Monday 13th July is the day UEFA showed every club how to get around their own Financial Fair Play (FFP) rules. The Court for Arbitration in Sport (CAS) ruled in favour of Manchester City, and lifted their 2 year European Competition, and instead gave them a £10 million fine.
But what does this mean for a potential Newcastle United takeover? Well it can only be a good thing. With City originally cited as breaching FFP rules due to sponsorship, there was a worry that the incoming consortium could not jump straight into the deep end in terms of sponsorship deals.
Now there is a conceivable chance that the new owners could use their connections to various businesses to build sponsorship partners with Newcastle going forward, and not the minuscule deals we have been use to under Mike Ashleys tenure.
As it stands the current combined deal with Puma and Fun88 is worth around £10 million, you would think that the new owners coming in will look to equal that with just sponsorship partners, never mind shirt sponsors and kit suppliers.
There is of course the exaggeration to how far they could go in terms of sponsorship, as my tweet below shows…
But with the news today, a substantial shirt sponsorship deal is not out of the realms of possibility now.
Lets look at one side of the consortium that could bring in substantial sponsorship deals, and that of the Saudi Arabia Public Investment Fund (PIF). There is the obvious link to Armaco through Yasir al-Rumayyan, but you would imagine they would want Vision 2030 to somehow be reflected through the sponsorship of Newcastle United.
Chances are the main sponsor could be Saudi Air or Saudi Telecom. The link with Saudi Air could prove more lucrative than just money into the club. With a partnership with the football club, it would be fair to assume a partnership with Newcastle Airport would come with it. With a new airline flying into the airport, with that will come more jobs, as you will need desk staff, in-flight crew etc from both sides.
There is the possibility for PIF to source most of the sponsorship partners. Not necessarily those companies that put tens of millions into the club to have their name on the shirts, but companies that could invest enough to have their image shown around the ground, and on interview boards, guaranteeing worldwide exposure with the Premier League. Lets be honest though some companies won’t need the exposure, but with PIF’s portfolio including companies like Disney, Facebook, LiveNation and Starbucks to name but a few, there will be plenty to try and get involved.
With a rumoured year long extension signed with Puma at the current rate, the incoming owners will want to sort a new deal for a kit supplier. This is another area they could try and get above the odd’s in terms of payments.
There is no doubt that once a takeover goes through, the call for Shirts, and fans actually stepping foot inside the Club shop again, after 13 years of being a Newcastle branded Sports Direct! The money to be made from shirt sales will be at levels not seen for at least 20 years.
It will not just be domestic sales, they will undoubtably be high, there will be a massive influx of worldwide sales, more specifically in Saudi Arabia. This renewed interest in the club, could allow for the new marketing department to essentially start a bidding war amongst kit manufacturers, knowing they will eventually get their money back.
Ever since the talks of the takeover intensified, and we found out it was with the Premier League, excitement grew on Tyneside and further afield, but fans of other clubs and some journalist warned us that, although on paper we would be the richest club in the world, we would be limited by FFP, that doesn’t seem to be as stringent as before.
The easing of the rules due to the influence of Covid has had on finances, and the City decision, it allows for the new owners coming in to invest straight away with high level sponsorship deals, that will change the outlook of the club!