City Football Group Expanding Into South America

March 23, 2017

City Football Group, the holding company that oversees New York City FC, Manchester City FC, Melbourne City and owns a stake in the Yokohama F. Marinos, are on the verge of expanding their global reach into South America, with the purchase of a Uruguayan club believed to be next target according to reports from The Independent, ITV and the Daily Mail.

CFG have rapidly expanded their portfolio of teams around the world since their foundation in 2008 as Sheikh Mansour bin Zayed Al Nahyan sought to purchase Premier League club Manchester City FC. The group rapidly invested in player development, acquisition and management as well as facilities for their club. They also added Manchester City Women to their portfolio in August of 2012.

Intent on becoming a global powerhouse in the game, CFG turned its eyes to Major League Soccer after Ferran Soriano was appointed CEO of the organization in 2012. Soriano had long held an interest in the United States, specifically in having an American franchise of a European club in MLS. Soriano was with FC Barcelona in 2008 when the club opened up talks with MLS Commissioner Don Garber over an expansion in Miami.

Barcelona’s bid for an expansion team ultimately never went through and Miami is still without a MLS team, however Soriano liked the idea enough to push for it at CFG. A year after being named CEO, and after negotiations over an expansion fee with Don Garber, NYCFC was announced as the 20th MLS club in May of 2013 in partnership with the New York Yankees.

Soriano and CFG continued onward, acquiring an 80% stake in Melbourne Heart on January 22, 2014. Shortly thereafter, news broke that CFG was renaming the Heart as Melbourne City FC, in keeping with their City Football global brand. CFG followed suit as they had in Manchester and formed Melbourne City Women in May of 2015.

Not content with having a club on three continents, CFG acquired a minority share of the Yokohama F. Marinos on May 20, 2014. They are prohibited from owning a controlling share in the Japanese club as a foreign based entity.

Since being established in 2008 City Football Group has grown to have a presence on four continents with Africa, Antarctica and South America escaping their grasp. Last year CFG Chairman Khaldoon Al Mubarak confirmed to City AM that the organization was looking to acquire more clubs.

“So I would say that when the opportunity arises, and we are looking at opportunities, you can expect us to add to the number of clubs we have already within the organisation.”

“It’s too early for me to pinpoint [the location]. We’re looking at opportunities, we’ll see how it goes. At the right time, the right place, we will tell you.”

It would appear that right time has come. If the reports are correct, CFG will add their first franchise in South America in the coming weeks. Second division Uruguayan Club Atlético Torque is rumored to be the takeover target. According to Uruguayan news outlet Ovacion, Torque have been working with City Football Group for some time.

The acquisition of a club in South America would help all of CFG’s clubs with player scouting and acquisition. Recent Manchester City acquisition Gabriel Jesus’ debut was delayed after there were issues with third-party ownership.

If CFG were to own a club in South America, their scouts would have a base of operations on the continent and players would be able to much more easily transfer between CONMEBOL nations than to and from elsewhere. South American players who are unable to acquire visas to play in countries such as Australia, the UK or the United States will find it easier to simply move to Uruguay for the time being while working towards acquiring a Visa. CFG has loaned players between their clubs in the past, most recently the signing by Manchester City of Yangel Herrera was quickly followed by a loan to New York City.

New York City FC have scouted and signed several South American players in their brief history and while a partnership with a Uruguayan club doesn’t mean that Luis Suarez or Edison Cavani will be at Yankee Stadium anytime soon, it means Claudio Reyna will have access to more information which can help him better scout NYCFC’s next South American signing.

Following the Uruguayan expansion, it is widely believed that CFG will look to China. CFG sold a 13% stake in their company to a consortium of Chinese investors for £265 million in 2015. Former NYCFC President and current CFG Chief Commercial Officer Tom Glick recently commented on their interest in expanding their operations in Asia.

While only Manchester City has won the league under the aegis of CFG, investment into facilities and player development for Melbourne and New York City show their intent is more than just marketing Manchester City. Melbourne City built a world class training facility and NYCFC recently began construction on a training facility north of the Bronx. The addition of a South American “City” team will not only help grow the brand, but will give all of the partner clubs new tools to help them compete.