Published December 24, 2013
Tycoon agrees to invest 400m euros and clear debt; sets Jan 15 deadline
ByAngela Tan email@example.com
[SINGAPORE] Singapore tycoon Peter Lim has a huge budget for his Christmas presents. By Jan 15, 2014, he would know if Santa has granted his wish to be the new owner of Spanish League football club Valencia CF.
In a press conference held on Sunday afternoon before Valencia's match against Real Madrid, Valencia's president, Amadeo Salvo, announced that Mr Lim, the 10th richest man in Singapore according to Forbes, had agreed to invest an initial 400 million euros (S$692 million) in the financially stricken club. Mr Lim has also offered to erase Valencia's debt to Spanish bank Bankia.
The arrangement could see Mr Lim buy the 70 per cent share belonging to the Valencia Foundation.
However, the agreement will not be official until Bankia, which holds the debt of the club, gives its approval. About 12 days ago, Bankia said it was putting Valencia up for sale.
Mr Lim has set the Jan 15 deadline for the offer to be accepted, so that the club can reinforce its squad in the January transfer window with the hope of challenging for Champions League places come the end of the season.
"Mr Lim's offer is amazing," Mr Salvo said.
"The club has to sell for a price between 200 and 250 million euros," he added. "The new investor has to eliminate the debt we have with the bank, invest in players, promise to finish the new stadium and to let the club be run by the people of Valencia. Lim's offer meets all these requirements."
A spokesman for Mr Lim declined to comment.
Valencia's fortunes on and off the field have suffered since a financial crisis struck Spain in 2009. The club has been unable to finish work on the Nou Mestalla stadium and has had to sell a number of its best players to raise capital.
Recently, Valencia was named one of the seven Spanish clubs to be investigated by the European Commission for alleged illegal state aid in which local government played a role in guaranteeing the loans taken out by the club from Bankia.
The search for a new investor has not been easy. Mr Salvo has spent months searching for a big investor in Valencia and thanks to super-agent Jorges Mendes, he has found Mr Lim. The 60-year-old is an avid sports fan worth around US$2.05 billion. He has also shown interest in buying a stake in rival Spanish club, Atletico de Madrid.
In an effort to seek refinancing initially, Valencia travelled to Asia, including China and Singapore. On Nov 2, it met Mr Lim, who showed interest in the project.
Mr Salvo said: "Lim is very passionate about football. In November, we opened advanced discussions about the future of Valencia. Upon our arrival back in Valencia, we came to the understanding that it would be difficult to refinance with Bankia.
"There is a multinational company that can guarantee 130 million euros to finish the Nou Mestalla stadium. It's a very real project and not fictitious. It's always been said that, if we needed to sell, it should be for around 200-300 million euros, which would eliminate our debt. I've always stated that this is wrong and it wouldn't work with a venture capital fund. We needed someone objective and not speculation."
He said following Bankia's statements, Mr Lim called the club and came to Valencia to meet the president of the board and vice- president of the foundation.
"Given this offer, which is one of two or three biggest deals in the world to purchase a club, we were obligated to present it to Bankia," Mr Salvo said.
He added that Bankia was impressed by Mr Lim's "extraordinary offer", but needs to review other offers before submitting a report to its board of directors.
"When Bankia gives the OK, Lim will come to Valencia to explain his project. Mr Lim wants to strengthen the team in January. He wants Valencia to play in the Champions League. This will be one of the biggest transactions in world football. It's a historic opportunity, it will solve all of Valencia's problems," Mr Salvo said.
A fishmonger's son, Mr Lim made his fortune through holdings in palm oil producers. No stranger to the European football scene, he offered £320 million (S$661 million) to buy English Premier League soccer club Liverpool FC in 2010. But his all-cash offer for the club was eventually scuttled by an offer from New England Sports Ventures, owner of the Boston Red Sox.
Mr Lim is also reported to have shown interest in Rangers FC in Glasgow, Scotland. Mr Salvo confirmed that Mr Lim had tried to purchase Valencia under former president Manuel Llorente, but was turned down.
Mr Lim is not the only ultra-wealthy person in Asia interested in the top football clubs in Europe.
In 2011, Malaysian entrepreneur Tony Fernandes, founder of budget airline AirAsia and chief of Formula One Team Lotus, completed the takeover of English soccer team Queens Park Rangers.
Another Malaysian tycoon, Vincent Tan, has been dominating soccer headlines of late, albeit for the wrong reasons, when he threatened to axe Malky Mackay, the boss of his newly acquired Welsh club, Cardiff City.