Chinese Consortium invests $400m in CFG

[Dribble]

One of the interesting things is that rags are saying "How can City be valued at £2bn when we are?"

Using something called the Markham Multivariate Model, which is generally reckoned to be the most accurate method of valuing football clubs, (based on City's last accounts) we should be valued at around £2bn. So that valuation, based on the value of the stake sold, is actually spot on.

Is that Manchester City Football club or CFG?

 

[mac]

does this mean ric is now changing his 2nd name to shaw

 

[IanBishopsHaircut]

does this mean ric is now changing his 2nd name to shaw

Very good

 

[Daz_Blue]

Has Wenger commented yet ?

 

[JoeMercer'sWay]

So my view.

I think it will have long-term benefits for City. Firstly, I expect trivial things like a pre-season tour to China and the like, but the core advantage for us is the door being opened to marketing in China, with CMC also owning the media rights to the Chinese Super League, we have a nice crossover. I wouldn't be sure on the emergence of a Chinese club in the CFG, I'd expect it, but I'm not sure how that would be squared with CMC's media rights deal. However, it's clear we have an investment and deal that has approval from on high in China, and we've been used as a tool in wider political relations, so I think from a commitment and backing point of view, we have a lot to gain from that deal.

Mainly the marketing opportunities and large exposure will mean increased interest in City by association, and thus hopefully enable us to bump up the Nike deal, as well as secure lucrative Chinese sponsorship deals. There won't be any immediate impact on FFP, but if we can bring in some deals then hopefully we can have a big summer, with or without Messi, and really build an elite squad. I also think this deal will make it less likely that there will be other Chinese investment in the Premier League, which benefits us as well.

So I think the core aim of this deal is to get the whole CFG into China successfully, and I think a Chinese club and CFG academies in China will be part of it. I think we'll benefit from marketing and exposure from a relevant investor who knows its market, and I think that will drive a strong commercial growth over the next few years. Our part of the deal is to be immensely successful on the pitch, build an elite squad and add the two cherries on top. If we do see any cash from the deal, I think it will either go into stadium development or more interestingly, the collar site. Food for thought.

 

[bobom]

Have I got this right (hypothetically), as I'm shit at business related stuff and seem unable to apply common sense to things that confuse me.

Quick google says there's about 100 million football fans in China.

If we signed Messi, and only half that fanbase bought his shirt, at £50 a pop.

That's £2.5bn in shirt sales? Before image rights and how that's divided across relevant parties.

Talking wildly and purely hypothetically here.

Surely if communism is good for something it's for forcing everyone to buy a shirt.

 

[@BluePhil8]

Has Wenger commented yet ?

Can't wait for his pearls of wisdom

 

[kas_tippler]

Has Wenger commented yet ?

 

[Prestwich_Blue]

Is that Manchester City Football club or CFG?

That's just based on City's accounts, not CFG. The MMM uses stadium utilisation & wage/turnover ratios as part of its calculation so you can only really apply it at club level. I'd guess City represents the vast majority of the CFG value though.

The calculation is as follows for anyone interested:

(Revenue + Net Assets) * ((Net Profit + Revenue)/Revenue) * Stadium utilisation % / Wage-to-turnover ratio

Revenue was £352m
Net Assets were £753m
Net Profit was £11m
Stadium utilisation was 98%
Wage-to-turnover ratio was 55%

So (with all figures in £m) that's (352+753) * ((11+352)/352) which gives 1140.

1140 * .98 = 1117

1117/.55 = 2030, meaning our MMM value is £2.03bn

Sale of a 13% stake for £265m gives a total value of £2.04bn.

 

[Father Paul]

Don't get me wrong, I hate the thick, shallow arrogant cunts and I've got plenty of memories of the empty-headed pricks sneering at us. But I think we play into their hands a bit at times sometimes, that's all.

Anyway, back to the discussion. World domination is inevitable. We are owned by the richest country in the world with assistance from the fast growing economy in the world.

Nice.

I would not rush to view this as a positive just yet. It is a fairly complex deal which down the line may have unforseen repercusions. While at present MCFC is clearly the dominant force in this expanding organisation in 10 or 15 years time other parts of the conglomerate may grow in importance. Indeed, in 30 or 40 years City may have fallen way down the pecking order. I won't be around then but I am feeling just a little bit uneasy that the team I have supported for decades is potentially going to be swollowed up by a ginormous conglomerate.