Revealed: the US billionaire who is in talks with Arsenal
Friday 09 February 2007
Arsenal are involved in advanced talks with a billionaire American sports tycoon, Stan Kroenke, about forming a ground-breaking partnership with Kroenke's Major League Soccer franchise, the Colorado Rapids,
The Independent can reveal.
The deal will primarily focus on Arsenal's push for expansion in America, initially at least, but an intriguing aspect is that it will put Arsenal into business with Kroenke, one of America's richest men with a personal fortune of more than $2bn (£1.02bn).
Kroenke, 59, a property magnate, is a prolific sports investor whose portfolio includes the NFL's St Louis Rams, the NBA's Denver Nuggets, the NHL's Colorado Avalanche, and the Rapids. He sees huge potential for football in America, evidenced by heavy investment in the Rapids, including a new, dedicated stadium that will open for the 2007 season. But he has watched with interest as his compatriots Malcolm Glazer, Randy Lerner, George Gillett Jnr and Tom Hicks have bought Manchester United, Aston Villa and Liverpool, and is understood to be open-minded about branching out in England himself.
There is no suggestion that Arsenal's current major shareholders - Danny Fiszman (25 per cent), Nina Bracewell-Smith (15.9 per cent) or David Dein (14.6 per cent) - are looking to sell, but Kroenke would give them a ready-made option if that changed and Kroenke wanted to expand his interests across the Atlantic. Another shareholder, Granada TV (9.9 per cent), would like to offload its shares, but those alone would not hand the buyer significant power.
With three of England's "big four" - United, Chelsea and Liverpool - already in foreign hands, Arsenal alone remain under British ownership. This had led to inevitable takeover rumours in the past year, not dampened by the fact that the hedge fund Lansdowne Partners has been stockpiling Arsenal shares (2.7 per cent). Lansdowne also bought into pre-takeover United, eventually selling to Glazer.
Under the terms of the proposed Arsenal-Rapids alliance, it is planned that the Rapids will be renamed, and become either Arsenal Colorado or Colorado Arsenal. There are also plans to change the colour of the team strip to match the historic maroon strip Arsenal wore last season.
Both the proposed names have been trademarked by Kroenke's Sports Enterprises firm, and their website domain names have been registered to KSE headquarters in Denver, Colorado, in anticipation of the deal being signed. The tie-up could also see the teams play against each other in friendlies, work on coaching initiatives, and develop players. The Rapids have plans to visit England for pre-season training before the 2007 MLS season starts in April. It is not known yet whether they will use Arsenal's facilities. The Rapids will play the final game of their pre-season tour against Valencia in Spain on 21 March.
Arsenal have been involved with a variety of partnership agreements, including the Belgian team Beveren and an academy in the Ivory Coast. They also have a "technical partnership" with Spain's Celta Vigo, a club increasingly likely to be used as a "staging post" for South American talent en route to London. The Rapids tie-up would give Arsenal access to North American talent, or be an option for young players to gain experience.
One stumbling block to Arsenal's link with the Rapids is that MLS rules do not allow franchises to change names or team colours without 18 months' notice, unless a penalty payment is made. Legal work to resolve this issue is ongoing. Arsenal ideally want the deal to begin in time for the 2007 season, when the international media spotlight will focus on the MLS with the arrival of David Beckham at LA Galaxy. An added complication is whether adidas, which provides kit for all MLS teams, will have time to produce a new Arsenal Colorado strip in time for this season's kick-off.
An important figure in forging the partnership is Jeff Plush, 41, the Rapids' vice-president and managing director, who is also a key man in the KSE empire. It is understood he is an Arsenal fan. He has specialised in recent years in the expansion of KSE's "strategic business initiatives, new media enterprises, and brand development".
The Gillett and Hicks takeover at Anfield has highlighted a growing desire by American sports tycoons to invest in English football. In a development which is separate from the Kroenke-Arsenal talks, The Independent understands that another American billionaire, with three franchises "in US sports", has been looking at Premiership clubs. A well-connected source at a New York investment firm said that this unnamed owner considered a bid for Liverpool last year. The source said that the person in question is not Robert Kraft, the owner of the NFL's New England Patriots, whose previous interest in Liverpool was well publicised, but declined to say who it is. The speculator is believed to be considering other options.
Arsenal are an attractive option because of their international status, while Newcastle are seen as ripe for a takeover. The owners of Manchester City and Reading would sell to the right bidder but probably lack the name recognition an American would crave.
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