How much would you expect to pay if you had designs on buying the biggest club in the country, Kaizer Chiefs? Prepare to part with a cool R1 billion. That’s the rough evaluation TS Galaxy owner Tim Sukazi gave during a conversation with the South African Football Journalists’ Association (Safja)
Sukazi recently bought Highlands Park’s Premier Soccer League (PSL) status, revealing a “ball-park” figure of R60 million cost for the transaction that saw his National First Division (NFD) team rocket up to the Premiership.
“If you’re talking Kaizer Chiefs or Orlando Pirates or [Mamelodi] Sundowns, then you’re talking something else, maybe even R1 billion,” Sukazi said.
“There’s no chance you could buy Kaizer Chiefs for less than R1 billion. You must look at what’s there at the club.
“They have got a Vodacom sponsorship and maybe they spend R75 million or R80 million, alone. Then there’s Toyota and all the rest (of the sponsors).
“It’s a well-decorated club from a sponsorship perspective, which has got monetary value in it. Before you wake up, their sponsorships would be in the region of R150 million or there about.
“And then there are other things like their player values, goodwill, it’s got a rich history and that will count in the pricing model.”
Sukazi took Safja through some of the intricacies that went into the deal he put together to buy out Highlands Park.
“The pricing of a football franchise depends on the willing seller and willing buyer model,” he said.
“However, there’s a ball-park range. A professional football status at the highest level of the game should cost in the region of R60 million or there about.
“And how does that price get arrived at? There could be some science to it. One, you’d look into the PSL grants that come in, the amount of money in grants that the football clubs receive per month (believed to be R24 million per annum).
“You then look at the player value with that squad. And then you look at the goodwill of that particular club.
“All of that put together will throw you to that R60 million mark for a ‘small’ club – if I can put it humbly, in respect of Highlands Park.”
Sukazi, who also tried to buy Bloemfontein Celtic before the Highlands Park deal last season, said he didn’t need to source outside investors or shareholders to secure the deal and was able to finance it in his personal capacity.
“There is no law that says you’ve got to look for shareholders,” he said.
“You do these things based on your capacity. If you’re able to buy a R1 billion business today, do it. If you can do it alone, do it alone, but if you need shareholders the you can get them.
“In our case, we just chose to do it. That’s it.”