DUBAI: A consortium led by Saudi Arabia’s Public Investment Fund has withdrawn a proposed take-over of Newcastle United, the English Premier League football club.
A statement from the investment group, which also included UK investor Amanda Staveley’s PCP Capital and the family business of the British entrepreneur Reuben Brothers, said the decision was made with “a deep appreciation for the Newcastle community and its football club. We believe we could have returned the club to the position of its history, traditions and fans’ merit.”
Talks between the consortium and Michael Ashley, the British retail entrepreneur who owns the club, have been under way since last year on a proposed takeover, with a suggested price tag in the region of GBP300m.
But the negotiations stalled after formal contracts were exchanged in April because of the need for formal approval from the English Premier League, whose rules govern ownership of clubs in the top rank.
The approval process was also delayed by the COVID-19 pandemic that led to the cancellation of English football matches for three months.
“The prolonged process under the current circumstances coupled with global uncertainty has rendered the potential investment no longer commercially viable,” a consortium statement said.
“During the unforeseeably prolonged process, the commercial agreement between the investment group and the club’s owners expired, and our investment thesis could not be sustained,” the consortium said.
It also noted that there was no clarity as to the circumstances under which the next season will start and the new norms will arise for matches, training and other facilities. The English football season is due to restart in September but issues relating to crowd attendance have not been finalized.
The takeover was overwhelmingly supported by fans of the 128 year old club, which boasts among the highest attendances in English football.
“We feel great compassion for the fans with whom we shared a great commitment to help Newcastle harness its tremendous potential and build upon its impressive and historic legacy while working closely with the local community,” the statement added.
The takeover, with Saudi investors in the driving seat, was seen as part of the strategy to diversify the Kingdom’s interests as part of its Vision 2030 plan. PIF has spent nearly $8 billion on foreign investment since the pandemic hit global financial markets.
“Our focus was on building long term value for the club, its fans and the community as we remained committed to collaboration, practicality and proactivity through a difficult period of global uncertainty and significant challenges for the fans and the club,” the consortium said.
“We would like to say that we truly appreciated your incredible expressions of support and your patience through this process. We are sorry it is not to be,” the PIF-led consortium said.