Does Mike Ashley REALLY want a Newcastle United takeover?
If a house is only worth what someone is willing to pay for it, then maybe the same can be said of a football club.
Newcastle United was put up for sale almost two years ago – yet Mike Ashley remains the owner.
So what’s going on?
Surely, Sir Jim Ratcliffe, chairman of chemicals group Ineos, is Ashley’s perfect buyer. He’s the third-richest person in Britain with a personal fortune of more than £18billion. He's not after a quick return, and he didn’t leak his interest in the club to the media, unlike some of Newcastle’s other suitors.
Bob Ratcliffe, the brother of Sir John, spoke about the valuations of Premier League clubs after taking over at the Allianz Riviera.
"We spent quite a lot of time looking at Premier League clubs and their valuations,” said Ratcliffe, who heads up Ineos’ football division.
"It was difficult to rationalise purchases in the Premier League for us. If you look below the top six, they are all £150million and above. You’re going to write a cheque for £50million and get in the Everton cup. Where are you going to go?
"You look at Newcastle, and we looked at a lot of clubs. You come back to a valuation in the hundreds of millions, and it’s difficult to contemplate. I think the foreseeable future it is off the radar. We have a project in Nice, and that will keep us busy."
The Ratcliffes clearly believe that they have got more value in France.
Ashley’s valuation of Newcastle seems to fluctuate around the £300million-mark depending on the club’s fortunes, though sources close to him have always insisted that he doesn’t have a fixed asking price. Most recently, the Bin Zayed Group claimed they had “agreed terms” on a £350million takeover.
That very public bid has since been dismissed by Ashley.
“The last bid,” Ashley told the Daily Mail in July. “He (Sheikh Khaled bin Zayed Al Nehayan) is a prince, and he’s got £38billion or £100billion, all these numbers – well, why would you even care what you’re paying then? What difference would £10million either way make? You would want speed, you would want certainty, you would want the keys and to get on with it.”
Is Ashley saying the deal broke down because of £10million? If he really wanted to sell, would £10million matter that much to him?
Tellingly, Ashley added: “I think I could own this football club for ever – that’s my new mental state. The reality is with these deals that once it gets out, if it’s not done, it’s probably not going to get done.
“The day someone buys Newcastle, they’ll do their due diligence – and finished. It will happen like Manchester City. By the time the media find out, it’s already complete. There’s no need for a delay with Newcastle. It is, honestly, a very well-run football club.”
There has long been scepticism on Tyneside about Ashley willingness to sell the club, despite his public protestations.
Speaking to Sky Sports in August 2017, Ashley said: “I must make it crystal clear that I’m not wealthy enough in football now to compete with the likes of Man City, not just Man City. I cannot, and will not.
“That's why, if someone would like to come along, take this seat and fund Newcastle with a nought on the end with more wealth than me, I will not stand in Newcastle's way. One of the reasons I am doing this interview is because I don't think you'll find many people out there who will actually stand up and do it.”
Ashley formally put the club back on the market a couple of months later.
Alan Shearer, United’s all-time leading goalscorer and, briefly, manager under Ashley, thinks he’s seen it all before. Speaking this summer, he said: “It comes up every 18 months, and nobody genuinely believes a takeover is going to happen. Something’s only for sale if you have a willing seller.”
So is Ashley unwilling to sell?
It all comes down to the price, and Ashley – who bought the club for £134million, and loaned it £129million to cover debts, in 2007 – has seemingly put a high price on a club which hasn’t won a major trophy in 50 years and needs investment on and off the pitch. But if Ashley is to sell up, it’ll be on his terms, and fan protests, up to now, haven’t nudged him towards a quicker, cheaper sale.
There are two other factors which could complicate any change of ownership. Newcastle’s retail operation is operated by Sports Direct, the firm majority owned and founded by Ashley.
“All revenue from the club store goes directly to the club, irrespective of the name on the receipt,” a club official told a Fans Forum meeting last year. “Sports Direct operates the store for the club, which means the overheads associated with staffing, managing stock and a large warehousing operation are significantly reduced.”
Would this retail arrangement continue? Or would it need to be unpicked?
There’s also the ongoing HM Revenue & Customs investigation into suspected tax fraud in football. The club was raided by HMRC officers in April 2017, and any buyer would want to know if there is a potential tax liability at the club.
Those issues, while complicated, aren’t insurmountable. And supporters will be asking themselves why a potential buyer with the means to take United forward has walked away from the club.
Is it because the price isn’t right?