Summer has finally arrived, promotion has been achieved, and we are all looking forward to hearing which players we might add to our hungry young squad before we start life back in the Championship.
In addition, season tickets are flying off the shelves, while pre-season games have been announced and are just a month away.
In the midst of all this optimism, however, isn’t it wonderful to have to mention Donald and Methven again?
The ‘Fans Together’ Group already sounds ropey before you do the due diligence on the people behind it, as well as their multiple failed enterprises. Leaving the reader to do their own research on this, let’s consider the model of ownership.
The football club model is slightly different from that of your average FTSE organisation.
The typical owner of a football club in the upper reaches of the Championship and the Premier League is a billionaire, or perhaps the club is owned by a sportswashing fund. That is because success in football ownership requires investment on the part of the owner- in other words, to make a loss.
Football is a losing game, even for the winners, and teams rarely break even. Look at the Spanish giants, and look at the examples of insolvent clubs that litter our football pyramid.
In this context, therefore, with the undoubted ambition that our fans and Kyril Louis-Dreyfus share, what are the merits of such a model?
I think it’s fair to say that the average fan, who already shells out hundreds of pounds per season on merchandise, tickets and the matchday experience, would be hard pressed to bankroll the acquisition of a striker like Chris Wood for close to £30 million.
I’ve deliberately highlighted Wood as an example because of the expensive mediocrity of the whole affair, and because it’s a sportswashed signing by our friends up the road. In addition, the sale also happened to be approximately the value of all of the shares of SAFC.
We as fans almost certainly can’t afford to support 39% of the investment required to spend our way into the Premier League, let alone sustain ourselves there.
Under this structure, the club cannot pass that burden onto the fans through ticket prices and merchandise because London prices don’t work up here. Therefore, we would quickly find ourselves with 39% of our shareholders either bankrupt or dormant. Meanwhile, the other 61% of the shareholders (KLD and Juan Sartori) aren’t likely to offer a free ride to the 39% by bankrolling 100% of the club’s investment costs while owning only 61% of the upside.
This would no doubt see us sink to the level of sustainability without investment, relying strictly on our youth system and genuine profitability to keep the club going. Perhaps this would be the best way forward for many of us, but I doubt that it satisfies KLD and I’m sure it doesn’t equate to challenging for Premier League safety or better.
What the club needs, therefore, is an investor on an equal footing with KLD (and Sartori, if he stays and is solvent) in order to progress.
It’s no coincidence that whilst the share situation is unresolved, KLD’s wallet is closed for next season. The stalling is probably already preventing us from doing the business we need to do this summer.
Donald and Methven have been quoted as being willing to sell to the buyer with the ‘fastest lawyers’. This is an incredibly obtuse and irresponsible approach to selling the stake they claimed to care so much about, before it blew up in their faces.
Hopefully, they take the more responsible approach of involving KLD in the transaction, either as the buyer himself or as the shared custodian of the club. He will split the burden of investment with whoever should take over and therefore should be well placed to help vet any buyer.
One aspect of this model that a lot of us like is the idea of a fan or two on the board.
Perhaps this could be achieved in a similar way to Liverpool, with a Supporters Board and fan representation at board meetings. In a football club, unlike in an FTSE business, it is necessary to properly represent the community within the club, regardless of their financial involvement. This would be a wise move for the new combination of owners, whoever they might be.