One of Africa’s richest men is plotting to buy a stake in Arsenal in a move that could trigger a full-blown takeover battle for the Premier League football club.
Aliko Dangote, a billionaire Nigerian industrialist, is in talks to buy the 16% stake being sold by Lady Nina Bracewell-Smith, the club’s fourth-largest shareholder. Dangote is understood to have registered his interest in buying the holding with Blackstone, the American finance house that has been given the job of finding a buyer for the shares.
Bracewell-Smith’s stake is currently worth £96m, but she is seeking up to £160m for the shares. Her holding is key to the future ownership of the north London club.
Arsenal’s two biggest investors, Stan Kroenke, the American sports tycoon, and Alisher Usmanov, the Russian oligarch, are also contemplating buying the shares. If either of the two men were to buy the Bracewell-Smith holding, they would be forced to launch a full takeover offer for the club.
Arsenal, which has a market value of £606m, is one of a number of Premier League clubs that could change hands this summer. Liverpool’s American owners, Tom Hicks and George Gillett, have recently put their club up for sale.
Manchester United has attracted bid interest from a fan-based consortium that wants to wrest control from the Glazer family.
Dangote is a passionate football fan and has the wealth to compete with Kroenke and Usmanov. Forbes magazine recently ranked him among the world’s 500 richest people, with a fortune estimated at $2.5 billion (£1.7 billion). He has helped the Nigerian national football team with cash presents and has stood for the post of president of the Nigerian football association.
He recently celebrated his 53rd birthday with the purchase of an eight-seater Bombardier jet, regarded as one of the most sophisticated private planes in the world.
He is the founder of the Dangote Group, a manufacturing empire that started in the late 1970s as a cement importer and which now has interests ranging from sugar and flour to telecommunications and oil.
He is a close friend of Nigeria’s former president Olusegun Obasanjo. Until recently he was the head of the Nigerian stock exchange but was forced to step down after falling out with Africa Petroleum, one of Nigeria’s biggest companies, which accused Dangote of manipulating its share price, a charge he has appealed against.
The Nigerian tycoon is thought to have made it on to a shortlist of about 10 investors, drawn up by Blackstone.
The holding was put up for sale earlier this year. It was inherited by Bracewell-Smith’s husband Sir Charles Bracewell-Smith and transferred to her name in 2005.
The stake has attracted interest from investors in Asia, the Middle East, eastern Europe and America. It is expected to be sold for about £15,000 a share, against a current market price of £10,000.
Sources close to Kroenke say he is the favourite to buy the holding. The American, who currently owns 29.9%, the largest single shareholding in the club, ultimately wants control and has told Blackstone he plans to bid.
Kroenke is also more popular with the Arsenal directors than Usmanov, who owns a 26% stake through his Red & White Holdings investment vehicle but has failed to gain a seat on the club’s board.
A buyer could be selected before the emergency budget on June 22, which is expected to put up capital gains tax on certain types of investment. A rise in the tax rate could cost Bracewell-Smith millions of pounds.
Foreign ownership of football clubs is under increased scrutiny because of the large debts many clubs have been saddled with after takeovers by foreign investors.
Some proprietors, such as Chelsea’s Russian tycoon Roman Abramovich, have slashed debts recently while others — Aston Villa’s American owner Randy Lerner, for example — have striven to avoid becoming dependent on bank financing.
The sale of a stake in Arsenal, which is forecast to make a pre-tax profit this year of £56m, will not be helped by growing speculation that Cesc Fabregas, its star midfielder, could move to Barcelona this summer.
Both Arsenal and Blackstone declined to comment.
By Ben Marlow – Courtesy Timesonline