NEW YORK (The Deal) -- Fans of Aston Villa may still be reeling from a 4-0 pounding by Arsenal FC in the FA Cup Final at the end of May, but team owner Randy Lerner, who is nearing a sale of the club, is quietly celebrating as the Villans avoided relegation and steep decline in valuation.
Industry sources say that Lerner, who is seeking around £150 million ($232 million) for the club from an unnamed buyer, would likely have had to accept a far lower price if Aston Villa, which finished 17 out of 20 teams in 2014-15 season, had been relegated for the 2015-16 season. Relegation from the Premier League would have meant being sent down to the Football League Championship, the second, far less lucrative tier of English soccer.
"Upon relegation I wouldn't be surprised if the club was worth £80 million to £100 million," explained one sports banker who steered clients away from the team when it hit the auction block in May 2014 because of its initial asking price of £200 million. "Relegation significantly hurts the value because you lose out on substantial media payments."
Unlike many U.S. professional sports leagues that have revenue-sharing programs, salary caps and regional sports networks, the Premier League shares a portion of media contracts with its 20 member clubs, but the funds are not split equally. Larger, more popular teams such as Chelsea, Manchester United and Manchester City get a larger portion of the profits, in what sources say is a system where the rich get richer and the poor get poorer.