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Nigerian Football Clubs to Get Funding from Capital Market
By Goddy Egene
Nigerians are to own shares in Nigerian football clubs very soon as some of the clubs prepare to access the nation’s capital market funding. This follows moves to restructure the Nigeria Professional Football League (NPFL) clubs’ ownership and open them to private sector investments.
To actualise the listing of NPFL clubs in the secondary capital market, the League Management Company (LMC) and NASD OTC Securities Exchange, operators of the over-the-counter market for unlisted public limited companies, have signed a Memorandum of Understanding (MoU).
Speaking at the MoU signing ceremony, Chairman of LMC, Shehu Dikko, said the partnership is very important to the LMC because sign-posts a step towards realising the vision nursed by the LMC to provide a strong structure for the NPFL Club ownership.
“It is a journey that has been long but potentially fruitful for the League, the clubs, our partners, NASD, corporate Nigeria and the general football stakeholders,” he said.
He recalled that in the late 1970’s to early 1990’s, individuals and companies dominated club ownership and funding listing the likes of Stationery Stores, Udoji United, Leventis United, Abiola Babes, Ranchers Bees, Ayusalam Rocks, BCC Lions, Jasper United, ACB, New Nigerian Bank, Flash Flamengoes and Iwuanyanwu Nationale and many others.
“Today, the fluctuating oil revenue is hitting harder at states’ resources while the organized private sector are now driving the economy hence we are seeking this platform to take football to the organised business and the people as is obtained in some more prosperous leagues such as those in Germany, Spain and coming closer home, North Africa has since been appreciated by the LMC hence we took steps to seek the actualisation. You will recall that in the quest for this, we did sometime in the past visit the Nigeria Stock Exchange (NSE) all in our bid to bring about this change to a more enduring club ownership structure. We are therefore very glad that NASD has embraced this vision and has offered to work with us towards the actualization,” Dikko declared. In his comments, the Managing Dikko/Chief Executive Officer of f NASD Plc, Bola Ajomale said the partnership is significant as it is bringing football and the business community together for the mutual benefit of all.
He said: “Our MoU marks the beginning of a merging of financial and sporting interests in an unprecedented manner in Nigeria. It is not often that securities markets and football are discussed in the same conversation but interesting things can happen when an imaginative manager decides to improve the fortunes of a sport and he decides to encourage teams to be publicly traded on a securities exchange. Like any other commodity, football clubs have rising and falling fortunes and can live or die based on foresight of their managers. Soccer may be a passion but it is a business like any other.”
Ajomale explained that actualising the objective of listing NPFL Clubs will require processes to adhere to the discipline of the financial market which may not be present in the structure of club ownership, noting also that listing a football club on NASD OTC Securities Exchange is not an instant recipe for success.
“After all Tottenham Hotspur, one of the biggest clubs in England, were publicly traded from 2001 to 2011, but decided to a private ownership structure. Again, of the 27 clubs that listed in early 1990s Britain, only a few remain successful and listed today. Significant restructuring is required to get the football clubs in shape before they can efficiently utilise investors funds and indeed attract such funds. The journey will be long and the hurdles numerous. But as they say, “the journey of a thousand miles begins with a step in the right direction” – such as the step the LMC is taking today,” Ajomale said. He said NASD will provide business education to the clubs and at the same time sensitise the capital market community on the opportunities in football.
