How a Saudi-led consortium won control of Newcastle United
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
In October 2019, Amanda Staveley and her husband were invited aboard the Serene, a megayacht owned by Saudi Arabia’s crown prince Mohammed bin Salman.
On the banks of the Red Sea, the British financier pitched a deal to Yasir al-Rumayyan, governor of Saudi Arabia’s $450bn sovereign wealth fund. It was a transaction she had struggled to complete alone: buying Newcastle United, the Premier League football club.
Political and commercial wrangles would delay the deal for two years until this week, when a consortium led by the kingdom’s Public Investment Fund acquired the club from British retail tycoon Mike Ashley for £305m. Al-Rumayyan was announced as Newcastle’s non-executive chair. Staveley, also part of the investor group, will sit on the club’s board.
“We’re incredibly proud to be custodians of the most incredible football club in the world,” she told the BBC, even as the team languishes in the Premier League’s relegation zone. The club, nicknamed the Magpies, has not won a major domestic title since 1955. “We want the fans to trust us. We will listen to your voices and hope to get the rewards the fans richly deserve.”
This message appeals to Newcastle supporters, who believe that Ashley had long underinvested in the playing squad. Hundreds gathered outside the club’s St James’s Park stadium, some dressed in traditional Arab-style headdresses. They celebrated the transfer of ownership from a British billionaire to a Riyadh-based investment group with the chant: “We’ve got our club back.”
The long-running saga of the Newcastle takeover relates to matters far beyond the football pitch and the desires of glory-starved fans. This account is based on multiple interviews with people directly involved in the deal talks, including football and government officials from the UK and Middle East.
They suggest the deal was unlocked by a series of geopolitical events, from Donald Trump leaving the White House to a new detente between rival Gulf leaders. It also required the persistent lobbying of British officials and a change in the Premier League’s commercial imperatives.
On-off talks
Staveley is best known for orchestrating the 2008 purchase of Manchester City by Sheikh Mansour bin Zayed al-Nahyan, a member of Abu Dhabi’s ruling family, and shortly afterwards a £3.5bn Abu Dhabi investment in Barclays bank at the height of the financial crisis.
She has said that on attending a Newcastle match against Liverpool in 2017, she “fell in love” with the club and attempted to negotiate a takeover through her investment vehicle PCP Partners. Those long-simmering talks broke down in 2018 after Ashley declared that negotiations with Staveley were “a complete waste of time”.
Unperturbed, Staveley, known for her Gulf contacts, revived talks by bringing aboard an investor with far deeper pockets in the form of the Saudi PIF. Others in the investment group included the British billionaire Reuben brothers.
Staveley’s pitch on Newcastle had appealed to al-Rumayyan and Prince Mohammed. The kingdom’s Public Investment Fund was embarking on a multibillion-dollar spending spree to develop the kingdom’s sports and entertainment sector and promote a new image for the conservative nation.
Over the coming months, PIF would acquire a $500m stake in concert promoter Live Nation, a stake in beleaguered cruise line operator Carnival, and secure deals to bring heavyweight boxing matches and Formula One races to the desert kingdom.
Buying a football club followed a playbook utilised by regional neighbours United Arab Emirates and Qatar. Activists criticise the strategy as “sportswashing”, using the world’s favourite sport to distract from poor human rights records.
A fit and proper test
In April 2020, a £300m takeover was agreed with Ashley, but got stuck in the Premier League’s approvals process.
League executives determined that the ultimate owner of Newcastle would be Saudi Arabia. PIF’s board is chaired by Prince Mohammed and includes his close lieutenant al-Rumayyan as well as six Saudi ministers and an adviser to the royal court.
The Gulf state would need to satisfy the league’s Owners and Directors’ Test — which can bar potential buyers if they have committed an act in a foreign jurisdiction that would be considered a criminal offence in the UK, even if not illegal in their home territory.
That was problematic given Saudi Arabia’s alleged involvement in beoutQ, a pirate TV network that streamed events which Qatar-based broadcaster beIN Sports had spent billions to acquire, including Premier League matches. BeIN, the Premier League’s biggest overseas broadcaster, lobbied intensely against the deal, as did human rights campaigners.
According to communications first reported by the Daily Mail, Prince Mohammed sent text messages to British Prime Minister Boris Johnson in June 2020 arguing Anglo-Saudi relations would be damaged unless the Newcastle deal was approved and that “we expect the English Premier League to reconsider and correct its wrong conclusion”.
A month later, the investor group, having refused to complete the paperwork related to the league’s ownership test, publicly declared they were pulling out of the deal.
That suited the Premier League’s commercial interests. In December 2020, beIN Sports signed a new $500m television deal to broadcast top tier English club matches across the Middle East, covering three seasons between 2022-2025. Newcastle were the only club to vote against approving the broadcast contract.
Qatar breakthrough
Ashley began legal proceedings against the Premier League, but the takeover had little chance of being revived as long as Saudi Arabia was at the forefront of the regional blockade against Qatar, which had begun in 2017 and included banning beIN from operating in the Kingdom.
Prince Mohammed began to ramp up efforts to lift the embargo after Donald Trump’s defeat in the US election in November 2020, reaching out to Qatar in what was widely perceived to be an attempt to curry favour with the Biden administration.
While Trump had stood by the young crown prince, ever after Saudi agents brutally murdered veteran journalist Jamal Khashoggi in 2018, Joe Biden was publicly critical of the killing and promised to reassess US relations with the kingdom.
Two weeks before Biden’s inauguration, Saudi Arabia hosted a summit at which it and its allies — the United Arab Emirates, Bahrain and Egypt — agreed to restore ties with Qatar.
As the leaders gathered at the historical site of AlUla, Prince Mohammed greeted Sheikh Tamim bin Hamad al-Thani, Qatar’s emir, with a warm hug in a public display of the rapprochement. “January was absolutely critical,” said a person with knowledge of the Newcastle talks. “Everyone [in the Middle East] made friends.”
Several weeks ago, Saudi officials told their Qatari counterparts that they would lift the ban on BeIN “soon”. The Saudi media minister then met UK officials and assured them the channel would be unblocked.
The country’s officials also indicated they would settle legal cases related to alleged television piracy brought by Doha. In another symbol of renewed ties, last month, Paris Saint-Germain, the Qatar-owned football club, announced it would play a match in Riyadh early next year.
Over recent months, Staveley, al-Rumayyan, and Premier League chair Gary Hoffman had also been holding a series of “constructive” talks. They worked towards a set of “legally binding assurances” that Saudi Arabia would not control the club.
But there are few details as to how these assurances work in practice. Staveley said PIF was “an autonomous, commercially-driven investment fund” which would make decisions alongside her and fellow investor Jamie Reuben in the running of the club.
“It’s utter bollocks,” said a person with knowledge of the negotiations. “The Premier League are doing this to neutralise the Khashoggi lobby. They now say, ‘We’re dealing with PIF, not the Saudi state.’ But how do you explain MBS texting Boris Johnson over the deal? How do you explain the board of PIF?”
Few fans care about the ownership structure. They believe the investors will provide the spending power to attract the world’s best players, speculating on social media that the likes of France’s Kylian Mbappé and Egypt’s Mohamed Salah will soon wear the team’s black-and-white striped shirts.
Staveley, sent out this week as the investment group’s frontwoman despite only having a 10 per cent stake, has done little to dampen expectations: “We obviously want to see trophies,” she said. “That’s what every new owner will probably say on day one. But we really do.”
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