When the influx first looked like coming, foreign ownership of
clubs was rallied against as the beginning of the end for English
football — with dire warnings that fans would lose the
connection with their local club as the sport became more about
making money than providing entertainment.
The same was said of foreign players, of course, when they
suddenly began descending on their Premier League around 15 years
earlier.
The likes of Eric Cantona and Dennis Bergkamp would obstruct
English talent from shining, it was widely believed. In fact, the
opposite has been proven to be true, as the many others who
followed those legendary players to English shores have helped
improved the native technique and ability beyond almost all
recognition.
Few predicted the Premier League would get stronger with
foreign players but, having contributed Champions League finalists
in each of the last five seasons, that has proven to be the case.
Few predicted foreign ownership would lead to a more
competitive league but, perhaps belatedly, even unexpectedly, that
is suddenly becoming the case.
After all, some of the traditional powerhouses of English
football have seemingly been handicapped by their foreign owners in
recent times, while others from the middle of the English pack have
been able to burst forward under the ambitious direction of new men
in charge.
In the former corner, unfortunately for their long-suffering
fans, is Liverpool. Just this week Rafa Benitez, the club’s
beleaguered manager, attempted to deflect attention away from his
own troubles by admitting publicly what everyone already suspected
about the way the club is now run:
"One of the priorities this year was to reduce the debt so
the club is working very hard to do this and I think that our
position will be much better,” the Spaniard said.
“We were doing a very good job this year trying to
reduce the debt. It was one of the most important things that we
had to manage. Along with football issues we had to manage them
together.
“When I signed my five-year contract [in March] we knew
that we had to work together so we will try to do the best for the
club. Sometimes you can do it and still perform on the pitch and
sometimes you have to wait a little bit.”
For the team, however, such a modus operandi has had obvious
negative effects. Having fallen agonizingly short of a first title
in 19 years last season, instead of providing that final investment
push needed to push the club over the finish line, the club’s
American owners, Tom Hicks and George Gillett, decided to tighten
the purse strings further.
That is the problem with servicing a £280 million debt,
one they placed on the club as part of their takeover in 2007. Xabi
Alonso, a vital cog in the successful Anfield machine, was sold to
Real Madrid for £30m in the summer, but Benitez was only
permitted to spend £20m of that on a replacement—on
Alberto Aquilani—when many other areas of his squad clearly
also needed reinforcement.
Consequently results this season have stagnated, to such an
extent the 49-year-old felt forced to guarantee this week that last
season's runners-up would qualify for the Champions League come
next May.
"We will be in the top four. I have to be positive. I am
realistic," the former Valencia boss said.
"I see the players training every day and I can see that we
have enough quality to finish in the top four."
But, at least according to figures released in June this
year, the Reds' debts pale into insignificance against those of
some of their major rivals.
Manchester United are saddled with even more debt (around
£699m) as a result of equally opportunistic American owners,
but their manager Sir Alex Ferguson has been careful not to suggest
that has been the reason behind his lack of recent spending:
“The money is there if I want to use it and it was
there in the summer, but I don’t think there is any value in
the market, that is why I didn’t buy anyone,” the Scot
revealed last week.
Despite selling Cristiano Ronaldo to Real Madrid for £80
million in the summer, the 67-year-old only made relatively
inexpensive moves for Luis Antonio Valencia (£17m), Gabriel
Obertan (£3m) and Michael Owen (free) in response.
“I am happy with what I have brought to the
club,” Ferguson said after that transfer window, despite
seeing other clubs spend big money.
“Last summer’s deals did inflate the market. It
was silly season, with the prices paid for players. The prices we
were quoted were not reasonable and that’s why I didn’t
do anything.”
Yet recent events suggest that might not entirely be the
case. The club’s recent decision not to complete a
long-standing arrangement to sign the Partizan Belgrade prodigy
Adem Ljajic for £10m suggests even moderate profligacy is no
longer acceptable at Old Trafford.
Having failed to replace their best player United have looked
less than stellar for much of this season, and it certainly looks
like winning their fourth consecutive league title will not be as
easy as in recent times.
Rounding out the big four, both Chelsea and Arsenal may have
avoided the worst of what foreign ownership can bring, but they too
have their own problems.
The Blues are in debt the most of any Premier League club
(£701m) to their generous Russian benefactor Roman Abramovich
and have recently been restricted from maintaining the sort of
spending that was seen under Claudio Ranieri and Jose Mourinho in a
bid to balance the books.
Abramovich wants the club to be self-sufficient within the
next few years, a target the club admits is unlikely to be achieved
without a further reduction in transfer and wage spending.
"It would be nice to go to the owner and say we don't need
any more cash, but that's not where we are today," Ron Gourlay, the
club’s newly appointed chief executive, said last month.
"I like to operate honestly but realistically.
Self-sufficiency is still the goal. That's what we're trying to
attain. Is it going to happen this year? No. I'm not going to make
any claim on that front because, realistically, it isn't going to
happen this year.”
Arsenal, meanwhile, seem hampered in their progress by a
boardroom saga that looks far from concluding. Both American Stan
Kroenke and Uzbekistani Alisher Usmanov have increased their stake
in the club to very close to the 30 percent that would trigger
takeover proceedings but have so far seemed reticent to go any
further.
That has left the club in something of a state of flux.
