The will-they, won’t-they mystery surrounding the attempts by Eight Sports Capital to buy into Tottenham Hotspur does not look like being demystified any time soon.
On Friday a press release landed in the inbox of the football and trade press, appearing to confirm that Eight Sports – a group financed by multi-billionaire Richard Tsai and Ng Wing-Fai and publicly fronted by Brooklyn Earrick – had acquired 24.99 per cent of ENIC’s shares from Daniel Levy.
Quickly, it emerged that there was more to the story than met the eye. ENIC and Spurs have since said they aren’t aware of any agreement between Levy and Eight Sports.
Speaking exclusively to The Spurs News, Professor Kieran Maguire, a football finance expert who is well connected within the industry, gives us his account of the last few days and what might happen next.
Did Eight Sports jump the gun?
“Almost as soon as the articles and social media posts went out,” says Maguire, speaking about the immediate chaos after the announcement, “they started to be revised or deleted.
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“It appears that, on the buying side, it has been handled in a very amateurish manner. You simply don’t put out a press release until the deal has been signed. If you’re dealing with someone as fastidious as Daniel Levy, it’s a very strange thing to jump the gun.“
What is Eight Sports’ reputation?
Eight Sports are a newly formed enterprise, but a previous bidder – Firehawk – has an almost identical roll call of investors and executives.
Firehawk failed with a bid to buy Spurs outright in September last year, but it was considered credible enough to detail the proposal on the UK Takeover Panel Disclosure board.
So, what is Eight Sports’ reputation among those in the business?
“I can’t find the company on Companies House,” says Maguire. “The previous company [Firehawk] had to sit out for 180 days after they made an offer.“
“Whatever the dynamic, football is a small industry with a big megaphone. The buyers have come out of this very poorly. They must be aware that the history of football acquisitions is littered with people who have used claims to garner attention.
“You don’t want to be associated with charlatans, tyre kickers and ne’er-do-wells. In the eyes of supporters, this will have put them into this category. They are looking for custodians, guardians of the club that they love.”
Why 24.99 per cent?
24.99 per cent was a very specific, seemingly deliberate stake to acquire. Why?
“It’s interesting that it’s for 24.99 per cent as well because, if it was over 25 per cent, you have additional protective rights under the takeover code. Levy wasn’t willing to forego that,” says Maguire.
“There is a lot of conjecture here, but it could be that if someone acquired over 25 per cent, they might have given the Lewis family the right to match that offer.“
What influence might Eight Sports have at Spurs?
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“By all accounts, this stake won’t have a board seat attached to it, so it’s a lot of money for zero influence.
“I was drawn to the comments of Florentino Perez recently when he said you should view a club as a work of art rather than a traditional investment, not a work of art. You get pleasure from it, but you will only get money at the exit point. It costs a lot of money in the meantime.”
What about the valuation?
Levy was said to value Spurs at about £3.75bn, although that appraisal was often pilloried by supporters and deal-brokers alike.
If the sale to Eight Sports goes through, however, it could cost them as much as £1bn.
“If they get things right off the pitch, it is a club with a lot going for it,” explains Maguire.
“They have great commercial revenues, the stadium is future-proofed. Because they have the stadium, your capital expenditure is pretty low, meaning you can put any investment you do make into the football side of the business.
“Even at a £3-4bn valuation, there are some very attractive elements to it.”
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