Chinese buyers quit European football

Aston Villa is the fifth European football club in which a big Chinese investor has sold all or some of its stake following the introduction of last year's investment restrictions by the Chinese authorities. Others include AC Milan, Atletico Madrid, Slavia Prague and Northampton Town.

The Chinese government set out new criteria for overseas investment last August, placing sports clubs on a list of 'restricted' sectors. The investment curbs made it more difficult for Chinese owners to pump money into their often lossmaking clubs.

The Financial Times notes that investment trends in China 'are often driven by a combination of opaque elite politics, corporate opportunism and a genuine search for new opportunities.' Sports lawyer Trevor Watkins told the Pink 'Un that the initial deluge of Chinese money had led to a 'Wild West' environment in which some investors were significantly overpaying for clubs, and investors were cashing in.

Chinese investors pumped more than $2.5bn into European clubs from 2014 to 2017. Leading investors included Fosun, the tourism to finance conglomerate; China Media Capital, the media and sports group; and, until it sold its stake in Atletico Madrid, the Wanda group.

Fosun's $58m acquisition of Wolverhampton Wanderers in 2016 has been probably the most successful deal so far with Wolves winning promotion to the Premier League. China Media Group acquired a minority stake in City Football Group that owns Manchester City and other clubs across the globe.

The Chinese owners of Aston Villa and AC Milan got their fingers burnt after taking on big debts as part of their acquisitions, hoping success on the pitch and favourable financing in China would help them pay their loans.

At Atletico Madrid Wang Jianlin's Wanda group made a small profit when he sold his 17 per cent stake.

Chinese investors are now likely to look beyond team ownership to other parts of the sector from ticketing software and stadium infrastructure to sponsorship and e-sports.