Abu Dhabi has bought into Manchester with its billions in oil. The emirate has not only taken over a football club, but has also improved entire districts. This concerted campaign relies on double structures and, above all, a lot of money.
Manchester City football club violated the financial rules of the British Premier League between 2009 and 2018. An independent commission came to this verdict this week. The club illegally received more than one billion euros from Abu Dhabi. The subsidies were therefore recorded as regular income, for example from advertising contracts with Emirati companies. Costs were also incorrectly stated. Manchester City have “systematically violated the rules of the Premier League for almost a decade,” said its managing director Richard Masters.
The scandal sheds light on a network of Emirati industrial groups, corporations, investment funds and their projects. Manchester City is the most visible part of this network, but economically negligible. It is unclear why Abu Dhabi affords this expensive showcase. Perhaps the emirate wanted to open up a new business area, possibly improve its bad reputation or establish political relations with Great Britain.
However, one thing is clear: The Manchester City case can only be understood if one also takes into account the economic and political complex behind the club. This not only includes eleven other football clubs. In the background of the club are, among other things, two state-owned oil companies, an aluminum company and a nuclear company.
First of all: Manchester City is not an independent football club. Rather, the club is part of a network of clubs, bundled in the City Football Group (CFG). She is involved in twelve clubs worldwide. In Europe, this includes the flagship Manchester City, the Spanish Girona FC and second division clubs in Belgium, France and Italy. In the USA, the group owns the majority of New York City FC. There are also investments in six other clubs in South America, Australia, Japan and China. The clubs share a network for monitoring talent, and players often move between the individual clubs. According to CFG, its company value is now around ten billion dollars.
The CFG is probably the most prominent group that promotes multiple club ownership in football. The model became known in Germany through Red Bull, whose football division extends from Leipzig via New York to Brazil and Japan.
While the Red Bull clubs are backed by the beverage company of the same name, the CFG Group was owned entirely by Abu Dhabi's Sheikh Mansour bin Zayid Al Nahyan, Deputy Prime Minister of the United Arab Emirates and half-brother of the ruling Crown Prince, until 2015. Later, other investors got involved. The sheikh still holds four fifths, and a good sixth is now owned by the US investor Silver Lake, in which the Emirati investment fund Mubadala has a stake.
In itself, the CFG is the impressive toy of a super-rich, the largest football empire in the world. But the group cannot be understood without its connection to Abu Dhabi's money pots, to the local oil industry and its connections to the emirate's political committees.
If you want to understand how close these connections are, all you need to do is look at a single person: Khaldoon al-Mubarak, 51 years old, born in Abu Dhabi, educated in Boston. He is also the club boss of Manchester City and chairman of the CFG management board. In addition to his jobs as a football official, he heads the Emirati investment fund Mubadala, heads a large Emirati bank and heads the state-owned aluminum and nuclear companies. He also sits on the board of directors of a state-owned oil company and the Abu Dhabi-based AI company G42. Al-Mubarak also holds several top positions in the Abu Dhabi government.
The Executive Affairs Authority (EAA) is one of Abu Dhabi's central political government bodies. Al-Mubarak heads it, CFG official Abdullah Khoury is its director of government affairs, and CFG board member Simon Pearce advises it.
Manchester City is not just one of twelve football clubs owned by one of Abu Dhabi's rulers. The club is run by people who hold key positions in the economy and politics of this country. It is financed by Abu Dhabi donors, including many state-owned companies.
The assumption is obvious: Manchester City was only able to push onto the international stage at such enormous financial expense because the people at the top of the club are also connected at the top of Abu Dhabi. The economic researchers at SWF estimate the assets managed by Emirati sovereign wealth funds at around $1.7 quadrillion. In comparison, the billion that is said to have flowed into Manchester City's coffers in violation of the rules over a decade seems like a bearable bad investment.
The club and its officials are not only rooted in Abu Dhabi, but also in Great Britain. The liaison here: Martin Edelman. According to US media, the New York lawyer is an important advisor to Abu Dhabi's Crown Prince Tahnoun bin Zayed al Nahyan and brokered an Emirati deal with a company owned by US President Donald Trump. Not only has Edelman been on the executive board of the CFG since its inception, he also chairs the Manchester Life housing project, which Abu Dhabi founded with the city of Manchester in 2014. Also involved in his supervision: Edelmann's board colleague Pearce.
As part of Manchester Life, the city leased brownfield land to Sheikh Mansour for 999 years. To do this, he had his companies prepare the land and build training complexes and a large concert hall there. Industrial wastelands became new commercial and residential areas. The city was celebrating a deal worth a billion pounds at the time. However, in an analysis, the University of Sheffield quoted a land developer who spoke of a "sweetheart deal". The university itself comes to the conclusion that the benefits of the deal were "asymmetrically distributed": the city conveniently gave up control of land to entities "that ultimately belong to Abu Dhabi." The researchers were unable to identify any income that the city generated from the project, even though it bore some of the risks.
This week, its former mayor made it clear how closely Abu Dhabi has become connected to the city of Manchester. Andy Burnham told the BBC on the occasion of the verdict against Manchester City parent CFG: He was "really worried" about a possible loss for the Emirati owners. They are “an enormously important partner in building modern Manchester”.
These connections have long since extended beyond Manchester - and not just because Burnham is now British Prime Minister: The United Arab Emirates are Britain's most important trading partner in the Gulf. In April, Abu Dhabi said it had planned investments worth more than 35 billion euros in Great Britain through its Mubadala fund. According to her, around 48,000 jobs have already been created there as part of the cooperation between the two countries.
