Sunday 3rd August 2008
Toon in US$520m takeover talks
Indian tycoon Anil Ambani and Singapore-based investment company Profitable Group are in talks to buy Newcastle Utd.
By Eugene YS Han (assistant editor - espnstar.com)
According to News of the World, Anil Ambani, who is the sixth richest man in the world and head of Reliance Communications (Rcom), India’s biggest telecoms company, has been discussing a US$520million takeover with Newcastle owner Mike Ashley.
Also in the frame to buy out Ashley is Singapore-based global investment company Profitable Group who have ESPN STAR Sports football pundit Steve McMahon as a Group Commercial Director.
When contacted by espnstar.com, McMahon declined to comment on the news, saying it was still too early to comment on this matter.
Profitable are also reported to have targeted Everton earlier this year. McMahon's English football connections gives Profitable a distinct advantage.
As for Ambani, he is the sixth richest man in the world and he two-times richer than Chelsea owner Roman Abramovich. His personal fortune stands at US$42billion while his company is worth US$45billion.
Ambani is also reported to be willing to pump in US$300million (£150million) to bolster Kevin Keegan's transfer kitty and reinforce the Newcastle squad if his company's takeover is successful.
Not only will Newcastle will be boosted in the financial area, the Magpies will also be able to spread their wings in the largely untapped Indian market. An exclusive stake in this market could be worth billions.
RCom already have a major stake in India’s entertainment market, and also own power plants and financial services companies.
According to reports, Rcom’s takeover might even materialise as early as next week. That would open the door for RCom to proceed with due diligence — and be a concrete step towards buying out Buckinghamshire-born Ashley.
Last month, Ashley made it clear investors are welcomed to help alleviate the financial problems the club is facing. Last June, the Newcastle owner told his players that they will have to pay for their own suits amongst other cost cutting measures.
Although Ashley prefers to have business partners, both Rcom and Profitable are thought to prefer outright ownership of Newcastle United.
In June, American investors InterMedia Partners claim they have been approached about a possible takeover of Newcastle.
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Click here to watch a news report on Newcastle's potential sale.
