Southampton owner tells Mauricio Pellegrino he has no extra funds
Matt Hughes, Deputy Football Correspondent
August 18 2017, 12:01am,
The Times
Southampton’s new Chinese owners have no plans to inject additional capital into the business or to spend money on new players because the takeover was largely financed via a bank loan and contributions from third-party investors.
The club announced that Jisheng Gao had paid £210 million for an 80 per cent stake in the club on Monday after Katharina Liebherr, the former owner, said that fresh investment was needed to cement Southampton’s position as a top-ten Premier League club, but did not release any financial details.
Mauricio Pellegrino, the manager, is aware of the situation, however, and has been told not to expect any additional transfer funds this month.
Gao’s takeover bid was a fraught process lasting more than 12 months with the Chinese businessman forced to abandon plans to buy the club through Lander Sports Development, his company, because of restrictions imposed by the Chinese government on taking capital out of the country.
The purchase was completed via Hong Kong using some of Gao’s personal assets, but The Times has learnt that the 64-year-old did not supply all of the £210 million and that the takeover was reliant on money provided by at least three other investors.
Nanyang Commercial Bank Limited, a Chinese-backed Hong Kong bank, is understood to have loaned Gao a significant portion of the purchase price, with several investors from Macau also contributing.
Gao’s backers are demanding a return on their investment and will not grant him a transfer budget so the club will continue to operate as it has done throughout the Liebherr family’s ownership. Markus Liebherr bought Southampton for £14 million in the summer of 2009 and it was inherited by his daughter after his death in August 2010. Katharina Liebherr has made a £150 million profit from the sale to Gao having converted £38 million of loans into shares five years ago.
In their most recent accounts, for the financial year ending June 2016, Southampton recorded a post-tax profit of £4.9 million, but that was reliant on the sales of Morgan Schneiderlin and Nathaniel Clyne for a combined £37.5 million the previous summer. Southampton made almost £50 million from player sales last summer and that will form part of their next accounts.
Pellegrino has been told that he must continue to sell players before he can buy, which could affect the club’s determination to keep hold of Virgil van Dijk amid interest from Liverpool and Chelsea. Ralph Krueger, the Southampton chairman, made an unequivocal statement on Wednesday, saying that Van Dijk is “not for sale during this window”, but it will come down to Pellegrino, who must decide whether it is worth keeping a player who is not training with his team-mates, particularly if doing so denies him funds that could be used to strengthen the squad.
Liebherr has retained a 20 per cent stake in the club that she may sell to Gao at a later date, but in the meantime her statement on Monday that it is “business as usual” for Southampton is an accurate reflection of the club’s position. The only immediate change to the club’s operations is likely to be the addition of Gao’s daughter, Nelly, to the club’s board. Southampton declined to comment last night.
https://www.thetimes.co.uk/edition/...io-pellegrino-he-has-no-extra-funds-6xz3ff8v6