When it emerged that Tottenham valued themselves at £3.75bn, some eyebrows were raised within the world of football business.
It is not exactly a trade secret that Spurs chairman and co-owner Daniel Levy is about as tough a negotiator as there is.
Besides long-running transfer sagas involving the likes of Harry Kane, Levy’s somewhat obstinate approach to negotiation has presented itself in talks for the naming rights for the Spurs‘ stadium.
Originally, Levy wanted £20m per year for the Tottenham Hotspur Stadium’s naming rights, which would make it comfortably the most valuable naming rights deal in the UK.
Six years in and Spurs are still without a naming rights deal, with Levy’s demands apparently the sticking point.
When Levy announced that he and ENIC were seeking fresh strategic investment in Spurs earlier this year therefore, fans could be forgiven for not anticipating new co-owners to arrive any time soon.
Spurs are believed to be seeking a new minority investor, perhaps somewhere around 10-15 per cent.
At a £3.75bn valuation, a 15 per cent stake would be worth around £560m.
What profile investor would be willing to part with nearly half a billion pounds without being guaranteed major strategic influence at the club? The latest Spurs takeover news my provide an answer.
Who has bid for Tottenham part-takeover so far?
Levy has confirmed that he has engaged the Rothschild bank to smoke out potential investors in Spurs.
The advisory group will be reaching out to parties who might be interested, likely in the US private equity sector, or potentially sovereign wealth funds.
Investors in the former category would see Spurs as a capital appreciation project with a view to flipping their stake for a profit in future years.
However, as reported by The Athletic‘s Matt Slater, who is one of the best connected sports business journalists in the country, no one has got anywhere near Levy’s £3.75bn valuation.
What’s more, it is believed that is unlikely that anyone will do so any time soon.
That means Levy may be forced to revise his appraisal of the club or abandon his search for fresh investment altogether.
TBR Analysis: How much are Spurs really worth?
Revenue multiplication is often cited as a determining factor in a club’s value.
For example, Chelsea were sold for roughly 5.2 times their annual revenue.
It isn’t an exact science – far from it – but at that rate, Spurs would be worth around £2.8bn – that is some way short of Levy’s £3.75bn valuation.
However, Spurs have one of the best stadiums at the world that they are paying for at a highly favourable, fixed rate.
They also have exhibited superb cost control in recent years, which means a new investor is not saddled with difficult-to-shift costs.
Significantly, Dynasty Equity’s recent investment in Liverpool is believed to have valued the club at a similar amount to Levy’s £3.75bn.
One might presume that Liverpool’s international brand, which is one of the most recognisable in the world, as well as their history and heritage might mean their value would be far higher.
But Spurs’ star is rising. And the fluid nature of overseas fandom means that the gap between Liverpool is becoming increasingly negligible.
