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Benfica face long wait to clear debts


Cash-strapped Benfica will have to wait at least two years to raise extra funds through a stock market flotation, according to the English financiers advising the club.

The struggling Portuguese giants – who face being banned :) from European competitions if they do not meet their debts – had hoped to float as soon as possible.

But London-based venture capitalists Apax Partners see the timetable stretching out to at least 2002.

"For a company to be appropriate to be floated, they need to be established and to be profitable, otherwise they won’t get value," Apax Partners’ director of corporate finance Glen Cooper told onefootball.com.

"They (Benfica) will be floating in due course – and I don’t think two years is a premature estimate," he added.

Benfica are planning to sell a substantial stake to the English company, who are specialists in the football business and currently advising clubs in France, Spain, Brazil, Belgium and Germany.

"We have been advising Benfica for nearly two years about the football industry and financial structuring and the way forward," explained Cooper, who brought Manchester United to the stock market in 1991.

Benfica have fallen on hard times and are desperate to raise cash to rebuild the squad and pay off creditors including former manager Graeme Souness and player Michael Thomas, who are said to be owed £1 million.

Fifa are threatening to ban Benfica from European competition unless the club meet the debts.

Apax have been drafted in to raise new funds from a stock market listing. The deal would involve Apax taking a 25 per cent stake in the club, whose legendary past includes two European Cup wins in 1961 and 1962.

"Benfica at the moment are transforming themselves from an association into a limited company," Cooper continued.

"It is essential for them to do that because when clubs are run as associations the management gets changed every three years so the people working there assume they will not be around in three years and don’t take the management seriously."

The plan is for Apax to run the club alongside Benfica chairman Joao Vale Azevedo.

The stock market listing could raise up to £50 million in total and the plan is for Benfica plc to eventually float in London as well as Lisbon.

There are currently no European clubs listed on the London Stock Exchange - although a number have an indirect listing via Enic (formerly, the English National Investment Company) which owns stakes in several European clubs.

Azevedo told onefootball.com earlier this week: "We have been waiting for this for a long time, because we want to turn Benfica into one of the best clubs in the world, like it was in the past. Once the regulators of the Lisbon Stock Exchange clear the new company, we won’t have any more problems."
 

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Marco I dont see what is so funny, we all go on about how poorly portuguese clubs do in europe and we all complain that portugal dont get enough european places and this year apart from porto benfica were the only ones to get some substantial points with wins over bucharest and POAK o.k not great teams but profesional teams that gives more points to portugal can u imagine if the only decent portuguese teams in europe were porto and sporting. As much as u might hate them benfica are one of only 3 teams in portugal that are capable of making a good contribution to portugal in europe.
 
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The truth of the matter is that Benfica is going to get banned!

Under a new certificate system that UEFA is going to introduce a club will have to qualify in order to obtain a certificate that allows it to play in the UEFA or CL. Without this certificate it cannot play, effectively being banned for the year while attempting to qualify for the certificate next year. One of the requirements in obtaining this certificate is that the club is financially stable and that it has no outstanding arbitration cases. As you know Benfica fail automatically as it should.
 

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I doubt that such a ban would be enforced. Personally, I think it sounds like total crap. So a club with financial problems cant compete internationally even if it has earned a place? This just goes to prove thats its not about sport anymore, just about money...this sucks..

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well if this is true this will not only affect benfica but galatasary, real madrid e.t.c
So i cant really see uefa banning the 2 holders so i doubt they'll do it to anyone else.
 
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Gentlemen, if you haven't figured out that football today is all about money and how much you make of it, then I suggest you get in touch with reality.

Believe what you will. The fact remains that UEFA plans to issue certificates that allow teams to compete in the cups. The financial factors are only a few of many factors that UEFA will consider when they are issuing certificates. Other factors include the state of a stadium, security, LACK OF PAYMENT FOR A TRANSFER and so on. Personally, what UEFA is trying to do here is admirable. They are trying to take the game to level of professionalism unseen in the past. By setting standards that all clubs must follow you will essentially create a level playing field (sort of). By making teams such as Benfica fulfill certain financial obligations they will essentially make Benfica a better team. Benfica will no longer be able to sign players at will without having the necessary financial resources to do so. Teams like Real, Galatasary and Benfica will not be able to or allowed to run massive debts in order to remain competitive. Lets face the music gentlemen, Benfica and others, including FCP and SCP need to be brought into the 21st century as quickly as possible if they are going to compete successfully in the future. We are slowly seeing this in Portugal with the capitalization of SCP and FCP and the new merchandising deal FCP has with Toyota and Nike.

Here's the article:

UEFA studying new licensing system for clubs

The special UEFA Task Force has proposed the introduction of a new modern, flexible and community-based licensing system for clubs, which it firmly believes will establish an even stronger basis for the ongoing development of football in Europe. The proposals came following a meeting of the UEFA Task Force, chaired by Senes Erzik (Vice-President of the UEFA Executive Committee and Chairman of the Committee for the UEFA Club Competitions) at the UEFA headquarters in Nyon.

Clubs to promote youth development and prove financial stability
The basic concept of the proposed system is that UEFA should define certain minimum criteria which clubs must satisfy in order to play in UEFA club competitions. National football associations would implement and monitor compliance with these criteria. The national associations may also establish additional criteria for their clubs, in accordance with their individual needs and taking account of the level of football development in their respective jurisdictions.
The UEFA minimum criteria consist of four pillars: sporting criteria; infrastructural/administrative criteria; financial criteria; and legal criteria. The aim of this system is to promote football at all levels; to improve the environment and level of safety for spectators; and to lay a secure foundation for the smooth running of all UEFA club competitions.
Among the most important conditions clubs have to meet would be the need to establish youth development programmes for all age groups between 12 and 18. Where this involves the development of football academies, both school and football education should be provided. Clubs would also be asked to operate local community projects for the grassroots development of football, the aim being to encourage more people to play and watch the game, and to forge strong links between clubs and local communities.
Equally important is the need to ensure that clubs are run according sound financial principles, both for the protection of players and the public. Given the fact that many clubs now operate as sizeable businesses, UEFA would require that the financial affairs of clubs be open to independent scrutiny, in order to improve transparency and ensure that all competitions proceed to a proper conclusion, always based solely on the sporting performances of the clubs involved.
Subject to approval by UEFA’s Executive Committee on 27 June 2000, the proposed licensing system will become effective as from the 2002/03 football season.
 

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It all sound very nice and healthy, but this stuff would NEVER apply to a club like Real Madrid, Milan etc...And yes, of course futebol today is all about big business but sometimes I try to forget that cos it sucks!

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Discussion Starter #9
I hope you don't add Benfica to that list!

[This message has been edited by Ola (edited 04-06-2000).]
 

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Hey ola what gave you the Impression we were in debt.
We are ****ing loaded I mean we can afford to free transfer one of benfica's most expensive players, I think you're mistaking benfica with someone else coz we're absolutely stinking rich!!!
 

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Ola, maybe 10-15 years ago I would have...

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