Insight to Villa’s take over by Tony Xia - How football as a business is run in China

[Gary Thomas]

You could write a good book building on the material on this thread!

[Grasshopper]

Thanx for the insight.

From what little known about Dr X, I think it is more telling that he has spent time outside if China and that he is probably familiar with "Western mentalities" as well as his own.

I work with a number of people of different nationalities and find myself learning different ways and angles of seeing/doing things. I have to admit to being a "Hybrid" of everyone and everything around me..

I can imagine and also hope that Dr X is open enough to embrace AVFC, The fans, Football as a passion and lifestyle rather than just a "Formular A1" as a atandard blueprint to success.

Someone of his Intelligence (presumtion) and experience in business will bring much needed hope and expectancy to our club rather than a proved failure who doesnt appear to possess the intelligence of a man with such wealth as Randy Lerner.

[Deisler123]

9 hours ago, meme said:

If it is true that Xia has spent several years studying the English football system, then he should be smart enough to realise that interfering might work in China, but not here.

no, interference by owner in the squad is no good anywhere in football. The reason that Xu (Guangzhou Evergrande) becomes successful is, he does not allow anyone (other than manager) to control the squad. And absolutely ZERO tolerance against players being lazy and arguing with manager. 

Xia needs to learn that from Xu.

[Deisler123]

7 hours ago, VillaBrum said:

This is a superb thread, which has given myself and, I'm sure, the other readers, a new insight into the way China functions (not only with football). I feel a more cheerful now!            Just one question:- Deisler, do you think that 'McParland The Great' is correct with his own view of the situation? He certainly puts his thoughts over very well.

http://www.astonvilla.vitalfootball.co.uk/article.asp?a=7520870

I pretty much agree with what he said, except partly that 'it is easier to acquite premier league club than other leagues because of how clubs are structured.' 

It is true for most of buyers, but not exactly true for Chinese buyers. 

UK is both economically and politically important to China, therefore football in UK is particularly attractive to Chinese buyers especially when they have state support.

There is why Chinese buyers have little interest in Italy/France and other small leagues. Germen leagues are different indeed because they must be owned by (at least 51%) by fans. But if there requires the same amount of investment to make the club equally succesfully, if I were the president or the boss behind the state support, I will rather invest in English league, because of the side benefit (political mostly). 

[Deisler123]

7 hours ago, VillaBrum said:

This is a superb thread, which has given myself and, I'm sure, the other readers, a new insight into the way China functions (not only with football). I feel a more cheerful now!            Just one question:- Deisler, do you think that 'McParland The Great' is correct with his own view of the situation? He certainly puts his thoughts over very well.

http://www.astonvilla.vitalfootball.co.uk/article.asp?a=7520870

McParlandTheGreat posted: 21/5/2016 14:03 

Let's look at the facts. The Villa website put out a statement that Recon was a holdings company which has a controlling interest in 5 companies, interests in many more, which in total employ 35000 personnel in 75 countries. It appears that the controlling interest in 5 companies bit was wrong. A guess might be that the mistake was at the Villa end; the Chinese end was quick to correct it. It now appears that the controlling interest is in 1 company (it is of course possible and even likely that it has major interests in the other 4; the statement from the Chinese end that it is engaged in acquiring a controlling interest in another 4 companies tends to imply this) 

There is a corrected statement on the Villa web site which reads: 
Recon Group is a multinational conglomerate group led by Dr. Tony Jiantong Xia. The group holding company owns, directly and indirectly, the shares of several publicly listed companies on the Hong Kong and Chinese stock exchanges and many other private companies employing 35,000 people in 75 countries. 

The mistake is a minor one. It doesn't matter a jot whether Recon owns majority interests in 0 or 100 companies. It is a holdings company; it is a vehicle for investments. What matters is whether or not it can put together the resources to buy Villa. It appears to have satisfied Hollis that it can. It now has to satisfy the leagues. If it can then Recon owns Villa. I have no problem with that. 

