Is China Taking Over European Football?

The drive into European football clubs by wealthy Chinese investors continues.

Chairman, CEO and owner of Chinese private holding company Recon Group, Dr Tony Xia, has agreed to purchase the recently relegated Premier League club Aston Villa for an estimated £76 million. Along with a change of ownership comes a change in club management with Robert di Matteo announced as the new club manager. This is the latest addition to an already lengthy list of European football clubs owned by wealthy Chinese investors.

1. 100% stake in Aston Villa by Recon Group for an estimated £76 million

2. 20% stake of Atletico Madrid by the second richest man in China, Dalian Wanda Group’s Wang Jianlin

3. 56% stake in Spanish club Espanyol by a leading Chinese manufacturer of auto model called Rastar Group

4. 69% stake of Inter Milan by owner of Suning Zhang Ji Dong worth $307 million

5. 13% stake in Man City from a Chinese consortium called CMC worth up to £265 million

6. 100% stake in Slavia Prague from CEFC Chinese Energy Company

7. 100% stake in FC Sochaux from HK based Ledus for €7 million

8. 100% stake in Granada from Chinese firm Link International Sports

9. 100% stake in ADO Den Haag from United Vansen Sports

10. 80% stake in OGC Nice by a group of Chinese investors

11. 100% stake in Newcastle Jets (A-League) by Ledman Group for around USD$5

12. 50,6% stake in Birmingham City by Paul Suen, Birmingham Int’l Holdings

13. 100% stake in West Bromwich Albion by Guochuan Lai

14. 100% stake in Wolverhampton Wanderers by Guo Guangchang

15. 60% stake in Auxerre by James Zhou, ORG Packaging

16. 99,9% stake in AC Milan by Li Yonghong – RSI for US$788 Million

So what are the reasons for such a huge influx of investment from Chinese firms and investors?

There are different perspectives on whether much of the investment in European football clubs represent China’s growing passion for football or whether it is for the sole purpose of tapping into a new market in the club’s home country. Other reasons include China’s aspirations to develop a globally recognized national football team and create a wider fan base. With President Xi Jinping a football lover himself, he is looking to invest heavily in football academies to make China the next footballing ‘powerhouse’ of the world. President Xi is planning to have a $850 billion worth sports industry in China alone by 2025.

It is also important to note the integral concept of ‘Mian Zi’ in China, meaning ‘reputation’ and how it may help explain China’s desire to mark their footprint in the footballing world. Not only do they have numerous outward investment-oriented Chinese companies, China also likes to display their success on the global stage. On top of that, having a stake in the club allows them a position to influence club decision-makers for their investment interests. More importantly, Chinese investors will have the power to engage in other business deals within the home country of the football clubs.

Looking specifically at the purchase of French second division club, Sochaux has switched ownership from Peugeot to a Hong Kong-based lighting company called Ledus. This €7 million club transfer saw Sochaux finish the league season at 15th place, but the owners claim to stay with Sochaux in the long-term and are willing to invest up to €100 million in hopes of getting promoted. Through the acquisition of Sochaux, rather than building an unlikely fan base in China, Ledus aims to expand their operations in France and internationalize their brand.

The growth of football club investment in Europe may not seem that surprising, given the dramatic economic growth that China has been experiencing for the past two decades. It now comes as no surprise with rumours flying around regarding potential Chinese takeovers of other top European clubs. Is this just the beginning of China’s growing dominance over European football? Only time will tell.