Guardian Football Finance. City's figures compared to the Premier League

[bobbyowenquiff]

The Chinese investor Chinese Media Capital paid a reported £338 million in two parts for their 14% stake in CFG. That values CFG at just over £2.4 billion. The £1.2 billion is money that the Sheikh loaned City to pay transfer fees, wages, infrastructure development costs and the like for the club; this amount was subsequently converted into equity. The only other significant costs I can think of that Mansour assumed and that were associated with MCFC would be the estimated £60 million for Thaksin's shares at the outset.

There's also been other expenditure on other CFG entities - and I think we can lump all this together as a single investment, as the CFG entities have been founded on the back of the know-how that originated in and, generally, using the branding / IP of MCFC. Most notable in costs terms is NYCFC, the licence for which cost USD 100 million (off the top of my head) to acquire from MLS and who've made losses since they were set up. But if the total investment in CFG including the £1.2 billion of loans converted to equity plus money for Thaksin's shares and spending the rest of CFG were added together, I'd be surprised if you were looking at more than £1.5 billion in total.

If we take the value of CFG as the £2.4 billion in line with the Chinese investment, 86% of that belongs to ADUG. That shareholding is therefore worth a shade over £2 billion. In other words, ADUG has obtained an asset (its shares in CFG) worth maybe half a billion quid more than it's spent on CFG. Not bad.

Now, I can understand why people might be inclined to lament the fact that our rise has been facilitated by this kind of multi-billion investment and corporatist approach, though I'd seriously question how else a mid-table club with aspirations to challenge at the top table was supposed to achieve that objective in any other way given the conditions we faced in 2008. I can equally understand people being uneasy that the investment came courtesy of a member both of the ruling family and of the government in a feudal monarchy where human rights abuses are suffered by large numbers of inhabitants. These are legitimate topics for comment and debate; even as a committed City fan, I have some sympathy with these views (although it doesn't stop me from enjoying our successes and revelling in the football Pep's team has played in the last year).

The problem is that there's very little considered comment and debate about these issues but there's a hysterical tone set by fans of other clubs on social media and it's become more hysterical of late with our success under Pep. These idiots are desperate to do us down in whatever way they can, The empty seats jibes are one strand of this. The other main strand is that we're a small club that's punching above its weight thanks to vast amounts of "oil money" continually being funnelled in by evil Middle-Eastern dictators.

Now,there are fine journalists out there who try to shape a more rational discourse, but many seem happy to pander to the social media bedwetters in the interest of clicks. I don't think Conn is in that latter categiory, but he does have an agenda about the pernicious effect of money in modern football that he pushes relentlessly.

It's easy to sympathise with the substance of a good number of his complaints; many of us who are of a similar age to him are no doubt nostalgic for various aspects of the more egalitarian structure and less sanitised football atmosphere we grew up with. On the other hand, turning the clock back is essentially impossible in the modern era. I think it's a desire to stress his agenda that has led Conn to make comments that are misleading about the state of MCFC, and I also doubt that it bothers him at all. It bothers me, however.

I can't recall any media article which mentions that Sheik Mansour has doubled the value of his investment presumably because it would destroy the false narrative that somehow we are just being bankrolled. On top of this ADUG will make huge profits on the 16,000 homes we are developing plus the university etc. City's business model is a role model for the whole world.

 

[Millwallawayveteran1988]

No one else seems to have mentioned it, but the entry on us really annoyed me. IMO it really shows Conn at his po-faced, hand-wringing worst. He acknowledges that we've become profitable but precedes that statement with a statement that, in 2008, Mansour:



So, references to shovelling in an unfathomable amount of cash, to a record loss, and to only winning because that enabled us to buy players we couldn't afford, which delivered the success to finally generate a profit. Actually, the money Mansour "poured in" has given him an 86% shareholding in an asset whose value, confirmed when a new investor took a significant slice of the group, means that the shareholding in question is worth more, by a sum well into nine figures, than he invested in creating it. Yes, City have proved a sound investment for the Sheikh.

But from Conn's text, people who aren't aware of that (most of his readers) are going to assume tht we're now profitable owing to huge sunk costs subsidising losses in the past. It helps to reinforce the negative stereotype that's widely attached to us in the media. It annoys me, as I think we should be able to expect better from him, though the standard of his output in recent years, including his book Richer Than God, means that my expectations of him are very moderate.