The thing about holdings companies is that they tend not to just stick money in any old company. They have a strategy. They target certain markets for growth. They build up related investments. They invest over a period, not for the short term. At least the better ones do; from what I've read of Recon this is what Recon does. They're based in a country with huge opportunities in the medium and long term, and Recon is wired into that. If you look at what's been said about the plans for Villa, that approach ties in. I've seen it suggested that it if we aren't promoted at the end of this coming season Recon will pull out. I don't think Recon is that sort of company. It's about long term investment and profit, not about short term return. It has highly ambitious plans for Villa and the structure around it; in the scheme of things, a one season promotion is highly desirable, but nowhere near critical. 

Early days. A lot more will become clear over the next two weeks and beyond. I hope we back it not knock it. Teams which aren't optimistic get nowhere on the field. Clubs and fans also need optimism.


 

I have to say that, we do not know if the mistakes were made by Villa current owners, or by Xia intentionally.

My feeling is, the mistake might be made by an intermediate person (as an agent or introducer), who may do this either purely by a mistake or intentionally.

But let's not waste our brain cells on this thing - because we will never find out whose fault it was!

[cyrusr]

20 hours ago, Deisler123 said:

 

 

 

Carson Yeung and Dr. Xia are pretty much similar, although Xia is more wealthier than Yeung is.

However, Xia may be backed up by China, and Yeung does not have that.

Plus, the market in China mainland is 1 billion time larger than HK.

So no conclusion can be drawn from the comparison between CY and Xia.

BTW - Yeung has been long known as a fraud/money laundering businessman. Xia has some negative reputation but not as bad.

Thanks for that, still don't like any similarities but at least he is not as bad!

[Deisler123]

7 hours ago, backofthenet said:

hi guys, new member here, been reading your posts an its really interesting stuff, i actually watch alot of asian football, your quite right about evergrande, i watched them a while ago win the AFC champions league against al-ahli (i think!), they do appear set to dominate asian football for quite some time,ive also noticed a team called hebai who seem to be doing ok, i dont recall them last season, are they a new team or someone that may challange evergrande, i have a couple of questions though, 1 is related the other not so

1. why isnt japanese football moving as quickly as chinese football, they have a better league set up and apparently better players but they dont seem to do well in the asian championships, in fact south korean teams seem to do much better.
2. the information you have given about Dr Xia is very helpful but why would he need any help from chris samuelson, who seems to be lurking in the back ground

you may not be able to give any insight on question 2 but thought id put it out there

Yes, Hebei Fortune just got promoted to super league, and they spent huge and bought Lavizzi and Gervinho. They are doing well.

I will attempt to answer your questions. I have more confidence in my answer to your first question, than to second one.

1. In early 90s, J-League had huge investment from owners - they also did the same thing as what Chinese super league are doing - buying famous players from Europe. And FA in japan made a lot of good decision, especially on youth training. So their national team started to do well in mid-90s. 

However, due to gobal financial crisis, Japanese companies no long have the money to invest in football. But still, their youth system has been built already so their national team is doing well and will do well in the next 20 years. And the top japanese players come to europe to play. Without the investment and the top players, J-league cannot do well in Asian championship. 

Korea has the similar issue - there is very little investment from owners. Their youth system is also good. 

Between China, Japan and Korean football - In most cases, Japan can win Korea, Korean can win (99% games) China, but China do well against Japan (relatively speaking). It is thought to be due to the fact that Japanese players are very skillful but fear physical contact, which is what Chinese players are good at. And Korean players are very good at stamina, so they are not afraid of skillful Japan.

In the next 5 years, Chinese super league will become the best league in Asia (arguably they already are). But the national football team requires at least 10-20 years plan in terms of building the youth system, which China just starts to have a few year ago. 

 

2. I dont know enough about Chris Samuelson - who seems to be an agent for financial talks? I don't think it is a bad idea to have an agent working for you in between you and the club you want to buy, specially for a chinese businessman who may know little about how to buy a football club, which Chris seems to have some reputation on that (mostly bad reputation i know but at least he has experience....)

[Deisler123]

5 hours ago, TheMightyVillans said:

Great read.

By the sounds of it if Xu Jiayin was our owner then the majority of the current team would be either fined, in the reserves or sacked.

I do believe so. Isn't that what Villa fans want in the end? The few days I have spent here, it seems most of people here want to get rid of most players from the club because they are too lazy (or do not deserve their wages?)  

