DIG THE NEW BREED II

In a summer of Premiership takeover talk it is suitably insane for newspaper column inches (yards!) to deal with an Arsenal takeover not yet happening. But it is a ‘work in progress’ – not unlike the team – so we’ll return to them.
Another takeover yet to happen is Blackburn Rovers. Many regard Sir Jack Walker as pioneering this ‘buying success’ malarkey, although he had the nous to spend, spend, spend when no-one else was. So it’s nice to see Blackburn, briefly, in this summer’s saga…
Things have gone quiet since. But in mid-June ‘lifelong’ fan New Jersey-based Daniel Williams had a look at Blackburn’s books (‘due diligence’) in preparation for a £67m buy-out.
The Walker Family Trust have run Blackburn since Sir Jack died in 2000 and accepted Williams as “fitting the club’s profile of a fit and proper person” (“our sort” as Arsenal’s Peter Hill-Wood might say) after previously interested parties were denied due diligence.
And Williams’ ‘lifelong fan’ claims are valid. The Lytham St. Annes-born thirty year-old supported Rovers as a kid, which means he saw Simon Garner play. And if he’s still interested after that…
South African billionaire Johann Rupert provided the obligatory American Football club owner – the Miami Dolphins’ Wayne Huizenga reportedly a small part of a reported consortium of business people. But his bids’ publicity was as lacking in longevity as detail.
So it was a clear run for Cambridge graduate Williams. An all-round good egg, relatively. Even a property developer for what you’d imagine to be a relatively good cause in West Africa – though a more complex story may yet emerge should he take over. His offer was due “by the middle of” July, so he could be duly diligent in time for the August 11^th kick-off. And, reportedly, further progress is ‘imminent.’
The summer normally brings tales of Fulham losses and 2007 is no different. £15.5m in the latest accounts (2006), making £125m in owner Mohamed Fayed’s ten years. Not Abramovich-style pocket-dipping. But a ‘concern’, as we’ll see.
This column previously asked whether Fayed would eventually resemble Robert Maxwell more than Abramovich, as he robbed Peter (Harrods) to pay Paul (Fulham). The question now looms larger. Fulham’s auditors, PKF, have regularly produced accounts on a ‘going concern’ basis – at Fulham this means ‘going’ without ‘concern’ only if Fayed digs deep. This year, PKF added a self-explanatory ‘Emphasis of Matter’ highlighting Fulham’s “significant losses and…significant deficit of shareholders’ funds (indicating) a material uncertainty which may cast significant doubt about (Fulham’s) ability to continue as a ‘going concern.’” Auditor-speak for “Aaaaaaaagh!!” Relegation would be ‘significant.’
Harry Redknapp’s activities, real and alleged, masked potential controversy surrounding Russian billionaire’s son Alexandre Gaydamak, who acquired Portsmouth from Serb (mere) multi-millionaire Milan Mandaric in January 2006. The controversy surrounded Alexandre’s dad, Arcadi, whose arms-dealing past means there’s an international warrant out for his arrest – he could be nicked for going to Fratton Park, a good excuse for missing home games. Arcadi’s only conviction is for tax evasion (like Al Capone). And he is suspected of being Portsmouth’s real backer (he owns Betar Jerusalem FC, being safe from arrest in Israel).
Alexandre acquired his 50% Portsmouth shareholding for around £15m. But Pompey’s latest accounts say he holds no “beneficial interest in the issued share capital” of Devondale Investments, Portsmouth’s controlling company (British Virgin Islands-based, wouldn’t you know) which is, in turn, controlled by “Mr. A. Gaydamak” – the accounts not making clear which one.
The £15m was a loan, ultimately repaid by bankers Singer and Friedlander. And Alexandre’s business failings, while explaining his lack of Abramovich-style largesse, don’t explain how £15m ever came his way. But even if it was Daddy’s money all along, needing to hide the fact that a club is financed by a tax-dodging fugitive arms-dealer is SOOOO last year.
In contrast to low-spending Russians at Portsmouth, loose-spending Americans at Liverpool – George Gillett Junior and Tom Hicks splashing their cash in the Fantasy Football League manner expected of such takeovers, players and computer graphics of the new Stanley Park stadium arriving as promised.
All credit to them for that. But neither have unblemished backgrounds – leaving aside Hicks’ long-standing support for George W. Bush, which must take some leaving aside in a city like Liverpool. Gillett, now worth £170m, went bankrupt in 1992 – twelve years prior to any ‘fit and proper person’ test’s remit, before anyone asks. While Hicks’ big-spending success at Dallas Stars ice hockey club must be set aside against his big-spending failure at Texas Rangers baseball club. Hicks spent a world-beating $250m on a ten-year contract for Alex Rodriguez, but the team failed to step up to the proverbial (and actual) plate. Club president Jeff Cohen said: “A-Rod (shows) the boss’s passion to win.” Aside from the furious spin that puts on events…”A-Rod”???
Like Malcolm Glazer at Manchester United, Gillett’s and Hicks’ offspring are club directors – 31 year-old Foster Hicks moving here to oversee operations. Unlike Glazer, they haven’t taken control by borrowing or indebting.
But hasn’t Glazer, after the effigy-burning and breakaway club-forming which greeted his arrival, proved the detractors wrong, with United’s Premiership title and all that summer spending? Well, no. The £50-70m (depending on how, if ever, the Tevez situation ends) will be paid over the lengths of the various deals – possibly only £20m up front. And even that’s covered by 14% season-ticket price-hikes and the linked compulsory purchase of all cup tickets (up to £300m extra per ticket-holder).
And United’s ‘re-financing’ plans (which brought Carol Vorderman to mind: “re-arrange your debts into one affordable monthly payment”) were shelved because of re-assuring sounding “turbulence in the debt market.” So CEO David Gill can talk ad infinitum about substantial profit increases “before we knew about the new TV deal.” With £62m annual interest payments (14.25% to hedge funds), they MUST be.
In 2005, United came bottom of their Champions League group, even missing UEFA Cup qualification. A feasible repeat this season and United are in trouble.
NEXT WEEK: Birmingham, West Ham and Arsenal.

‘MotorMurph’ is written by Mark Murphy

Entry Filed under: MotorMurph Column

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