Brazilian football clubs open doors to foreign investors

A new law allowing Brazilian football clubs to operate as companies has opened the door for foreign investors to buy teams in the spiritual home of the "beautiful game," following in Europe's footsteps.

Passed last year, the law could help ailing Brazilian clubs turn their finances around.

After a century operating as non-profit associations, Brazilian clubs have started transforming their business models since Congress passed the "Football, Inc." bill last August, encouraging the creation of SAFs, or "football corporations."

Already, US investors have negotiated deals to buy historic Rio de Janeiro clubs Botafogo and Vasco da Gama.

Brazilian football great Ronaldo, retired from his Ballon d'Or-winning glory days in Europe, has bought Cruzeiro, the club where he made his professional debut, adding it to his investment portfolio alongside Spanish second division side Real Valladolid.

Before the law was passed, just two top-tier Brazilian clubs operated as companies: Cuiaba, owned by local tyre manufacturer Drebor, and Red Bull Bragantino, part of the Austrian beverage company's international stable of teams.

"Brazilian football was always very closed to external investment because of the domestic-controlled business model," said Cesar Grafietti, who advises football investors as a partner at consulting firm Convocados.

"With these investments, the trend will be for Brazilian clubs' management to improve, which brings yet more money and in turn better performance," he told AFP.

- 'Win to be profitable' - Experts say Brazilian clubs are an alluring option for foreign investors.

Brazil is the world's leading exporter of footballers, and its currency has been weakened by the coronavirus pandemic.

The business potential "is huge" in