Chinese football super league becomes club for real estate firms

Chinese football super league becomes club for real estate firms

Staff Reporter

2014-02-17

Chinese financial group Ping An is rumored to have won the bid as the new sponsor of the Chinese Football Association Super League (CSL), a professional association mainly comprised of clubs backed by property companies, reports the Shanghai-based First Financial Daily.

While the new sponsor, set to replace property developer Wanda Group, will not be announced until later this month, Ping An reportedly has won the three-year naming rights with its offer of 150 million yuan (US$24.74 million) a year, the report said.

In comparison, Wanda paid 65 million yuan (US$10.7 million) per year between 2011 and 2013 to become the main sponsor of the league with the naming right.

“At this time, anyone that becomes a sponsor of CSL will see their money well-spent, since the football business will gain momentum in the long-term,” sport business consultant Yang Yan noted.

Despite a decline in revenue following the government crackdown on gambling in 2009, the company set up by the football association to run the CSL saw its income double to 370 million yuan (US$61 million) in 2013 from the previous year, and posted a net profit of 119 million yuan (US$19.6 million). The CSL also got a boost from the Guangzhou Evergrande club winning the title at the 2013 Asian Football Confederation Champions League in November, the newspaper added.

This is not the first time Ping An has been involved in the football business. The financial group was the owner of a football club in Shenzhen between 1997 and 2002, during which time the then insurance company in the southern Chinese city became well known across the country.

Ping An Bank made two failed attempts to become a football sponsor in 2009 and 2010 before the recent bid, which is linked to the group’s reported plan to introduce a football lottery in China.

Ping An told the newspaper that the group has no such information.

Meanwhile, the newspaper pointed out that Ping An will be investing in a league of property companies since businesses coming from or operating in the sector have become owners of all 16 clubs.

Apart from Wanda’s success story, Evergrande Group has grown its property development operations in 25 cities in 2009 to 140 cities last year, after it purchased the Guangzhou club in 2010.

The latest property developer joining the league is Greenland Group, which became the owner of the Shanghai Shenhua club and renamed it Shanghai Greenland Shenhua on Feb. 6.

Although only two of the 16 clubs posted profits in 2013, an investor said the investment should not be valued by the club’s earnings, since these companies could save money on advertising, owing to the considerable media coverage during a game.