Chinese firms battle for an English club

Five years ago, you wouldn't have found any Chinese owners among English football clubs. Today, the company Yunyi Guiokai Sports Development Limited owns nearly 88% of West Bromwich Albion, and the consortium China Media Capital holds a 13% stake in Manchester City. According to British media, another club from the world’s wealthiest football league—the Premier League—may soon end up in Chinese hands. Two Chinese groups, Lander Sports Development and CITIC Securities, are competing for one of the Premier League’s most traditional teams, FC Southampton. The asking price for the current 10th-placed team in the league could reach the equivalent of a quarter of a billion euros. That’s how much the seller, Swiss billionaire Katharina Liebherr, is reportedly seeking.

“Southampton is a highly attractive club. Whenever someone in England shows an interest in selling a club, there's immediately a lot of interest on the market,” said sports analyst and football agent Jozef Tokos to Economic Daily.

FC Southampton was purchased in 2009 by Markus Liebherr, the founder of one of the world’s largest manufacturers of heavy machinery and construction equipment. At the time, the club was in financial trouble and under administration, and he paid a “laughable” 15 million pounds for it. However, just one year after entering English football, he passed away from a heart attack, and his business empire—including Southampton—was inherited by his daughter Katharina. She had no experience owning any kind of sports team, and many considered it only a matter of time before she would sell.

“There is increasing competition in the Premier League, and we must look ahead—seeking new markets for commercial growth and innovation,” Liebherr wrote in a letter to fans after news of potential Chinese investment surfaced.

According to The Sun, Lander Sports Development is currently a step closer to acquiring the club, reportedly submitting a bid worth over 220 million euros. According to an anonymous club source, the negotiations had reached an advanced stage. One unresolved issue is whether current CEO Ralph Krueger—a former coach of the Swiss national ice hockey team—will remain in charge. “Buying a football club is a medium- to long-term investment, and it remains to be seen whether new owners will retain key personnel for the sake of continuity,” Tokos noted.

Football has increasingly become a tool for Chinese companies to break into the European market. Their ownership isn’t limited to two Premier League clubs and three second-tier teams—Chinese firms also co-own clubs in Spain, France, and the Netherlands.

“China's outward image-building efforts have skyrocketed. It’s as if top officials have realized the power of marketing and PR in a global economy,” said Czech sinologist Martin Kříž, who happens to be a fan of Slavia Prague. That club was acquired in autumn 2015 by the wealthy Chinese company China Energy Company Ltd. (CHFC).

“Such investments help companies enhance their public image, signal openness, and aim to better understand Western European traditions,” Kříž explained. The Chinese have long-term goals and, through their growing influence, hope to boost Chinese football in the coming years. The most populous country’s ambition is to one day host the FIFA World Cup.

“China is now more visible in various sectors than ever before. It’s safe to expect that Chinese investments in European football will continue in the years to come,” Tokos added.