Will Leeds be the next member of the uber-rich?
Posted on November 19, 2019
IF ALL goes to plan, Leeds United should soon be benefitting from a big cash injection from Qatar Sports Investments (QSI), the people who have made Paris Saint-Germain one of Europe’s wealthiest and high-profile clubs.
The news has had a mixed reception, Qatar’s human rights record has been pointed out, along with the morality of inflated investment in football as a tool to enhance reputations, the practice of “sports washing”. However, others are enthused by the prospect of Leeds United joining the band of clubs that form the new European elite.
If there’s a club currently outside the Premier League that could make a quantum leap, it is surely Leeds. There are smaller clubs in the top flight and Leeds have enormous support and traction. Furthermore, Leeds is the eighth biggest city in Britain by population (790,000) and has the fourth highest gross added value and has been ranked the third best city for business outside of London. It has the largest financial services community outside the capital and contributes £ 66.5 billion in economic output. It also has a branch of Harvey Nichols, a sign of gentrification and a growing middle class.
QSI has long been casting envious glances across at the Premier League. Their investment in PSG has yielded countless domestic trophies, but the “project” is aimed at European domination. Basically, Ligue 1 success is all too easy for a club with a budget that dwarfs every other club’s wage bill in France. It cannot be too satisfying for PSG’s owners to see their investment cast in the role of “flat-track-bullies” week-in, week-out. Neymar, their trophy signing when they outbid every other club in the ultimate soft power-play, has not proved to be the man they thought they’d signed and he wants to go to a more glamorous environment.
So the Premier League offers a chance to join the big football gravy train that is popular the world over. With English football already embracing owners from similarly debatable locations, as well as morally-bankrupt industry sectors, QSI may find it relatively easy to make their mark and spend their petro-dollars. It may even help with Qatar’s 2022 World Cup, which is struggling to win people over. If Leeds do not win promotion this season, it is reasonable to assume that QSI will provide the financial impetus to fulfil that goal. Anyone doubting that will soon be put right as star names start arriving in West Yorkshire.
But Leeds United, with or without QSI money, are going well at the moment, although there is talk of their current wage bill being unsustainable. In 2017-18, their wages amounted to £ 31 million, but they are said to be around £ 40 million at the moment.
The club enjoys excellent attendances at Elland Road, their average this season is in excess of 35,000, equating to a stadium utilisation rate of 93%. Leeds want to increase the capacity to 50,000 but this would only take place if the club achieves Premier League status.
Leeds have been in a good position to secure a Premier League place since Marco Bielsa became coach. For a while last season, they looked near-certainties to win promotion and this season, they are in the top three. Bielsa has become something of a cult figure, but Leeds fans will be only too aware that this is a manager who doesn’t stay anywhere for too long. At Lille he was in charge for seven months, at Marseille 15 months. He’s been at Leeds for 17 months. Bielsa has the track record and presence to fit the bill of an owner like QSI, although it is not hard to imagine them being seduced by the prospect of hiring a Mourinho or Wenger-type manager.
The fact that Leeds United is an attractive investment proposition says a lot about the club’s current status and underlines that they have come a long way since tipping into League One and suffering a period of bizarre ownership under Massimo Cellino. Current owner Andrea Radrizzani bought the club for £ 45 million from Cellino in 2017. A spokesman for QSI said: “It’s an opportunity, it’s interesting and it’s a big name in English football that we can help develop and bring back; a very beautiful brand with which we can recreate a story.”
QSI values Leeds at between £ 50 and £ 70 million, but Radrizzani may want close to £ 100 million for the club. He has spent around £ 65 million of his own money on buying the club and Elland Road. PSG cost QSI € 70 million and today the club is worth up to € 1.4 billion. If they were to sell the French champions, QSI would make a substantial profit on their outlay, although total expenditure has obviously been a lot higher than the purchase price.
QSI apparently wants to accelerate negotiations, possibly fearing that if the club was to gain promotion at the end of the season, the asking price will undoubtedly increase given the huge rise in revenues that can be anticipated from Premier League status. Leeds’ revenues in 2017-18, their last reported accounts, totalled £ 41 million.
Ever since the 1970s, Leeds have hankered for a return to their golden era, although they were the last pre-Premier Football League champions and then assembled an expensive collection of star names in the late 1990s, a period that proved to be financially catastrophic. Like many clubs, Leeds got left behind in the modern era – their last Premier season was 2004-05 – but the arrival of QSI on the scene will undoubtedly be transformational. There will be moral issues to deal with and separating football from those will be difficult, despite the insistence of those that claim there is clear blue water between the two. That’s a problem for Leeds and their fans to deal with. If it comes off, we can expect a familiar old name to be added to the first class lounge in the Premier League. Some will certainly welcome the return of Leeds if only because of the intensity of their historic rivalry.