The takeover of Newcastle United by a Saudi Arabian consortium is making waves. But what exactly is going on in the north east of England? How does the kingdom benefit, how does the club benefit? And will Newcastle soon be the richest club in the world?
It is said that a dog does not care whether its owner is a good or a bad person. The dog is only interested in how it is treated. In professional football it is now very similar in many respects: In the end, it is primarily about being well-off – where all the money comes from is a side note.
It is therefore not surprising that Newcastle United fans cheered in front of St. James’ Park on Thursday evening, as if center forward Joelinton – so far exactly zero goals this season – had just done Liverpool FC himself with a three-pack. Instead, the supporters of Newcastle United Football Club celebrated the takeover of their club by a Saudi Arabian consortium in 1881. Quasi a gift for the club’s 140th birthday.
Some see a completely normal process in modern football, others speak of a new, perhaps the final escalation stage of a sick business model. But what exactly is happening in Newcastle, at one of the oldest football clubs in the world? An inventory.
1. Newcastle and Saudi Arabia: what is it about?
Newcastle United has been owned by British billionaire Mike Ashley for a number of years. The fans hate Ashley and Ashley, among other things, has not had a great interest in his gambling and speculative object for a long time and wanted to get rid of Newcastle again.
Saudi Arabia’s royal family, on the other hand, is desperate to return to English football. As early as the 1970s, the Saudis intensified contacts and business relationships with English clubs, players and coaches, among others Bill McGary, Danny Allison and David Wallit were successively national coaches for the national team of the Kingdom of the Persian Gulf between 1976 and 1979.
The contacts between Newcastle and Saudi Arabia have existed for a long time, now the so-called Public Investment Fund (PIF) in cooperation with the corporation PCP Capital Partners and RB Sports & Media, a subsidiary of the real estate giant Reuben Brothers, rumored 80 percent of the shares of the club.
The PIF is also an instrument introduced in the 1970s that looks after the assets of what is probably the richest country in the world and makes corresponding investments. The fund is said to be worth around 400 billion euros. The PIF is likely to be the largest corporation in the world, with investments of around 50 billion euros in the USA alone, including funds flowing into Citigroup, Boeing and Facebook. Newcastle’s purchase price of around 350 million euros seems more of a marginal note.
The new chairman of the Magpies is to be PFI boss Yasir Al-Rumayyan, as well as Amanda Staveley from PCP Capital Partners and Jamie Reuben from RB Sports & Media, who will each have a seat on the committees.
The Premier League had recently resisted the Saudis’ involvement because, among other things, there were allegations that the Saudis had the rights holder of the Premier League with a kind of “pirate channel” beIN Sports torpedoed. Now the competing broadcaster allegedly maintained by the Saudis has BeoutQ stopped his work. There was also a binding promise that the “Kingdom of Saudi Arabia will not control the football club Newcastle United FC”. Officially, the state and the PFI are considered separate.
2. What are the goals of Saudi Arabia with the deal?
The royal family is not interested in money, the Saudis have enough of that. It’s about so-called sport washing. The human rights organization Amnesty International coined the term.
Put simply, this is the intention of investing in sports events, clubs or associations to create a cleaner image. Like other Gulf states, Saudi Arabia knows about the finiteness of its raw materials and has therefore been preparing for a certain (economic) structural change for decades. Last year alone, the Dakar Rally and the Spanish and Italian Supercup took place in Saudi Arabia.
In this area, Saudi Arabia is emulating its arch-rival Qatar, which is already significantly further in the transformation of its infrastructure and economic sources of income. The 2020 Champions League final between FC Bayern and Paris St.-Germain was the last highlight in Qatar’s sportswashing plan so far, which had made it into the final twice: as the owner of PSG and sponsor of Bayern.
3. What does the deal with the Saudis bring to Newcastle?
United is one of the oldest clubs in the world with an incredibly large, loyal and passionate fan base. In recent years, the owner Ashley refused, around four billion euros, but larger investments in the squad, which is why the Magpies are miles away from earlier heyday and even relegated to the Premiership a few years ago. At the moment, the proud club is trading as a gray mouse and is – once again – in a relegation battle.
That is why the fans are thirsting for a fundamental change – and the necessary change to lead their club back to the top. There should now be plenty of that in one fell swoop, after all, Saudi Arabia is considered the richest country in the world. The massive number of fans, the club’s cult factor, the still decent brand “Newcastle United” and the large amount of money from the Middle East should be the breeding ground for a return of the Magpies to the Big Five of the Premier League.
