Southampton are under new ownership, and the new owners have a plan which should end the club’s recent period of stagnation on the pitch.
There is a modern tendency to think ‘what’s the catch?’ at the takeover of any football club, but the sale of Southampton to the Sport Republic group looks like a purchase which will be good value for all concerned. Covid-19 has taken a heavy toll on the balance sheets of all football clubs, but there are never any guarantees that the new owners will be better than those they’re replacing. But Southampton seem to have landed on their feet, with no further debt being put on the club, a coherent plan for how they hope to grow, and a philosophy rooted in sporting values rather than pure venture capitalism.
The new owners are led by the former Brentford co-Director of Football Rasmus Ankersen and businessman Henrik Kraft, with the money coming from Dragan Solak, a Serbian businessman who owns the United Group, a provider of broadband, mobile and pay TV across eight countries. They are promising an approach that will not rock too many boats at St Mary’s, with Kraft already having told the press that, “We will be an active and engaged owner, but we will not be starting any revolutions.”
It’s a sale that has been a couple of years in the making. Chinese businessman Gao Jisheng paid between £180million and £200million to purchase an 80% stake in the club from Katharina Liebherr in 2017, but his time in charge of the club has largely been marked by a period of stasis. Gao didn’t put any money into the club himself but didn’t take any out either, and the result of this was the team stalling after several years of progress on the pitch which ended with them finishing in sixth place in the Premier League in 2016. But since Gao took control, Southampton have failed to finish above midway in the Premier League, and supporters had become frustrated by what was perceived to be a lack of communication from a foreign-based owner.
The nuts and bolts of the sale are fairly straightforward. Sport Republic are reported to have paid £125m for the club, but they also assume responsibility for the £80m loan taken on by the previous owners from Michael Dell’s company MSD. This is not due to be repaid until 2025 and interest is payable at 9.14% per annum, but it does also allow for further borrowing.
The good news for Southampton is that, unlike the sale of Burnley to the American businessman Alan Pace at the start of 2021, at least the new owners are paying for the purchase of the club themselves. Pace’s vehicle for the sale, ALK, paid around £150million for 84% of Burnley’s shareholding, but there was disquiet at the revelation that ALK had only put around £15m of its own money into purchasing the club, with the rest coming from a secured loan from MSD and around £55m from Burnley FC itself. This leveraged buyout put the club immediately into debt, where it hadn’t been before.
Southampton are to become part of a multi-club stable, although no other clubs have been purchased by the group yet. These can be very successful, as demonstrated by the high profile of the Red Bull group of clubs. This year’s Champions League group stage included both RB Leipzig and RB Salzburg, while they have other interests in the USA, Brazil and Africa. But this isn’t always the case. The involvement of Rolan Duchatelet at Charlton Athletic and Standard Liege in Belgium brought widespread protests at both clubs.
But ultimately, it is the individuals concerned rather than any specific model that ultimately decides the success of any such venture, all of which makes the involvement of Rasmus Ankersen the most intriguing aspect of the sale of Southampton. His achievements at Brentford, where the club returned to the top flight of English football at the end of last season for the first time since 1947, are well-documented, but he also proved himself in running a club with his involvement at the Danish club FC Midtjylland, where the club has won the Danish Superliga three times since the Brentford owner Matthew Benham bought a controlling share in the club in 2014 and installed Ankersen as chairman. His success there led to him being offered the position at Brentford.
The financial stratification of the Premier League means that matching the achievements of FC Midtjylland will probably be beyond Sport Republic’s reach for Southampton, but this doesn’t mean that there isn’t scope for the new owners to improve the club. There don’t seem to be any plans to replace Ralph Hassenhuttl as manager (as a former manager of RB Leipzig, he has experience of the multi-club ownership model), but it’s likely that Southampton will pivot towards the analytics-led recruitment policy which took Brentford into the Premier League. The multi-club model will mean that players end up moving between these clubs, but it’s impossible to say how this will be structured because Southampton are the group’s first purchase.
It is a curious coincidence that the has been hobbled this season by the sort of inconsistency that is the enemy of an analytics-led approach. Southampton are in the small coterie of Premier League clubs – along with Brighton, Crystal Palace, Burnley and Newcastle – who’ve drawn a lot of games this season and have won just four (but drawn nine) of their 19 league games so far this season. But these figures tell a story in themselves of how fine the margins between success, stagnation and failure in the Premier League can be. Another goal in just three of their nine drawn matches would have seen them in the top half of the table and chasing a place in Europe. These are the sort of fine margins that engender believe that positive change can be effected within the club.
Of course, there are no guarantees of success in football, and a change of ownership always has an element of gamble. But the new owners are making the right noises, and the previous experience of Rasmus Ankersen at both Brentford and FC Midtjylland indicates that there may be a reason for cautious optimism among Southampton supporters. As an established Premier League club, there is no need for a ‘revolution’ at St Mary’s, but Southampton have been treading water for too long, and a different approach may be just what the club needs after the relative torpor of the Gao Jisheng years.
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