Could the NFL Lockout Impact Aston Villa?
The bloom may be off the rose for Randy Lerner at Aston Villa, and the ongoing NFL lockout could cause more problems for the Premier League squad.
Lerner earned praise from Villa fans when he took over the team in 2006, but after three consecutive sixth-place finishes in the league, Aston Villa dropped to ninth this season. And things could be getting worse. According to a March article in The Guardian, Lerner has put more than £200m into the club in his five years of ownership. And while revenues have grown – from £37.2m in 2006-07 to £90.9m in 2010 – so have the team’s salaries.
According to The Guardian, Villa’s salary payments amounted to £22.4m in Lerner’s first year, or 60 percent of the club’s turnover. Today they have reached £79.9m, or nearly 88 percent, of the club’s total revenues. And the team is burning through Lerner’s fortune, estimated at about $1 billion by Forbes in 2010. Lerner has injected the team with £115.6m in equity and another £89.6m has come in through shareholder loans.
Now the team looks like it will have to sell Ashley Young, as they are expected to complete a £16million transfer of the England winger to Manchester United later this month.
This is where the ongoing labor issues in the NFL come into play.
The league and its players are currently fighting over how to divide $9 billion in annual revenues. And while no one is losing money yet, that will change if any games are missed this fall. No games mean no TV revenue, no gate receipts, no concessions – no incoming funds of any kind. And as Lerner also owns the NFL’s Cleveland Browns, that’s a major hit to the bottom line – no matter how much you are worth.
While the finances of the Browns and Aston Villa are not directly linked, it doesn’t seem realistic to look at one without the other. If Lerner continues to reach into his right pocket to support Villa, while also seeing money taken out of his left pocket because of the NFL lockout, when does he start to believe enough is enough? And if he reaches his breaking point, does he decide to sell one of the teams? If so, which one?
Lerner didn’t buy the Browns – his late father, Al, purchased the team and Randy Lerner inherited them when his father passed away. But Lerner chose to buy Aston Villa because of fond memories he had for the team while attending college at Cambridge. So while his heart may be in Birmingham, his head could be in Cleveland. With no salary cap in the Premier League and Villa Park only seating a little over 42,000, it’s hard to see how Aston Villa can compete with big-money teams like Manchester United, Arsenal and Chelsea without Lerner continuing to dig into his pockets.
NFL teams, on the other hand, have costs certainty built in with revenue sharing and a salary cap.
We’d hate to see Lerner have to make that kind of hard decision. We’ve always thought of him as the perfect kind of owner – one who has money and is willing to spend it, while also hiring knowledgeable people and letting them do their job without interfering.
But at the end of the day, no matter how much he may love Villa, he’s still a businessman. And that businessman may realize the time has come to end his European vacation.