Man City close in on £1.5bn deal after Premier League settlement
Manchester City are closing in on a sponsorship deal worth up to £1.5billion after reaching a settlement with the Premier League.
Man City have been in a battle with the Premier League over the past year regarding the associated party transaction (APT) rules.
Man City have now reached a settlement with the Premier League, with The Times reporting on 8 September Pep Guardiola’s side are in line to complete a “hugely lucrative” long-term deal with Etihad Airways as a result.
The deal with the state-owned Abu-Dhabi airline was blocked in 2023 for not being fair-market value under the APT rules.
Former Man City financial adviser Stefan Borson exclusively told Football Insider the new 10-year deal with Etihad Airways will be worth upwards of £1.5bn due to indexation.
Man City have already agreed Etihad Airways deal
Man City successfully challenged the APT rules following a two-week private arbitration hearing in the summer of 2024, with the tribunal ruling the regulations in place were unlawful last October.
Following amendments by the Premier League, the Manchester giants challenged the APT rules again in February this year before the parties came to a settlement last week.
Speaking exclusively to Football Insider about the Etihad Aiways deal, Borson said: “It'll be a lot because of the way compounding works.
“We know that City have got a deal because Etihad was on the shirt last season. It's on the shirt this season and the stadium is still called the Etihad. We know that they have done the first couple of years of this 10-year deal that they put to the Premier League originally in 2023, so it wasn't binary.
“Then I think really from what you can gather from the first APT decision, the way that the deal works was that you had an escalator each year. So, it starts off at let's say for the sake of discussion a £100million per annum for all of the rights. There's a lot of rights involved here.
“In fact, I think this is one of City’s arguments is that no other club has got such an all-encompassing deal. No other club has got a sponsor for the kit, the stadium, the training complex, everything else. So, therefore, it's very hard to come up with the right value.
“Let's say it was 100m, then each year you add, let's say 5 per cent indexation, which is inflation, and each year it goes up 5 per cent because you're trying to get the annual average value in real terms to be the same as it was in the first year. So, in effect by the time you get to year 10, it's up to £150m because of the way indexation works.
“Now, if what happens in the contracts appears to be in the latter years there's some kind of mechanism whereby certain intellectual property rights also grow by a certain percentage, we don't know what these IP rights are, but this was what the Premier League said you've just gone too far, it's too expensive.
“The top and bottom of it is, I think the new deal as it is will be upwards of £1.5bn-plus over the 10 years with all of the indexation the compounding and everything else.”
In their latest published accounts for 2023-24, Man City’s turnover increased by £2.2m to £715m, with £344.7m of commercial revenue boosting that figure.
Man City waiting to hear 115 charges verdict
In a separate legal battle, Man City are still waiting to hear the verdict in their 115 charges case.
Man City were dealt 115 charges by the Premier League in February 2023 for allegedly breaching the financial fair play (FFP) rules over a nine-year period between 2009 and 2018.
An independent commission hearing started in September last year and ended in December, with the panel still considering its verdict.
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