Liverpool urge Uefa to look into 'odd' City deal
Saturday 16 July 2011
Liverpool's managing director, Ian Ayre, has questioned whether Manchester City's record £400m sponsorship deal is merely a ploy to sidestep Uefa's Financial Fair Play regulations.
The Malaysian capital is becoming a centre for anti-City sentiment as deep any corner of Old Trafford. The week in Kuala Lumpur began with Arsène Wenger launching an attack on what he called City's "financial doping". It ended with Ayre wondering how an airline and a club, both owned by members of the Abu Dhabi royal family, could not be a "related party", which, under financial fair play would prevent them doing business with each other.
Under Uefa's regulations, teams that incur aggregate losses of more than €45m (£39.5m) over three years face exclusion from European competition in 2014. Manchester City's annual losses last year ran to almost three times that. The "related party" clause of the agreement means that clubs like Manchester City and Chelsea, who are dependent on their benefactors, cannot get round the regulations by sponsoring themselves to wipe out the losses.
Etihad Airways, like Manchester City, are owned by the same Bin Zayed family who rule the emirate. "Is Etihad, Manchester City and Sheikh Mansour a related party?"asked Ayre. "If they are, then it's up to Uefa to rule on them. When I spoke at Soccerex earlier this year, I was on a panel about financial fair play. The guys from Uefa who are managing it said there would be a robust and proper process about related-party transactions."
Ayre also doubted whether the 10-year agreement would pass Uefa's test of "fair value". Even though the deal includes redevelopment around the stadium, Ayre wondered how Etihad, which has never made a profit, could derive this much commercial value from naming a ground that even when it was officially known as the City of Manchester Stadium was generally called Eastlands.
"It hasn't happened anywhere in Europe where a football club has renamed its existing stadium and it's had real value," he said. "It was called the City of Manchester Stadium or Eastlands for the last nine years and now it's going to be called something else – and someone has attached a huge amount of value to that.
"I find that odd because there is no benchmark in football that says you can rename your stadium and generate that amount of value. Mike Ashley tried it at Newcastle [calling his stadium Sports Direct.com@ St James' Park]. But nobody calls it that and it doesn't have that kind of value."
Having declared pre-tax losses of £20m this year, Liverpool are not entirely clear of the financial fair play regulations themselves. However, Ayre is confident that his club's sponsorship model is more organic than Manchester City's – the majority of whose sponsors are based in or owned by the Abu Dhabi government.
"If you look, we haven't lost a sponsor for many years. When Carlsberg were no longer our shirt sponsors, they remained with us as a key partner. I think that has more consistency and more longevity than just going out and signing loads of people. That is the way we focus on business and not the way other people do theirs."
Ayre insisted that globally there are only two Premier League clubs that really matter, even though Arsenal and Chelsea are this summer attempting to tap an Asian market that Liverpool first exploited when Kenny Dalglish was playing for rather than managing the club.
"I believe quite strongly that there are only two brands that are truly global. Liverpool and another team from down the M62. You can see the scale of what we do in Asia compared to other clubs," said Ayre, who first started working in Hong Kong when he left the Royal Marines, going on to run a sports management company based in Malaysia.
"That is not to say people will never catch us but it is a hard thing to do. It is not just about winning trophies, it is about building a year-on-year legacy."
However, although the club's director of football, Damien Comolli, oversaw a series of trials in China this week, Ayre was cautious when it came to boosting the Liverpool brand with Asian players, something their main sponsors, Standard Chartered, are keen for them to do. The quality Park Ji-sung brought with him to Old Trafford was, he said, the exception not the rule.
"The thing I found most surprising was the age of our fans here," said Ayre, "A section who were camped outside the hotel in China were all between 14 and 19. People talk about us not having won the league for 21 years, so you would think we would have an older audience. It shows it is not just about success but heritage and legacy."
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