October 5 – The financial rumour mill is again buzzing with talk that Mike Ashley could at last find a buyer at a price he would accept for Premier League Newcastle United.
Financier Amanda Staveley is reported to have spoken to Premier League side Newcastle United officials after their 1-1 draw with Liverpool last weekend, a club who turned down her $1 billion bid last season on behalf of Chinese investors.
Chinese investment money may have dried up but Staveley has control of £28 billion fund fund, via PCP Capital Partners, which is mainly Middle Eastern money which has ambition to own a Premier League side.
Ashley, who took over as Newcastle owner in the summer of 2007, has had a rollercoaster ride at the club financially, having ridden the crash in value during the financial crisis as well fan revolts and relegation for a season to the Championship.
The club has been sale for a while though not actively marketed, and with Ashley have rejected bids of around the £100 million mark back in 2012.
With the club operating profitably and currently enjoying full stadia (fans are not lovers of Ashley) and ninth position in the Premier League, it is hard to see Ashley accepting anything less than £500 million. Ashley is said to have spent £300 million on the club.
Ashley recently sold his interest in Scottish giants Rangers after a protracted and bitter battle for control. He has since relinquished control of the merchandising operation which he managed through his Sports Direct retail operations.
Selling Newcastle United is unlikely to be an emotional decision for Ashley.
Newcastle, who secured an immediate return to the Premier League under Spanish manager Rafa Benítez, reported a sharp downturn in profits for their relegation season in the club’s last reported figures. Pre-tax profit plunged to £4.2 million for the year to 30 June 2016, against £36.2 million, the second-highest in the league, in 2014-15.
While turnover did fall to £125.8 million (2015: £129.7 million), the outcome was explained largely by increased costs, attributable partly to a transfer splurge on the likes of Andros Townsend and Jonjo Shelvey, as the club battled unsuccessfully to salvage its Premier League status.
Back in the newly enriched Premier League and with 50,000+ sell out home matches, a city fully behind them and big TV cash, the club will likely more than double that revenue figure.
One black cloud is an outstanding tax case against the club brought by the UK’s revenue and customs tax authorities. That case saw club offices raided earlier this year and is still making its way through the courts.
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