This article is the third part of the series “Private Equity in Football: A Game-Changer or a Risky Bet?”, exploring how private equity is reshaping the football landscape, injecting capital and redefining club ownership with both transformative potential and significant risk. In Part 1 of this series, we explored how the financial instability and post-pandemic football opened the door for new types of owners in the football industry. In Part 2, we studied how these funds view clubs as assets within a broader investment portfolio, the logic behind multi-club ownership, and what this means for governance, performance, and long-term sustainability. In the third part, we showed the process of buying football clubs. Now, this article aims to evaluate whether multi-club ownership (MCO) models generate sustainable financial benefits or pose long-term risks for football clubs and stakeholders.
When private equity firms acquire a football club, they don’t just buy a team, they invest in an asset they expect to transform, optimize, and eventually exit at a profit. But is this logic compatible with the unique financial reality of the game? The answer depends on how success is defined, in financial metrics or footballing terms.
When private equity firms acquire a football club, they don’t just buy a team, they invest in an asset they expect to transform, optimize, and eventually exit at a profit.
Investment Tactics : From Restructuring to Optimization
Private equity actors typically bring a playbook designed for corporate turnarounds. In football, that often translates into:
- Debt Restructuring: Many takeovers involve absorbing or reorganizing club debt. This can ease short-term financial pressure, but in some cases, new debt is used to finance the acquisition itself (LBO-style), increasing future risk.
Example: Burnley FC was acquired by ALK Capital in December 2020 for approximately £170 million, via a leveraged deal that transferred about £60–65 million of debt onto the club itself, secured against its own assets. Following relegation in May 2022, the club’s turnover collapsed from £123.4 million to £64.9 million, a drop of nearly 50%, largely due to a halving of broadcast revenue (£110 million → £47.8 million). This sudden downturn exposed the fragility of the LBO structure, forcing reliance on parachute and solidarity payments, and highlighted how relegation can swiftly unravel leveraged financial models.
- Cost Control & Efficiency : PE-owned clubs often implement stricter salary caps, leaner management structures, and centralized decision-making to reduce costs.
Example: Toulouse FC, under RedBird Capital, drastically reduced its wage bill and staff size while focusing on young, undervalued talent, a strategy that led to promotion to Ligue 1 and a Coupe de France victory in 2023.
- Infrastructure Investment : Stadium renovations, new training facilities, and digital platforms are seen not just as expenses, but as long-term value drivers.
Example: AC Milan and Inter, now owned by U.S. investment firms RedBird and Oaktree respectively, have deemed a full renovation of the Giuseppe Meazza stadium, commonly known as San Siro, financially unviable. Instead, both clubs are in discussions to jointly purchase the historic 1926-built venue and its surrounding area from the Milan municipality, as part of a €1.2 billion redevelopment plan that includes a broader real estate project. This new venue is coming with projections estimating a potential hundred of million boost in clubs valuation over the coming years.
- Smarter Recruitment: Data-driven scouting and player trading become a priority. Recruitment is increasingly seen as a financial lever, not just a sporting need.
Example: Under Gérard Lopez, and with financial backing initially tied to Elliott Management, Lille OSC built a transfer model based on acquiring undervalued talent and selling for profit. The club sold Nicolas Pépé to Arsenal in 2019 for €80 million (a record fee for an African player) after signing him for just €10 million. In 2020, Lille also negotiated Victor Osimhen’s transfer to Napoli for around €70 million.
These strategies aim to create a more “investable” club that grows revenues while stabilizing costs. However, behind the spreadsheets lie softer, less tangible metrics that are often ignored.
Return Expectations: Value Creation vs. Sporting Vision
Private equity doesn’t typically aim for break-even; it targets multiples. A club acquired at €100 million may be expected to sell for €500 million within five to seven years. This return logic drives most key decisions:
- Commercial Expansion: Boosting revenues through global partnerships, merchandising, digital content, and expanding into emerging markets.
