Good profile on Dragan froma website on the business of football - https://offthepitch.com/a/enter-dragan-serbian-mogul-who-joins-epls-billionaires-club
Enter the Dragan: The Serbian mogul who joins the EPL’s billionaire’s club
Dragan Šolak, partnering with Danish investors, Rasmus Ankersen and Henrik Kraft, has bought Southampton in a deal that values the club at around £240 million.
The 57-year-old Serb’s United Group is the largest media and telecoms company in South East Europe with a 2019 enterprise value of €2.6 billion.
New ownership group promises both multiclub ownership and continuity for one of England’s best run clubs.
The Serbian Government are very critical towards Šolak, the richest man in Serbia, who owns various independent media outlets in the country.
The last time a Serbian businessman took over a south coast English club, the results were dramatic, but the legacy mixed.
In May 1999 Milan Mandarić, a Serb-American businessman who had previously owned NASL franchises and OGC Nice, bought Portsmouth. Promoted to the Premier League as First Division champions in 2003, they established themselves in the world’s richest league for nearly a decade.
Mandarić sold up in 2006, with the foundations of the 2008 FA Cup winning side in place – although financial ruin followed under various successor owners – and bought Leicester City, who he later sold for a huge profit.
Southampton, who have played in England’s top flight for 46 of the last 56 seasons, will be hoping for a smoother ride under their new owner Dragan Šolak.
Photo:
Alamy
Šolak this week led a takeover at St Mary’s, partnering with Danish investors, Rasmus Ankersen and Henrik Kraft, in a deal that values the club at around £240 million.
Their vehicle, Sport Republic, is understood to have paid £100 million to majority shareholder Gao Jisheng for an 80 per cent stake, while also taking on £90 million of debt. Katharina Liebherr, daughter of the late Swiss-German billionaire Markus Liebherr who bought the club a year before his death in 2010, retains 20 per cent.
Portfolio of high-influence stakes in football clubs
Southampton, promised Šolak in a statement announcing the takeover, “will be a cornerstone of the organisation we plan to build.”
This, added Kraft, is “a portfolio of high-influence stakes in football clubs and other sporting assets across the world.”
Kraft is an investor in sports tech – he says that they plan to use their football investments “to accelerate the development of these companies” – and a former board member of United Group, the media and telecoms conglomerate that has made Šolak rich.
The 38-year-old Ankersen is more widely known, having served as chairman of Danish Superliga club, FC Midtjylland, and as co-director of football of Brentford until last month.
According to a 2020 profile, Šolak helped the Serbian opposition to Slobodan Milošević’s rule
Both of these clubs saw meteoric rises, leaning heavily on data based approaches, while he served them: Midtjylland won the Superliga three times, and Brentford reached the English top flight for the first time in 74 years.
However, it is Šolak who is understood to have provided the hard cash that drove this deal. But who is the 57 year old Serb, and where does his money come from? What underpins his wealth, widely reported to be in the billionaire stratosphere? Will he be a good investor? And what does this mean for Southampton?
Rise to wealth
Šolak was born in the former Yugoslavia in July 1964, and began his business career in 1990, founding VANS, one of the first film production and distribution companies in Yugoslavia.
At the end of 1992, and with the country riven by civil war, he sold all his businesses in Belgrade and for the next decade moved between Prague, London and Ljubljana, founding numerous companies, incorporating everything from music rights to broadband.
According to a 2020 profile in the Croatian newspaper, Express 24, Šolak helped the Serbian opposition to Slobodan Milošević’s rule.
Milošević was overthrown in 2000 and foreign investment opened up in Serbia soon after.
Šolak’s internet company KDS – later renamed as Serbian Broadband (SBB) – signed a $10 million investment agreement with the Southeast Europe Equity Fund (SEEF) - reputedly the first foreign investment in Serbia after the fall of Milošević.
A few years later, he founded Total, a TV platform for satellite distribution, and with SBB, which expanded to Telemach in Slovenia, becoming a leader in cable television in the region.
In 2012, he merged everything into the United Media company based in Luxembourg, and a year later the headquarters moved to Amsterdam.
Private equity investors
Today United Group is the leading media company in the Balkans, incorporating five national television and over 50 cable channels, as well as 28 web portals, numerous newspapers, magazines and radio stations.
Sport Klub, his sports TV network, have a number of high profile rights deals, including F1 and, until recently, the EPL. By its own account United Media employ more than 13,500 people and their services are used by 11.32 million.
Photo:
PR Brentford: Rasmus Ankersen
In March 2019 British Private Equity Group, BC Partners, acquired a majority stake in the group from KKR, a leading global investment firm, giving it an enterprise value of €2.6 billion.
Šolak retains a 34 per cent stake in Summer BidCo BV, United Group’s Luxembourg domiciled holding company, valuing his assets from United Group at €1.1 billion.
