Despite being one of the main drivers of the transfer window last winter, Newcastle United did not fall into a frenzy with its investment strategy. Despite being taken over by Saudi Arabia’s sovereign wealth fund, the Magpies’ new management seems to be willing to take the time to lay out the step-by-step roadmap to orchestrate the club’s rise. It’s a strategy that contradicts the descriptions hitherto employed by the “new riches” of European football. Lighting.
While starburst was expected off the shores of the Tyne last January, a major player in international football did not land at Newcastle United during the last winter transfer window. Magpies fans had to settle for a “British” buyout to fix the sudden weaknesses of an embattled workforce, like the icing on the cake that Brazilian international Bruno Guimarães signed in the last days of the transfer window. For an investment of 42.1 million Euros from Olympique Lyonnais plus a bonus of 8 million Euros.
If the strength of the sovereign fund of the new majority shareholder, Saudi Arabian PIF, enabled Newcastle United to attract a hundred million pounds to attract new players; No forced purchases were made to satisfy (early) desires for splendor. The new management team did not succumb to the policy of overinvestment by clubs often described as the “new rich” to lure their first stars.
“Sales clubs tend to push prices up when teams with a strong shareholder at their head approach them. Clubs like Paris Saint-Germain or Manchester City FC have faced this situation. During the transfer window last winter, Newcastle United managed to escape this reality. “The club has certainly not tried to put itself in an over-invested position to attract the stars. It is clear that the sporting situation is not conducive to that,” analyzes Sports Advocate Me Badou Sambagué. It has received hundreds of offers from intermediaries. Rather than throwing itself into the lion’s mouth, the club chose to go through a market observation phase without putting pressure on itself,” said Olivier Jarosz, Member of the Board of LTT Sports, a consulting firm in professional football’s strategy and management. .
Economic rationality and staying in the Premier League
Newcastle United has also been able to take advantage of an economic environment conducive to investors to make their purchases without incurring the price “inflation” traditionally attributed to a wealthy new person in European football. Due to the Covid-19 crisis and certain economic and political upheavals, European clubs have competed less fiercely in the market for key talent. “In this period when we came out of the Covid-19 crisis, the price of players in the transfer market even tended to decrease for the first time in decades. This created a good window of opportunity to invest later on,” says Olivier Jarosz.
While the relatively cautious approach Newcastle United has taken in the last transfer window has been facilitated by the economic context, it still responds to an upward plan to meet the challenges of the moment by new decision makers. “In the mode of work put in place by Newcastle United, we observe a kind of convergence between short-term sporting ambitions and the political will not to immediately embark on a flashy investment strategy. The new administration is trying to stay low profile to gain acceptance in the English and European football ecosystem. Let’s not forget that the negotiations took more than 18 months until the completion of the sale. Many reservations have been made regarding the identity of the receiver in English football,” says Renaud Régner, Managing Director of Kroll. “Furthermore, Newcastle United wanted to secure hiring in order to achieve its number one short-term goal: keeping the club in the Premier League. Newcastle United essentially bet on players who knew the English league very well,” continues our expert accustomed to operations within European football. .
A policy that is not limited to players. As for sports coaching, the first decisions taken by the club’s new operational boss, Amanda Staveley, were also surprising. The appointment of a world-class coach to the Magpies bench is awaited by the observers; The management chose to appoint Bournemouth FC’s former coach, Eddie Howe, last November. Regarding the sporting director position, the choice must be made for the English football specialist as Dan Ashworth, former coach of Brighton & Hove Albion FC, is expected to fill the position.
On the other hand, some key employees who were already in office prior to Newcastle United’s takeover by PIF retained their positions despite changes in shareholders. This is the case, for example, of Steve Nickson, the head of hiring, who holds the Magpies franchises. Steve Nickson knows the workings and environment of Newcastle United very well. Amanda Staveley needs to rely on such profiles to build her project. Then everything will depend on whether it is urgent to achieve results in line with the club’s new goals,” explains Me Badou Sambagué.