Chinese investors pay $400 million for Manchester City group stake

The deal, for a stake of more than 13 per cent, values the City Football Group at $3 billion.

Britain's prime minister David Cameron, left, stands with China's president Xi Jinping, centre, and Manchester City chairman Khaldoon Al Mubarak, third right, during a visit to the City Football Academy in Manchester in October. Joe Giddens / Reuters
Beta V.1.0 - Powered by automated translation

Chinese investors are taking a US$400 million stake in City Football Group as the company that owns Manchester City FC beats a path to the world’s most populous nation, where the popularity of the “beautiful game” is on the rise.

The consortium led by Shanghai’s China Media Capital Holdings and Hong Kong’s Citic Capital will take a 13 per cent stake in City Football Group, which also owns New York City FC and Melbourne City FC, through the investment.

That values City Football Group at $3 billion, the companies said.

The cash injected into City Football Group will be used to fund its China growth as well as for expansions elsewhere.

“Football is the most loved, played and watched sport in the world and, in China, the exponential growth pathway for the game is both unique and hugely exciting,” said Khaldoon Al Mubarak, the chairman of City Football Group.

“We have therefore worked hard to find the right partners and to create the right deal structure to leverage the incredible potential that exists in China.”

The deal, which took six months to seal, will involve new shares being issued in City Football Group in addition to the ones held by Abu Dhabi United Group, the investment company privately owned by Sheikh Mansour bin Zayed.

Sheikh Mansour was the sole shareholder of City Football Group before this latest deal.

More than half of Chinese football fans support a Premier League club and matches in that league have reached more than 350 million people in China, the government-run English-language People’s Daily Online reported in late October.

Xi Jinping, China’s president, wrapped up his UK visit in that same month with a tour of Manchester City’s new football academy, highlighting sport as a key area in which to strengthen cooperation and exchange.

Mr Xi visited the club’s 80-acre youth development and first team training site in central Manchester.

During his tour of City’s academy, Mr Xi said that sport was an important part of China-UK exchanges and that China could learn from British football.

Greater cooperation on sport would promote closer ties between the two countries, he said.

In his comments, Mr Xi noted the sport’s global appeal and the UK’s role as a football power.

Mr Al Mubarak said at the time that Mr Xi’s visit was “testament” to the club’s strong links with China and to its “ambitions for them to deepen and grow”. Mr Xi’s affection for football has moved it up the list of national priorities, with plans to expose more children to the sport.

Manchester City boasts star players including Sergio Aguero and Yaya Toure, who paraded their skills during the Fifa World Cup in Brazil.

Manchester City this year reported its first profit in the seven years since Sheikh Mansour bought the club in 2008. The club made a £10.7m (Dh59.2m) after-tax profit for the 2014-15 season thanks to record annual revenues of £351.8m and a reduced wage bill, according to to the latest annual report that it published in October.

Follow The National's Business section on Twitter