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Chinese investor seeks to buy Liverpool soccer club

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chinese_liverpool_soccer_0.jpg By David Barboza
August 11, 2010


Shanghai — When reports began circulating last week that a Chinese investor was bidding to take over the Liverpool soccer club in the English Premier League, British tabloids quickly called him King Kenny.

That little-known investor is Kenny Huang, 46, a globe-trotting sports enthusiast who has made marketing deals in China with the Cleveland Cavaliers and the Yankees, and has entered into a business partnership with Leslie Alexander, the owner of the Houston Rockets.

In February, he helped the Yankees tour China with their World Series trophy, trying to drum up interest in Major League Baseball. He also advised Chinese investors bidding to acquire a 15 percent stake in the Cavaliers, although the deal did not work out. And in an interview this year, he said that he would consider acquiring an N.F.L. team.

“If there’s an opportunity, we’ll do it, but only for the learning process,” Huang said during the interview in Shanghai in March. “The N.F.L. is the most profitable league. The management, the intellectual property, the ownership structure is the best.”

Friends say Huang made a fortune working on Wall Street and helping clients invest in Chinese initial public stock offerings. Now, they say, he is pushing China to overhaul its sports system and develop its own professional sports leagues with corporate sponsors — a challenge in a country where the government retains tight control of sports programs.

But his interests are not confined to China. In what could be one of the biggest sports club deals in history, Huang is said to be considering acquiring the Liverpool club from its owners, Tom Hicks and George Gillett of the United States, who bought the team in 2007. The English Premier League is the wealthiest soccer league in the world.

Such a takeover — which Huang hinted at in a news release last week — could cost as much as $600 million, analysts say, including the assumption of debt.

Liverpool said last week that there were six bidders for the club but declined further comment. Investors from India and the Middle East are reportedly among those who have shown interest.

The planned bidding for Liverpool underscores the growing interest of foreign buyers in professional sports teams in Europe and the United States. The Manchester City soccer club in England, for example, is owned by the sovereign wealth fund of Abu Dhabi, and in New Jersey, the Nets are controlled by the Russian billionaire Mikhail D. Prokhorov.

Huang, a Chinese-born United States citizen, declined to be interviewed about the potential Liverpool bid. The Times of London wrote last week that China’s sovereign wealth fund was financing the bid. But a spokesman for that fund, China Investment Corp., told The Financial Times that the story was preposterous.

That leaves the spotlight on Huang, who colleagues say has close ties to the Chinese government but also deep-pocketed admirers in the United States.

“Kenny’s a very talented guy, and he’s very knowledgeable about sports,” said Red McCombs, a former owner of the Denver Nuggets and the San Antonio Spurs, and an occasional investor with Huang in China. “He’s a unique dealmaker. I’ll bet on him any day.”

His background, though, is as complex as it is impressive. In the interview in March, Huang — whose Chinese name is Huang Jianhua — said that he grew up in the southern Chinese city of Guangzhou and that as a 9-year-old, he entered a state-run sports school as a badminton player.

Later, he said, he studied Japanese at Zhongshan University in Guangzhou and then in 1985 moved to New York, where he earned a master’s degree at St. John’s and took courses at Columbia University and New York University. He is married with two children, he said.

He also spent several years in the 1980s and early 1990s at the New York Stock Exchange working with Asian stock listings, he said. Then he found more lucrative work.

“After ’91, the Japanese economy collapsed,” Huang recalled of his time at the stock exchange, saying his Japanese was excellent. “The billionaires were in trouble. They said, ‘Why don’t you quit and become our personal investment adviser?’ I was helping them buy and sell assets.”

Court records in the United States show he lived in New York and southern Florida and in the 1990s formed a series of small companies, including one that sold “Chinese-made novelty products.” It eventually went out of business.

The Web site of another company he helped form, Aspen Infrastructure Investment, lists one of the partners as George Lindemann, whom Forbes magazine ranks as one of the world’s richest men. Lindemann could not be reached for comment this week.

(Huang was sued by one of his former United States partners in a dispute over $2.9 million, but earlier this year, a Florida jury ruled in his favor.)

About eight years ago, he met the consultant Marc Ganis, now his partner at SportsCorp China, a sports business firm.

Ganis said that years ago, Huang brought Chinese officials planning the Beijing Olympics to visit sports facilities in the United States. He said Huang’s business and government ties and his knowledge of how to create successful deals in China allowed him to create breakthrough sports initiatives in the country.

“I’ve introduced Kenny to some of the most important people in the sports industry in the U.S.,” Ganis said. “And they immediately recognize that as China develops, he’s going to be able to grow with it. He has a unique ability to bridge East and West.”

One of his ventures is Rocket Capital, formed with Alexander of the Rockets. The venture and others have invested more than $200 million in Chinese I.P.O.’s in Hong Kong over the past five years, according to securities filings.

Huang has also worked on sponsorship deals in China with the Rockets, the Cavaliers and the Yankees. Just last week, his company QSL Sports said that a Chinese company had signed a four-year sponsorship deal with the Yankees in the instant noodle sector.

Now, Huang said, he is working to duplicate Little League baseball and other youth sports leagues in China. He has already invested in a professional baseball league and a pro basketball league, the National Basketball League, which he intends to revamp so that it can compete with the much bigger and more heavily financed Chinese Basketball Association.

Analysts say the Chinese have a growing interest in professional sports teams in the United States and Europe. Nike and Adidas are investing heavily in expansion here, and China’s own sports brands, like Li Ning and Anta (which Huang invested in and which recently signed Kevin Garnett of the Boston Celtics basketball team to a sneaker deal) are also thriving.

“I’ve seen the changes in the post-Olympic period,” Huang said in the interview as he lounged on a sofa at the Westin Hotel in Shanghai, dressed in a track suit. “You now have the opportunity to invest in sports. The government wants sports to become an industry.”

For Huang, the change in Chinese government policy is drastically altering the sports industry here, opening new opportunities for sports clubs and marketers. And that is one reason the Yankees are also looking to Huang.

“He’s our man in China and he was incredibly important in creating our connections with the Chinese Baseball League and getting our first Chinese sponsor,” said Randy Levine, the president of the Yankees. “Basically, he makes sure that the Yankee brand is known in China and he brings sponsorship opportunities to us.”

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