Example: CVC Capital Partners injected €2.1 billion into LaLiga’s media rights in exchange for an 8.2% stake in a new 50-year commercial entity. The goal is to help clubs modernize and capitalize on global digital consumption.
- Asset Appreciation: Especially in multi-club models, players are developed and sold across affiliated teams to maximize returns on talent.
Example: RedBull’s network, including Leipzig and Salzburg, allows talent development and movement across markets.
- Exit Strategy Planning: From day one, most PE firms work toward a defined exit, via resale, IPO, or integration into a larger sports conglomerate.
Example: Elliott Management’s short-term stewardship of Milan is illustrative; they restructured the club in 2018 and sold it four years later to RedBird for €1.2 billion, doubling their initial valuation.
Yet, while these tactics often deliver financial upside, they can clash with the timelines and unpredictability of sporting success. Building an academy, creating a culture, or sustaining fan engagement doesn’t fit neatly into a five-year ROI model.
Building an academy, creating a culture, or sustaining fan engagement doesn’t fit neatly into a five-year ROI model.
Risk Factors: Financial Gain vs. Football Culture
The financial impact of private equity ownership is not uniformly positive. Several key risks have emerged across multiple clubs:
- Short-termism: The pressure to meet return targets may result in prioritizing quick wins, such as player flipping or budget cuts, over long-term sporting coherence.
Example: Standard Liège, under 777 Partners, saw several managerial changes in two seasons, with unstable performances and growing fan frustration. In May 2024, a Belgian court authorized the seizure of all assets of 777 Partners in Belgium, including Standard Liège’s club accounts, its stadium company, and shares, following a legal claim by former owner Bruno Venanzi and the stadium shareholders over unpaid payments
- Over-Leverage: Clubs burdened with acquisition-related debt may face existential risk if results falter.
Example: Burnley FC’s leveraged buyout is a textbook example of vulnerability; failure to achieve promotion could have severely impacted solvency.
- Governance Disruption: PE often brings rapid changes at board level, and centralized control can disempower local management.
Example: Hertha Berlin, another 777 club, underwent multiple leadership changes between 2021 and 2023, contributing to relegation and internal instability.
- Profit Over Passion: Fan discontent grows when clubs are reduced to financial assets. Branding decisions, ticket pricing, or sponsorship deals made without local consultation often provoke backlash.
Example: Everton supporters protested vehemently in 2023 against 777’s proposed takeover, citing the firm’s opaque finances and track record across other clubs.
- Loss of Intangible Value: Clubs are not just businesses, they are vessels of memory, identity, and regional pride. This emotional value is often invisible in PE-led strategies.
Example: As seen with Vasco da Gama or Genoa, supporters have pushed back against ownership changes that altered the club’s visual identity, community engagement, or fan traditions.
Conclusion
Financial improvements are often presented through clean balance sheets and improved EBITDA margins. But not all gains are structural. Some clubs show “growth” through asset sales or short-term cuts rather than sustainable revenue expansion. But these numbers often reflect artificial boosts: player sales, cost cuts, or one-off capital injections.
Moreover, few private equity owners consider soft metrics such as trust, cultural connection, or the social value of football clubs. These intangibles may not appear in annual reports, but their erosion is deeply felt by supporters. These costs are harder to quantify but arguably more damaging in the long run.
Private equity can bring much-needed financial expertise and modernization to football, but when financial engineering overtakes sporting values, clubs risk becoming hollow corporate shells. The real challenge lies not in whether these strategies work, but in who ultimately benefits ; Will it be the fans, the legacy, and the sporting project, or simply the balance sheets of shareholders?
But while financial restructuring and commercial growth are essential pillars of a club’s transformation, they ultimately mean little without results on the pitch. In the next article, we explore whether private equity’s strategic playbook can truly deliver sporting success, or whether the game remains stubbornly resistant to financial control.
