A decade ago, the property developer Evergrande spent Rmb100 million ($15.4 million) on the takeover of a football club in Guangzhou that had been disgraced by a match-rigging scandal (see WiC100).
The rationale for making the investment was simple. Evergrande saw a chance to remake the club in its own image, boosting its own profile nationally. Its tycoon boss Xu Jiayin was gambling that the team would win promotion back to the Chinese Super League (CSL) and his company’s name would be lit up across TV broadcasts, football shows and newscasts.
Evergrande wasn’t the first company to latch onto the struggling Guangzhou team. Over the years the naming rights had switched between Baiyun (a Chinese medicine firm), Apollo (a power drink) and Geely (a carmaker), to name but a few. Yet none of the above had pulled off major successes on the pitch. That changed when Xu began to spend big on better players (see WiC68), including international stars, who were paid unprecedented salaries. Starting in 2011, Guangzhou Evergrande went on to win the CSL for seven consecutive seasons, assisting its Guangdong-based owner in turning his company into a nationally-known name.
Such was the club’s success that internet major Alibaba invested Rmb1.2 billion for a 50% stake in the same franchise in 2014, with the club officially renamed again as Guangzhou Evergrande & Taobao.
That was until this month, at least, when a new rule from the Chinese Football Association (CFA) required teams to drop references to sponsors, owners or investors in their names. As a result China’s most successful club has morphed again, this time to Guangzhou Dui, which means “Team Guangzhou”.
The club’s crosstown rival Guangzhou R&F, backed by another local property firm, also changed its name to Guangzhou Cheng, or “Guangzhou City”.
As of last week, Xinhua reported, a total of 58 professional football teams had applied to change their names, with more than 80% of the applications approved. Nor are state-owned enterprises exempt from the new ‘neutral name’ sponsorship rule. Shanghai SIPG, backed by the Shanghai International Port Group, is proposing to change its name to Shanghai Harbour. Shandong Luneng will change to Shandong Taishan (after the famous mountain in the eastern coastal province). A couple of clubs, such as Beijing Guoan (which means ‘national security’), have asked to retain their original names.
The new naming rule was initially proposed in a blueprint from 2015 which aimed at wider reforms in Chinese football, ThePaper.cn reported. The government-stipulated review proposed that “regionalisation” and “decommercialisation” of professional football clubs should be encouraged – but it took a few years for the recommendations to be acted upon.
Soccer clubs in Europe rarely incorporate the brands of their financial backers in their names (Austrian side FC Red Bull Salzburg being a notable exception).
Only time will tell if the changes will dampen some of the corporate interest in pumping much-needed funds into Chinese football, although the CFA says the adoption of ‘neutral names’ will help clubs to operate more sustainably on a long-term basis. Of course, company owners will still get the benefits typical of professional leagues in other parts of the world, such as their logos on team shirts and matchday entertainment packages for their clients.
Evergrande has been busy repaying debt, which might suggest less appetite for expensive signings and other team investments. However, given that Chinese leader Xi Jinping is known to be an avid football fan it would make it a courageous decision indeed for any of the current owners to scale back their club’s resources significantly…
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