'It's a unique model' - How Man City are building a power base in South America

Montevideo City Torque
Divulgação / Torque
City Torque - one of two clubs now associated with the English giants in the region - are thriving under the umbrella of the City Football Group

While on Wednesday evening Manchester City's thoughts were firmly focused on events in the Rhineland, on the other side of the Atlantic Ocean another side decked in sky blue were out looking to advance in continental competition.

Montevideo City Torque took on their city rivals Fenix for a place in the first Copa Sudamericana group stage, having landed in continental competition for the first time in 2021 – by rights the club should have entered the Libertadores but chose to forfeit their spot in the preliminary stages in favour of entering the secondary South American tournament.

Having drawn the first leg 0-0, the visitors capped a perfect evening for the City Football Group with a 2-0 win to advance into the next round – a notable achievement even if it does not quite compare with a Champions League semi-final.

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One of Uruguay's youngest clubs following its foundation in 2007, Torque were taken over by the City Football Group a decade later, becoming in the process its first acquisition in South America following similar partnerships in New York, Melbourne and Yokohama.

At the start of 2021, City added Bolivian giants Bolivar to their portfolio, the 11th side in the CFG stable, and first associated with the Group under the label “partner club”.

“We are very pleased to grow our global presence through this important collaboration with Club Bolivar,” City Football Group chief executive Ferran Soriano stated upon announcing the partnership.

“This long-term agreement is the first of its kind and will enable Club Bolivar to draw down on and utilise the wide range of football industry expertise developed by City Football Group.

“As well as supporting Club Bolivar’s ambitions, we have an opportunity to learn. Our work in Bolivia will certainly strengthen our knowledge of, and network in, South American football.”

Since its advent following the takeover of the Premier League club by the Abu Dhabi United Group in 2008, the CFG has concentrated its investments on regions not traditionally considered football bastions.

Ferran Soriano Manchester City GFX

“It's unique, it's not a model that's been replicated so far,” Football Finance expert at Sheffield Hallam University Dr. Robert Wilson explained to Goal.

“Manchester City, the City Football Group, needed to do something to achieve a competitive edge over their competitors because, historically, they weren't as valued as a property as someone like Manchester United or Real Madrid or Barcelona.

"In order to do that, they strategically chose to grow the profile of the sky blue, and exposure of the brand of City Football Group, and that led them into mature territories.

"First of all, it was New York City, they've got a club in Melbourne, in Tokyo, the Indian sub-continent. So, they're steadily picking up clubs in these developing territories, they want to get a foothold in these new markets that European football can get into.

“United have done very well in the Far East and Middle East but they have not been as successful in Australasia and North America. What CFG has done is put down roots in those territories, and that drives interest.”

Indeed, the Group's incursion into South America, a region largely ignored by Europe's top clubs in marketing and commercial terms, breaks new ground.

Unlike many of the aforementioned regions, the continent boasts an extremely strong, well-rooted local football infrastructure dating back – in the case of Argentina, Uruguay and Brazil in particular – to the 19th century.

On the other hand, the weakness of the region's economy in global terms explains precisely why for years it has been South America's players rather than fans which have been the principal attraction for overseas investors.

Dr. Wilson, however, sees plenty of potential benefits for the CFG – even aside from the obvious attraction of tapping into the continent's huge talent base for young prospects.

“Firstly, the football market is mature. Argentina, for example, is a football hotbed, a pretty decent level in the top division that works well, feeding the national team,” he explains.

“Some of the other countries aren't as well served, which is attractive to City, and I don't think we should discount the benefits of the player transfer mechanism.

"Traditionally, we've had problems with third-party ownership, which is intensified in South America because of the way things work.

“This type of approach will absolutely reduce the ability of third-party ownership happening and the City Group will be able to move players properly, throughout the continent and throughout the City Football Group.”

Manchester City CFG GFX

City have had to make apparent concessions in order to enter South America. The region's football supporters are famously fanatical about the game and their clubs, and also fiercely resistant to any changes imposed from the outside.

Torque, a young club with negligible following, were unusually receptive to rebranding. However, a historic side like Bolivar will keep their own name (and already played in sky blue prior to this partnership), and if the Group hopes to expand further on the continent, it will likely have to come to similar accommodations to strike a balance between brand recognition and respecting the wishes of local fans.

On the other hand, the success that CFG has experienced in Uruguay points to another advantage of investing in certain parts of the region.

The nation's football has long been dominated by just two teams, Penarol and Nacional. Since 1915, the Primera Division title has been won just 13 times by a different club. In addition, Danubio and Defensor Sporting, who account for eight of those wins, both suffered historic relegations this season.

