Newcastle United: Confidence grows over compromise that could see takeover resurrected

The three parties involved are continuing to work behind the scenes and there are signs that a compromise could be reached 

Tony Evans
Friday 21 August 2020 11:58
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Newcastle's Saudi Arabia takeover collapses

With Gulf State soft power taking centre stage in football this weekend, the Newcastle United takeover saga has faded into the background. But the controversy rumbles on.

When Parliament returns next month, Chi Onwurah, the MP for Newcastle Central, will present a petition to the House calling for transparency and accountability from the Premier League. On Wednesday the Newcastle United Supporters Trust (NUST) had a meeting with Richard Masters, the chief executive of the ruling body. It was scheduled for 15 minutes but lasted more than double the allotted time period. NUST tweeted that it was “constructive.” Nevertheless, the club will start the new season with Mike Ashley remaining the owner. The anger on Tyneside will not go away.

Neither will the Amanda Staveley-led consortium. Staveley is the public face of the bid that is primarily financed by Saudi Arabia Public Investment fund (PIF). The Saudis were prepared to take on an 80 per cent interest in Newcastle, with the Reuben brothers and Staveley’s PCP Capital Partners buying 10 per cent each. The group walked away last month after waiting in vain for four months to receive a verdict on the owners and directors test.

The appetite to purchase St James’ Park remains. The three parties continue to work behind the scenes to find a formula that will allow the takeover to proceed. There is quiet confidence that some sort of compromise can be found.

The sticking point has been the role of the Saudi government in the future direction of the club. Staveley maintains that not only does PIF have complete autonomy from the regime but the wealth fund does not intend to take a hands-on approach to the day-to-day running of Newcastle.

Events in Lisbon this week have sharpened Saudi eagerness to buy into the Premier League. The success of Paris Saint-Germain in reaching the Champions League final against Bayern Munich has irritated many in the Gulf. PSG are owned by Qatar, the region’s pariah nation. Saudi Arabia has been the driving force in a multinational boycott of its neighbour. Another of the major players in the anti-Qatari sanctions is the United Arab Emirates, whose deputy prime minister is Sheikh Mansour, the owner of Manchester City.

The French side’s exploits have brought mixed publicity for Doha. Accusations of ‘sportswashing,’ the highlighting of human-rights abuses and the appalling treatment of migrant workers in the country accompany every PSG success. Yet there are enough positive images generated by football to cause Saudi Arabia and Abu Dhabi to envy their Qatari enemies.

Those connected with PIF have always claimed that Newcastle would be run very differently to PSG and City. Both of those clubs are essentially money-no-object vanity projects for their respective states, hence their problems with Uefa’s financial fair play regulations. The narrative from PIF’s partners is that the Saudi investment in Newcastle was based on hard-headed business principles. Fans on the Gallowgate were not getting something for nothing. PIF wanted a return.

If PSG win the Champions League, that thinking could change. Football has always been a expression of national identity. Before the fall of the Iron Curtain, sporting success represented a vindication of social and economic programmes for competing systems. A Cold War is in progress in the Gulf and PSG and City are proxies in a political conflict. Newcastle could be next.

The underlying problem for the Premier League is the Saudi treatment of beIn Sport, the TV rights holder in the area. The Qatari broadcaster has been refused a licence in the desert kingdom and beIn transmissions were hijacked and pirated by illegal operations based around Riyadh. This week the Saudi authorities agreed to work on a framework to tackle piracy and protect intellectual rights in the region. It is unlikely to be enough for the Premier League to rubber-stamp PIF’s involvement in Newcastle but it is a sign that the compromise is in the air.

MPs, local politicians and supporters will keep the pressure on the Premier League. The consortium have hinted that buying Newcastle would be a prelude to wider investment on Tyneside. Clarification of further spending plans would increase the public clamour for the takeover. The Saudis are not shy of upping the ante when it suits them. A half-billion “look what you could have had” package of proposed funding would put intolerable pressure on the owners and directors test. As would the threat of buying elsewhere.

Soft power, hard cash. Both may still be heading towards Newcastle. The new season will start with Ashley still in place but it is doubtful it will end that way.

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