DUNLAVY COLUMN

Villa are caught up in the great Chinese takeaway

TONY Xia is – apparently – worth a billion quid. So when the 41-yearold turned up at Villa Park in an Uber, something smelled fishy.

By this summer, the reek was overpowering. A missed tax bill. Sacked staff. A £40m shortfall and a desperate hunt for investment.

Like the fat striker who turns up for pre-season towing a caravan, the onetime European champions were a shambling wreck.

By the start of July, a club that spent a Championship-record £88m on players in the 2016-17 campaign was pondering flogging their car park to make ends meet.

Only by borrowing against their final parachute payment did Villa dodge a winding-up order. But for the arrival of investors Nassef Sawiris and Wes Edens, who injected “significant” capital in exchange for a 55 per cent stake, insolvency loomed.

So where did it all go wrong for ‘Dr’ Tony, who arrived in 2016 amid a flurry of big-money signings and brash promises?

And as the “heartbroken” 41-year-old relinquishes control for a lowly co-chairman berth, should Villa fans reserve any sympathy?

Devaluation

A little, perhaps. When Xia bought the club, China was in the midst of a football boom, hell bent on becoming a ‘soccer superpower’.

Exhorted by president Xi Jinping, Chinese investors swarmed across the football landscape, buying into clubs everywhere from Madrid to the Midlands.

Then, in late 2016, a devaluation of the Yuan against the dollar and a subsequent rush to move money abroad saw Beijing clamp down on overseas spending.

China has always imposed a $50,000 annual limit on ‘capital outflows’, whether that is investing in companies or buying property.

Anything more – like Xia’s £76m purchase of Aston Villa and the £4m monthly payments that propped the club up thereafter – needs special dispensation from the government.

Overnight, however, loopholes were closed and rules tightened up. Now, any investor in a foreign company must show clear evidence of benefit to China – for instance, access to a new technology. Clearly, a down-at-heel Championship club does not fit the bill.

Worse yet for Xia, Beijing specifically discouraged investment in football, Jinping slamming the brakes on his own pet project.

In January, the Chinese Super League – where Carlos Tevez was once paid a world-record £34m-a-year – imposed a salary cap.

In February, Wang Jianlin, one of China’s richest men, flogged his £50m stake in Atletico Madrid.

In March, Pan Gongsheng, China’s head of exchange policy, publicly outlined the government’s new-found aversion to “irrational” investment in football.

“If these purchases help improve Chinese soccer, then I think that’s a good thing,” he said. “But is that what’s really happening?

“A lot of Chinese companies already have high levels of debt and then borrow another large sum to make overseas purchases. Others pretend to be investing but are actually just moving their assets.”

Fortunate

When the president of China – or even a minion – speaks, big business bends over backwards to comply.

Ostensibly, Birmingham and Wolves, two other clubs in Chinese hands, are fortunate. Their owners, Trillion Trophy Asia and Fosun, are registered in Hong Kong where capital controls do not apply.

Nevertheless, neither club should feel entirely comfortable in the current anti-football climate. Paul Suen, the head of TTA, recently bought the second-most expensive house in Hong Kong at an eye-watering £143m.

Given China’s current refusal to sanction the purchase of any foreign real estate, this indicates an abundance of accessible cash, yet Blues are currently under a transfer embargo after failing to comply with FFP.

Coincidence? Or evidence of waning interest?

West Bromwich Albion, whose owners Yunyi Investments operate out of Shanghai, have hardly broken the bank either. Their net spend for the summer is a little over £3m.

Xia, then, was unlucky. Yet he was also undeniably reckless when the storm hit. By January 2017, he must have known which way the wind was blowing, yet still blew £23m on deals to bring the likes of Scott Hogan and Conor Hourihane to Villa Park.

In hindsight, that now looks an all-or-nothing punt, a final p***-up before prohibition. Signing John Terry on an annual salary of £3.64m six months later was equally irresponsible, but Xia was all in by then, gambling on promotion to the Premier League or a relaxation of capital controls.

Fulham scuppered the first punt, beating Villa 1-0 in the play-off final at Wembley. The second explains why Xia then spurned several offers to buy the club, insisting he sought only a minority backer.

Whether this represented a genuine belief that China would ease off the brakes or simply the belligerence of a ruined gambler, only Xia can say.

Either way, a dramatic devaluation of the Yuan in early July crushed his hopes and it is no coincidence that the club were then sold in short order.

Were Villa in real peril? Probably not. Buyers were queuing round the block even with a winding-up order on the doormat and a £40m FFP shortfall to cover.

Dismissal

Long-term, too, there should be little damage beyond a disrupted pre-season and the loss of CEO Keith Wyness, whose unseemly dismissal came after he unilaterally sought the advice of administrators. Yet fans will not forget the embarrassment of recent months, the sackings, the sniggers and the snide remarks. Nor that Xia let the repo men creep so close to the door.

Questions also remain about Xia’s ongoing input. From his perspective, keeping 45 per cent is a no-brainer with Premier League riches on the horizon. Presumably the plan is to buy the club back when – or if – Beijing softens its stance.

But he offers little value to the club with his fortune in a Chinese bank vault.

Now, Sawiris and Edens must cover costs while Xia waits for a green light that may never come; it is a recipe for friction, and a potential block on future investment.

If Xia really “loves” Aston Villa and “wants nothing in return”, as he claims, wouldn’t it be best to take the hit and sell up completely?

Whatever transpires over the next 12 months, it will now be very difficult for him to regain the trust of supporters, many of whom doubt both his means and motives.

It is also clear that any club seeking a saviour will no longer find one in the East. The Chinese invasion – for now, at least – is over.