EXCLUSIVE: US tycoons in Norwich City investment talks

[littleyellowbirdie 2,530]

12 hours ago, king canary said:

I really don't see how Archant have done anything wrong here? They got the news these guys were visiting, they got the fact they were here because they were in talks about investment, they identified every member of the group and their links and they published.

Just because they didn't know the exact details of what this investment could look like (new shares, existing shares etc etc) isn't a reason not to publish. I don't see how getting the scoop on what is a very significant piece of City news is posturing and if the publication dents the chances then frankly the club only have themselves to blame for both making zero effort to hide the presence of these easily identifiable investors and allowing Webber to burn their relationships with local media to the ground. 

I thought challenging Webber on 'whether he wanted the job' after what he has done for the club on the positive side was absolute populist bunk, but actually I do also think that the club's perfectly capable of doing its own PR so there really isn't much point to the Pink Un unless they're prepared to challenge the club somewhat. No doubt the club is pissed off at them, but I do think the nationals would have soon cottoned on anyway and it was good journalism on Archant's part. 

[Terminally Yellow 2,448]

19 minutes ago, Midlands Yellow said:

I’ve seen it done, it’s a quite a skill with short pipe and container. 

What you do with your penis is your own business, mate. 

[Parma Ham's gone mouldy 2,219]

Buying a minority stake at surface value is an odd thing to do, unless it is a precursor to a full takeover and the surface price is considered trotsdem undervalued. 

If this were the case one might reasonably ask why it is undervalued. Then - given that -  why there were no investors previously. I find all of that a reach, unless one assumes that the recent concretisation of the limits of the self-funding model have precipitated a cultural mindset change. A resignation-acceptance of ceiling for the majority shareholders. This would imply that they have indeed been holding the club back for personal reasons and have now opened channels to ‘reasonable’ rather than perfect ‘other options’. I find it hard to believe that Attanasio is uniquely suited and the sole conceivable option over a period of (say) a decade.

Buying a private minority shareholding does nothing for the club. It is a private transaction and no money benefits anyone other than the seller. Buying a minority shareholding in Norwich - at anything near current face value - would also negatively affect future buyer plans as it would concretise Delia and Michael’s - currently rather theoretical - massive share value gain over c25 years. This is the main corporate finance point as the minority shareholding transaction benchmarks Delia and Michael’s win-gain moving their shares value  from theoretical to monetary. It would be akin to giving them £65m overnight. As a buyer why would you do that when they don't have the money to run-operate their asset? 

As a buyer purchasing or investing into a listing or struggling asset - and I’m afraid if you cannot meaningfully compete at the top level, indeed you are shown not to be able to, plus you can make no investment input into your asset as shareholders - you simply would not allow existing shareholders to max out on their holdings. 

You might agree to invest or provide access to new funding streams on condition of some form of dilution of existing shareholdings, you might create a new pot or vehicle that would allow new investment to garner a strong shareholding whilst weakening existing holdings (without them adding new funds also).

The only possible reason to buy any shareholdings at market would then be that the asset is so undervalued at current market that you don’t mind concretising a massive win for them and buying it out, perhaps having spent a period as a minority shareholder accessing all transparent data and conducting out-to-in Due Diligence. I personally think that this would be massively underplaying the Attanasio hand (or anyone like them), so I am afraid I discount it. You would simply deal harder than that anyway. The Ferrari asset will rust away through lack of driving through lack of funds for petrol. One does not make $700m passively I suggest. 

The questions that one would ask brokering such a deal from the centre would be:

(seller)

1. Why now?

2. Why Attanasio particularly?

3. What does Attanasio have that nobody came close to before?

4. What value can Attanasio add that we can’t ourselves?

5. What makes Attanasio a long-term trustee? 

6. If Attanasio isn’t a long-term trustee who does the seller sell to next?

7. How do the answers in 1-6 fit with the promises we made to ourselves about selling, those we made to the fans, our legacy?

