The other side of the football billionaire's club

When one thinks of Football Clubs owned by billionaire oil tycoons and wealthy Arab Sheikhs residing in their air-conditioned palaces in the Middle East, the likes of Manchester City, Paris-Saint Germain and Chelsea come to mind. Fans will obviously be ecstatic when the clubs they support have now been given the keys to the treasure chest which contains seemingly endless amounts of money which can be splashed on world-class players, the likes of which could only be dreamt of before. With the release of vast amounts of gold, some silver usually finds its way back to the likes of the Etihad, Stamford Bridge and the Parc des Princes. Football is probably the only sport in the world where silver is more valuable than gold. But what happens when that supply of money dries up? What if, one day, this wealthy investor has decided to stop investing his millions in one of Europe’s lesser lights? It’s not a feeling one can escape from, and this is exactly how fans of Portsmouth, Rangers and Malaga feel at the moment. [caption id=“attachment_416432” align=“alignleft” width=“380”]  Portsmouth’s woes don’t seem to stop. Getty Images[/caption] PORTSMOUTH Portsmouth’s tryst with wobbly finances has dragged on for several years, ever since current Sheffield Wednesday owner Milan Mandaric bought the club in 1999 to save it from administration, alongwith Frenchman Alexandre Gaydamak. Harry Redknapp took over as manager in 2002, and was able to use the funds Mandaric made available to invest in players, meaning that Pompey were able to finish just outside the European spots in 2006-07, before playing on the continental stage after winning the FA Cup in 2007-08. But the duo’s unwillingness to continue to pour in the same amount of funds gave Emirati businessman Suleiman Al-Fahim an opportunity to buy Portsmouth from Gaydamak in 2009. Al-Fahim, however, was in charge of Portsmouth for only forty days before Ali Al-Faraj, a businessman of Saudi extraction, bought ninety percent of the club’s shares. This was because Al-Fahim did not have the funds required to maintain the club. In an attempt to recoup some funds, Al Fahim had sold Portsmouth’s highest earners (including Peter Crouch, Niko Kranjcar and Glen Johnson). Portsmouth’s woes continued under Al-Faraj, when it was revealed that the staff and players hadn’t been paid for the second month running in December 2009. Football contract laws meant that the players could now hand in a two-week notice before quitting the club without compensation. As a result, Portsmouth were given a nine-point deduction after a winding-up order was filed (and subsequently dropped) by HM Revenue and Customs. During the 2009-10 season, Balram Chainrai became the owner, only to realise that it was over 135 million Pounds in debt. To save the club, he placed it in administration. Pompey’s nine-point deduction meant they were relegated to the Championship, and lost 1-0 to Chelsea in the FA Cup final. Despite this, Portsmouth were not granted a license to play in the Europa League the following season. What follows is a continuation of this tale of woe. Hope was rekindled when Pompey finished 16th in their first season in the Championship before Vladimir Antonov bought Portsmouth the following summer. Another flurry of transfers ensued before a Europe-wide arrest warrant was issued against Antonov for asset stripping of his banks in Lithuania. In February 2012, Portsmouth went into administration for the second time in two years with no money in the bank and over 58 million pounds in debt— meaning they were now relegated to League 1, the first time they have played at this level in over 30 years. Left with no alternative, Portsmouth have sold a majority of their players. Jason Pearce left for Leeds United, followed by Joel Ward, Stephen Henderson, Kelvin Etuhu, Hayden Mullins, Aaron Mokoena, Greg Halford, Erik Huseklepp and most recently, Dave Kitson. Portsmouth have until August 10th to reduce their wage bill in order to avoid liquidation. Since then, Tal Ben Haim, on a reported weekly wage of 36,000 Pounds has left the club. RANGERS While Southern England may have one crisis club, one of Scotland’s most famous institutions now face the same fate. Glasgow Rangers FC have won the Scottish League 54 times, the Cup 33 times and the League Cup 27 times, in addition to a European Cup Winners’ Cup in 1972, meaning they’ve won a whopping total of 115 trophies. Rangers’ financial issues began— like Portsmouth— in 1999, when Dick Advocaat invested heavily in the team after backing from steel magnate David Murray, who until very recently was chairman of the club. The intention of this huge spending was to bring Rangers European success, but with little to show for their rewards (despite winning the Scottish League by a massive 21 points) before Celtic won the league by 12 points in Advocaat’s second season, the large sums spent on players meant Rangers were 52 million Pounds in debt. The summer of 2003 saw several players leave due to the worsening financial situation at Rangers, and despite continuing to win trophies, they posted a loss of 3.9 million Pounds in 2008. Despite this, they won their 52nd Scottish title that year. The financial ill-health meant that in 2009, Rangers had to sell some of their squad without the means to sign anyone. Despite this, they managed to win a League and Cup double. They retained their title in 2010 and defended it successfully in 2011, but their financial troubles continued to mount. In 2012, Rangers were forced to enter administration over non-payment of taxes. Murray had sold the club to staunch Rangers fan Craig Whyte in 2011 for a symbolic one Pound. The rest of the money that exchanged hands had gone towards repayment of debt. Rangers had not submitted their account for the 2011 season, and as a result were stripped of the right to play European Football for the 2012-13 season. On the 14th of June of this year, HM Revenues and Customs’ unwillingness to allow Rangers to enter the Company Voluntary Agreement (CVA), wherein a mode of payment is usually agreed to repay investors while still in debt to continue functioning, meant that Rangers are now set to enter liquidation. Following this, Charles Green bought the club and christened it ‘The Rangers FC’ to replace the original Rangers to avoid the dissolving. Rangers have since been relegated to the Scottish Third Division, with their right to compete in the Scottish Cup still hanging in the balance. They are allegedly in debt of close to 134 million Pounds. MALAGA The last club on this list is Malaga CF. The Spanish team were bought by Qatari Royal Sheikh Abdullah Al-Thani soon after the World Cup ended in 2010. Numerous players were bought, including established internationals Jeremy Toulalan, Joris Mathijsen, Santi Cazorla and ex-Netherlands striker Ruud van Nistelrooy. Though the Club managed to qualify for the the Champions League for the first time in their history, financial woes were afoot when the quarter complained to the Association of Professional Footballers in Spain over non-payment of wages, though these were subsequently dropped. Malaga’s debt of 90 million Euros was too much for even a cash-rich Sheikh to handle, and he seems to have now washed his hands off them. Talk of players being sold to ease the aforementioned issue have now come to fruition, with Venezuelan international striker Jose Salomon Rondon being sold to Anzhi Makhachkala just days ago, while Santi Cazorla’s joins Arsenal. Malaga now face relegation to the Spanish lower leagues and the loss of their Champions League campaign, should they not balance the books in time. At a time like this, look at clubs who’ve managed to stick to financial prudence. Because, as Bruce Wayne said, sometimes the return isn’t worth the investment.