Why Accepting Club9 Maybe The Only Way Forward (for now)
I, like many Wednesdayites woke up last Friday to not only a Con-Dem alliance that created a nice loop of dictatorship but also to news that Club9 had made an official offer for the Club. Things seemed to be moving forward at last. This brief optimism was dashed only hours later as the club decided it was in its best interests to not only reject the deal but to publish sensitive information on the official website in such a manner that they deemed it insulting to the Club, and seemingly severed ties with Club9. This, the club said, was £2m for 40% of the club with £420k annual management fees.
| A few hours later, the CEO of Club, Jon Pritchett, went on Radio Sheffield’s Football Heaven programme and explained that wasn’t the full story, whereby the detail included cash on closing the deal, a further £3m over 2010/11 and £5m on promotion to the Championship. The management fees would be linked to performance of the new management team that aims were to increase revenue of commercial activities and cost cutting in non-essential areas (I’m going out on a limb, but agent fees maybe one issue here). On top of this, there would be a deal with the Co-Op bank to write off £6-8m of the bank overdraft. |  |
My opinion here, on reflection of the state of the clubs accounts and finances, is how the hell can we reject such an offer out of hand and sever ties unless there is a solid alternative (and better) offer already on the table? There is room for negotiation, and no doubt the club can come up with some deal of a share issue to get this £2m into the club. Surely we are better to get this cash in now and allow the club to take advantage of this cash in the transfer market whilst we can instead of dragging it out for another God-knows-how-long and let the club slip deep into the brown stuff? I know people will cry “£2m for 40% of the club, don’t be so stupid!”, but how would you put a value on a club that has a negative balance sheet and the next financial year will see a significant reduction in revenue? Who is to say it ahs to be 40% for £2m? This can and should be negotiated, so if they default on further payments, their shareholding is below 30%. My personal feelings on this is that it touches a nerve with some members of the board who will see their life presidency going up in smoke. Whether that was Lee Strafford I don’t know, and whether it was Lee Strafford who put out that statement on Friday, again, I have no idea, but I think it was not.
 | Jon Pritchett once again was on Football Heaven (http://news.bbc.co.uk/sport1/hi/football/teams/s/sheff_wed/8690494.stm) discussing Lee Strafford’s resignation, commenting that Lee was merely a spokesperson for the club, but more revealing to me was the fact that the club have no financial structures in place and that financial information required to Club9’s financial partners has not been handed over to them despite them asking for this information over 8 weeks ago. Despite this, Club9 themselves are still willing to stump up £2m in the meantime. |
Whilst all this has gone on, some fans patience has snapped and talk of a Supporters Club takeover of current shares is being discussed. For all the best will and intentions in the world these people have, I cannot see how past mistakes will not be repeated with regards to delusions of grandeur and posturing in public to garner attention that inflicted The Owls Trust. Wednesdayite won’t give up their shares easy, and the total fragmentation of the current shareholding will make it extremely expensive and ultimately a fruitless exercise as many people won’t sell as they enjoy having shares in the club. Needless to say, this option would take decades to come anywhere near buying full control of the club. If the impossible did happen, and say we went on a losing streak of three games, the fans (and ultimately owners) will be calling for the managers head and more knee jerk reactions will occur, plunging us deeper and deeper.
My thoughts at the moment is that members of the board that published the initial rejection statement are threatened that they will ultimately be removed from office and their power over a section of the local community diminished to nothing over night. I’ll be honest, I like how Jon Pritchett talks, but we’ve had lots of people who talk impressively but fail to deliver, not only in football I hasten to add!
| The club need to look at a club that has built itself up from the lower echelons to a major power. Pritchett talks about Derby being a good model in attracting fans. Many people talk about Aston Villa with Randy Lerner (see http://www.bbc.co.uk/blogs/mattslater/20....in_is_vill.html ) being a owner who come in and been successful, and he has been the model to be based on in the Premiership, but that is not where we are. The club I would base a new era on are abroad and they are Lyon. Without retyping out Chapter 3 of “Why England Lose”, they were a backwater club on a £2m turnover in 1987 when they were taken over by their current owner and chairman, and now (if you’ve not been living under a rock) are a European Superpower. He did this by initially concentrating on the product on the field, and then when that was successful, reached out beyond football with other products. |  |
Whether Club9 are that type of owner, only time will tell…
Craig (BBT)
Owls Alive