Whilst I am quite sure that any such deal has been simmering for some time, the players will be reasonably well known to each by now I would assume, I cannot believe that the results of the last two premier seasons have not shifted the cultural goalposts somewhat. Whether this be triggered solely and privately in the minds of the majority shareholders, or whether others have increasingly raised the prospect or indeed catalysed it and somewhat driven the change.

Dreams are wonderful,  powerful things in football. Wishing on them sustains players, management and all for decades. Conversely glass ceilings being found to be unpenetrable  - despite sterling, diligent, professional efforts - create a weltschmerzen that is omnipresent. 

For Delia and Michael to dilute, reduce, relinquish, discount their (theoretical) massive share value gain would be an extraordinary, noble and loving gesture. 

I wonder if they always envisaged making such a fine gesture to an American Baseball owner?      
 

The issue as seller here -  danger even - is that you only make this gesture once. If you make it to - say - a souped-up version of The Canaries Trust with businesses and Norwich fans investing, then you could be sure that your generous, selfless gesture goes to a good cause and legacy. I personally would need some convincing that giving away - or being pressed in negotiations to discount the theoretical gain - to an American Baseball club owner, would not simply see somebody else (perhaps patiently, superficially-decently) cashing in my legacy gift voucher at a later date of their own choosing. 
 

Whilst clinging to the theoretical gain at face value might impede good investment or discourage potential good owners, simply giving it away at a point of negativity - with who knows what corollary emotions - would equally not be a good corporate finance move. They do not need to make such a move to anyone other than a good trustee. When one makes such a decision might thus be insightful, as the why has been clear for a while. . 

I can’t help thinking about what my Father - a wise man -  said when he found out that Gordon Taylor was being paid £500k a year to be CEO of the PFA. He said ‘I wonder who they turned down who offered to do the job for £400k?’

Parma 

Edited June 2, 2022 by Parma Ham's gone mouldy

[Midlands Yellow 3,970]

35 minutes ago, Terminally Yellow said:

What you do with your penis is your own business, mate. 

Vivid imagination you have there, how’s the anger management course going? 

[PurpleCanary 5,556]

Parma, I find the idea of a benevolent consortium of the Norfolk great and the (moderately wealthy) good and the fans very appealing. But as far as I know no such grouping exists, so someone would need to do a fair bit of serious organising. And without any certainty that it would produce something viable.

The baseball owner, by contrast does exist, has reasonably quantifiable financial assets, and an examinable - and seemingly respectable - track record in owning a sports team. And perhaps - who knows? - has the crucial virtue of coming across as someone to be trusted.

[Terminally Yellow 2,448]

1 hour ago, Midlands Yellow said:

Vivid imagination you have there, how’s the anger management course going? 

Hey I'm not the one coming on the Pink Un talking about what I'm doing with my Pink Un. That's all you. 

[PurpleCanary 5,556]

8 hours ago, PurpleCanary said:

Parma, I find the idea of a benevolent consortium of the Norfolk great and the (moderately wealthy) good and the fans very appealing. But as far as I know no such grouping exists, so someone would need to do a fair bit of serious organising. And without any certainty that it would produce something viable.

The baseball owner, by contrast does exist, has reasonably quantifiable financial assets, and an examinable - and seemingly respectable - track record in owning a sports team. And perhaps - who knows? - has the crucial virtue of coming across as someone to be trusted.

From October 2021:

As it stands, the only plan known publicly is that Tom Smith will receive S&J’s 53 per cent majority shareholding. A common assumption is that this plan is set in stone, and that Smith will carry on self-sufficiency exactly as before. I do not believe the plan is fixed, and as far as how he might run the club I have no idea, knowing next to nothing about him, although that hasn’t stopped fans who seems to know as little as I do being certain about what he will do, and his ability, or more often his lack of it, to run a football club.

If I had his ear I would suggest another alternative. A version of self-sufficiency that was community-based, recognising the role of the club in Norfolk as a whole, with some finance from a group of well-disposed local people in business, and genuine – as opposed to lip service - fan involvement and power (a golden-share veto?) in decision-making.

