The Iran Privatization Organization said shares of Tehran's two main football clubs, Esteghlal and Persepolis, will be offered in the stock market by late February.
"Both clubs have submitted their financial statements to the IPO that are being reviewed. We have not yet set a date for the share offer, but tentatively it would be by the end of February," Hossein Qorbanzadeh, the IPO head, was quoted as saying by ISNA,
The IPO is discussing the details with the representatives of the two clubs, Qorbanzadeh said without providing details.
In May 2020, it was announced that shares of the two biggest soccer teams would be offered in the Iran Fara Bourse's Base Market after their registration and recapitalization is over. Shares of companies unable to address the main regulatory requirements, such as financial transparency, can be sold only in the base market.
Earlier reports said 50% of the shares of the two clubs are supposed to be sold to companies with more than 10,000 shareholders and the rest to cooperatives.
Not all shares of the government will be offered, Qorbanzadeh said. "We proposed offering 20% of the shares in subscription sales…the money would be paid to the clubs to help them solve their financial problems.”
The move comes after recent media reported on the possibility of banning the two clubs from the AFC Champions League 2022 because they failed to meet the requirements for obtaining the entry licenses.
More than a decade ago, when the Asian Football Confederation insisted on privatization of professional football clubs, state-owned clubs were no more acceptable and deadlines were set for transfer of proprietorship.
Following the AFC ruling, several scenarios were considered for the two clubs, including selling it via auctions. Efforts were made in the past to privatize Esteghlal and Persepolis, but to no avail. The baton has been passed on from one government in Tehran to another, unable (some say unwilling) to find lasting solutions to the management and financial problems of the two popular clubs.
Accumulated debts of the clubs and their ambiguous financial statements are seen as the main hurdle to privatization. According to Qorbanzadeh, the last financial reports of the two clubs show accumulated debts of Esteghlal and Persepolis at 2,000 billion rials ($6.6 million) and 1,500 billion rials ($5 million), respectively.
Esteghlal (the Blues) had a private owner before the 1979 Islamic Revolution, but it was put under the control of the then Physical Education Organization (now Sports Ministry). Persepolis (the Reds) had a similar fate.
