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1. Usmanov had criticized Kroenke’s stewardship of London team
2. Arsenal has struggled in recent years, failing to win league
The majority owner of Arsenal soccer club agreed to buy out Russian billionaire Alisher Usmanov’s stake, ending a dispute between the tycoons over management of the London Premier League team.
American billionaire Stan Kroenke will make an offer to buy all outstanding shares in Arsenal Holdings Plc, Kroenke’s KSE UK Inc. investment vehicle said in a statement Tuesday. Usmanov’s Red & White Securities agreed to tender its 30 percent stake in the bid, which values the club at about 1.8 billion pounds ($2.3 billion), according to the statement. Kroenke owns about 67 percent of the company.
Despite his shareholding, Usmanov was shut out of the process of developing strategy at Arsenal and didn’t have a seat on the board. He last year criticized Kroenke as the team struggled through a disappointing season, saying the majority owner was responsible for the team’s performance on the pitch.
Manager Arsene Wenger, who had led the club since 1996, stepped down at the end of the most recent campaign, in which the team finished sixth in the league and again missed out on the elite Champions League competition.
Usmanov, 64, whose assets include an iron-ore producer and Russian phone carrier MegaFon PJSC, is Russia’s eighth-richest person with a net worth of $14.4 billion, according to the Bloomberg Billionaires Index. His exit from Arsenal raises questions about his relationship with Everton, a mid-ranking Premier League team based in Liverpool. The Russian is a longtime business partner of Everton’s majority owner, Farhad Moshiri, and Usmanov’s USM Holdings sponsors the training ground.
Kroenke, 71, founded a real-estate development company that built shopping centers and apartment buildings. He owns the Los Angeles Rams of the National Football League. His wife, Walmart heiress Ann Walton Kroenke, owns the Denver Nuggets basketball team and the Colorado Avalanche hockey team.
Usmanov is the second Russian billionaire to pull back from an investment in the Premier League: Roman Abramovich, the owner of Chelsea football club, shelved a major redevelopment of the club’s stadium, blaming an unfavorable investment climate. The decisions come against a backdrop of worsening Russian-U.K. relations, with Britain accusing Russia of poisoning a former Russian spy and his daughter in Salisbury, England.
Kroenke is consolidating his ownership as the team prepares to begin the season under new manager Unai Emery. The club has been outshone in recent years by cross-city rival Chelsea, as well as Tottenham Hotspur, which is moving into a new 62,000-seat stadium.
While Arsenal Holding is listed on the NEX Exchange Growth Market for smaller companies, the shares rarely trade, given that Kroenke and Usmanov own a combined 97 percent. Kroenke is offering 29,419.64 pounds a share in cash, below the last trade on July 31 of 32,000 pounds. Deutsche Bank AG is advising Kroenke.