Would that please all fans? Hardly. The extra finance would certainly not be anywhere near too much, and definitely never enough. We would still be poor but honest. Just not quite as church-mouse poor but honest as we are now.

[essex canary 495]

18 minutes ago, PurpleCanary said:

From October 2021:

As it stands, the only plan known publicly is that Tom Smith will receive S&J’s 53 per cent majority shareholding. A common assumption is that this plan is set in stone, and that Smith will carry on self-sufficiency exactly as before. I do not believe the plan is fixed, and as far as how he might run the club I have no idea, knowing next to nothing about him, although that hasn’t stopped fans who seems to know as little as I do being certain about what he will do, and his ability, or more often his lack of it, to run a football club.

If I had his ear I would suggest another alternative. A version of self-sufficiency that was community-based, recognising the role of the club in Norfolk as a whole, with some finance from a group of well-disposed local people in business, and genuine – as opposed to lip service - fan involvement and power (a golden-share veto?) in decision-making.

Would that please all fans? Hardly. The extra finance would certainly not be anywhere near too much, and definitely never enough. We would still be poor but honest. Just not quite as church-mouse poor but honest as we are now.

The position Parma outlines seems to be very similar to 20 years ago when the last share issue took place and the Associate Directors Group was created. If the Club wished to continue along this path it would have further nurtured that environment. The Golden Share arrangement that Luton Town have developed with their Supporters Trust being a case in point.

Probably not going to work in the current environment hence where we are now. 

Purple, I recall that you were convinced by Delia's remark about a vote in the event of a change in majority ownership. Let us hope  that an EGM would be called which would give all minority shareholders the opportunity to ask all relevant questions.

[BigFish 1,986]

2 hours ago, essex canary said:

Purple, I recall that you were convinced by Delia's remark about a vote in the event of a change in majority ownership. Let us hope  that an EGM would be called which would give all minority shareholders the opportunity to ask all relevant questions.

I would have thought an EGM would almost certainly be required. Reflecting on @Parma Ham's gone mouldy long post does there really have to be a "why now" moment, these things often happen slowly at first, then quickly. On @PurpleCanary's suggestion I reamain convinced that the fans neither have the money, the inclination or the energy to make it happen.

[GMF 736]

13 hours ago, essex canary said:

Not sure that I am greatly concerned about that point but whilst shareholders have approved the issue of shares, they haven't approved who to so is that really an acceptance of dilution?

The real point here is that the Club simply seem to want to leave their minority shareholding initiative 20 years ago withering on the vine with no dynamics. Hard to see that that is compatible with a Community Club.

 

With regards to your first paragraph, sorry, but that’s simply not the case, as the directors are free to exercise the option as they see fit, without reference to existing shareholders.

With regards to your second point, increasing the shareholding base was a product of needing a new capital injection at the time. I’m afraid, whether we like it or not, the game has moved on from having a wide shareholder base, not least because of the associated administration. If the option was exercised, the purchaser would then be required to make an offer to all existing shareholders at a similar price, many of whom, depending upon the price, would probably accept.

[ricardo 7,380]

27 minutes ago, BigFish said:

I would have thought an EGM would almost certainly be required. Reflecting on @Parma Ham's gone mouldy long post does there really have to be a "why now" moment, these things often happen slowly at first, then quickly. On @PurpleCanary's suggestion I reamain convinced that the fans neither have the money, the inclination or the energy to make it happen.

Agreed, in the present economic environment this is a non starter. Conversely, with dollar strength its a perfect time for the yanks to make a move. 

As always we now await events.

[lake district canary 4,531]

12 hours ago, Parma Ham's gone mouldy said:

1. Why now?

2. Why Attanasio particularly?

3. What does Attanasio have that nobody came close to before?

4. What value can Attanasio add that we can’t ourselves?

5. What makes Attanasio a long-term trustee? 

6. If Attanasio isn’t a long-term trustee who does the seller sell to next?

7. How do the answers in 1-6 fit with the promises we made to ourselves about selling, those we made to the fans, our legacy?

