Man City paid council £750,000 a year for stadium name rights… that sold for £100m

Man City’s Abu Dhabi owners agreed a deal to pay Manchester Council just £750,000 a year for the naming rights to the club’s stadium – months before they were sold to Etihad Airways in an agreement worth an estimated £10m a year, The i Paper can reveal. It comes amid growing concerns over deals struck between Abu Dhabi and Manchester’s political leaders, including Andy Burnham – formerly Greater Manchester mayor – as the scale of City’s financial cheating rocks the world of football. The airline, owned by the UAE government, struck a landmark, 10-year sponsorship deal for the council-owned stadium – as well as the club’s shirt and surrounding campus in 2011 – worth a reported £400m. Shorts Exact figures were never confirmed by either party, but the naming rights part of the package were reported at the time to be worth between £10m and £15m a year – or in excess of £100m over the next decade. The sponsorship agreement between Etihad and Manchester City forms a key part of how the club was found to have breached the Premier League’s financial regulations between 2009-10 and 2017-18. An independent commission found City guilty of almost all of the charges relating to financial breaches, with the club potentially facing punishments including huge points deductions, or even expulsion from the Premier League. The commission found City had arranged “sham” contracts with commercial partners that allowed the Abu Dhabi government to illicitly pump money into the club, artificially inflating revenue and reducing costs by more than £900m. Fresh revelations about the naming rights deal come amid concerns over whether Manchester City Council achieved value for taxpayers’ money in its dealings with the club’s owner, Abu Dhabi United Group (ADUG). The local authority has faced criticism after allowing City’s owners to buy up a swathe of land near the stadium for development under a “sweetheart deal”, which gave ADUG “first dibs” on buying up any public land within a defined area of the city. Deal capped naming rights at £750k The Etihad Stadium was originally built using taxpayer and lottery funding to host the Commonwealth Games in 2002, at a cost of £112m. The venue is still owned by Manchester City Council but is leased by Manchester City, under a 250-year lease that was renegotiated in October 2010, after ADUG’s takeover of the club two years earlier. According to a Freedom of Information (FoI) request obtained by The i Paper, the new agreement meant the club would pay 50 per cent of any naming rights deal to the council, up to a cap of £750,000 a year, which would increase in line with inflation. It is understood the naming rights sale has raised around £14m for the council since 2011. In the FoI, the council said it had consulted external financial advisers over the deal, but was not party to any negotiations between the club and potential sponsors. Critics say there needs to be more transparency over how local authorities, including Manchester council and the Greater Manchester Combined Authority, were involved with City’s deals – and to what extent they were aware the sale of naming rights had vastly exceeded the sum paid to the council. Professor Jon Silver, an academic at the University of Sheffield, has raised concerns about Manchester council’s relationship with ADUG, in particular the joint property venture, and told The i Paper that the naming rights deal required further scrutiny. He said: “Whether you agree or disagree with the [property deal], some of that was commercially sensitive. The money here is not – this is a public asset being used by private partners. The transparency aspect of that deal should be 100 per cent.” Siân Astley, a Reform councillor in Manchester who was recently defeated in the race to replace Burnham as mayor, claimed the naming rights deal showed a “lack of due diligence” by Manchester council. “It’s selling off the family silver on the cheap,” she said. Council’s stadium deal ‘under review’ The figures behind the deal were never reported publicly by either party at the time, but City’s then chief executive Garry Cook described it as “one of the most important arrangements in the history of world football”, which would help the club comply with incoming Financial Fair Play (FFP) rules, which limited clubs’ spending based on their revenues. Last month, an independent commission found City’s sponsorship deals were a “sham” in which companies, many of whom were adjacent to the Abu Dhabi owners, were only required to pay a “base fee”. The remaining “tagged sums” were paid by ADUG and totalled around £830m in artificially inflated revenue over nine seasons, the commission said. According to the commission, City recorded total sponsorship fees of £86.75m for the 2011/12 season, but only £16m of this was “base fees” paid by sponsors, and the remaining £70.75m was topped up by ADUG. The naming rights deal with Etihad was renewed in 2021 on improved terms. However Manchester council confirmed last month that the terms of the stadium lease with Man City is now “under review”. It is understood this relates to the fact that a £300m expansion, which will see the stadium’s capacity rise above 60,000, is about to be completed. Meanwhile, Greater Manchester Combined Authority is also reviewing loans made to property companies during Burnham’s time as Greater Manchester mayor, after questions were raised over three loans totalling £55m which were given to firms controlled by Man City’s Abu Dhabi owner, Sheikh Mansour, in 2017. Manchester City Council, Manchester City and Etihad Airways were contacted for comment.