No one else seems to have mentioned it, but the entry on us really annoyed me. IMO it really shows Conn at his po-faced, hand-wringing worst. He acknowledges that we've become profitable but precedes that statement with a statement that, in 2008, Mansour:



So, references to shovelling in an unfathomable amount of cash, to a record loss, and to only winning because that enabled us to buy players we couldn't afford, which delivered the success to finally generate a profit. Actually, the money Mansour "poured in" has given him an 86% shareholding in an asset whose value, confirmed when a new investor took a significant slice of the group, means that the shareholding in question is worth more, by a sum well into nine figures, than he invested in creating it. Yes, City have proved a sound investment for the Sheikh.

But from Conn's text, people who aren't aware of that (most of his readers) are going to assume tht we're now profitable owing to huge sunk costs subsidising losses in the past. It helps to reinforce the negative stereotype that's widely attached to us in the media. It annoys me, as I think we should be able to expect better from him, though the standard of his output in recent years, including his book Richer Than God, means that my expectations of him are very moderate.

Typical Guardian Reporter. His love of all things FC United made me want to puke in that book.

 

[EricBrooksGhost]

Typical Guardian Reporter. His love of all things FC United made me want to puke in that book.

Coupled with his lack of comment on their subsequent financial and management problems clearly makes him a **** in my eyes.

 

[NantwichBlue]

The Chinese investor Chinese Media Capital paid a reported £338 million in two parts for their 14% stake in CFG. That values CFG at just over £2.4 billion. The £1.2 billion is money that the Sheikh loaned City to pay transfer fees, wages, infrastructure development costs and the like for the club; this amount was subsequently converted into equity. The only other significant costs I can think of that Mansour assumed and that were associated with MCFC would be the estimated £60 million for Thaksin's shares at the outset.

There's also been other expenditure on other CFG entities - and I think we can lump all this together as a single investment, as the CFG entities have been founded on the back of the know-how that originated in and, generally, using the branding / IP of MCFC. Most notable in costs terms is NYCFC, the licence for which cost USD 100 million (off the top of my head) to acquire from MLS and who've made losses since they were set up. But if the total investment in CFG including the £1.2 billion of loans converted to equity plus money for Thaksin's shares and spending the rest of CFG were added together, I'd be surprised if you were looking at more than £1.5 billion in total.

If we take the value of CFG as the £2.4 billion in line with the Chinese investment, 86% of that belongs to ADUG. That shareholding is therefore worth a shade over £2 billion. In other words, ADUG has obtained an asset (its shares in CFG) worth maybe half a billion quid more than it's spent on CFG. Not bad.

Now, I can understand why people might be inclined to lament the fact that our rise has been facilitated by this kind of multi-billion investment and corporatist approach, though I'd seriously question how else a mid-table club with aspirations to challenge at the top table was supposed to achieve that objective in any other way given the conditions we faced in 2008. I can equally understand people being uneasy that the investment came courtesy of a member both of the ruling family and of the government in a feudal monarchy where human rights abuses are suffered by large numbers of inhabitants. These are legitimate topics for comment and debate; even as a committed City fan, I have some sympathy with these views (although it doesn't stop me from enjoying our successes and revelling in the football Pep's team has played in the last year).

The problem is that there's very little considered comment and debate about these issues but there's a hysterical tone set by fans of other clubs on social media and it's become more hysterical of late with our success under Pep. These idiots are desperate to do us down in whatever way they can, The empty seats jibes are one strand of this. The other main strand is that we're a small club that's punching above its weight thanks to vast amounts of "oil money" continually being funnelled in by evil Middle-Eastern dictators.

Now,there are fine journalists out there who try to shape a more rational discourse, but many seem happy to pander to the social media bedwetters in the interest of clicks. I don't think Conn is in that latter categiory, but he does have an agenda about the pernicious effect of money in modern football that he pushes relentlessly.

It's easy to sympathise with the substance of a good number of his complaints; many of us who are of a similar age to him are no doubt nostalgic for various aspects of the more egalitarian structure and less sanitised football atmosphere we grew up with. On the other hand, turning the clock back is essentially impossible in the modern era. I think it's a desire to stress his agenda that has led Conn to make comments that are misleading about the state of MCFC, and I also doubt that it bothers him at all. It bothers me, however.

Great post Peter