Capital Economy, Business and Finance
Thanks to local hero Dan Burn, Newcastle United ended a 70-year wait for a domestic trophy at the weekend and put paid to one of the most notorious sporting droughts.
Whether it will satisfy the Saudi sovereign wealth fund, which spent £305 million buying the football club in 2021 and nearly £500 million on player transfers since, is another matter.
These eye-watering sums are loose change for the Saudi Public Investment Fund, thought to hold assets of about £718 billion, with Newcastle’s pace of investment constrained by financial rules not yet in place when rivals were similarly bought by mega-rich owners.
A sign of the Saudi PIF’s impatience is its hostility towards ‘associated-party transaction’ (APT) rules, designed to ensure deals between clubs and companies linked to their owner are at fair market value.
The old set of APT rules were deemed “void and unenforceable” by a tribunal in February. If the same happens to the new rules – currently under legal challenge – the spending shackles may come off.
Photo credit: Justin Setterfield/Getty Images
