It seems that every week there is a new rumour concerning the City Football Group and who
they will purchase next.
One week it's a team in France, next it is China.
What is for sure is that CFG, of which Manchester City is the biggest team, is quietly changing
the way football is run.
City Football Group was founded in January 2013 as a holding company for its sports properties,
owned and operated by the Abu Dhabi United Group.
That, in turn, is owned by Sheikh Mansour bin Zayed, one of the most powerful member's
of the Abu Dhabi royal family in the United Arab Emirates.
CFG owns 100 per cent of Manchester City and Melbourne City FC, the group owns 20 per cent
of Japanese club Yokohama F Marinos and owns 80 per cent of NYCFC.
The other 20 per cent is held by Yankee Global Enterprises, the American owners of the iconic
New York Yankees baseball team, controlled by the family of George Steinbrenner.
Last year CFG added two more properties; Club Atlético Torque in Uruguay and, most controversially,
a 44.3% share in the Spanish club Girona.
An identical 44.3% share was owned by Pere Guardiola, Pep's brother.
Manchester City Women, alongside partnerships with clubs and academies across the world,
from Ghana to Denmark, also come under CFG's umbrella, as do a number of companies offering
marketing and other services.
The aim, according to chairman Khaldoon al Mubarak, is to spread the City brand on a
global stage.
“We have an ambition as a football group to have an organisation that is global and
that will have multiple clubs as part of it,” Mubarak cold the club's in-house TV channel,
CityTV.
The clubs have been re-branded to fit parent club Manchester City's look and feel.
Sometimes sky blue shirts are introduced, sometimes badges are redesigned, sometimes
the name of the club is changed altogether.
As happened in 2014 when the group bought Melbourne Heart and controversially changed
its name to Melbourne City FC.
Business deals have followed connected to the Abu Dhabi royal family.
Manchester City famously signed a ten year, £400 million sponsorship deal with Etihad
Airways, the national carrier of United Arab Emirates.
Given the huge increase from any previous sponsorship deal – and the fact that the
company is effectively run by one of Sheikh Mansour's close relatives, Sheikh Hamed bin
Zayed Al Nahyan – the deal caught the attention of UEFA, who suspected that the deal didn't
represent a fair market rate.
In the end UEFA approved the sponsorship deal, but fined the club a record £49 million for
its lavish spending.
Those sponsorship deals have continued across the globe.
Etihad signed a shirt sponsorship deal with NYCFC and also appears on the front of the
Melbourne City FC's shirts.
A massive new kit deal was just signed with Puma which would apply to all CSG teams, except
NYCFC, who are obliged to wear Adidas due to a tie up with MLS.
These globalised commercial deals – alongside booming TV rights revenue – and the shifting
of some costly salaries from City on to its group, has helped to make Manchester City
profitable, something that seemed impossible a few years ago given the £1 billion plus
spent on transfers since Sheikh Mansour bought the club from deposed Thai prime minister
Thaksin Shinawatra in 2008.
Last year City announced that they had made a profit for a third year running, of just
over £1 million in 2016-17.
There was also record breaking revenue of close to £473.4million, placing City in the
financial elite of world football.
And yet not all is rosy with how CFG operates, with its globalised stable of clubs raising
issues about conflict of interests and controversy surrounding the movement of players between
teams with the group.
When Spain international David Villa signed for NYCFC, he first went to Melbourne City
FC for a month to gain match sharpness before being shipped back to New York for the start
of of the season.
And then there was the issue of Frank Lampard, signed to NYCFC to much fanfare.
Instead, he went on loan to Manchester City.
CFG later said the NYCFC announcement had been a mistake, but one that had far-reaching
consequences.
The affair had shone a light on City Football Group, who were creating a network of clubs
where players and staff might be interchangeable, potentially circumventing local transfer rules
and creating all sorts of potential conflicts of interest.
There had long been worries about owners taking control of multiple clubs but this was clearly
a structure UEFA and other governing bodies weren't prepared for.
At the start of 2016 the issue came up again, in relation to the signing of 23 year old
Australian midfielder Anthony Caceres.
City paid his club the Central Coast Mariners the A$325,000 fee and promptly loaned him
to Melbourne City FC.
The move incensed Melbourne City's rivals as cash transfers between clubs are banned
in the A League.
The head of Sydney FC, Tony Pignata tweeted that he believed “Caceres to City is wrong.
How can FFA allow this?
There are no transfers between A-League clubs, yet it seems you can bypass.”
It left the the Football Federation Australia scrambling to close the loophole before it
happened again.
His loan deal was extended for another season, before being loaned to Al Wasl in the UAE.
He has now been loaned again to Melbourne City FC.
There is perhaps another issue other than clever financial tricks to keep City and its
group afloat and in profit: the homogenisation of global football culture.
Mubarak has stated that the four clubs are just the start.
“I would say when the opportunity arises - and we are looking at opportunities - you
can expect us to add to the number of clubs we have already within the organisation,”
he told CityTV.
One next stop is likely to be China.
Premier Xi Jinping, the man at the heart of China's current football revolution, visited
City's training ground in 2015.
A few months later, City Football Group sold a 13 per cent stake of the company to China
Media Capital and CITIC Capital for close to $400 million, valuing the club at an astonishing
$3 billion.
CMC was founded by Li Ruigang, often referred to as the “Rupert Murdoch” of China.
He is now a member of the CFG board.
Khaldoon al Mubarak said the move would “leverage the incredible potential that exists in China”.
Yet some worry what this model – super imposing a uniform club culture around the world -- will
do for indigenous grass roots football.
“One danger is foreign clubs who see the opportunities in China actually doing something
they would never do in their own market.
Branding locally,” said Rowan Simons, author of Bamboo Goalposts, a book about football's
turbulent history in China.
“In the Beijing grass roots league you'd have Barcelona teams 1,2,3, where the branding
goes all the way down and you won't have any organic teams with their own identity...
What a horrible world it would be if we one day we would see Barcelona Beijing v Manchester
City Beijing FC.”
The model of borderless super brand football groups is likely to be replicated elsewhere,
given the success so far of City Football Group as well as companies like Red Bull and
the Pozzo family.
Even the likes of Leicester City's owner has dipped his toe in to owning a club in Belgium's
second division as are AS Monaco.
Qatar's Aspire Academy has also purchased clubs in Belgium and Spain.
UEFA's regulations aren't really built for this new form of ownership structure, which
will become much more prevalent as the richest clubs get even richer.
Europe's governing body was faced with such a problem when Red Bull Salzburg in Austria
and RB Leipzig in Germany both qualified, despite both being connected to the parent
company of Red Bull.
The current rules ban the same owner having two teams in the same competition for the
sake of integrity.
But UEFA's Club Financial Control Body approved both team's appearances.
The future of club football, it seems, is international.