August 14, 2006 9:55 pm

Aston Villa/Randy Lerner

Proprietors of soccer teams often feature in the chants of their supporters. For the terrace poets of Aston Villa, the name of the club’s new owner, Randy Lerner, offers immense potential. Can Mr Lerner say the same about Villa? The once-great club only nears the top of England’s premiership when teams are listed alphabetically. Last year Villa finished 16th out of 20 clubs.

Like Malcolm Glazer, who bought Manchester United, Mr Lerner also owns a successful American football team, in his case the Cleveland Browns. When it comes to cities, both Cleveland and Birmingham are heavy on the eye but that is where the parallels end. The economics of America’s NFL are in a different league to English football. NFL player salaries have been capped for 12 years. In March, this agreement was renewed for another six years. Revenue sharing means the big teams subsidise the smaller ones. The result is a smaller gap between teams’ ability. In the past five years, 27 of 32 teams have made the play-offs, the end-of-season knock-out tournament.

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As a resurrection candidate, Villa has some attributes. Last year’s pre-tax loss of £8m was small by soccer standards and the implied £75m enterprise value paid by Mr Lerner is unlikely to dent his £1bn fortune, as estimated by Forbes Magazine. The club has a solid fan base and, in the recently appointed Martin O’Neill, a respected manager.

Yet all of this runs up against the appalling economics of English football. The big teams dominate. In 2004-5, commercially run Manchester United spent twice as much on player wages as Villa did. Then there is Chelsea, funded to an almost indiscriminate degree by Russian billionaire Roman Abramovich. That year it blew £126m on buying players, or 20 times more than Villa. Mr Lerner has found a home for his dollars, but he may be lucky to get a quarter back.

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