São Paulo, May 17, 2022 (AFP) – In the image and likeness of Europe, Brazilian football is opening up to foreign investment, which could revive many teams facing financial difficulties and cement Brazil’s dominance in South America.
So far, US investors have negotiated the purchase of Botafogo and Vasco, while others are preparing to land in Brazil. In addition, former striker Ronaldo Nazario acquired Cruzeiro club, making his professional debut.
“With these investments, the trend is to improve the management of local football. This tends to bring in more money, and thus increase competitiveness,” Cesar Grafitti, partner at Confucado Consulting and consultant in this type of operation, told AFP.
The fortunes emerged as soon as Congress approved in August 2021 the Sociedade Anônima do Futebol (SAF), which grants tax benefits and encourages the transformation of club companies, which have operated in Brazil for a century as a non-profit association.
“Brazilian football has always been very closed to foreign investment due to the club’s national control model,” Grafitti explains.
Before the SAF law, the company had only two clubs in the Brazilian league: Cuiabá, owned by the national tire brand Drebor, and Red Bull Bragantino, part of the multinational Austrian sports conglomerate.
– “Profit to be profitable” – the deal is attractive to foreigners due to the depreciation of the real against the dollar and the euro and the “raw material” of Brazil, the main source of players, experts agree.
Also because there is scope for football fans to be exploited commercially in a country that claims 110.4 million out of 213 million people are fans of a local team, according to EPUB.
Gravity says a market has opened up with “great potential”.
Vasco and Cruzeiro, both currently playing in the second division, and Botafogo, who returned to the elite this year, joined the SAF as an escape from their financial crises, a disease prevalent in Brazilian clubs.
The three debts totaled $442 million in 2020, according to consultancy Sports Value.
American John Textor, co-owner of Crystal Palace in England, Belgian Molenbeek and known as a Hollywood virtual reality expert, in March closed the purchase of 90% of Botafogo’s shares for US$77 million, which will be invested in the next few years. Years. Three years.
“Football is no different than any other business,” Textor told CNN in March, before signing Portuguese coach Luis Castro and 12 players in Alfinegro’s squad. “You have to win to be profitable.”
After negotiations deemed unfavorable by some for the club, Ronaldo acquired 90% of Cruzeiro, for an amount that remains unclear.
“We will not rest until we have widely implemented an efficient and ethical management model that achieves sporting success,” the former striker, who also owns Real Valladolid, in Spain’s second division, said when concluding the deal to buy the heavenly team. At the moment, FC Minas have been conservative in signings.
The American 777 Group, which owns Genoa in Italy and part of Seville in Spain, is awaiting a decision by Vasco’s advisors and partners to confirm the acquisition of 70% of the club for $135 million.
– More SAFs on the horizon – Sports market specialist Rafael Zanet believes that “the urgency of financial reasons” has made the trio speed up transactions, but this experience will serve as a model for those interested in following the same path, such as Coritiba, Atlético Goianiense and Atletico Paranains.
“In the future, some clubs interested in SAF will be more pressing when accepting offers,” Zanet predicts.
Bahia, who is in the second division, is negotiating with Grupo City, owner of Manchester City and 11 other clubs.
The champion of Brazil in 2021, Atlético Mineiro also does not rule out the possibility of becoming SAF. But other greats like Flamengo, Corinthians and Palmeiras are not tempted for the time being.
Grafietti notes that they “may choose alternatives that do not necessarily involve a negotiation with a single owner” to maintain some control.
If the new model lives up to expectations, says Zanet, the Brazilian teams, champions of four of the last five editions of the Copa Libertadores, will extend the distance to their South American rivals.
“Latin America should look to the Brazilian market as a reference. This is the way to grow, even a little closer to Europe,” says the specialist.
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