[Deisler123]

4 hours ago, Grasshopper said:

Thanx for the insight.

From what little known about Dr X, I think it is more telling that he has spent time outside if China and that he is probably familiar with "Western mentalities" as well as his own.

I work with a number of people of different nationalities and find myself learning different ways and angles of seeing/doing things. I have to admit to being a "Hybrid" of everyone and everything around me..

I can imagine and also hope that Dr X is open enough to embrace AVFC, The fans, Football as a passion and lifestyle rather than just a "Formular A1" as a atandard blueprint to success.

Someone of his Intelligence (presumtion) and experience in business will bring much needed hope and expectancy to our club rather than a proved failure who doesnt appear to possess the intelligence of a man with such wealth as Randy Lerner.

Yes, his education in US is a good sign of a businessman who may have (good) attributes from both cultures.

Lets wait and see.

[sidcow]

Thanks for writing all that up Diesler.  It does back up my own thoughts that it's pointless looking at his personal wealth and trying to see what companies he does or doesn't own or how he owns them. If there is government involvement in all businesses in one form or another it really depends on what their desire is in all this

But it then begs the question,  if he is not working with the blessing and support of the government,  why is he bothering at all?  People keep talking about asset stripping but we have no assets to strip,  even the land Villa Park stands on isn't worth the money he has paid. If he wanted to make serious money and has £65m to invest there are 1001 better ways to spend your money,  as Randy has found out he would have been far better off just leaving his £62m in a current account for 10 years,  he would be significantly better off. 

If Xia is not here to do something serious I really can't see why he would be here at all. 

Edited May 22, 2016 by sidcow

[TheMightyVillans]

11 hours ago, Deisler123 said:

I do believe so. Isn't that what Villa fans want in the end? The few days I have spent here, it seems most of people here want to get rid of most players from the club because they are too lazy (or do not deserve their wages?)  

I certainly wouldn't have been complaining if they got fined, put in reserves or sacked this season 

[Villarocker]

12 hours ago, Deisler123 said:

no, interference by owner in the squad is no good anywhere in football. The reason that Xu (Guangzhou Evergrande) becomes successful is, he does not allow anyone (other than manager) to control the squad. And absolutely ZERO tolerance against players being lazy and arguing with manager. 

Xia needs to learn that from Xu.

Now ^THAT^ is exactly what I want to see. An owner who shows his face, shows that he's interested and takes no shit from those that he employs. Maybe then the players will care more about their role at the club. 

[Rodders]

13 hours ago, Deisler123 said:

 

UK is both economically and politically important to China, therefore football in UK is particularly attractive to Chinese buyers especially when they have state support.

There is why Chinese buyers have little interest in Italy/France and other small leagues. Germen leagues are different indeed because they must be owned by (at least 51%) by fans. But if there requires the same amount of investment to make the club equally succesfully, if I were the president or the boss behind the state support, I will rather invest in English league, because of the side benefit (political mostly). 

So there is likely an acknowledged political benefit to this deal and others. If mentions of your state upset you, may I ask how you view the political benefit?

[nnock1984]

I think it's obvious that we could really benefit from having a Chinese player in the first team. Diesler, who are some regular internationals for China who could do a good job for us?

[Deisler123]

9 hours ago, sidcow said:

Thanks for writing all that up Diesler.  It does back up my own thoughts that it's pointless looking at his personal wealth and trying to see what companies he does or doesn't own or how he owns them. If there is government involvement in all businesses in one form or another it really depends on what their desire is in all this

But it then begs the question,  if he is not working with the blessing and support of the government,  why is he bothering at all?  People keep talking about asset stripping but we have no assets to strip,  even the land Villa Park stands on isn't worth the money he has paid. If he wanted to make serious money and has £65m to invest there are 1001 better ways to spend your money,  as Randy has found out he would have been far better off just leaving his £62m in a current account for 10 years,  he would be significantly better off. 

If Xia is not here to do something serious I really can't see why he would be here at all. 

There has been quite a few years that a lot of domenstic assets (mostly in the form of cash) start to be spent on overseas assets. This phenomenon is due to a lot of different reasons, some good, some bad. It is very difficult to reach conclusion on this, before Xia does anything for the club.

