Newcastle back to square one after Saudi takeover fails

MANCHESTER, England, (Reuters) - Newcastle United head into the short Premier League close season surrounded by uncertainty after the collapse of the proposed Saudi takeover — with an owner who wants to sell the club but with no viable purchaser in place.

Club owner Mike Ashley was ready to sell the club to the investment group, which included Saudi Arabia’s sovereign wealth fund PIF, Amanda Staveley’s PCP Capital Partners and Reuben Brothers in a deal worth more than 305 million pounds ($400.68 million).

But the takeover bid, announced in April, never emerged from the Premier League’s owners and directors test and on Thursday the consortium pulled out.

Fans who had dreamt of big-money signings and competing for European places, now face a more mundane reality for a team which finished 13th in the Premier League last season.

While there have been some reports of possible interest from potential purchasers in the United States, no actual proposal has appeared and sources close to the Saudi consortium said they never had to deal with any rival bid.

The consortium blamed the prolonged scrutiny process and global uncertainty linked to the COVID-19 pandemic for their decision to withdraw, although Staveley has suggested there may yet be some way to get the deal done.

Newcastle managing director Lee Charnley offered similar hope saying Ashley, founder of retail firm Frasers Group, remains committed to the Saudi deal.

“We acknowledge yesterday’s statement. Never say never, but to be clear Mike Ashley is 100% committed to this deal. However our current focus must now be on supporting (manager) Steve Bruce in the transfer market and on the preparations for the new season,” he said.

Ashley has not taken the club off the market but his chances of finding a new buyer may be hampered by the economic uncertainty following the pandemic.

“It is genuinely unlikely at the moment. Premier League buy outs either need very deep pockets (sovereign funds etc) or a high degree of borrowing,” said football finance expert Rob Wilson of Sheffield Hallam University.

“This risk associated with the latter in an unsteady market looks unlikely hence with no Saudi acquisition it looks difficult,” he added.

Newcastle have not featured in the Champions League since 2004 and have not won the English title since 1927 or FA Cup since 1955, despite claiming one of the country’s largest fan bases. BROADCAST DISPUTE

One of the key problems for the bid was the continued conflict over Saudi Arabia’s response to cases of unauthorised broadcasting of Premier League games in the country — part of a long-running dispute between the kingdom and neighbouring Qatar.

A source close to the bid said that PIF had offered to put together a Saudi consortium to buy the rights to broadcast the games in Saudi Arabia since Qatari company BeIN Sports, who own the rights, has had their licence to broadcast in the kingdom removed.

Another source close to the deal, put the blame for its collapse firmly on the Premier League.

“The problem with the deal was the intransigence of the Premier League. Everyone else was happy to proceed,” the source said.