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Kieran Maguire drops 'huge' Newcastle FFP verdict after takeover update
Newcastle United forming a multi-club network would help to increase revenues and boost their Financial Fair Play situation.
That is the view of finance expert Kieran Maguire, who spoke exclusively to Football Insider about the benefits of Newcastle partnering with affiliate clubs.
The Magpies’ ownership are reportedly looking at purchasing a new club as they look to venture into multi-club ownership.
Multi-club ownership is growing increasingly popular in football, with Manchester City’s City Football Group now one of the leading sports organisations around the world.
The Red Bull Group and Chelsea’s recently set up BlueCo group are other examples of multi-club networks within football.
Maguire believes there are ‘huge’ benefits to Newcastle’s owners expanding their ownership portfolio.
“The benefits of a centralised multi-club ownership model is that you get what we refer to as synergies, which work in two ways,” Maguire told Football Insider’s Sean Fisher.
“First of all, we have revenue synergies.
“You can generate more money by having a kit deal for example which covers not just Newcastle United, but the other clubs within the group as well.
“From the point of view of sponsors, that means that they might have the confidence that their product is going to be shown on a variety of shirts and a variety of markets, so that can be beneficial.
“If you take a look at Manchester City and the City Football Group, most of the clubs, if not all of the clubs have kits supplied by Puma.
“Quite a few of the kits have the same front-of-shirt sponsorship and therefore overall more revenues are coming in.
“The other form of synergies is what we refer to as cost synergies.
“You only ultimately need one legal department, one HR department, and one IT department operating across all of the clubs and therefore that can help to reduce costs.
“If you’ve got increased revenues and lower costs, that can be a huge help in terms of profit, which ultimately feeds through into Financial Fair Play.“
In other news, Kieran Maguire: Newcastle fans ‘should erect a statue’ of unsung takeover hero