Abu Dhabi-controlled City Football Group announced the takeover of the Indian side the day after a US equity fund pumped $500 million in new cash into CFG, taking its value to $4.8 billion.
On top of the English champions, CFG also own New York City FC, Melbourne City in Australia, Yokohama F Marinos in Japan, Sichuan Jiuniu in China, Spanish second division side Girona and Club Atletico Torque in Uruguay.
Analysts say the 65 percent stake taken in Mumbai is new proof that CFG wants to build a global football-based entertainment conglomerate.
Mumbai’s former owners, Bollywood actor Ranbir Kapoor and Bimal Parekh, a fund manager for Bollywood stars, “will hold the remaining 35 percent of shares,” said a CFG statement.
“We believe that this investment will deliver transformative benefits to Mumbai City FC, to City Football Group and to Indian football as a whole,” said CFG chairman Khaldoon Al Mubarak.
Kapoor and Parekh founded Mumbai when the Indian Super League was created in 2014. At the start they hired foreign stars including Nicolas Anelka, Freddie Ljungberg and Diego Forlan with English manager Peter Reid but could not buy success.
Mumbai City has twice reached the ISL end-of-season playoffs but never won a title.
While Manchester City pack out their 50,000-plus stadium, Mumbai’s 8,000 capacity stands are usually only half full to see the team now managed by former Sporting Lisbon captain Jorge Costa.
Nita Ambani, head of the ISL and wife of India’s richest man Mukesh Ambani, said the deal marked a “new era for football in India.”
– Football’s Indian future –
And CFG chief executive Ferran Soriano said in Mumbai that the group “has been looking at football in India for years”.
“We are now convinced of the bright future for the ISL,” he added.
Soriano said the new owners were sure that in 10 years “there will be Indian players who are going to be stars on the world stage.” He promised investment in coaching and facilities at Mumbai.
Simon Chadwick, a sports business professor at Salford University in England, said that Soriano has long expressed a vision that “football clubs should operate like Walt Disney”.
This would see clubs produce entertainment products that can be franchised in many countries using the latest television technology, and accompanied by merchandising and retailing strategies, he added.
Chadwick said India was an increasingly important sports market with its strengthening economy and growing middle class.
He said the Mumbai deal uses CFG’s operations in “football, entertainment, technology, business. By franchising in this way, CFG can serve multiple markets at the same time, thereby appropriately targeting local consumers and generating associated revenues.”
CFG now employs more than 1,500 footballers across the globe and Chadwick said the group would make cost-savings by having so many franchise clubs to slash the cost of “talent spotting and acquisition.”
“CFG is ahead of its rivals and has established a competitive advantage both off and on the field that its rivals will struggle to match,” he said.
Manchester City have won the English Premier League title four times since Abu Dhabi United Group, the investment vehicle owned by Sheikh Mansour bin Zayed Al Nahyan, took over the club.
They have had 11 successive years of financial growth and earlier this month reported record revenue of £535.2 million (628.6 million euros) last season.
