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Sheffield United notebook – takeover valuation and sister club in financial trouble
Sheffield United have been the subject of plenty of takeover talk in recent weeks, with reported interest from the US and Saudi Arabia. It’s no secret the club is up for sale with Prince Abdullah looking to attract a buyer, or alternatively secure investment to help with the finances needed to sustain Premier League football.
United World sister clubs Beerschot and Chateauroux are also for sale, according to reports in Belgium, and that is the focus of this week’s Sheffield United Notebook.
Takeover valuation
What is a good valuation for Sheffield United right now? When in the Championship, a deal to sell the club to Nigerian businessman Dozy Mmobuosi was agreed at £115m, with a further £35m due upon promotion.
Recent reports that a consortium of Saudi investors have held talks claimed they were discussing a sale at the £140m mark, so there is a clear figure emerging of the club’s value right now.
READ MORE: Tom Davies could help solve one of Sheffield United’s transfer priorities
Mmobuosi, of course, was looking to strike a deal based on the probability of Premier League football, but that has now been taken out of the equation following promotion for anyone looking to do a deal right now.
Is the £140m-£150m area a reasonable price for a club the size of Sheffield United, with its own assets and a stable fanbase?
Football finance expert Kieran Maguire has had his eye across plenty of Premier League takeovers in recent years and says although Prince Abdullah would be right to try for more, he feels the figures being mentioned so far are about right.
“Bournemouth went last year for around £140m-£150m and I know that may upset Sheffield United fans because they will say ‘We have a bigger stadium’ but the trouble is gate receipts don’t make a lot of difference.
“It’s how much you can spend on players and the strength of your squad. If I was looking to advise someone on Sheffield United I would normally value a business on what I think the cash flow is going to be over the next 10 years.
“Realistically, how many seasons out of the next 10 do we think Sheffield United are going to be in the Premier League? There is an expectation they are going to find it challenging. Therefore, you would factor that into the price.
“In the case of Newcastle, they had been relegated in 2016 but they spent a lot of previous years in the Premier League so that was why their price is higher. I think £150m is fair, but that doesn’t mean I wouldn’t be looking for more and trying to hype it a bit.
“The chances of relegation at the start of the season have got to be 50/50 for a club that has just come up, so, therefore, £150m would seem a good price. You can buy a club in the Championship for £30m-£40m.”
United World club in trouble
Sheffield United’s sister club Châteauroux is in financial difficulties and facing a bleak future unless they can settle outstanding debts and win their appeal against a demotion to the fourth tier.
The demotion, which was announced by the National Directorate of Control and Management (DNCG), the organisation responsible for overseeing the accounts of professional football clubs in France, also means they will lose their professional status.
It’s yet more problems for Prince Abdullah at a time when he is trying to secure a sale of Sheffield United. According to La Nouvelle Republique, Châteauroux currently has a ‘mountain of debt of five million euros’ and Prince Abdullah has until June 30 to find the finances to clear the debt and also satisfy the requirements for the 2023-24 season.
If not, they will be placed into National 2 – an amateur league. Châteauroux announced its intention to appeal.
In a statement on its website, it said: “La Berrichonne de Châteauroux was auditioned by the DNCG to present its provisional budget for the 2023/2024 season. All requested financial guarantees have been submitted.
“However, after examining the file, the commission decided to demote the club to National 2. La Berrichonne de Châteauroux will appeal this decision and will be auditioned again in a few weeks, and will do everything possible to provide the additional information necessary to convince the commission.
“The appeal period will allow the club to find the appropriate solutions to ensure the maintenance of the Berrichonne in National 1.”
It’s a crucial few days in the club’s history and supporters can only hope now that the appeal process will provide enough time for the money to be secured. According to Gazet van antwerpen, United World wants to sell all its European clubs and has actively been looking for a buyer for Beerschot.
Although concerns at the two sister clubs, Sheffield United fans should not be too worried about their own affairs. There are no signs of financial trouble at Bramall Lane, with Premier League money set to help stabilise the next few years and address the cash flow issues of last season.
That will then allow United to get back on track with its plan to become a self-sufficient development club until a suitable buyer is found.
