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China Daily Website

Funding stalemate question mark over Shenhua future

Updated: 2012-08-27 21:21
By Yan Weijue ( chinadaily.com.cn)

Didier Drogba and Nicolas Anelka, two of the biggest names in the Chinese Super League, could have played their last match with the Shanghai Shenhua FC over the weekend, due to an escalated equity stake rift among its major stock holders, warned the Oriental Sports Daily Monday.

Funding stalemate question mark over Shenhua future

Shanghai Shenhua's striker Didier Drogba hugs teammate Nicolas Anelka (R) after scoring against Hangzhou green town at the Shanghai Hongkou Stadium in Shanghai, August 4, 2012. [Photo/Agencies]

Zhu Jun, the club's investor with 28.5 percent of the holdings, will only cover his share of the club's daily expenditure, if his request for a large stake transfer is not met in the coming days, said the newspaper citing an insider.

Shenhua FC is currently owned by Zhu Jun (28.5%) and five state-owned enterprises, namely Shanghai SVA Group, SMEG (Shanghai Media & Entertainment Group), Huangpu Investment Ltd, Shanghai SVA Electric Group Co., Ltd and Shanghai SVA Information Industry Co., Ltd.

When Zhu became a shareholder of the club in 2007, the two sides agreed to the term that if Zhu would invest 150 million ($23.6 million) over the next two years his stake would increase to over 70 percent with the increment transferred from the five other enterprises.

It is reported that Zhu has put more than 600 million yuan ($94.4 million) into the club in the past five and a half years, while the five SOEs racked up zero.

In 2009, the transfer did not go through owing to various reasons, another insider revealed to the newspaper, adding that spokesmen from the SOEs promised Zhu then to release the transfer and again in 2011, but in fact it has made no progress to date.

"It (the stalemate of stake transfer) is annoying, and has had a bad effect on many of our tasks…The biggest problem is that the operation and financing work of the club cannot be carried out normally. The equity stakes issue has become the biggest bottleneck for the development of Shenhua," said one operator of the club.

If the stalemate continues, Zhu Jun, who has been signing all the checks for the club, will stop showing his generosity, only shouldering 28.5 percent of the club's expenditure. And the consequence will become serious, meaning the players will not get paid on time.

Giovanni Moreno, a former Racing Club (an Argentinian soccer club) player who joined Shenhua in June, missed Shenhua's CSL match against Shandong Luneng on Saturday. Insiders said that it was because Shenhua defaulted by 6 million yuan on the transfer fee with Racing Club.

Drogba and Anelka could refuse to play if Shenhua fell short with their salary payments, added insiders.

Shenhua signed Anelka in January and Drogba in June 2012. Their weekly salaries are reported to be set at £200,000 ($316,256) and £250,000 respectively.

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