With few teams able to compete with the big two, and Penarol and Nacional themselves a pale shadow of their formerly formidable selves, there is ample room for a new side with sensible administration and steady investment to challenge.

That is indeed what Torque have done: having bounced between the second and third tiers of the pyramid for their first 10 years of existence, they only sealed a second promotion to the top flight as recently as the end of 2019.

The following year they secured back-to-back third-placed finishes in the two halves of the Uruguayan season and, should they continue their progress, they will have reasonable hopes of not just improving on that position in the coming years but also competing on a continental level.

Ferran Soriano Manchester City GFX

“A small amount of capital goes in from CFG and makes quite a tangible difference to the playing standard,” Wilson said of City Torque's impressive ascent.

“If they can acquire clubs and properties in diverse regions that ultimately go on and win their domestic competition or are much more competitive at the top level of the game, then that will generate interest in the domestic club but it will also have a tangible spin-off for the CFG and Man City. It allows City to reach into those new territories.”

Off the pitch, association with the Group is bringing tangible benefits. In March, Torque unveiled an enormous, state-of-the-art academy in nearby Canelones, a multi-million dollar facility which, according to the club, will also be available for use by local public schools.

Bolivar president Marcelo Claure, meanwhile, announced that work will begin on three separate projects in Bolivia – an academy in Santa Cruz, a stadium for the side and a first-team training centre – which represent a total investment of just under $40 million (€29m).

Whether the City Football Group has further plans for expansion in South America remains to be seen (Goal attempted to contact the Group for comment on this article but received no reply).

One of the most curious parts of the story, however, concerns two clubs with no links, formal or otherwise, with the English club, yet have chosen to adopt their name and colours.

In 2017, Ecuador's River Plate performed a comprehensive brand change to become Guayaquil City, also taking on the sky blue for their home shirts.

This drastic transformation led several media outlets to report that they, several months prior to Torque's takeover, had become City's first South American possession, but this tale was later rebuffed by the club's president, Miguel Angel Loor, who told El Universo: “This is an independent Ecuadorian club... whoever thinks differently is mistaken.”

This year, meanwhile, Buenos Aires City FC, a beach football side who also play in sky blue, announced their intention to enter the professional 11-a-side game in Argentina at the lowest Primera D level.

Again, they are unaffiliated to City or the CFG; but both in Ecuador and Argentina, the enterprise seems to have ready-made candidates for expansion should they choose to enter new markets in South America.

City are not the only football concern thinking trans-nationally. Soft drink giant Red Bull has been similarly active in building up a stable of affiliated teams, and in 2020 finally achieved its goal of placing a team in Brazil's Serie A when Red Bull Bragantino were promoted to the top flight (it was second time lucky for the Austrian corporation, whose previous effort with Sao Paulo's Red Bull Brasil fell flat).

Bragantino, like Torque, are also active in the Sudamericana this season, leaving open the possibility of a clash of the corporate titans at some point in the competition; and further down the line, repeats of MLS' Hudson River Derby between New York Red Bulls and NYCFC in Brazil, Uruguay or Argentina are easy to envision.

According to Simon Chadwick, professor of sports enterprise at Salford University, CFG chief Soriano (below) sees this model – known rather prosaically as multi-club ownership – as what has been dubbed the 'Disneyfication' of football.

Ferran Soriano Manchester City Mumbai City

“Ten years ago he came to speak to my students when he was finance director at Barcelona,” he explained to the Guardian. “Even then, he compared football clubs to Disney.

"At Disney, you can franchise out across the world, make films in different languages, build theme parks. Multi-club ownership is the realisation of his Walt Disney view of football; where clubs are entertainment franchises, where football is a form of content.”

Wilson, though, is unconvinced by this interpretation. “The franchise question is interesting, I was half-expecting that to happen with the amount of US investment in the Premier League, but it hasn't just yet,” he stated. “I don't think [Disneyfication] has ever been realised.

“There have been instances where a particular club might have behaved in that kind of way but I don't think we've seen it on the sort of scale that perhaps we were expecting.

"That's largely because of the impact of things like FFP (Financial Fair Play) in European leagues, that have prevented some of the investment taking place that could have accelerated that type of concept.

“I think it's still a relevant concept. I just don't think it's as prevalent as any of us were expecting.”

The multi-club model is still in its infancy, especially in South America, meaning that any negative consequences that may follow the euphoria of initial investments and promises of more to come are yet to reveal themselves.

For now the likes of Torque and Bolivar are reaping the benefits of association with one of the world's most powerful financial institutions.

However, if the trade-off is a more generic, monotonous football world and the loss of local club identities, the onus will be on both City and its partners to ensure a balance is kept between commercial interests and fans' wishes.