Football finance expert Kieran Maguire has praised Newcastle United’s response to the Premier League APT ruling.
In the aftermath of PIF’s Newcastle United takeover, the Premier League coincidentally introduced the new associated party transaction (APT) rules designed to monitor sponsorship deals struck by clubs.
Mike Ashley damaged Newcastle’s commercial income, so increasing sponsorship revenue was a focal point for Newcastle’s new owners.
A lucrative Adidas deal was signed, while Newcastle agreed a £25m Sela sponsorship. However, the APT rules forced Newcastle to lower the value of the Sela agreement as it wasn’t deemed ‘fair market value’.
Following a complaint from Manchester City, the APT rules have been declared null and void and ruled as “unlawful”, meaning Newcastle ultimately missed out on millions in their sponsorship agreements.
Newcastle could now seek compensation from the Premier League for the impact caused by these “unlawful” regulations, and Maguire insists the Magpies have positioned themselves brilliantly throughout the process.
Kieran Maguire explains PIF masterclass during APT ruling
Newcastle were never directly involved in the legal battle over the APT rules as it was Manchester City who took the fight to the Premier League.
Amanda Staveley slammed the APT rules when they were first introduced, but Newcastle let City do the fighting for them – a move that Maguire praised as an “absolute blinder”.
Speaking on the Loaded Mag NUFC channel, Maguire said: “Manchester City are feeling absolutely vindicated, and I think Newcastle United have played an absolute blinder.
“They have just sat by the sidelines.
“So if City lost, they would incur all the legal costs. If City win, Newcastle United are now in position to say ‘well, we’ve had to negotiate deals and have lost opportunities from potential commercial partners’.
“Now, we need to have a conversation internally and could need a conversation with the Premier League to say we’ve lost players but if we’d been able to sign deals with associated parties…”
How the APT ruling will impact Newcastle United
The APT ruling is a big success for Newcastle given the regulations were brought in as a direct consequence of the PIF takeover.
Newcastle are aiming to reach the top, but the “unlawful” regulations seriously stunted the club’s financial growth. As supporters are well aware, the Premier League Profit and Sustainability Rules have been a frustrating blockade during transfer windows, but the APT rules stopped Newcastle from signing lucrative sponsorship deals that would have helped to navigate those regulations.
When Newcastle officials heard the APT verdict, they quickly acknowledged that it wouldn’t have any short-term impact on revenue.
However, it does make it possible for Newcastle to explore bigger and more lucrative sponsorship deals with PIF-related parties in the future, and that is an exciting prospect.
Newcastle are well behind their Premier League rivals financially, but with stadium talks underway and commercial revenue now unlocked, things are looking up.
Receive a digest of our best Newcastle content each week direct to your mailbox
