Newcastle United’s Saudi Arabian owners say they turned down the chance to buy a 30 per cent stake in another Premier League team, believed to be Manchester United, for £700million before opting to buy the North East club.
Chairman Yasir Al-Rumayyan has revealed that the country’s Public Investment Fund [PIF] was given opportunities to invest in clubs across Europe, including the Premier League, Italy and France, before choosing to purchase Newcastle for £350m - half the price of what it would have cost for the alternative investment.
While Al-Rumayyan did not specify where the offer came from, the club in question is thought to be Manchester United with the Glazer family willing to take the money from the PIF but not give the Saudis any say in the running of the club.
Unsurprisingly, the people controlling Saudi Arabia’s sovereign wealth fund, which is chaired by the country’s de facto ruler and new Prime Minister, Crown Prince Mohammed Bin Salman, were not sold on the idea.
Instead, PIF launched a takeover bid for Newcastle in January 2020, with the Premier League finally signing off on the deal 18 months later after the Kingdom agreed to stop the piracy of international sporting events and paid compensation to Middle East rights holders Bein Sports.
“When we looked at it, we looked at it from a financial perspective,” Al-Rumayyan said on a podcast in Saudi Arabia.
“By the way, it wasn’t the first offer we got regarding a football team. We looked in Italy, France and the UK as well.
“For example, in the UK there was a team that approached us on the basis that we take 30 per cent of the ownership, and we don’t interfere at all in terms of managing the club, for £700m.”
PIF walked away from the deal and instead turned their attention to one of the sleeping giants of English football in Newcastle United. Owned by British retail billionaire Mike Ashley, supporters had been crying out for new owners for more than a decade.
PIF, probably wary of negative publicity, went into partnership with English financier Amanda Staveley and property magnates the Reuben family, with Al-Rumayyan revealing both parties were keen to “have skin in the game”.
He explained: “Football, of course, is one of the most important sports there is. Whether domestically (in Saudi) or abroad. It’s the number one sport in the world.
“And why the English Premier League? Because it’s the best league in the world. No other league competes with it.
“There are 20 teams, three are relegated and three are promoted. The advantage of the Premier League is that any of the 20 teams can beat the best team in the league.
“We bought Newcastle, who offered us 100 per cent of the ownership. But Amanda Staveley and her husband, who got us the opportunity, told us, ‘We like it so much, we would like to be with you’. That was perfect.
“Then came the Reuben family who are one of the biggest property investors, saying that, ‘We would like to come with you’, and these are one of the biggest investors in Newcastle. I said, ‘Perfect! Tell them to come’. So now they [Amanda, her husband and Reubens] have skin in the game.
“We bought the whole team for £350m, instead of only having 30 per cent in another team for £700m.”
As well as the desire to own a European football club as part of the Saudi 2030 vision to diversify the economy, the purchase was also part of efforts to cleanse Saudi Arabia’s international reputation after accusations of human rights abuses and war crimes in Yemen.
Having already spent more than £200m on nine new players in just two transfer windows, the intention is to turn Newcastle into one of the major forces in European football and raise the club’s value to the same sort of level as Chelsea and Manchester United.
The former was sold over the summer for £4.25bn by Russian Roman Abramovich [a £3.5bn sale plus promise of further investment] and, presumably, that is what the Saudi consortium would also look to do at some point to get a return on their investment.
Al Rumayyan added: “You can see Chelsea was sold for £3.5bn. So, my potential now is to go from £350m to at least £3.5bn.”