A 40-year-old businessman from East China’s Zhejiang, Tony Xia Jiantong, has beaten other more flamboyant Chinese tycoons to become the first mainland resident to buy a major soccer club in the UK, after paying 60 million pounds (HK$683.46 million) to acquire a 100 per cent stake in Championship-league side Aston Villa.
Few details apart from the headline buyout figure have been made public, as the spotlight shifts onto Xia and his network of companies.
“It seems more entrepreneurs are following this path — accumulating wealth through capital markets speculation, scoring political points, and finally making their business bigger and unchallengeable,” said a Shanghai-based analyst with a state-owned mutual fund.
Many entrepreneurs are eyeing overseas soccer clubs, after President Xi Jinping expressed a personal passion for the game and announced his ambition to make the country a global powerhouse in the sport.
Xia made a splash on December 1 when a listed company he controls called Lotus Health Industry Holding Group named Xi Yinping, cousin of President Xi Jinping, as an independent director.
The nomination by the board was dropped one day later, after sparking online debate and pushing the company’s Shanghai-listed shares up by their 10 per cent limit.
Lotus Health’s annual report issued in April showed a net loss of 508 million yuan (HK$603.1 million) after revenue declined 11.41 per cent on year to 1.78 billion yuan (HK$2.11 billion). The company’s shares trade at a price-earnings ratio above 120 times on Shanghai Stock Exchange, or about 10 times the market average.
According to the announcement made by Aston Villa on its official website, Xia has bought the team with privately-held Recon Group, which Xia controls.
Recon Group also owns a controlling interest in five publicly-listed companies on the Hong Kong and Chinese stock exchanges, in addition to several private companies employing 35,000 people in 75 countries, the announcement said.
The official website of Recon Group describes itself as a multinational conglomerate operating in six core business sectors, ranging from new energy to smart city technologies.
Teamax, the smart city tech arm held by the Group, went public in Shenzhen last January through a reverse takeover of a company producing shampoo called Soffto.
Early last year, Chinese property tycoon Wang Jianlin bought a 20 per cent share of Spanish powerhouse Madrid Athletico for 45 million euros (HK$348.65 million).
The biggest acquisition of a foreign football club by a Chinese company occurred in December last year, when a consortium led by state-backed China Media Capital took a US$400 million stake in the owner of Villa’s far larger and wealthier rival, Manchester City.