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The Beautiful Game plays to a wider audience

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Although AIS offers tactical opportunities in emerging leagues and clubs, other sports and allied sectors, our emphasis within the suite of currently available opportunities is on the elite clubs and organisations forming Football’s most successful leagues.

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European football club revenues now comfortably exceed €25bn per season with 69% of those revenues concentrated in the five most successful countries – England, Spain, Germany, Italy and France.

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By far the largest component of these revenues (in excess of 60% in the English Premier League, for example) is from broadcasting rights, with many countries seeing rapid increases in the value of both domestic and increasingly important international packages.

 

New media trends have brought a wider range of potential rights holders into competition, with clubs and national associations feeling the benefit. These improving income streams, from large global media players, provide increasingly robust security for a range of club financing initiatives with AIS providing board level access to those opportunities.

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Arena International Strategy Chairman Steve Foster founded Special Risks Ltd, trading as Pro-Secure internationally, when he retired from his career in professional football. As a footballer Steve represented England at the FIFA World Cup. Special Risks is a long-term partner of the Professional Footballers' Association, as their preferred supplier of career-ending injury insurance for the 4000 professional footballers in the English divisions.

Increasing opportunity – reducing risk

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We see risk control as central to investors' interests in the football sector. The trend toward improved governance in the industry, both at international (Financial Fair Play regulations) and national organisation levels has brought much improved stability with debt levels carefully and regularly monitored.

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For example, leading clubs’ major expense is formed by its wage bill, with intense competition for the best talent having sometimes pushed clubs to spiralling and often unsustainable costs in order to attract and retain star players. The benefits of increased regulation can be seen in that in all five of Europe’s major leagues the wages to revenue ratio has fallen below the 70% threshold, the widely accepted indicator of a club’s financial health.

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A key component of projects screened, introduced and monitored by AIS is the use of specialist insurances to control major risks to clubs’ primary assets and lines of income. Whether insuring players for career-ending accident and injury or future income for credit default by commercial partners, the centre of excellence for worldwide protection is the London insurance market, primarily Lloyd’s of London. AIS uses its long-term relationships with numerous underwriters and syndicates at Lloyd’s, providing the best security in more than 200 territories worldwide.

© 2018 by Arena International Strategy Ltd.

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