Queens Park Rangers F.C. - Ownership and Finances

Ownership and Finances

After a number of years of financial difficulties which included a period in financial administration, QPR was bought by Formula One tycoons and multi-millionaires Bernie Ecclestone and Flavio Briatore in a £14 million takeover in August 2007. In spending £690,000 to acquire a 69 percent majority stake in the club from a Monaco-based consortium led by Italian football agent, Antonio Caliendo, Ecclestone spent £150,000 on his 15 percent, while Briatore bought 54 percent for £540,000 through a British Virgin Islands registered company, Sarita Capital. In addition, Briatore and Ecclestone are believed to have promised £5 million in convertible loan facilities to help buy players and have covered £13 million of debt, in a total commitment to the club of around £20 million. At the time of purchase the remaining 31 percent of shareholders turned down the offer of 1p a share. Four months later, on 20 December 2007, it was announced that the family of billionaire Lakshmi Mittal had purchased a 20 percent shareholding in the club from Briatore. The purchase price of the 20 percent stake was just £200,000. As part of the investment Lakshmi Mittal's son-in-law Amit Bhatia took a place on the board of directors. While Gianni Paladini remained chairman of the football club, Alejandro Agag, as chairman of QPR Holdings (the parent company) was the de facto chairman, until he was replaced by Flavio Briatore in early February 2008. Agag moved into the role of managing director, supported by a deputy managing director, Ali Russell, who moved from Hearts in the Scottish Premier League.

Despite QPR's perilous financial condition in 2007–08, the combined personal wealth of the club's new owners (which included the world's then 8th richest man Lakshmi Mittal) sparked speculation that QPR would receive significant further investment from their new benefactors drawing parallels to their wealthy West London neighbours Chelsea and Fulham. However, no significant further funds were made available to the club other than those injected as part of the purchase of its share capital and much of the subsequent player transfer activity involved loan acquisitions or free transfers. Indeed it was reported in January 2008 that the investors had not discharged the £10 million loan from ABC Corporation (secured on the club's stadium) together with its £1 million annual interest burden—despite the club's prospective annual turnover of between £10 million and £15 million a year. Furthermore around £2 million was still owed to former director and major shareholder, Antonio Caliendo, who waived £4.5 million of loans when Briatore and Ecclestone bought the club. It was expected that the ABC loan would be discharged in June 2008 on its maturity and that the debt owed to Caliendo would be paid off "in early 2008" in line with a funding strategy which Ecclestone publicly stated would not result in the wealthy owners simply bankrolling the club. In fact the ABC loan was discharged on or around 31 July 2008. Mittal's investment is thought to be primarily motivated by his son-in-law's interests and that Mittal himself would remain a silent investor while Briatore, Ecclestone and Bhatia worked together to implement the strategy of slowly building the club up ahead of a push for promotion to the Premier League in 2009. The new owners also pledged to refurbish Loftus Road and use their experience in Formula One to increase sponsorship revenues. On 25 March 2008, QPR confirmed that, from the 2008–09 season and for five seasons, their kits would be supplied by Lotto Sport Italia as part of a number of new partnerships formed by Flavio Briatore. The investment potential of the club's new backers resulted in a number of wildly speculative storylines in the football press throughout the 2007–08 season including rumoured signings of former World Player of the Year winners Luís Figo and Zinedine Zidane (the latter as a possible manager).

In May 2008, billionaire Vijay Mallya was linked with buying into the club, as part of the Ecclestone, Briatore and Mittal consortium. Following the termination of the club's sponsorship deals with Car Giant, Le Coq Sportif, and Sellotape at the end of the 2007–08 season, in early July 2008 it was expected to be announced that Gulf Air would be the new shirt sponsors for 3 years. Further sponsorship packages were also announced including Abbey Financial Services and Lotto Sport Italia. In 12 September 2011, Malaysia Airlines and AirAsia announced its sponsorship of QPR’s home and away match and "third" jerseys for the two seasons with sponsorship cost some RM30mil (£6.2mil).

Flavio Briatore's future as QPR chairman came under question in September 2009 after he left the Renault F1 team in the midst of race fixing allegations. The Football League board discussed the matter on 8 October 2009 and declared that they would be awaiting a response from Briatore to various questions before commenting further. Meanwhile, the club continued to make losses (£18.8m in 2008–09 and £13.7m 2009–10). Briatore sold his (62%) shares to Ecclestone in December 2010 (with the Italian possibly retaining a right of first-refusal should Ecclestone sell) and initially stepped back from the day-to-day running of the business in favour of Amit Bhatia and Ishan Saksena (company chairman and managing director). However his involvement gradually returned and conflicts between Briatore and Bhatia/Saksena resulted in both Bhatia and Saksena leaving QPR in May 2011. During QPR's successful Championship-winning season in 2010/11, Ecclestone made numerous public statements about his willingness to sell his stake in the club, hoping to cash in on their promotion to the Premier League. On 18 August 2011, Malaysian businessman Tony Fernandes was unveiled as the majority shareholder after having bought out Ecclestone's then-66% stake in the club for a rumoured fee of around ₤35 million, while the Mittal Family retained their 33% stake. Amit Bhatia was restored to his position as Vice-Chairman. Phillip Beard was announced as the new Chief Executive of the club and Gianni Paladini removed as club chairman. Briatore and Ecclestone are no longer involved with the club. They have no board representation or other financial ties. Bhatia also explained in the takeover announcement that the loan, representing the refinanced ABC Corporation debt (secured using the stadium as collateral) has now been "bought off" by the new regime (that is, refinanced by new debt). It is though that the current debt is represented by a shareholder loan to the club and is non-interest bearing. Despite the club's fortunes in attracting investors, it continues to be mired in controversy from previous ownership regimes and has been subject to proceedings from former investors Carlos Dunga and Antonio Caliendo.