Academic journal article The International Sports Law Journal

French Football Clubs 'To Float' in 2007-A Topical Note

Academic journal article The International Sports Law Journal

French Football Clubs 'To Float' in 2007-A Topical Note

Article excerpt

Manchester United Football Club was one of the first football clubs to 'float'--that is, to have its shares quoted on the Stock Exchange. And at one time, its capitalisation was worth 1 billion [pounds sterling], making it the richest football club in the world. But, according to the recent Deloitte and Touche Annual Soccer Finance Report, ManU, as it is known by its fans, has been dislodged from this heady position by Real Madrid.

The floating of Football Clubs on Stock Exchanges has had a chequered history to date, in that no all floatations have been successful and returns for investors in football clubs have not always turned out to be lucrative. In fact, the jury is still out in financial and investment circles. Apart from the fact also that fans of the clubs concerned have not always fared very well under such arrangements--witness the takeover of ManU by the Glazer family. However, floating on stock exchanges does have certain advantages, including opening up the possibility of wider share ownership (including fans) and the raising of finance for the development of clubs and their facilities, including new stadia (not every football club has a Roman Abramovich to bank roll them!), although it has to be acknowledged that a large proportion of additional finance is often swallowed up in payroll costs, especially players' wages, which still continue to figure as a significant item on clubs' profit and loss accounts!

In France, floatation to date has been prohibited. But, in December 2006, the European Commission requested the French Government to open up the market and modify the Act No. …

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