These are exactly the right questions. 5/6/7 are the most important, as most of us who are dubious about selling to an investor have always said - you may sell to the right person, but the problem can come later on when that person sells to someone else - and that can be as little as two years or even less. The long term safety of the club is paramount and the main reason why Delia/MJW are careful about wanting to sell. The best scenario is selling to a true fan who has money - but as we all know that person does not exist - and there has been no sign that a local fan group based buy out is feasible or workable.

Some people don't care and just want the money a rich investor can bring, but that is just so shallow and short sighted. Norwich is a special club, almost unique in the way we work and in the way we are successful compared to clubs around us who spend huge amounts of money to do what we do on a shoestring.

So DS/MJW are right to be careful and would be quite justified in handing on to Tom Smith if that is the best way to ensure we don't end up like other clubs that crash and burn down the line after selling up. 

[PurpleCanary 5,556]

44 minutes ago, BigFish said:

I would have thought an EGM would almost certainly be required. Reflecting on @Parma Ham's gone mouldy long post does there really have to be a "why now" moment, these things often happen slowly at first, then quickly. On @PurpleCanary's suggestion I reamain convinced that the fans neither have the money, the inclination or the energy to make it happen.

I have never envisaged money coming from fans. That is not what I said  in that piece. The money and indeed the organisation to make it happen would come from the great and the good, although if fans wanted to get involved at the start of course they could. But once set up they certainly would be involved, assuming they wanted to be, and have some proper powers.

[Badger 2,405]

26 minutes ago, ricardo said:

Agreed, in the present economic environment this is a non starter. Conversely, with dollar strength its a perfect time for the yanks to make a move. 

As always we now await events.

Good point Ricardo - I hadn't considered the exchange rate. Seems strange to recall that prior to the Credit Crisis how much stronger the pound was to the dollar - average $2 to the £1 in 2007 and is now £1.31.

It makes the purchase of British assets much cheaper - on the downside, the repatriation of profits will be worth less as well, and you'd have to be pretty brave to bet on the pound over the next ten years after we voluntarily imposed economic sanctions upon ourselves making trade with out main customers more difficult and expensive.

[norfolkngood 1,086]

i think once the Americans are in they will go for a complete takeover 

One thing they will not want is to put money into something they will not have control over 

How exactly that will happen i do not know but Delia will be under pressure from fans if the Americans own 18 % and then start saying they will put IN XYZ if they had complete control 

We would then have someone with 53% saying they can not and will not put money in and someone with 18% saying they will invest 

i honestly thing the reason Delia will not sell is Tax reasons if she sold she would have to give away millions 

[PurpleCanary 5,556]

12 minutes ago, norfolkngood said:

i think once the Americans are in they will go for a complete takeover 

One thing they will not want is to put money into something they will not have control over 

How exactly that will happen i do not know but Delia will be under pressure from fans if the Americans own 18 % and then start saying they will put IN XYZ if they had complete control 

We would then have someone with 53% saying they can not and will not put money in and someone with 18% saying they will invest 

i honestly thing the reason Delia will not sell is Tax reasons if she sold she would have to give away millions 

But if she doesn't sell then she doesn't get any money...🤓

[norfolkngood 1,086]

7 minutes ago, PurpleCanary said:

But if she doesn't sell then she doesn't get any money...🤓

You are quite right but i think she has enough to live her years out ,

so she does not need the extra money selling the club would give her ?

also she would be paying tax twice ,once when she sold the club ,

then any money she left to TOM would then be taxed again inheritance tax 

If she left the club to tom only one lot of tax would be paid 

just my thoughts 

[shefcanary 2,392]

27 minutes ago, PurpleCanary said:

But if she doesn't sell then she doesn't get any money...🤓

I always love the attitude of the rich to paying tax.  A flotation I worked on nearly ended at the 11th hour because the seller saw his personal tax liability had increased by about £10m; he ignored the fact that he would receive another £120m because of the float! 🤦‍♂️

[norfolkngood 1,086]

