Lancashire, UK based English Premier League club Blackburn Rovers is close to finalizing a deal, to be bought over by Indian poultry and biotherapeutics company Venky’s. In the past, larger conglomerates such as the Sahara Group and Reliance Industries have been linked to the acquisition of Premier League clubs, many of which are debt ridden and struggling financially. In July, BlackBurn Rovers was also linked to a GBP 45 million takeover from Saurin Shah, the nephew of BCCI Vice President Niranjan Shah.
Yesterday, Blackburn Rovers posted a note on their website (Almost there) confirming that a deal with Venky’s may be closed in November. Since then, Venkatesh Rao, Joint MD at Venky’s has told the Guardian that a GBP 46 million deal will be announced within the next 10 days. This would be the first instance of an Indian company buying an EPL team. Note that the EPL is a high stakes game, and Venky’s will need a lot more money to keep the club competitive; in particular, they’re buying just before the transfer window opens in January, when players can be bought or sold. Another bidder, Ahsan Ali Syed, whose antecedents were questioned, had promised the club GBP 100 million to buy players in the transfer market.
The business of English Football is a high stakes game, and the higher in the rankings a club is, usually, the more its need for resources; players are expensive, and for most clubs, wages are upwards of 50% of the cost…if it’s a fight for the top spot, which is where the money and the glory is, you probably need a money hatchery.
The guardian reports that the Jack Walker Trust, which owns Blackburn Rovers, is seeking at least GBP 25 million for the club, and there’s a debt of GBP 15 million to be taken on board. The Independent, earlier this year, had called the EPL the debt league, and reported that Blackburn had an operating loss of GBP 6 million, a turnover of GBP 50.9 million and net debt of GBP 20.3 million. The loan is repayable by May 2012.
Just a couple of weeks ago, Liverpool FC was sold to New England Sports Ventures, which also owns the Boston Red Sox for GBP 300 million. The EPL is popular in India (though it’s popularity is hardly comparable with Cricket), and I thnk it’s unlikely that Venky’s Blackburn acquisition will have any perceptible impact on Indian interest in the EPL…I’m certainly not switching allegiance from Manchester United. Let’s see if any digital deals come through: Two EPL football clubs have inked deals in India previously:
p.s: pardon the poor joke, but I guess Blackburn will have new wingers now.