US investors consider selling FC Liverpool

It ranks among the most prestigious brands in the sports business, which is why it has tens of millions of fans around the world. The football club FC Liverpool is as iconic a name as the legendary band The Beatles. The club, nicknamed The Reds, boasts 19 English league titles, half a dozen Champions League trophies, and three wins in the former UEFA Cup.

It's no surprise that a team playing its home matches at the iconic Anfield stadium is an attractive sporting asset for billionaire patrons and private equity investors alike. After all, FC Liverpool is a brand with a premium quality reputation.

And that is reflected in the estimated value of the entire club. According to Forbes’ annual ranking, with a valuation of $4.45 billion, FC Liverpool is the fourth most valuable football club in the world today. In addition, The Reds posted a solid operating profit of $104 million. And after two difficult COVID seasons, it seems that the overall football industry is back on a long-term growth trajectory.

However, at the beginning of the week, the sports portal The Athletic reported major news – the club’s American owner, the investment firm Fenway Sports Group, is allegedly ready to sell the famous football club. The estimated sale price is around $5 billion.

If Fenway Sports Group really handed over the ownership reins to another party, it would be an extraordinarily successful business move. The Fenway investors bought FC Liverpool in 2010 for $475 million. Today, they could receive more than ten times that amount for their top football brand.

But why sell a club that has been doing well both financially and on the pitch in recent years? The main reason may, paradoxically, be this very ideal combination.

"The owners probably feel that now is the right moment to sell. The club is riding high and is doing well both on the field and financially," said sports analyst Jozef Tokos for the Economic Daily.

It's also worth mentioning that the current richest basketball player, LeBron James, is a minority shareholder in Fenway Sports Group. The Los Angeles Lakers star owns a one percent stake in the firm. If the FC Liverpool sale goes through at the reported $5 billion price tag, James would receive a hefty bonus — $50 million. James already tops the earnings list among basketball players, having made $125 million in the last fiscal year. That’s the highest income ever recorded by a basketball player. And now he could earn tens of millions more.

Back to Liverpool. Time will tell whether the club — where Slovak defender Martin Skrtel played between 2008 and 2016 — will actually change ownership. According to Tokos, there’s currently no clear or specific motive for the sale. “In the case of Chelsea, the reason was obvious. There was external pressure related to the current geopolitical situation and sanctions against oligarchs. Another possible reason could be a forced sale due to financial difficulties at the parent company. But that's not the case with Liverpool either. So we’ll have to see how the potential sale develops in the coming period,” Tokos added.

The Americans’ business reasons may also be completely unrelated to football. One possible scenario is a pivot to a different industry where the Fenway group expects higher or more profitable returns in the next few years. Unlike the competing City Football Group, Fenway does not own a network of other football clubs. Therefore, any synergistic effects wouldn’t be disrupted by a potential sale.