Watford hope to strike it rich after unique deal with City FX trading company
Watford have struck a unique deal with a City-based foreign exchange trading company that will not only boost the club’s commercial income but, they hope, may also save “very significant” sums in the transfer market.
The Hornets are the first Premier League team to enter into such an agreement, which they believe will give them access to lower exchange rates when conducting international transfer business.
Divisa Capital, which also has offices in the United States and New Zealand, is understood to have paid a six-figure sum to partner with Watford for an initial three years.
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The deal – set to be confirmed today – comes weeks before what is tipped to be a record-breaking summer transfer window, fuelled by an increase in broadcast payments to England’s top clubs.
“I think this is potentially very significant, given the amount of money that could be going overseas,” Spencer Field, Watford’s head of commercial, told Morning Wire
“If you look at £100m coming into the club from TV money, you’ve got to think a decent proportion of that will be going on players. So a percentage point here or there can clearly be significant.
“One would assume the amount of spending on players will continue to increase. Having a partner who understands the complexities of FX trading and how we should do our deals to maximise the benefit we get from transferring money internationally can only be of benefit to us.”
The Premier League’s reshuffled commercial position, which will next season see one title sponsor – currently Barclays – replaced by a handful of partners from different sectors, has paved the way for Watford’s deal.
It means that other financial services will be able to enjoy the prominence of pitch-side advertising – one of the benefits Divisa Capital will enjoy, along with hospitality, at Vicarage Road.
“Next year clubs are going to get a windfall. A lot of that is going to be spent on players from Europe, so they’ll have Euro needs, and Latin America – it’s very likely this money will be spent heavily,” Arik Oslerne, a director at Divisa Capital, told Morning Wire “And with Barclays no longer having exclusivity, it opens the doors for clubs to think about how they utilise their FX.”
Watford’s owners the Pozzo family also own Udinese in their native Italy and Granada in Spain. Divisa Capital’s agreement, finalised with agency SportQuake, is only with the Hornets.
The Hertfordshire side have already secured their Premier League status for next term, thanks largely to a strong first half of the campaign, and also reached the FA Cup semi-finals.
Watford made a £4.7m pre-tax loss for the year ending June 2015 due to bonuses paid for promotion to the first tier. Last summer they spent £23m on transfers, plus a further £13.5m dependent on performances.