First priority for Saudi PIF as Newcastle United owners but time is now of the essence
The Saudi PIF takeover of Newcastle United appears to be now simply a question of time.
All the ducks are now seemingly lined up in a row and it is a case of the football authorities now giving their approval after going through the necessary checks.
Whilst our natural reaction as Newcastle fans is one of scepticism / cynicism after having had our hopes turn to dust so many times, if it isn’t happening this time then you have to wonder if it ever will.
With it being the Saudi PIF financing the bid, if/when they become new owners, they will be thinking big.
They are involved in many projects around the world and looking to diversify long-term from an over-reliance on the oil money which is financing these investments around the globe.
When it comes to thinking ‘big’, obviously transfer budgets will be part of that thinking, but that is only one small part of things, especially in these early days once they complete this NUFC purchase. Indeed, FFP (Financial Fair Play) rules mean that you can’t just buy who you want from day one, even if you have the private funds to do so.
Very much like the case of Manchester City, this Saudi PIF project won’t be just about putting a team out on the pitch, I think we are guaranteed that this will be a far wider reaching scheme that will see a much bigger transformation than replacing Joelinton with a goalscorer.
I would be astonished if the first priority for the Saudi PIF bidders isn’t the one I am thinking of…indeed, I fully expect that they already have done a lot of work on it, with very possible that a deal on this aspect is already agreed and would be made public once the purchase of the football club is confirmed.
I am referring to the land opposite the Gallowgate End, land bought by Newcastle United back when John Hall and Freddy Shepherd were running the show. The idea being that sometime in the future, St James Park could be expanded at the Gallowgate End as part of a larger scale development. The plans they had drawn up back then, showed St James Park could be expanded to at least a 60,000 capacity, with that expansion being part of a wider development that would incorporate a massive casino, hotel and so on.
When Mike Ashley bought Newcastle United, that land opposite the Gallowgate End came as part of the deal. However, Mike Ashley later sold the land to himself and then eventually sold it on to developers for a personal profit.
Despite objections from Newcastle fans, the city council approved plans to build a combination of hotels, student accommodation, office space and retail, which would mean realistically there would be pretty much zero chance of St James Park being expanded, even if the club ever got a new owner…
It really is a no-brainer for any ambitious new owner of Newcastle United to look for any possible ways to increase St James Park’s capacity.
This works on a number of levels, not just in terms of enabling more fans to get into matches and give support to the team, it very much works on a business level. Which is why clubs such as Manchester City were so keen to expand the Etihad despite having massive personal funds available to them.
Ground development doesn’t come under Financial Fair Play (FFP) rules, so doesn’t have to affect spending on transfer fees and wages. Owners can privately fund an increased capacity and the benefits to them for doing this are: getting more fans into St James Park would obviously produce higher matchday revenues going forward, allowing them to grow the business/brand, it also means that if/when they come to sell the club in the future, they would get that money back and more on their extra investment.
With the FFP rules, increasing revenues in this way would mean ambitious owners would then be able to spend significantly more on both transfer fees and player wages in the future.
The Saudi PIF are involved in all kinds of projects, including/especially construction so every chance their expertise could enable even more innovative ways to help maximise the St James Park capacity.
Obviously a deal would need to be done (or have been done…) to compensate the current developers but no reason why an alternative development can’t be the outcome, which includes an expanded St James Park. Certainly, if Newcastle City Council are waving through this current development as it is stands, it would surely be unthinkable to believe they would then for some reason block a different approach that would see a bigger stadium capacity.
The clock is ticking though and we look for an early conclusion to this reported buyout. If it does happen and we see investment in both the playing squad and the infrastructure, particularly plans for a bigger St James Park capacity, the change in mood/belief of Newcastle fans would be something to behold.
It would actually be beyond belief that the Saudi PIF is only about securing the football club and not looking to have extra assets/projects in Newcastle on top of that, especially with the city centre location of St James Park. Even if you ignored the expansion of the stadium, it would be ridiculous to think that they wouldn’t want to get control/ownership of this prime city centre land that is next to SJP.
The presence of the Billionaire Reuben brothers as minority shareholders in this Saudi PIF bid for Newcastle United hasn’t really been put under the spotlight much.
They were second highest in the latest Sunday Times UK rich list with a fortune of close to £20billion and their fortune is largely built on property/development.
They are already well established in Newcastle city centre and for example, own huge plots of land and property on Pilgrim Street, their development company Taras Properties is behind a massive office and leisure scheme on the former Bank of England site in the city centre. This is just one of a number of projects they are involved in up here, as well as owning Newcastle Racecourse.
The logic for me is that as well as any involvement in NUFC, the Reuben brothers will be the key people on the ground, driving forward any wider plans the Saudi PIF have in and around Newcastle, such as taking control of that land at Strawberry place and it becoming part of the overall scheme with Newcastle United at its heart.
Obviously we can only speculate on anything and everything now BUT it could only be a matter of weeks before we see a future glittering with potential made public.
If you would like to feature on The Mag, submit your article to [email protected]