Gulf investors have bought for the second time in a year a Spanish soccer club.
Kaiser Rafiq, a partner and managing director of the Dubai-based Royal Emirates Group of Companies, declined to identify the club, but said the group would formally announce the $90 million acquisition on Thursday. The group is chaired by Sheikh Butti Bin Suhail Al Maktoum, a member of the Dubai royal family.
Taking a leaf out of Abu Dhabi and Qatar’s successful use of European soccer acquisitions to build their brand, position themselves as global players and leverage opportunities, Rafiq said the investment would help promote Dubai.
"We want to prove to the world that we are not only investing in the UAE but we are capable of making huge investments abroad," Rafiq told The Associated Press. "We care about sports and we are hoping that this will send a very positive message that we are cable of doing anything."
Dubai has successfully used sports to promote its brand with Tiger Woods and Roger Federer regulalrly visiting the desert city to play in tournaments and the world's richest horse race luring tourists to its glitzy shopping malls and five-star hotels.
Dubai - once a regional leader in employing bold investments, mind-boggling mega projects and an aggressive public relations campaign to create a global brand – saw its image and credibility tarnished when it suffered a financial collapse in 2008. The acquisition of the Spanish club is Dubai’s first major acquisition since the financial crisis.
The acquisition follows the purchase in June of Spain’s Malaga FC by a Qatari investor, Abu Dhabi’s takeover in 2008 of Manchester City and the awarding in December by world soccer body FIFA of the hosting of the 2022 World Cup to Qatar.
The Dubai Group, one of the royal family’s major holdings, announced hours before the announcement of the soccer acquisition that it was seeking to renegotiate the terms on its $10 billion debt -- $4 billion of which is more than previously divulged.
The disclosure highlighted the financial problems Dubai is still experiencing as well as the lack of transparency during and since the 2008 financial crisis. Dubai as well as many of its government-controlled companies is believed to have a total debt in excess of $100 billion, but have yet to disclose precise figures.