- Erick Thohir group to retain 30 percent in club after deal
- Suning’s among several Chinese groups pursuing sports deals
A unit of retail group Suning Holdings Group Co. will acquire about 70 percent of Italian soccer club Inter Milan for 270 million euros ($306 million), a rare purchase in which a Chinese company will control a major European sports team.
Suning Sports Group will purchase existing and new shares in Inter Milan, the parent company of Shenzhen-listed Suning Commerce Group Ltd. said in a statement Monday. After the acquisition, the group headed by Indonesian businessman Erick Thohir will still retain 30 percent in the club, according to the statement. Thohir will remain as president of Inter Milan, while Italian tycoon Massimo Moratti will sell his stake to Suning, the club said in a separate statement.
Buying control of the Italian club “helps Suning to capture the trend of sports and fitness interest in China, raise the standards of local football, and also raises Suning’s profile as it expands globally,” Suning Holdings chairman Zhang Jindong said in a speech at an event to announce the deal held in Nanjing, where the company is based.
The investment comes amid China’s goal to build a sports industry worth 5 trillion yuan ($760 billion) by 2025 as President Xi Jinping aims to turn the country into a soccer powerhouse. Chinese teams have been the biggest spenders on talent in 2016, and some of the nation’s richest businessmen have invested in clubs and training programs at home and overseas.
"The strategy of Suning in sports is a serious one and the start of a much wider global strategy,” said Thohir at the briefing. “China is looking to embrace and develop the game of football both at home and globally.”
The country aims to have more than 70,000 soccer pitches by 2020 and wants its national team to be among the top ranks in Asia by 2030, the government said earlier this year.
Investing heavily in sports is also part of Suning’s strategy to create a strong brand in the highly competitive e-commerce space, said Liao Xinyu, an analyst at UBS Securities Asia Ltd .
"The deal is a breakthrough for Suning in exploring opportunities in the sports industry," said Liao ahead of the announcement. "The sports strategy may help Suning cultivate more loyal customers in the competitive e-commerce market. If an online platform can remind customers of Inter Milan, it’s more likely to attract traffic."
Suning is not alone among big Chinese companies looking to invest in the world of international football. This year, Chinese billionaire Wang Jianlin’s Dalian Wanda Group Co. signed a partnership agreement with FIFA, becoming the first major sponsor for the soccer body since a criminal corruption scandal overwhelmed the organization.
A Chinese investor group is also pursuing the takeover of AC Milan soccer club, Inter Milan’s traditional opponent, people with knowledge of the matter told Bloomberg. The club is owned by former Italian Prime Minister Silvio Berlusconi’s family. A Chinese group led by China Media Capital Holdings bought a $400 million stake in Manchester City Football Club’s owner in December.
Last year, Suning paid La Liga $270 million for its video site PPTV to have the Spanish soccer league’s exclusive media rights, and it has lavished millions on expensive foreign players for its local club.
Suning Sports is wholly-owned by Suning Holdings, and it owns and manages the Jiangsu Suning Football Club.
Inter finished fourth this season in Italy’s Serie A, the country’s top league, missing out on participating in the lucrative Champions League competition next season. Six years ago Jose Mourinho led the team to its best season by winning three trophies -- the Champions League, Italian Serie A championship and Italian Cup.
— With assistance by Daniela Wei, and Rachel Chang