The word ‘takeover’ instantly sets football fans’ pulses racing, their eyes bulging with imagined riches from an oil baron, a local hero, or a tech mogul. But is that the type of takeover are on course for?
When Daniel Levy announced earlier this year that Spurs were seeking strategic investment, his language was diplomatically vague, leaving open the possibility of both a full or partial takeover.
The chairman and co-owner’s pre-amble to the club’s annual accounts, for which Spurs posted club-record revenues of £550m, read as follows:
“To capitalise on our long-term potential, to continue to invest in the teams and undertake future capital projects, the Club requires a significant increase in its equity base.
“The Board and its advisors, Rothschild & Co, are in discussions with prospective investors. Any recommended investment proposal would require the support of the Club’s shareholders.”
It has since emerged that Spurs values its total equity at around £3.75bn. A full sale at that price would – comfortably – be a world-record for a football club takeover.
However, it appears more likely that Levy and his peers in the ENIC Group, which no longer includes Joe Lewis following his conviction for insider trading in April, will sell a minority stake.
After raising £500m for a new football acquisition, Amanda Staveley’s PCP Capital Partners are reportedly looking at Spurs, while the likes of MSP Sports Capital and Liberty Media have been linked in the past.
But the Premier League takeover market is saturated at present.
As well as Spurs, West Ham, Wolves, Crystal Palace and Brentford are all looking for minority investment, while Everton have been locked in takeover purgatory for over a year.
What’s more, there is believed to be a declining appetite among private equity firms and financial institutions to invest in the Premier League.
Where is Tottenham’s place in all of this?
TBR Football spoke exclusively to Liverpool University football finance lecturer and Price of Football author Kieran Maguire to survey the takeover landscape.
Spurs, the best-run club in England?
Spurs fans have protested ENIC’s running of the club on several occasions over the years, most notably in the aftermath of the star-crossed Super League plot that Spurs helped to engineer.
Those wounds are unlikely to heal any time soon, especially in light of Spurs’ controversial new concessions policy and ticket price hikes that many bedrock fans believe are pricing them out.
For those supporters, it might have been a surprise to learn that Fair Game recently ranked Tottenham as the best run club in England in their annual Index.
The report assessed clubs based on four metrics: finance, governance, equality and diversity, and fan engagement.
There is no doubt that, from a corporate perspective, Levy is one of the most respected operators in the game. But does that mean that the football club is the best run in the country?
“Spurs are the most profitable club in the history of the Premier League,” said Maguire.
“Their cost control has been magnificent. It has often been less than 50 per cent of revenues that have been spent on wages.
“The move to the new stadium has been a masterclass in terms of success from a financial point of view.
“The multi-functionality of the stadium has future-proofed Spurs in a lot of ways.
“So, as a business, I absolutely agree. Their commercial arm and their vision has ticket every single box.
“The only thing that has surprised people is the failure to date to secure naming rights for the stadium.
“But that, from my understanding, has come down to the intransigence of one person who is holding out for a price that no one is willing to pay.
“What areas can they improve? They need to understand that Spurs are a football club as well as a business.”
Spurs takeover: Where will the money go?
Previously, reports have suggested that Spurs could sell a 10-15 per cent stake, similar to the arrangement Liverpool owners FSG struck with Dynasty Equity in September 2023.
Now, a new story in The Sun suggests that Tottenham could in fact relinquish as much as 25 per cent, with Staveley’s PCP Capital Partners ramping up their efforts to buy into the club.
The overtures Levy made in his initial statement courting investment in Spurs suggested that capital raised as part of an equity sale would be reinvested in the club.
But Maguire is sceptical.
“I think there is a fair chance that this would be a purchase by PCP Capital of ENIC’s existing stake in Spurs.
“Therefore, there is a fair chance that it will be a transaction between private individuals and there will be no impact as far as the club is concerned.
“The thing is, Spurs don’t need cash. What do Spurs need money for?
“The only thing you could say is that it might be used to pay down debt. But if I’d borrowed at 2.5 or 3.75 per cent, I wouldn’t be looking to pay down debt.
“Also, there would be penalty clauses for early repayment of that debt, so it doesn’t wash with me.
“The issue would be, what is it in it for Amanda Staveley?
“She needed to borrow from the Reuben Brothers to complete her buy-in to Newcastle. But for Spurs, you’re talking the best part of £750m, so I suspect she would be more of a public face for a deal.
“What she does have is a very good network. It could be that she is fronting for Middle Eastern investors.
Why invest in Spurs?
In almost every case, investors see football clubs as giga capital appreciation projects. In essence: buy low, sell high.
But with Spurs valuing themselves at nearly £4bn, where is the next big plateau in terms of revenue generation that can unlock new value for a would-be investor?
Beyond expanded franchise-style competition formats or a new Club World Cup, the likes of Spurs see commercial revenue as less static than matchday and broadcast income.
Elite clubs are looking for ways to monetise their overseas fanbase and some are betting big on web3, for example. Man City are even in the process of hiring a senior metaverse manager.
But in terms of the blue-sky vision for football investment on a grand, long-term scale, these projects alone will not be enough to ensure investors get a worthwhile return on their billion-dollar buy-ins.
“My concern is that you have a find-a-bigger-fool approach,” said Maguire.
“The crypto market has been major evidence of this. You’ve an awful lot of evangelists about the product, but unless you can find someone who is more of an evangelist about it than you are, it is tough to find value.
“You have to look at the ways football clubs are currently making money – matchday income, commercial and broadcast.
“What we are seeing from clubs including Spurs is a broad sweep towards making it harder to be a season ticket holder.
“They want football to be a tourist activity as opposed to a legacy or local representation of community. That is very much the American model, where price gouging is seen as fair game.
“There are modest revenue opportunities there.
“Broadcast income in its current form has limited growth domestically. Everyone who is going to subscribe to Sky has already done so.
“So you either increase the number of matches, but I think we’re at saturation point there.
“Alternative means of consuming the product are what investors are now leaning into. I’ve been sent a few pitch decks from clubs for things like mixed reality. It’s insane, this stuff.
“You only need five per cent of Spurs’ global fanbase to buy into this to see a significant change in the beneficial numbers.
“The Premier League is a global product and they want to deliver it to a global audience.
“With sponsorship, where else can you go? We have all the main categories covered already. So it is difficult in some senses to see where the value is coming from.“