But you can ask the same question to all owners of English club that are not very successful recently. 

'If Xia is not here to do something serious I really can't see why he would be here at all. '. Yes, I do agree. 

[Deisler123]

1 hour ago, Rodders said:

So there is likely an acknowledged political benefit to this deal and others. If mentions of your state upset you, may I ask how you view the political benefit?

Rodders, i was not upset by the mentions of the state - please do not try to play the wording games. I was upset by someone who (not for the first time since I joined VT) keeps pointing a conversation to the political system that China has, which has nothing to do with the coversation itself. 

I do have my view on political benefit, but I don't want to talk about it here (in VT I did talk about topics relevant to China politics, but that was because I want to explain things about the football and this take over).

The video below, from TED talks, by Kevin Ruud, is a good one to read. He used US as an example but if you just substitue 'US' with 'UK' in his talk, it is also fine.

 

Edited May 23, 2016 by Deisler123

[Kingman]

Deisler123 do you know if there is any truth in todays reporting? 

Dr Tony Xia, Aston Villa's prospective new Chinese owner, has been plagued by claims he fabricated his academic record, while a company he controlled has apparently previously run foul of authorities for providing false information to secure a certificate.

The controversies throw fresh doubt over the mysterious businessman who is hoping to seal a £65 million takeover of one of England’s oldest clubs.

The Premier League and Football League are understood to have growing concerns over Mr Xia's "conglomerate", the Recon Group, following reports that it controls only one listed company that, according to the Shaghai Stock Exchange, made a loss last year, not the five Villa previously claimed.

Villa Park CREDIT: GETTY

Allegations in China that Mr Xia had falsely claimed to be a professor have been brushed off by the Harvard graduate who said the media had exaggerated his academic record.

But The Telegraph has obtained a document from Fang Zhouzi, who runs a website exposing false titles in China, which appears to shows that Dr Xia had applied for special status from a Chinese province by claiming he was a professor at Harvard between 2001-2.

The document, which could not be independently verified by The Telegraph, also shows he claims to have obtained a Masters and a Phd at the prestigious university between 1996-2001.

The Telegraph contacted Harvard to ask for the release of Dr Xia’s record, but was told that he had put a block on access to it.

It can also be disclosed that a company controlled by Dr Xia, Hangzhou-based XWHO, was criticised by China’s Ministry of Construction in 2007 for providing false information when it attempted to secure an industry standard certificate.

That would add fresh concerns over the due diligence carried out by Villa’s board with regards to the bid for the recently-relegated club.

Villa announced on Wednesday that it was being taken over by the Recon Group, which it said “owns the controlling interest in five publicly listed companies”.

Outgoing owner Randy Lerner described Dr Xia as a “hugely successful businessman” in information released to the press, while Chairman Steve Hollis told media: “The reason we went with him is because of his background”.

Randy Lerner CREDIT: GETTY

The Financial Times reported on Friday that only one listed company is under the control of Recon Group - Lotus Health Group, a large producer of the food additive MSG.

Lotus Health Group made a net loss of 508.5 million yuan [£53.3 million] on revenues of 1.7 billion yuan [£180 million] last year, according to the Shanghai Stock Exchange. That is compared with a net profit of 23.9 million yuan [£2.5 million] the previous year.

Mr Xia bought the company in March 2015, and the following December eyebrows were raised in the Chinese business community when it emerged the cousin of President Xi Jinping had been elected to its board of governors.

The decision to elect Xi Yinping was retracted a day later, but little is known about the episode given the tight controls in Chinese media over reporting on Beijing’s top leaders.

Mr Xia himself Tweeted – and then deleted – a post warning people not to believe rumours about the affair.

There are few reports detailing Dr Xia’s personal wealth or his self-professed love of football in Chinese media.

He does not appear on the Hurun report – a list of China’s most wealthy. The latest report has more than 1,700 people, with wealth ranging from $34.7bn (£23.7bn) to $310m (£214m).

The businessman from eastern China – whose age has been quoted from 39 to 41 in different reports - said he is seeking to use his investment to forge closer ties between his home country and the UK.

