Sunderland AFC’s very own billionaire shareholder, Juan Sartori, must have felt very much at home at the meeting of the global superrich at the World Economic Forum in Davos last month. His stated aim whilst schmoozing with his fellow plutocrats in the exclusive Swiss ski resort: to seek much-needed investment.
Alas, as it transpired, the investment he sought was in his homeland of Uruguay rather than our club, a business in which he still holds a 20 per cent stake and which is currently up for sale.
This shouldn't be a surprise; after he came from nowhere to claim second place in the election for the centre-right National Party’s presidential nomination last year, Sartori was successfully elected as a Senator, so you would hope that the first priority of an elected politician would be to serve the interests of his country and his constituents rather than a football club he’s been involved with for little more than 18 months. His political party have promises of thousands more jobs to fulfil.
Mr Sartori is clearly a shrewd businessman with a talent for populist political communication. He has financial interests around the world in the agricultural and extractive industries through his Union Group company. Like other would-be disrupter politicians around the world, he’s hardly a self-made entrepreneur, but he clearly knows a decent opportunity to make money when he sees it.
If we accept - without documentary evidence - the story that the Madrox Partners did actually use their own money to purchase the club from Ellis Short for £40 million in 2018, then Juan’s stake in Sunderland cost him around £8 million.
If estimates are correct and Donald is now looking to sell-up for something near that price, the impending sale of the club would net Juan a couple of million quid profit at most (although a lot more if the original purchase of the club turns out not to have been funded by the shareholders in Madrox). Either way, it’s relatively small beer for a talented man with a large fortune and big ambitions.
Financial news website Bloomberg this week reported that the sale of the club is imminent. Could it be that - now his place in the national political life of Uruguay is secured, in no small part to his vast financial reserves - it is Sartori who will now look to take over control from Donald? Are the pieces falling into place?
The weak British pound, which has again fallen against the US dollar over the last week, makes assets in the UK more attractive to global investors. Sartori knows this very well, and has spoken openly about how Brexit could make the UK more attractive to global capital, though cautioning that investments would be delayed until there is more certainty regarding how the ongoing political project here is resolved.
Perhaps, as the post-Brexit future of the UK becomes ever clearer, the hoovering up of undervalued assets with huge growth potential can begin in earnest.
Juan is demonstrably a man of considerably greater means than either Oxford insurance salesman and former Eastleigh Town chairman Stewart Donald or old-Etonian “PR man”, Charlie Methven. Donald and Methven themselves noted in their early remarks that it would be Donald fronting the takeover because the original plan of an “International Consortium” - which we can infer was to be headed by Sartori - would have taken longer and been more complex than a takeover headed by a UK-based business man with a track record of football club ownership.
At the time that the investment from FPP Partners was announced in November 2019, the Echo reported that Sartori had been willing invest more in the club. By December, Methven was saying that Sartori would take a more active role and that he had put further funds into the club in September. In December, Madrox’s articles of association was amended to clarify that Sartori’s shares are held in the name of offshore British Virgin Islands company, Arvesa Corp. Then came Donald’s capitulation to calls for him to sell the club - which had essentially been up for sale since day one. Since then, silence.
Foreign Direct Investment (FDI) in English football has a long and ongoing history, and it has very often come from super-rich individuals, families and companies with close ties to the most dubious of dubious regimes or business practices.
Little is made of where the money comes from that has funded the growth of Manchester City or Chelsea from average sized clubs to global superbrands. Indeed, I often find it perplexing that more fan hostility is shown toward US-owned global sports businesses owning Premier League teams as part of their diverse and entirely legitimate investment portfolio than clubs being procured as part of a sports-washing PR strategy, employed by tyrannical dictators.
The Saudi Royal family may be eying up our friends along the road, and they don’t seem to mind. We are increasingly aware of the destructive impact of the global food production sector on the future of the planet, yet nobody really asks about the impact that Sartori’s company has on global CO2 emissions.
