‘Next to nothing’ - How PIF view Newcastle United revealed amid cost-cutting plan
Football financial expert Kieran Maguire believes Newcastle United remain a “trophy asset” to the Public Investment Fund.
Fans and pundits have speculated whether the Saudi Arabian sovereign wealth fund - worth a reported £720billion - have lost interest in the Magpies. PIF invested a significant amount during the early post-takeover days but, in recent times, the spending has dried up.
Supporters were left feeling disheartened by the summer transfer window as no major first-team signings were made. FFP/PSR restrictions have prevented Newcastle from using their new-found riches - unlike Chelsea and Manchester City in previous years.
Toon chairman and PIF governor Yasir Al-Rumayyan also unveiled plans to switch focus to a more domestic approach. As it stands, around 30 per cent of the fund’s assets are tied up abroad and they wish to cut this by 12 per cent.
“The (international investments of the fund) increased from two per cent (in 2015) all the way up to 30 per cent”, he told the Future Investment Initiative summit in Riyadh last month. “Now our target is to bring it down to a range between 18 to 20 per cent.
“People used to come to us and ask for money. We are now seeing that shift from people wanting to take our money to people wanting to co-invest. All of these companies are big investors in new sectors that were not in existence in Saudi Arabia. People are seeing the difference, from their perception of Saudi Arabia back in 2015.”
This led to further questions regarding PIF’s long-term plans at St James’ Park. However, monetary guru Maguire has insisted Newcastle - bought for £305million three years ago - are a drop in the ocean for their portfolio.
“Newcastle United is a trophy asset as far as PIF are concerned,” Maguire told TBR Football. “That means they look at them through a different lens than they do other commercial investments.
“Also, Newcastle do not move the dial as far as PIF’s portfolio is concerned. Newcastle for £305m is next to nothing. I don’t see this as anything of concern for Newcastle fans. The challenge is PSR, not PIF not being willing to put money in.”