Economy, Business And Markets

2 Football Clubs Will be Offered to Highest Bidders

2 Football Clubs Will be Offered to Highest Bidders2 Football Clubs Will be Offered to Highest Bidders

The financial statements have been signed to help remove the last obstacle in the way of privatization of the two major state-owned football clubs, Persepolis and Esteghlal, said Jaafar Sobhani, the top adviser to the director of the Iranian Privatization Organization (IPO).

The IPO official said after the boards of directors at the two clubs signed and confirmed the financial statements, the Reds (Persepolis) and the Blues (Esteghlal) are now officially ready to be priced for auction.

The adviser said the IPO has accomplished the pricing for the two clubs’ brands, stating that the prices for the two clubs will definitely be dissimilar up to 15%.

After calls made by the Rouhani administration to privatize the two popular clubs, a special committee was formed to facilitate the process. But the clubs’ massive overdue debts accumulated from the previous years hampered the privatization process and the boards of directors at the clubs initially refrained from signing the financial statements.

The IPO officials say the organization values the stocks based on the debts, assets, and financial statements, emphasizing that the issue of overdue debts “is not a big deal” for the two popular clubs of the capital Tehran.

The IPO predicts that the public announcement for the auction is expected to be made by February and that the potential buyers will be selected by the end of this year (March 20, 2015).

Persepolis and Esteghlal are among the oldest football clubs in the country, with millions of fans. For decades, the government has directly run the clubs though the now-defunct Physical Education Organization (whose head was the vice president) and later the ministry of youth affairs and sports.

Different governments have been blamed for their direct interference in the management of the two clubs, as dozens of managers have been appointed only to be fired at short notice.

Based on the latest decisions, 49% of the shares for each club will be auctioned for the highest suggested prices by the private sector, while 30% will be transferred to a group composed of the former players of each club and the ministry will keep the remaining 21%, although it claims it will not interfere in the management.

Various amounts of 400 to 800 billion rials ($10.95 million to $21.9 million based on market exchange rates) are reported as the overdue debts incurred during the years at the popular clubs. A majority of international footballers who joined the clubs during the past years were not paid their salaries and their contract money, many of whom sued the two clubs at the International Federation of Football Association (FIFA).