Exclusive: ‘Wrexham now an entertainment brand not a football club’
Wrexham’s pioneering approach of focusing on show business has seen the value of the club explode.
That is according to football finance expert Dan Plumley, who told Football Insider that “all bets are off” when it comes to valuing such a unique club.
Despite being Wales’ oldest club and the third-oldest football club in the world, Wrexham have spent much of their recent existence playing third-fiddle to the country’s other two major clubs, Swansea and Cardiff.
Although those two teams have been in the Premier League this century, neither can claim to have had the cultural impact that the Red Dragons have in recent times.
Thanks to investment from Hollywood stars Ryan Reynolds and Rob McElhenney and the TV show on Disney that followed, Wrexham have accrued a large and loyal fanbase.
And thanks to that investment, the club have enjoyed three promotions on the trot, and Wrexham will have a tidy £30million transfer budget to work with as they embark on their first season in England’s second-tier since 1982.
Wrexham enjoy success by focusing on entertainment industry
A report by Bloomberg stated that Reynolds and McElhenney are considering selling a stake in the club “for a valuation of up to £350m ($475m)”, according to sources familiar with the matter.
Whilst finance expert Plumley shared his doubts over the validity of that figure exclusively to Football Insider previously, the senior lecturer from Sheffield Hallam University pointed towards the “entertainment brand” as a reason as to why that figure was even being discussed in the first place.
As a football club, Wrexham are likely less valuable than that figure, with the finance expert pointing out “that kind of valuation would outstrip some lower-ranking Premier League clubs,” but when factoring in the club’s brand as a whole, it becomes a little less outrageous.
Plumley said: “To get them to that figure overall, you’ve got to position it as you firmly believe that this is now an entertainment brand, and such a different proposition to a football club.
“That valuation is causing a stir because of that factor, because it is worth, ultimately, what someone is prepared to pay.
“And look, if these shareholders come in and pay that value for their shares and it puts the total value at £350m, then we have to kind of take that as it is in terms of the share price that has been paid.
“But I think you’re looking at two kinds of ways to view that club then.
“There’s the traditional football club valuation metrics that are not the best, but get you in and around the figure that looks more like £70-100m at the minute. But if it’s an entertainment brand, then all bets are off with that valuation, and it is phenomenal in terms of where that club’s been.
“That kind of valuation would outstrip some lower-ranking Premier League clubs.
“So yeah, I think it’s high is my personal view, but if you’re looking at it as an entertainment proposition and whatever happens next with that club, and if they get into the Premier League as well at some point, then we are in that kind of ballpark.
“Ultimately, I think that one comes down to what are those investors prepared to pay, which is where the noise will start with the overall valuation.
“But either way, buying that club for £2m in the National League and from where they’ve been to where they are, even if it’s only a £100m valuation that we’re arguing about, is phenomenal, absolutely phenomenal.”
Ally McCoist tips Danny Ings for Wrexham move
Whilst the discourse around the club’s value takes place around them, the Red Dragons are focusing on improving Phil Parkinson’s squad for their first season in the Championship in over four decades.
Ally McCoist has tipped out-of-contract striker Danny Ings to make the move to Wrexham, and the striker would bring Premier League experience to the Welsh side.
Another top-flight player the club are interested in is Fulham captain Tom Cairney, although the Scotland international is considering a contract offer from the West London club.