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China welcomes an unprecedented soccer fever

Monday, 15 Aug 2016 17:58   |   By Chen Yaping

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It seems that every a few months, there will be a report saying that some Chinese company has bought into a foreign soccer entity.

Although a soccer backwater in the past, China has entered into a buying spree in recent years. Chinese capital has also been flowing into the soccer industry. Chinese investors have invested about 2 billion US dollars in sports assets, especially in soccer-related sectors. 5 years ago, that number was zero.

According to a recent report, China-based IDG Capital Partners has agreed to acquire a 20% stake in French soccer club Olympique Lyonnais for €100 million. The two sides are also planning to set up a joint venture in China for their common interest in the sport. These days, such reports are a common phenomenon.

In recent months, a series of striking purchase deals have caught international eyes in the industry. Impressively, it seems that next year’s Milan derby, one of most-prestigious European soccer games, will feature two teams recently purchased by Chinese groups.

In June, Chinese retail giant Suning Commerce Group announced that it has acquired an approximate 70% stake in the Italian football club Inter Milan for €270 million. 2 months later, AC Milan’s owner Silvio Berlusconi confirmed that the Italian giant will be sold to a Chinese consortium led by Sino-Europe Sports Investment Management Changxing for €740 million, including €220 million of debt.

Meanwhile, China is showing its interest in the world soccer governing body as well as foreign clubs. After all, purchasing a club will bring valuable experience in club management and operation while taking roles in Federation Internationale de Football Association (FIFA) means a greater say in the industry.

This part of the business has been led by some of China’s richest groups like Dalian Wanda and the Alibaba Group. Early in December 2015, Alibaba E-Auto announced a valuable eight-year partnership with FIFA, to become the exclusive presenting partner of the FIFA Club World Cup.

In March, as FIFA was still suffering from corruption scandals and continuous doubts, Wanda signed a US$150 million agreement to become FIFA's first Chinese sponsor. This has become a milestone for Chinese soccer.

As expected, with the help of FIFA, Wang Jianlin, Chairman of Wanda, announced in July the hosting of an annual high-level “China Cup” tournament, to raise the profile of the Chinese national football teams. China’s richest man plans to use this new tournament to rival the European Champions League.

The latest news is that Zhang Jian, the Chinese Soccer Federation's General Secretary, is among the 7 candidates who will contest for the new seats on FIFA’s ruling council. Although we will have to wait and see the result, what’s certain is that China is growing its presence and influence in the soccer industry. Also, the chance for China to hold a FIFA World Cup is increasing by the day.

Proofread by Sean O Diobhilin

Tags: Wang Jianlin,AC Milan,Alisports,Inter Milan,investment,Wanda Group

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