In addition, he has a number of large stakes in SMEs, mostly relating to hotels and his great passion of golf.
Local outrage
Šolak’s enterprises have made him the richest man in Serbia, but he isn’t universally loved in his home nation.
In a fiercely nationalistic country, his Maltese citizenship and Swiss residency don’t go down well, nor does the overseas domiciliation of his businesses.
This week, the Serbian MP Djordje Todorovic, acerbically tweeted that Šolak “got rich by falsely rebroadcasting his programs from Luxembourg” – a reference, it seems, to Summer BidCo BV’s residency.
Indeed news of the Southampton takeover prompted something of a social media pile on, led by the Serbian Prime Minister, Ana Brnabić, who tweeted: “his acquisition shows crystal clear what kind of oligarchy we were in the first decade of the 2000s, when Serbia was led by Šolak’s political and business partners. All this was done with the money of the citizens of Serbia, the misuse of state resources (Telecom) and political power.”
The nationalist politician, Sandra Bozic, tweeted about Šolak and his friend Dragan Djilas, the former mayor of Belgrade, who is also the main opposition leader in Serbia.
“I just didn't understand whether the thieves Šolak and Djilas will share the profit from the club with the citizens of Serbia, considering that they are buying it from the money they stole from them? And from which account do they transfer money? The one from Mauritius or Hong Kong?”
Another Serbian politician, Bojana Radaković, tweeted: “If you didn't know what could be bought from the money that Djilas and his partner stole from our people.”
Media campaign
None of these lurid and seemingly libellous allegations were backed up by any evidence, but are in keeping with the hostility the tycoon has faced from the government.
It is also a tone adopted by pro-government media in Serbia towards Šolak, not just in the past week, but over a sustained period of time.
The tabloid Kurir last February described him as a “calculating and avaricious tycoon” who “played dirty and without scruples in the game of business” whose “empire was built on a slew of speculative, cowboy-style, even cartel-like activities.”
It was less a profile than a character assassination.
A source, who works in Serbia’s independent media, says that the campaign emanates directly from the office of the Serbian president, Aleksander Vucic, who views Šolak’s media empire as a challenge.
Pro-government media stirs up this hostility and acts as an echo chamber for allegations, many of which are exaggerated or baseless. Šolak has in the past successfully sued state media in the Swiss courts for these type of attacks.
“What's important is that the government has basically been waging a campaign against any independent voices in Serbia,” says one western journalist who has reported from the country for a number of years.
“N1 [a newspaper owned by Šolak ] was one of them, so Vucic has gone after the United Group. Sports Klub is one of the battles.”
900 per cent rise in rights value
Sports Klub is an interesting case study in how the state has tried to take on Šolak‘s empire.
Telekom Srbija, the state owned telecoms provider, has invested some €2 billion on rights in an attempt to gain market dominance in the telecoms and broadcast market from United Group.
Last year it outbid Sports Klub for a six year deal for EPL rights, paying €705 million over that period to screen the English league – a 900 per cent rise on the previous deal with Serbia, and an unfathomable amount for a company with annual revenues of barely €1 billion. (The interesting epilogue to this is that Šolak now gets a slice of that bloated Serbian foreign rights cash at Southampton).
Other attacks against his media business are less overt. When United Group launched a new daily newspaper called Nova last year, it was unable to find a printing house in Serbia that would take on its business.
Supermarkets have also been pressured not to carry any independent newspapers, who are also excluded from state funding according to Reporters Without Borders.
Serbia has fallen from 76 to 93 in Reporters without Borders World Press Freedom Index, and is characterised as “a country with weak institutions that is prey to fake news spread by government-backed sensational media, a country where journalists are subjected to almost daily attacks that increasingly come from the ruling elite and pro-government media.”
United Group’s news outlets are seen as something of an antidote to that.
A good fit
Beyond the statements published on the day of the takeover, alluding to multi-club ownership, no real detail has emerged about where Sport Republic want to take Southampton. Neither the club nor Rasmus Ankersen responded when we approached them for comment.
Ankersen is still listed as the Midtjylland chairman on its website, although a statement circulated in December said that he was working with them as an external consultant until the end of the season.
It seems that the consortium has got a good deal: the South Coast club are one of the best run in English football: they are stable, have a good stadium that they fill each week, and have an outstanding pedigree in developing young players at their own academy or buying them in and selling them at a profit.
Ankersen worked miracles with far less at Brentford.
“One of the first things they [Sport Republic] said to us was that they know we don’t need fixing,” its CEO Martin Semmens said in an interview with The Athletic this week.
He added that the club resisted a leveraged purchase of the club, in the manner of Burnley’s takeover at the end of 2020.
“There are three things we were looking for: good people, good investment and a plan that fits with our strategy,” he said.
“The reason this one was successful was that we believe in their plan, and they believe in our plan. In the short term, it gives us security and clarity. In the long term, it gives us something to work towards that will make a real difference.”