5 minutes ago, shefcanary said:

I always love the attitude of the rich to paying tax.  A flotation I worked on nearly ended at the 11th hour because the seller saw his personal tax liability had increased by about £10m; he ignored the fact that he would receive another £120m because of the float! 🤦‍♂️

thats my view say delia sold her share for 100 millon she would get taxed 

then she left the remaining money to Tom he would then get taxed 

so the 100 million would be taxed twice leaving Tom with much less 

[nutty nigel 7,527]

After everything we've seen for nearly 25 years I'm amazed that people think Delia, and I must assume MWJ (although it's never said) are motivated by personal financial gain.

Perhaps pondering over other people's money addles the brain.

[Mengo 822]

15 minutes ago, nutty nigel said:

After everything we've seen for nearly 25 years I'm amazed that people think Delia, and I must assume MWJ (although it's never said) are motivated by personal financial gain.

Perhaps pondering over other people's money addles the brain.

Nice word - Addles  ,  to make someone feel confused and unable to 

think clearly:🙃🤫

[dsr-burnley 25]

1 hour ago, GMF said:

With regards to your first paragraph, sorry, but that’s simply not the case, as the directors are free to exercise the option as they see fit, without reference to existing shareholders.

The majority shareholders, assuming a big enough majority, can remove the directors from office in an instant, if the director's aren't doing as they're told.

[nutty nigel 7,527]

9 minutes ago, Mengo said:

Nice word - Addles  ,  to make someone feel confused and unable to 

think clearly:🙃🤫

It fits the situation perfectly but more luck than judgement because I use the wrong word far more often🙃

[dsr-burnley 25]

13 hours ago, PurpleCanary said:

Parma, I find the idea of a benevolent consortium of the Norfolk great and the (moderately wealthy) good and the fans very appealing. But as far as I know no such grouping exists, so someone would need to do a fair bit of serious organising. And without any certainty that it would produce something viable.

The baseball owner, by contrast does exist, has reasonably quantifiable financial assets, and an examinable - and seemingly respectable - track record in owning a sports team. And perhaps - who knows? - has the crucial virtue of coming across as someone to be trusted.

One thing to bear inmind about American owners.  And as a Burnley fan and a Milwaukee Brewers fan, I know about this from both sides!

American sports teams are run on the basis that the owner makes a profit.  Attanasio does enjoy owning the Brewers and is very popular with the fans, but he is also (almost certainly, because they don't publish their accounts) taking money out of the club.  He expects to make a profit from being the owner.

Put another way, American owners are more likely to take money out than to put money in.  He's more likely to do it for profit rather than for fun.

Burnley's owner owes the club £112m which is all tied up in a structure that means (essentially) that it's gone for ever.  Liverpool's owners take big fees.  Man United's owners did it the same way as Burnley's but more successfully in that the club is still profitable and they are continuing to leach the millions out of the club. 

If Attanasio's idea is that he can buy the club cheaply and sell out if/when you get back into the PL, and make his profit that way, then that's not so bad.  If he is planning to take directors' fees and make money that way, that's bad.  And if he plans a leveraged buyout, where he immediately takes all the cash from the club to pay his own debt for buying it - runs for the hills, don't let him near.

Edited June 2, 2022 by dsr-burnley

[essex canary 495]

1 hour ago, GMF said:

 

With regards to your second point, increasing the shareholding base was a product of needing a new capital injection at the time. I’m afraid, whether we like it or not, the game has moved on from having a wide shareholder base, not least because of the associated administration. If the option was exercised, the purchaser would then be required to make an offer to all existing shareholders at a similar price, many of whom, depending upon the price, would probably accept.

100 per cent agree with that. It follows then that the potential USA interest could provide the Club with the opportunity to buy out 6,800 plus minority shareholders and give them fair reward along the lines I proposed earlier in this thread.

The question then becomes is the Trust or any other party willing or able to assist and/or represent minority shareholders in this matter and when would they take the matter forward?