Now, I am mindful, of the Old Testament proverb...
The son shall not suffer for the iniquity of the father, nor the father suffer for the iniquity of the son. (Ezekiel 18:19-20)
And that the son-in-law is yet one further step removed from the father, but it would be naive to ignore the presence of the daughter of the Russian oligarch, Dimitri Rybolovlev, in this story of Sartori and Sunderland.
Juan’s wife, Ekaterina Rybolovleva, is the nominal owner of AS Monaco, with her father the club President. Rybolovlev has faced repeated questions over his property dealings with Donald Trump and faced corruption charges related to a long-running dispute over a multimillion dollar art deal.
At the time of his emergence from obscurity in Switzerland onto the Uruguayan political scene, there have been accusations in El Pais (Spanish) regarding supposedly underhand social media and “fake news” tactics used by Sartori’s political campaigns. It seems that the tone of was that of the outsider, determined to transform the stuffy traditional centre-right National Party, which is almost as old as the Republic of Uruguay itself, with his dynamism.
But his campaign was unsuccessful and the Party’s candidate, Luis Alberto Lacalle Pou, takes over the Uruguayan Presidency on 1st March 2020 following an election win over the incumbent left coalition in October 2019.
Uruguay has a democracy that is one of the most resilient and popular in South America and it ranks highly in terms of human rights (homosexuality has been legal since 1934, for example). And beyond a sensationalist story in The S*n a while back regarding his financial involvement in the legal production of marijuana, little has been written in the British media regarding his political and business dealings.
But essentially, on the surface, Juan is clean as a whistle.
Models of club ownership
According to the excellent new book, The Price of Football, by Keiran Maguire, there are 5 models of football club ownership in Europe:
- The Trophy Asset
- The Butterflies
- The Flipper
- The Local Fan Made Good
- Fan Owned Clubs
The question posed here, then, is would we as Sunderland fans be happy with a rising star of the global business and political elite taking over our club, be that Sartori or any other figure who would value the club as a “Trophy Asset” - a plaything, a hobby into which is plough the excess profits of political and commercial success and a fun place in a newly-buccaneering England to bring your contacts in your private helicopter?
We don’t seem happy with the current ownership model, whose pockets are not quite that deep. Whether Stewart Donald is a “butterfly” fluttering between different clubs (e.g. Eastleigh, Oxford and Sunderland) out of a love of football trying to make a profit along the way, or a “flipper” who bought a big club at its lowest value in order to turn a quick profit, running the club on a shoestring in the meantime is possibly a moot point right now.
There is a crucial role to play here by FPP Partners, not just as creditor but also as final arbiter of any transfer of Sunderland AFC’s holding company’s - Madrox Partners - shares. Questions remain essentially unanswered as to how and why the much-touted initial FPP takeover has turned into a loan with large strings attached. There are many unknowns about how the club is being managed internally, and they have done their due diligence on a potential takeover already. They remain silent on the matter.
It may be that FPP Partners will move in to take over the club and fund our rise back to the big-time (and the £250 million valuation that would put on the club) now that the investment environment in the UK is becoming more certain. Being part of a profit-driven, customer-focused global investment portfolio of a corporate giant is perhaps be the least worst option at this stage.
It is also entirely possible that neither the “Dell Boys” nor Juan Sartori are among the small number of interested parties taking a serious look at the taking over the club. We will find out soon enough.
What do we want for our club?
I have discussed at length the vanishingly small chance of “The Local Fan Made Good” coming forward - my Euromillions ticket didn’t pay out this week - and my preference for our transformation into a “Fan Owned” Socio club in recent articles.
But I ask thinking fans with critical eyes and sceptical minds - are you prepared to see Sunderland AFC becoming the plaything of yet another global billionaire, Sartori or otherwise, or a global investment firm - or, could we urgently explore more sustainable, innovative ways for our beloved football club to be financed and developed?