By Paul Nicholson
July 8 – English club ownership continues to attract investors though the anticipated sale of Premier League Aston Villa by its American owner Randy Lerner has faltered. Neighbouring Premier League club West Bromwich Albion has seen ownership control shift further to chairman Jeremy Peace, while mercurial sports entrepreneur Barry Hearn has sold his League 2 club Leyton Orient to Italian businessman Francesco Becchetti.
Villa’s Lerner announced the club was for sale in May, once it looked comfortable of maintaining its Premier League status. The price is expected to be between £200-250 million for the club that in its last accounts reported a £51.8 million loss in their accounts for 2012-13.
The club said it can now “close a chapter” on their period of financial pain. Much of that likely to do with Lerner waiving £90.1 million of loans, converting them to equity, as the club was prepared for sale.
While discussions are on-going and said to be “productive” (all rumoured new owners are US-based), so far no deal for the club has been announced, Lerner said that focus must now be on the club preparing for the new season.
“Over the last eight weeks we conducted a targeted process during which we explored the sale of the club,” said a statement from Lerner.
“In advance of this process however, I committed to our manager to become completely focused on the upcoming season should there be no agreement to sell by the time players and coaches return to training.
“Given that no agreement has as of yet been reached, I feel that it is time now to turn my full attention back to Villa matters at hand.
“While the sale process has been productive and remains ongoing, my priority at this point in the summer, heading into the upcoming season, is that the Villa organisation’s sole focus be football – undistracted by any sales process.”
On the other side of Birmingham, West Brom chairman Jeremy Peace has increased his stake in the Premier League club to a majority share of 76.4% after the purchase of 905 shares at £3,000 each.
Taking that share price and applying it to all the club’s stock, then West Brom’s value comes out around £31 million – less than the club will receive from TV rights income this season which is likely to be £65 million.
Breaking the 75% ownership threshold is important for Peace as it gives him more control over the club through his West Bromwich Albion Group Ltd holding company. But local fears that he will now offload the club having amassed control are probably misplaced as the business is strong and in any case, finding a buyer at the true value is not straightforward, as Lerner at Villa has found out.
Lower down the leagues one club that has been sold is Barry Hearn’s Leyton Orient. The club lost its promotion play off to move up the Championship last season, having earlier in the year lost the opportunity to groundshare at London’s Olympic Stadium with Premier League neighbours West Ham, even though Orient are the closest club to the stadium.
Italian Francesco Becchetti takes over the chair at the club, having bought Matchroom Sport Ltd’s 90% stake for an undisclosed sum. Hearn reckoned he spent £1 million a year on the club but was always realistic about the football economics at League 1 level.
In the dispute with the London Legacy Corporation over the use of the Olympic Stadium, Hearn made the point that West Ham was a £100 million commercial business given exclusive use of a £700 million asset on a peppercorn rent almost in perpetuity. If a foreign buyer acquired the club for say, £200 million, they would be getting the London 2012 Olympic stadium, built with British taxpayers’ money, for free.
Orient settled a dispute with the Premier League over their decision to allow West Ham to play in the stadium when they reached a “confidential agreement” last week.
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