Leeds United have Red Bull as a minority shareholder in the club, alongside various even smaller shares held by those more directly involved with 49ers Enterprises.
That includes the likes of Jordan Spieth and Justin Thomas, as well as the likes of Russell Crowe, Michael Phelps, and Will Ferrell. Obviously, Daniel Farke’s side securing promotion from the Championship is the big financial win for all investors concerned given the jaw-dropping windfall Leeds have received.
The front-of-shirt deal with Red Bull and kit deal with Adidas have likely doubled in value overnight upon promotion, while Leeds’ enterprise value skyrocketed in the process. If they wanted to and there is a market for a minority equity stake, Red Bull would be quids in.
Leeds United fans didn’t initially have clarity on the size of the stake that Red Bull purchased from 49ers Enterprises in the summer of last year, only that it was deemed a ‘significant minority’ of the club’s equity.
Red Bull make Leeds investment talk clear
A £1 billion 49ers and Red Bull plan has been outlined recently. However, no matter what, Leeds know they need serious investment now in the Premier League which is instantly swallowed up by the huge investment in the transfer market needed to be competitive on the pitch.
The problem isn’t so simple, as Leeds have a £61 million financial problem but there has been significant Red Bull investment mooted to help plug that gap.
Especially due to the fact Leeds haven’t posted a single year of profit since 2017. Even then, the surplus was less than £1 million. Many perhaps thought the drinks titan would look to increase shares, but Leeds have found another solution.
City AM report that Red Bull’s stake in Leeds has now reduced to below 10 per cent. That is because the German energy drinks company declined the opportunity to invest in the issue of £120 million of new shares in recent days.
Red Bull haven’t actually cut their stake. The club’s other investors, celebrity or otherwise, have increased their equity. That means Red Bull’s stake has decreased proportionately rather than them selling shares.
The new funding has been provided by members of the 100-strong consortium of investors who bought majority control of the club from Andrea Radrizzani in the summer of 2023.
The report also states the new capital will primarily be used to fund the proposed expansion of Elland Road to around 53,000 seats, although it could also be utilised to help supplement Farke’s summer transfer budget.
It does not look as though Red Bull are actively entertaining the idea of increasing their shares any time soon after they declined to do so during this opportunity.
Leeds’ PSR concerns remain an issue
Amid PSR rules changing impacting Leeds, there could still be PSR sales required for Farke and the 49ers. Leeds cannot just spend the £120 million investment on transfer targets but it helps in what they can afford to lose.
The players Leeds may yet sell to create more headroom and wiggle room financially for greater expenditure include the ones who can get them huge PSR wins. That includes academy developed players or younger signings who have become assets as they have improved in the first-team.
The main players that come under one of those categories include the likes of Willy Gnonto, Pascal Struijk, and Mateo Joseph. Harry Gray should also be worth a fortune in the future if he fulfils his potential over the coming seasons.
Leeds would prefer to build around a young core of high value assets, but many have appreciated in value and could fill any further financial gaps remaining in Leeds’ budget for the 2025/26 campaign.
To make a real assault on the league, Leeds could cash in on one or two to increase their budget further, by amortising the new signings who replace them over long contracts. Financially, they are healthier after the recent injection but there are no guarantees this summer regarding a number of their key players.
