Saudis close to taking control of Newcastle

hdeal would potentially make club one of richest in the world hlengthy secret talks lead to £305m purchase from Ashley

The takeover of Newcastle United by a Saudi Arabian-financed consortium that would establish the club as one of Europe’s most powerful was on the brink of being sealed last night.

Following secret negotiations that had been going on for weeks, Premier League lawyers were understood to have been working frantically to finalise the takeover in the hope of making an official announcement today.

The deal, which would net owner Mike Ashley around £305million, would transform Newcastle into one of the richest clubs in the world, backed by the world’s largest sovereign-wealth fund.

The news was greeted with joy on Tyneside yesterday, with supporters having pined for this takeover to go through for more than a year.

It would finally bring an end to 14 largely miserable and divisive years under Ashley’s control and would, in theory at least, give Newcastle the spending power enjoyed by Manchester City and Paris St-germain, who are owned by the ruling families of Abu Dhabi and Qatar respectively.

The deal would entail Saudi Arabia’s Public Investment Fund taking an 80 per cent controlling stake, with the London-based Reuben brothers paying for a 10 per cent stake, and the broker, Amanda Staveley, receiving 10 per cent for her role in setting up the deal.

Staveley, who has fought tirelessly for the takeover, is expected to front the club, at least in the short term, until the Saudis feel comfortable in their new business venture. Ultimate control is then expected to shift to the new chairman and PIF governor, Yasir Al-rumayyan, alongside a newly appointed chief executive officer.

It will bring an end to 18 months of deadlock after a deal was initially agreed with Ashley in April 2020, only for it to stall when it failed to pass the Premier League’s owners’ and directors’ test.

At the centre of the dispute was TV piracy within Saudi Arabia. The Premier League broadcast partner, Qatari-owned BEIN Sport, was banned in the country. That meant it was impossible to watch Premier League games in Saudi Arabia legally.

The issue was inflamed by the fact the Premier League was blocked nine times by the Saudi state from taking legal action against those responsible, long before it emerged the PIF wanted to buy Newcastle.

That led to an offer of arbitration from the Premier League, initially turned down by the consortium, but which was accepted by Ashley in September last year, two months after the PIF publicly withdrew from the process in frustration at the inability to pass the owners’ and directors’ test.

That hearing will no longer be necessary as the Saudis have moved to solve the problem and the issue of whether the PIF is separate from government control appears no longer to be relevant to the Premier League.

There will, however, still be criticism of the deal, given Saudi Arabia’s human rights record and

the murder in 2018 of journalist, Jamal Khashoggi, who was critical of the regime.

The murder took place at the Saudi embassy in Turkey and the United States government, as well as Western intelligence agencies, determined it was carried out under the direct order of Crown Prince Mohammed bin Salman, de facto ruler of Saudi Arabia and chairman of the PIF.

Despite intense lobbying against the takeover from human rights groups and the widow of Khashoggi, the opposition to the BEIN Sports contract was the major obstacle that had to be overcome, but it now seems certain the Premier League will give the deal the green light after BEIN confirmed that its legal dispute with Saudi Arabia had finally been settled.

Crucially, progress has been made behind the scenes after the Saudis took control of the talks directly and asked the Premier League what they needed to do for the takeover to be revived. They have since acted on that instruction.

Sources close to the potential deal claim representatives in Saudi Arabia regret failing to take a more hands-on approach in convincing the Premier League that the PIF was fit to run the club.

BEIN’S claims that its signals were being blocked by Saudi Arabia as part of hostilities with Qatar had played a key factor in the Newcastle deal failing the directors’ and owners’ test. In recent days, however, Saudi legal representatives have made contact with BEIN to assure them that they want a $1billion arbitration case with Qatar settled.

Sources close to the broadcaster, which had warned that rights values would plunge unless the row was resolved, said the pledge was “absolutely enormous for our business”. Saudi’s population of 40 million is rated as the biggest potential market in the Middle East and North Africa for BEIN.

Saudi Arabian officials, who have maintained for months that BEIN’S signals were not blocked, were contacted by The Daily Telegraph, but were unable immediately to verify the claim that its dispute with BEIN had been settled.

However, one key figure in derailing the previous takeover attempt said: “There is now nothing legally stopping the takeover. The legal issue will be resolved; so it simply becomes a moral question for the Premier League.”

A lack of clarity around the separation between the state and its sovereign wealth fund was also cited as a key factor for a tortuous process that led to Saudi Arabia eventually pulling out.