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Mercenary Ownerships Roil Soccer

In the next few days, Spanish attacking midfielder Santi Cazorla is expected to complete a move to Arsenal from Malaga. It is a logical move for the Gunners, who favor technical ability over physical power.

But what doesn’t make sense is why Cazorla is leaving Malaga in the first place. Malaga, owned and financed by Sheikh Abdullah al Thani, was supposed to be the most acute threat to the Barcelona-Real Madrid duopoly in La Liga.

Nearly two years after buying Malaga, investing tens of millions of dollars into players and facilities, and gaining praise for his balanced approach to club development, Al Thani wants to sell. Without his backing, the club will have to dump top players.

There is an increasing trend of takeovers of teams by personal fortunes who have no real stake in the club’s future. These takeovers can artificially reconfigure the sport by turning a provincial club into a powerhouse. But they can also destroy a team financially and even send it into the second division.

Last year, Indian tycoon Ali Ahsan Syed bought Racing Santander, abruptly departed, and left the dept-laden club in bankruptcy. The unpaid players walked out and could not be replaced. A downward spiral resulted in relegation to the second division.

Swiss team Neuchatel Xamax also competes in the second tier after a disastrous season under the ownership of Russian businessman Bulat Chagaev. Chagaev, it transpired, forged documents to claim non-existent assets in order to buy the club.

Elsewhere, it is the same story told over and over again. Portsmouth went bankrupt after a takeover by UAE businessman Suleiman al-Fahim. Feuding American owners George Gillett and Tom Hicks contributed to the Liverpool's decline.

What can be done to prevent future disasters?

Leagues should be able to prevent disreputable businessmen from operating teams. A thorough background check conducted by Spain’s La Liga or Switzerland’s Super League would have revealed that Ali Ahsan Syed was guilty of similar crimes in the past (he tried to defraud Australian businesses and was under investigation by Interpol) and that Bulat Chagaev’s assets were overstated.

League administrators would then be able to closely monitor the club’s expenses to ensure stability, or, if necessary, to confiscate the club’s license.

The German Bundesliga has a requirement that all clubs must be owned by fans. Fans pay their annual dues, which go toward operating the club. If a local businessman or corporation wishes to buy the team, it cannot have a majority of the voting rights, even if it owns the controlling stake.

But the German model has some limits. Though a foreign takeover of Manchester United by the Glazer family unloaded heavy debt on the club, the Red Devils have certainly had better results in the Champions League than any German club.

After Manchester United’s IPO having brought further attention onto the Glazers, many fans are now demanding they leave. But with both income and performance on the pitch improving, is their ire justified? If results decline, it will be.

On Wednesday, a group of Chinese investors bought a share in Internazionale. Foreign investment will allow the club to buy a new stadium despite Italy’s economic woes. Nevertheless, the Moratti family, which has owned the club for decades, will maintain control.

Suleiman Kerimov brought Anzhi Makhachkala from obscurity to fame by signing Samuel Eto’o and Roberto Carlos. In the process, he brought publicity to Russia’s war-torn Dagestan.

This year, Chelsea won the Champions League, Manchester City won the Premier League, and Paris Saint-Germain became a force to be reckoned with in Europe, all because of foreign investment and management.

Strict regulations would ultimately freeze soccer’s landscape in place. Naturally, the Barcelonas and Real Madrids of the world would benefit from the end of future competition.

An effective solution would require more balance. There is nothing wrong with foreign owners as long as they can produce the requisite funds. Sheikh Abdullah al Thani will leave Malaga in a better state than when he bought it. What more could you ask?

In addition to rigorous background check, the German idea of fan power is not a bad one. Maybe giving fans total control over the team would discourage hefty investments. So instead, guarantee them a minimum amount of voting power by ensuring that they be represented on the board.

Just as Barcelona and Real Madrid are owned by fans, the fan-control model might be a viable option for clubs who cannot find a suitable investor.

Wherever there is money, there is potential for crime and corruption. So in today’s era of globalization, it is paramount that takeovers that go awry, such as Racing Santander and Neuchatel Xamax, remain the exception rather than the rule.

Theodore Furchtgott is a RealClearSports soccer columnist. He can be reached at Theodore.Furchtgott@gmail.com.

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