How Foreign Ownership Has Affected the English Premier League & Liverpool Football Club

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  • Topic: Liverpool F.C., Premier League, Manchester United F.C.
  • Pages : 5 (1630 words )
  • Download(s) : 145
  • Published : November 19, 2012
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Introduction

The Premier league is the top soccer division in England. It is claimed to be the richest league in the world where some of the most popular players and football teams play. Most professional sports teams that are capable of buying top football players are generally the most successful. Foreign investment in English Premier League teams has become a trend and a way of becoming rich and successful.

Most of the clubs in the league are controlled by foreign investors out to make profits. Liverpool F.C was formed in 1892 by John Houlding to play at Anfield after Everton F.C vacated the field. The club is arguably the most successful club in England. It has won 18 First Division titles, 7 FA Cups, 7 League Cups, and 5 European Cups.Liverpool F.C. signed a deal with Prince Faisal Al Saud to initiate and activate an elite commercial collaboration between F6, Liverpool F.C., and the Richard Petty Nascar Team.

Factors of management that are strength to the program

Collaboration with effective partners is a major strength in the performance of the club. These exclusive collaborations explore collaborative commercial opportunities viable to football, Nascar racing, and interactive media in the Middle East country, Saudi Arabia and the surrounding nations. The Middle East sport market has great potential of growth, as the fan base in the region is growing everyday. The deal will strive to enhance the level of football competition, sports management expertise and soccer players in the region. Among the strategic partnership, plans in mind include the creation of academies and training facilities owned and controlled by Prince Faisal's organization.

The framework for collaboration in Nascar has been created to evaluate the expansion of a Nascar racing circuit and Richard Petty racing institutions in the Middle East environs. F6 is one of the leading investors in interactive sports media in Saudi Arabia and has considered this deal as a perfect opportunity to bring in local teams and athletes, and introduce new methods of management and training in sports. It will also provide employment opportunities and innovative reality media production techniques (Foster et al, 2006).

Liverpool fans have greatly contributed towards the success of the club. The number of Liverpool fans has increased as a result of celebrating the club’s sale to new owners and also due to the appointment of a new manager Roy Hodgson. The signing of a new player Joe Cole saw the Liverpool website break its previous record of 65 million page views to over 85 million page views. The news of Joe Cole signing raised the page view impressions to over 483,000 in just an hour. In addition, the time that the club’s fan spend in the site increased from five minutes to seven minutes while the average number of page view increased from 4.5 to 5.95.

Factors of Profitability and viability

One of the factors contributing to profitability and viability of Liverpool is the use of market value approach. This approach has enabled the company to assess its market value and thus evaluate its overall performance (Foster et al, 2006). Other approaches that have also contributed to the clubs success include the Acquisition-Based valuation approach and the Sabermetrics technique. The Acquisition-Based valuation approach assists in making viable acquisition for the club while the sabermetrics is very useful in the evaluation of players’ performance and the overall performance of the club (Foster et al, 2006). As a result, Liverpool F.C. debts have almost doubled to £86m based on the latest financial reports. The club has however recorded an increase in profits after making losses the previous year. The club’s annual accounts show a pre-tax profit of £10.2m in 2008, which is an increase fro the previous year in which the club made a loss of £21.7m.

Application of Triangulation to gain an accurate value of the club

Technological development and growth...
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