Yao Ming to become owner of Shanghai SharksAccording to an insider in China who is familiar with case, Houston Rockets center Yao Ming is on track to purchase his former basketball club in China, Shanghai Sharks, that  faces an uncertain future after running into severe  financial difficulties.  Yao’s bid for the club is 20 million yuan or about 3 million US dollars.

A talk between Yao’s management team with the Shanghai Sports Bureau and the state-owned Shanghai Media Group, the club’s major shareholder, went rather smooth. Shanghai Shenhua, a soccer league, is also bidding for the club. But Yao has a clear advantage due to his strong influences among the basketball fans in China. Sharks current coach also expressed his preference and said  “If Yao takes over, it would definitely be great.”  If nothing unexpected happens, Yao will become the owner of a Chinese basketball club.

Last month, the Chinese Basketball Association announced that the domestic league lost 115 million yuan  and Shanghai Sharks was among the clubs that faced the prospect of being unable to reach the CBA’s entry requirement next year. Since the withdrawal of their main sponsor earlier this year, the Sharks have fallen into financial difficulties, forcing SMG to put the club up for sale.

Yao started playing for the Sharks in 1997 and lead the team to the CBA champions in 2002 before he was selected by the Rockets as number one pick in that year’s NBA Draft.

As one of Yao’s long-term fans, I do have some concerns about his taking over of Shanghai Sharks. As the owner of a sports club, what he needs to do is much more than just investment. Since he never had experiences in business operation, marketing and branding, whether he and his term can make a badly distressed club come back in play remains questionable.

Most key players of the Sharks were Yao’s teammates.  Managing friend-type teammates can be difficult, especially when he as an investor has to negotiate with them on issues like compensations and promotions.

Yao Min may not be as rich as most people would think. That huge amount of transfer fee has taken away a large portion of his income.  I remember after the Szechuan earthquake last year, he only made a half million yuan donation, which triggered an intensive criticism among the public in China. Investing in a distressed club like the Sharks is unlikely to be an one-time shot. He may have to inject additional funds into the club in the future. Whether he has sufficient funds to do so also remains unclear.