Arsenal owe around £416m in various loans, much of that after
the recent move to the Emirates Stadium (due to the economic
crisis, luxury flats on the old Highbury site have not provided the
expected windfall), and while the board regularly insist there is
money to be spent their manager, Arsene Wenger, has been curiously
reticent to make waves in the transfer market.
Consequently, the respective troubles of the big four have
seemingly opened up the competition at the top of the
table—ironically to another set of clubs who seem to be
flourishing under foreign ownership.
Aston Villa are a third Premier League club to be owned by an
American, but unlike Hicks and Gillett or the Glazers, Randy Lerner
did not stack the Midlands club with debt upon his arrival.
Blessed to already have an astute manager in Martin
O’Neill on board, Lerner has proven himself a canny
operator—giving his manager enough funds to strengthen the
squad (albeit with the occasional sale) while not overstretching
the finances beyond acceptable levels.
The rewards have been noticeable, as a core of young and
talented (and, encouragingly for domestic observers, predominantly
English) players have helped the club into the top four at this
early stage of the season.
Even more importantly, the club have beaten Liverpool,
Chelsea, and Manchester United already in the
campaign—lending weight to their claims they are reading to
break the long-held dominance of the big four.
Another club that are equally determined to make such a
breakthrough is Manchester City. Unlike Villa, however, their new
Middle East owners are doing it the old-fashioned—or nouveau
riche —way, speculating to accumulate.
The new owners have spent huge sums acquiring the likes of
Robinho (£32.5m), Emmanuel Adebayor (£25m) and Carlos
Tevez (upwards of £40m, depending on what you believe), with a
determination to become one of the biggest clubs in the world.
So far, big victories over both Arsenal and Chelsea (albeit
both at home) suggest they are on the right track, even if a run of
seven straight draws suggest there is still work to be done.
But the board, led by one of the world's richest men in
Sheikh Mansour bin Zayed Al Nahyan, seem determined to see their
club reach the the pinnacle of the European games. Few fans will be
surprised if the club is in or around the top four come the
season’s end, and the big clubs are very wary of the new
threat they pose.
With Tottenham—not technically under foreign ownership,
but generous in their spending nonetheless—also looking
strong, for the first time in many years their seem a number of
viable alternatives to the big four at the the top of the table.
By and large, foreign ownership can suddenly be thanked for
that.
That is not to say the league as a whole is more competitive.
All members of the supposed big four, in particular United and
Chelsea, have still enjoyed sizeable victories over many of their
opponents this season.
These clubs, the Bolton Wanderers and Blackburn Rovers (the
last club to deny a big four side the title, in 1995) of the
league, just don’t have the financial clout to raise their
aspirations beyond simply staying in the league each season. Yet
they are also forced to spend beyond their means in order to ensure
they achieve that aim.
Consequently, these 'middle-tier' teams have helped raise the
overall debt of all Premier League teams to a staggering £3.1
billion.
That is almost twice what the league raised through Premier
League television rights (the clubs' major source of income) in the
last round of bidding in February, where Sky paid 'just'
£1.78bn for the rights to live action for the next three
years.
"The live UK rights are the largest contribution to the
revenues we distribute centrally to the clubs and this deal gives
them the stability to plan and invest in the most important aspect
of our business – the football – everything else flows
from that," Premier League chairman Richard Scudamore, somewhat
worryingly, said at the time.
At the very bottom of the league, unfortunately, are a couple
of examples of what can happen when foreign ownership and
overspending go beyond the limits—examples of what many
pundits feared would be the case when the phenomenon first arrived.
Both West Ham United and Portsmouth are struggling valiantly
after the effects of botched ownerships, as their respective
chairman quickly realised that actually football is not the easiest
business in which to make money.
The Hammers now face crippling debts due to both the
financial problems of their owners and some illegal practices on
the pitch (they owe Sheffield United over £20m after being
found liable for the Blades' relegation in 2007, after knowingly
flouting league rules to sign Carlos Tevez and Javier Mascherano).
And perhaps Portsmouth’s current struggles are a
warning to the other Premier League clubs currently operating under
huge debt. For so long spending beyond their means to compete under
Harry Redknapp (for which they won the FA Cup in 2008), the South
Coast club are now being passed from owner to owner as they
struggle to pay the staff's wages, let alone their debts.
On the plus side for casual fans, that has allowed recently
promoted teams like Birmingham City and Burnley the chance to avoid
going straight back down—a fate that used to be the norm but
in recent seasons has become far less common.
Nevertheless, the plight of teams like Portsmouth has many
already worrying about the long-term consequences of foreign
investment.
"I think there is an awful lot of expenditure and you say to
yourself, 'Where is it going to end?'" Sir Alex Ferguson told North
West Business Insider magazine last week.
"This is exactly what was happening in the business world two
years ago. There were warning signs and everyone knew there were,
yet they carried on because it was so easy to access loans.
"In the football world you say to yourself the warning signs
are there, but nobody seems to be bothering about it. You wonder
where it's going to go and what is going to happen if one major
club were to go, to collapse."
In the long-run, then, foreign ownership may well cause the
crisis it was always expected to.
But for now, surprisingly, it seems to be making the playing
field—at either end of the table — just that little bit
more even.
Alex Dimond is a columnist for Bleacher Report, the open
source sports network.
