Paris Saint-Germain - Ownership and Finances

Ownership and Finances

Thanks to the financial backing from an ambitious group of businessmen led by Guy Crescent, Pierre-Étienne Guyot and Henri Patrelle, Paris Saint-Germain was founded in 1970. Since its inception and like many other French clubs, PSG has had some difficulties in the economic field. Indeed, despite a good debut during the 1970–1971 season with a profit of 1.5 million francs, the trend reversed and the club's debt increased throughout the years. PSG president Henri Patrelle, searching for financial support, made way for fashion designer Daniel Hechter, who allowed the club to obtain professional status in 1973. Hechter launched an investment offer to help PSG palliate a serious financial crisis in the mid-1970s: 10,000 francs for one lifetime subscription at the Parc des Princes. Famous French singer and PSG fan Henri Salvador took four. Daniel Hechter was banned from football for life by the FFF following the scandal of double ticketing at the Parc des Princes in 1978, an illegal strategy to reduce the club's deficit. Francis Borelli replaced him as PSG president. Under his 13-year mandate, PSG became the leading club in Paris, despite competition from Paris FC and Matra Racing, and captured its first trophies. However, Borelli's old-style management didn't allowed the club to properly handle the emergent football business during the 1980s and by the early-1990s PSG was in financial agony with an immense debt of 50 million francs. For the first time, the Paris City Council, presided by the mayor of Paris, refused to wipe the slate clean.

French TV channel Canal+ gave reprieve to the ailing Paris Saint-Germain after purchasing the club in 1991. PSG received a whopping 40% of their income from televised games and became one of the richest clubs in France. Thanks to this money, PSG embarked on a spending spree, buying the best talent in France and the world, and entered a golden age, winning nine trophies. Canal+ became the club's majority shareholder in 1997 and the sole shareholder of PSG in 2005. Canal+ managed the club through delegated-president Michel Denisot during the 1990s. From 1991 to 1998, PSG maintained its finances healthy and the club's expenditures stood at €50m per season thanks to the rise of television rights and the increasing number of spectators at the Parc des Princes, as well as an excellent performance in national and European competitions. Following the departure of Michel Denisot in 1998, the club began to accumulate debts that reached €96m in 2002. The net debt fell to €8m in 2004 after recapitalizing the club. PSG's finances, however, remained in the red. Between 2004 and 2006, PSG was the only French club with a large deficit, registering losses of €30m. The club's turnover, however, increased from €69m to €80m. Canal+ sold Paris Saint-Germain to investment firms Colony Capital, Butler Capital Partners and Morgan Stanley for €41m in 2006. The club's debt was wiped clean by Canal+. Under its new owners, PSG's turnover reached the €100m and the losses gradually decreased over the years to only €5m in 2009.

Colony Capital purchased the majority of the shares of Butler Capital Partners in 2008, though they retained a 5% stake in the club. Colony Capital acquired all the shares of Morgan Stanley in 2009, becoming owners of 95% of the club. Colony Capital revealed in 2010 that they were looking for new investors to make Paris Saint-Germain a true title contender for years to come. Qatar Investment Authority became the majority shareholder of PSG after buying a controlling 70% of the shares in 2011. Colony Capital (29%) and Butler Capital Partners (1%) remained minority shareholders. QIA bought the club in a deal worth €50m, which covered an estimated €15-20m in debt and losses of €19m from the 2010–11 season. PSG became the richest club in France and one of the richest clubs in the world. PSG splashed a French record €108m and were the biggest spenders in the world for the 2011–12 season. Qatar Investment Authority purchased the remaining 30% stake held by Colony Capital and Butler Capital Partners and became the sole shareholder of Paris Saint-Germain in 2012. The transaction valued the entire club at €100m.