Dubai, Sheikh Mohammed bin Rashid al-Maktoum, while Newcastle United have been in takeover talks, most recently with the Jersey-based Belgravia Group.

Manchester City yesterday became the latest club to disclose they are involved in talks with a potential investor, and it is understood the club are available lock, stock and barrel, for an initial investment of around £75m. The club's chairman, John Wardle, said "talks are at a very early stage" with an unnamed potential investor.

Perhaps the most surprising revelation in The Independent's investigation is that the tycoons who own Tottenham Hotspur would consider selling ­ but it would take an eye-popping £300m for them to do so. Another London club, Fulham, who are £160m in the red, mostly to their benefactor-chairman, Mohamed al-Fayed, would probably be available to anyone wanting to assume that debt.

And there are two more clubs susceptible to takeovers in the near future: Reading's owner, John Madejski, has gone on record as a potential seller and Everton might consider offers ­ there is a possibility of a majority of Premiership clubs soon being owned by newcomer speculators.

Today's Independent investigation also reveals, for the first time, guide prices to all 20 Premiership clubs and the likelihood of each one being sold.

It shows that the Premiership's 20 clubs are worth £3.3bn combined. The most valuable club according to our "guide prices" are Manchester United, who would cost upwards of £923m to buy today. Arsenal, at £569m, are rated as the next most valuable, followed by Liverpool, Chelsea, Newcastle and Tottenham.

Manchester City's share price values the club at shy of £13m. Their debts are £51m, made up of "external debt" of £32.3m plus £19m owed in private loans to Wardle and his business partner, David Makin, who between them own 30 per cent of the club.

It is thought that both men, as well as the next largest shareholder, Mark Bowler, with 18 per cent, would happily walk away if a new investor was willing to spend £75m to buy all the club's equity (for £36m, probably less), pay off private loans (£19m), promise about £20m for squad investment, and take on the external debt on top. Wardle, Makin, Bowler and others paid up to four times the current value for their shares.

"John Wardle is City through and through," a source said. " But he has made no secret that he has always been a reluctant chairman, and as long as it's in the club's interest, if someone comes in with serious and credible investment, he would sell."

On paper, Spurs, a plc, are worth around £90m, which equates to the value of their ordinary shares plus the value of an additional £30m of preference shares. Given the recent sale of West Ham (for £85m plus the assumption of £23m debt, for an "enterprise cost" of £108m) Spurs' relative price should be about £120m.

Allowing for a whopping premium on top for their shareholders ­ the largest stake, 30 per cent, is held by ENIC, whose managing director, Daniel Levy, is the Spurs chairman ­ and the price might rise to £200m-plus. But in today's sellers' market, insiders at White Hart Lane feel that they could achieve more.

The current shareholders paid up to twice the current value for their stock. Tens of millions of pounds have been spent in recent years, and the club also ownplayers with big price tags who are not listed on the balance sheet; Aaron Lennon and Ledley King foremost among them.

On a like-for-like basis against Manchester United, sold for £790m last year, insiders insist Spurs are worth £200m-plus, at least. When rated by EBIT potential (earnings before tax and income), Spurs, a debt-free club, are worth £12.8m per year against £46m for United using the most recent financial figures. On that basis, Spurs' value would equate to £221m.

"You can't justify a £300m price tag on paper, but if you buy a sports franchise you don't pay what it's worth in a traditional sense these days, but what it could be worth," one source said.

Arguably one of the less likely clubs to be sold is Fulham, if only because most investors would baulk at assuming such huge debts on a small club. But while Fulham are not being hawked around, it seems they are for sale. " The chairman [Fayed] has never said he wants to sell, and considers it as a family business with a long-term goal of breaking even," a spokeswoman said. "But it would be naïve to think that if he got a substantial offer, sufficient to recoup 100 per cent of his investment, that he would not consider it."

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