The answer to the last question could be not yet then again it could be argued that if Michael Foulger's shares are potentially to be bought out that now is the right time to make the case for other minority shareholders?

Could be a good opportunity for the Trust too in that they could ask supporters to donate all or a percentage of shares to the Trust?

 

[lake district canary 4,531]

55 minutes ago, nutty nigel said:

After everything we've seen for nearly 25 years I'm amazed that people think Delia, and I must assume MWJ (although it's never said) are motivated by personal financial gain.

This^^^ 

Their only concern is and always has been the well being of the club. They put in a high percentage of their wealth into buying the shares in the first place and also loaned money to the club on top of that.  They are wealthy compared to most of us, no doubt, their loan has been repaid, their income from book sales and royalties must be pretty good, so money is not a major concern to them.

It must be totally clear to anyone who looks at the club that they are not in it for the money.  What money have they gained from those 25 years? Shareholders dividends maybe? The club has gained income for sure from all the ventures and maybe Delia's catering gets her a percentage, who knows, but apart from that she does not take anything from the clubs coffers like an investor would. 

Any real money is tied up in her shares and ultimately if she sold them she would presumably make a lot on those - and she has had several opportunities to cash in when their value was high, but she and MJW have stuck with it throughout good times and bad. So really it is false thinking to think she is in it for the money.  They want the club to make money for sure, but making money for themselves is not an issue and never has been. Anyone who thinks otherwise clearly hasn't been paying attention.

 

[Badger 2,405]

28 minutes ago, essex canary said:

Could be a good opportunity for the Trust too in that they could ask supporters to donate all or a percentage of shares to the Trust?

Given that the Trust has acted against the interests of the club at crucial times that could be a hard one to sell!

[PurpleCanary 5,556]

16 minutes ago, Badger said:

Given that the Trust has acted against the interests of the club at crucial times that could be a hard one to sell!

Is that true, Badger? I have no idea, although as a member I may be blocking bad stuff out…

[BigFish 1,986]

2 hours ago, PurpleCanary said:

I have never envisaged money coming from fans. That is not what I said  in that piece. The money and indeed the organisation to make it happen would come from the great and the good, although if fans wanted to get involved at the start of course they could. But once set up they certainly would be involved, assuming they wanted to be, and have some proper powers.

I see @PurpleCanary, I think we may only differ in semantics. Any "great and good" would need to have some kind of affinity with the club, so fans really, and still I don't see the money, invlination and energy required. The Canaries Trust is an admirable if low key instituition and I assume, cause I can't remeber-sorry, that your piece envisioned something on a larger scale. I just don't see how that gap is bridged.

[komakino 272]

26 minutes ago, lake district canary said:

This^^^ 

Their only concern is and always has been the well being of the club. They put in a high percentage of their wealth into buying the shares in the first place and also loaned money to the club on top of that.  They are wealthy compared to most of us, no doubt, their loan has been repaid, their income from book sales and royalties must be pretty good, so money is not a major concern to them.

It must be totally clear to anyone who looks at the club that they are not in it for the money.  What money have they gained from those 25 years? Shareholders dividends maybe? The club has gained income for sure from all the ventures and maybe Delia's catering gets her a percentage, who knows, but apart from that she does not take anything from the clubs coffers like an investor would. 

Any real money is tied up in her shares and ultimately if she sold them she would presumably make a lot on those - and she has had several opportunities to cash in when their value was high, but she and MJW have stuck with it throughout good times and bad. So really it is false thinking to think she is in it for the money.  They want the club to make money for sure, but making money for themselves is not an issue and never has been. Anyone who thinks otherwise clearly hasn't been paying attention.

 

That's a rose tinted view. 

Delia is an opportunist and has done very well out of Norwich City. It was a vehicle to prop up a fading career and keep her in the public eye. It wasn't and isn't (directly) about money, it was and is about publicity. 

The club owes her nothing and all loans have been repaid. In publicity terms, she has made money by her very existence connected with Norwich City. She needed the club more than the club needed her. She still does. 

She is a fan, but it didn't start and end there.