When Red Bull arrived at Elland Road and almost immediately splashed their emblem on the front of Leeds United’s shirt, fans questioned what the 49ers had signed up for.
Red Bull is now as much a content production machine as an energy drink firm, and its presence in football is intended to promote both aspects of the business.
However, their strategy no longer relies solely on marketing. Football is huge business, and it appears that they want a return on their investment in the form of cold, hard dollars rather than merely exposure.
That would explain why they purchased an unnamed minority investment in Leeds United when they could have paid for the contentious front-of-shirt agreement separately.
It is also why the Austrian corporation acquired a share in Paris FC alongside Bernard Aurnault, one of the world’s wealthiest individuals. They will most likely sell their equity in both clubs for a profit at some point.
Several events must occur in Leeds before this may occur.
Obviously, Daniel Farke’s side’s promotion from the Championship is the major deal.
Leeds’ corporate value would jump overnight, and if there was a market for a minority equity interest, Red Bull would be eager to participate.
49ers Enterprises is to spend £200 million to extend the stadium and increase capacity to roughly 53,000.
That would transform Elland Road into one of the country’s largest stadiums, doubling matchday and commercial revenue almost overnight.
In the PSR age, that would be a game changer for Leeds, who have struggled with EFL spending rules.
Leeds United to target the business sector with Elland Road reconstruction.
As part of Andrea Radrizzani’s acquisition, the 49ers have already committed £10 million to prepare for the stadium expansion, the most of which will go toward a feasibility study.
Now that Leeds have formally regained control of Elland Road, Liverpool University football finance lecturer Kieran Maguire believes the club will focus on the lucrative hospitality sector with a refurbishment.
“Leeds as a city is a finance hub,” says the author of The Price of Football.
“As a result, there are many finance-related businesses and financial heavy hitters there. That implies they can offer a lot more corporate hospitality packages on an extended Elland Road.
“Clearly, fans will always be concerned about ticket prices, which is a worry for those with a hospitality focus.
“Clubs with a long history in low-income communities must be careful not to exclude their core following from purchasing tickets.
“Despite the criticism, West Ham’s season tickets were reasonable when they relocated to the London Stadium and are still far lower than those of the other major London clubs.
“Elland Road need an overhaul in terms of its potential to produce revenue from tickets and the business sector. “A new stadium is one way to accomplish that.”
Will Leeds’ stadium expansion transform the club into a Premier League force?
If Leeds obtain UEFA Category 4 classification at Elland Road, as they have promised, the refurbishment will be extremely profitable.
The Premier League’s PSR system is due to change from next season to one based on spending as a proportion of income rather than profit, which will have a significant impact on Leeds’ football future.
Matchday revenue would skyrocket, of course, but the commercial advantages of a revitalized stadium would be huge.
Tottenham, for example, has tripled their matchday and sponsorship revenue in their new stadium since 2019, and the Whites are hoping to do the same.
And, while it would not immediately lift Leeds to the level of challenging the Premier League’s so-called Big Six, it would undoubtedly have a substantial impact over time.