“He plans to make Aston Villa the most famous football Club in China with a huge fan base,” said material from Villa.

Wu Celi, a football author and one of China’s top sports journalists questioned whether this goal was possible given Villa’s fall in status. 

He also raised concerns over whether Dr Xia has the financial muscle to turn the club around.

“It will be hard for Aston Villa to develop a huge fanbase in China because their performances are not very good,” he told The Telegraph.

“This has risks. And good football team needs the support of a large amount of capital.”

Fans of Aston Villa would be cautious of potentially wealthy buyers from the Far East, following the experience of bitter local rivals Birmingham City, who were bought by former hairdresser Carson Yeung for £81.5m in 2009.

Carson Yeung CREDIT: GETTY

Yeung was sentenced to six years in prison by a Hong Kong court for money laundering in 2014 after being described as “not a witness of truth" by the judge.

Dr Xia’s public relations team did not respond to requests for comment from The Telegraph.

Additional reporting by Ailin Tang 

http://www.telegraph.co.uk/business/2016/05/23/questions-linger-over-new-chinese-owner-of-aston-villa/? 

Edited May 23, 2016 by Kingman

[Deisler123]

1 hour ago, nnock1984 said:

I think it's obvious that we could really benefit from having a Chinese player in the first team. Diesler, who are some regular internationals for China who could do a good job for us?

Firstly, no Chinese players (at the moment) can get a work permit. As the China national team is not within the first (60? or 40? i cannot remember) of the FIFA table. The players therefoe need to be loaned out from Villa to other leagues in EU in order to gain the permit (Chelsea do that a lot), or being bought with more than 10M to activate 'football genius clause'.

Let's assume they can play for Villa, then a few that come cross my mind:

1. Wu Lei - Shanghai SIPG,24 yo - AMC/small attacker -he is quick and his off-ball is top class. His shooting is poor. He is better played as a shadow attacker.

2. Zhang Linping - Guangzhou Evergrande- 27 yo - RB/CB -he is very strong physically. He is called Zhang-mos, as he is a look-a-like and plays the same type of football as Sergio Ramos

3. Zhang Yuning - Vitesse (netherlands) - 19 yo - CF - he is strong, very good at holding the ball, top heading skills, not very quick, not very good at passing and shooting. He is believed to be the player that has the potential to become the China's best football player in the next 10 years. He, in my opinion, is better than Solanke (the chelsea loanee at Vitesse) who was the top-scorer in youth UEFA champions league.

There are others ofc. Especially those youth players 17-19, there are a lot of them who are quite good.

Problem is the transfer fee. As i have mentioned in another post in the thread, Chinese players (in Chinese clubs) are very expensive. Wu Lei is like 10M pounds at least, and Zhang Linping is like 8-10M. Zhang Yuning is much cheaper (at Vitesse) though.

I think generally speaking Chinese players who play in defenders position may mostly-likely become successful in English football.

 

 

 

[Deisler123]

11 minutes ago, Kingman said:

Deisler123 do you know if there is any truth in todays reporting.

Hi Kingman, as far as I can see from this reporting, there are three allegation to Xia, 

1. Harvard Professorship claim

2. 1 listed company instead of 5

3. President's brother.

 

First off, these three things are no secret in China. Everyone knows it - I didnt know Xia and Recon before this take over, but I baidu-ed it, and I get these rumour said by a lot of people on forum.

1. In the battle between him and Fang Zhouzi, there is evidence that he used 'Professor' in his application form. He is not the only one who has done this - I dont think it is very bad - but yes if that was true then it is not good.

It should be noted that Fang Zhouzi, although was appreciated at the beginning of his 'anti-fraud' career, now has been seen as 'doing it too much for no good'.

2. No one knows if this is Xia's fault, or a misunderstanding, or current owner's fault. I dont think this is an issue tbh.

3. Whether or not this is true, I do not know. People are certainly talking about it - again, i see this as a minor problem.

[Duck]

For gods sake, the press really can't stop digging can they. It's negativity every day at the minute.

Obviously we all want the takeover to be clean and legit, but it seems like the "journos" are (as usual) praying  for us to screw up. Fed up of it all the time!