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Chinese super club is apparently almost as valuable as Man United

Before the fundraising, it was 60 percent owned by property developer Evergrande.

Guangzhou Evergrande'’s Paulinho of Brazil (8) celebrates with teammates after scoring a goal.
Guangzhou Evergrande'’s Paulinho of Brazil (8) celebrates with teammates after scoring a goal.
Image: AP/Press Association Images

CHINA’S MOST SUCCESSFUL football club, Guangzhou Evergrande Taobao, has raised $132 million from new investors in a deal that valued it at $2.4 billion — within striking distance of Manchester United.

Asian champions Evergrande raised 869 million yuan from issuing the new shares on China’s little-known, over-the-counter market, the National Equities Exchange and Quotations (NEEQ) system, where it listed in November.

But the sale fell short of Evergrande’s previously stated target that the money-losing club would raise up to 2.65 billion yuan.

Before the fundraising, it was 60 percent owned by property developer Evergrande and the rest was held by e-commerce giant Alibaba.

The sale diluted their stakes to 56.71 percent and 37.81 percent respectively, a statement released on Thursday said, implying 5.48 percent of the company was now owned by the 23 new investors.

Investors paid 40 yuan per share for their stakes, a lofty price that some had questioned given that the club has been losing money.

The deal values Evergrande at a jaw-dropping $2.4 billion — putting it in a similar league to New York Stock Exchange-listed Premier League club Manchester United, which is currently worth $2.53 billion.

Evergrande lost $75 million in 2014, according to earlier results.

Among the new shareholders, the largest is a fund managed by Shenzhen’s Foresea Kaynes Investment with a 1.16 percent stake, the statement showed.

In China, football clubs often serve their owners by providing political capital, a show of hometown loyalty or a trophy in a business empire.

- © AFP, 2016

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