Decoupling an English Women’s Professional Football Club

Over the last ten years or so, many English women’s football clubs have been acquired by, or amalgamated into, men’s football clubs. The result? Currently only two out of 24 clubs in the Barclays WSL and WSL2 are not associated with a men’s club (those being London City Lionesses (part of Kynisca, Michele’s Kang multi-club ownership women’s football group) and Durham).

However, after such period of consolidation, a new trend is emerging as more professional women’s clubs are being “decoupled” from the men’s club. Recent examples include  Michele Kang’s acquisition of Olympique Lyonnais Féminin (“OLF”), the sale of Chelsea Women to BlueCo (a subsidiary of Todd Boehly and Clearlake Capital’s ownership group) prior to securing minority investment from Alexis Ohanian, and Aston Villa’s agreement to sell a majority stake in their women’s club to V Sports (the parent company founded by the club’s owners) and a minority stake to third party US investors. With more clubs surely set to follow.

Here at Onside Law, we work with a growing number of clubs and their advisory teams in this space.  This article explores the main reasons for decoupling the women’s club and the key legal considerations for those navigating this path.

Main Reasons for Decoupling

• Financial reasons
  • Compliance with financial regulations governing the men’s club (for example, “Profit and Sustainability Rules” under the Premier League Handbook), to help the men’s club stay within the permitted level of operating losses. For Premier League Clubs, the sale of certain assets (such as the women’s team) would need to comply with the “Threshold Transaction” and “Associated Party” rules and must also be at Fair Market Value (FMV), be transparent and real. There are similar rules (if not more stringent) under the UEFA’s Financial Sustainability Rules (updated in July 2023). The Premier League and UEFA have a range of sanctions available for non-compliance and are looking closely at these types of transactions. Onside Law can provide further information/advice on the relevant rules as required.
  • As the operating costs of the women’s club increase (such as higher transfer fees (noting Olivia Smith became the first £1 million transfer earlier this month) and greater minimum operating standards), clubs face increasingly harder spending decisions within their overall football activities.
• Establishing dedicated resources and governance for the benefit of the women’s club. A standalone company, board and executive can focus their attention and make day-to-day decisions through the lens of the women’s club. This may open the door to tailored marketing, sponsorships, partnerships and community programmes, creating greater revenue generating power, as well as freer participation in strategic thinking at league level.
• Producing a cleaner vehicle with the necessary arrangements in place (see further below), which in turn provides a more investable opportunity for third party investors interested solely in women’s football.

Key legal considerations

For any club that is considering decoupling its women’s team, we set out below at a high level some of the key legal considerations:

• Structure of the Deal – a decoupling could be structured as a share sale of the existing or new women’s subsidiary (or holding company of the women’s subsidiary) holding the relevant assets, or as an asset transfer.
• Identification of Assets – the key relevant assets are likely to be:
• Player and Non-Playing Staff Contracts – the transfer of employment of the players and non-playing staff whether pursuant to TUPE or otherwise;
• Trademarks/IP – the women’s club will likely want to obtain a licence to use the club’s IP, including the logo and name. The parties will need to consider the term of that licence (we understand it is at least 50 years for OLF) and the conditions around any use;
• Footballing matters – the impact of any sale and/or investment on key footballing matters such as the licence to play in the league (for example, in the Barclays WSL or WSL2), factoring in any change of control procedure required by Women’s Super League Football Limited) and registration of players;
• Commercial contracts – in respect of any commercial contract existing prior to decoupling, care will need to be taken with bundled deals, for example, how rights get unbundled (if at all) after the expiry of existing contracts. If they stay bundled, it will be important to consider how the women’s rights will be sold and valued, and brand exclusivity;
• Facilities – the parties will need to agree ground and training facility arrangements, including the priority between sides given the congested football calendars across league fixtures and cup competitions, as well as the promotion of different commercial partners and stadium facilities (including F&B) which may need to cater for different audiences;
• Shared resources – it will be necessary to consider what resources the women’s club will continue to require from the men’s club, such as HR, infrastructure, marketing, communications. Will there be standalone social media accounts and ticketing platforms? What about the academy and funding of the girls’ provision?
• Cross promotion – in the event of decoupling, the club will need to address whether players of each team will be available for cross promotional purposes and how this will be achieved.
• Data – given the historic linking between the men’s and women’s businesses, it is likely that all data (including fan membership and ticketing data) is housed centrally. Prior to, and following decoupling, the parties will need to address how data is shared.
• Regulatory – clubs will need to engage early and liaise closely with the relevant football governing bodies and leagues to comply with regulatory requirements, including those set out above around financial fair play and profit and sustainability as well as change of control and owners’ and directors’ tests (as applicable).
• Governance – we would expect the women’s club to have its own dedicated resource and ability to make operational day to day decisions, however, the men’s club may retain some oversight and/or say. The parties will need to consider how this is achieved – whether through board representation, contractual reserved decision-making and/or information rights.
• Exit – if third party investment is secured what will be the restrictions on exit be and will the men’s club have an approval right over an incoming buyer (in addition to any regulatory requirements (such as owners’ and directors’ tests) at league level)?

If you require further information and/or would like to discuss in more detail, please contact our Head of Women’s Football Harriet Leach (harriet.leach@onsidelaw.co.uk).