Waiver Vote - Shareholders Only Please

[Feedthewolf 4,894]

6 minutes ago, shefcanary said:

FTW, it is right to say that during the period of the Shareholder Agreement (it ends in January 2026) Attanasio will not be looking to increase his holding, although it is only that agreement with Smith & Jones that I believe legally would prevent him from buying from minorities directly after a period of grace. If that agreement came to an end then all bets are off as to what the next steps would be.

I have long held the view that ultimately Smith & Jones will sell a large proportion of their shares to Attanasio to allow him to become overall solely in charge of the club, but I expect them to retain a small block of shares and transfer them to a trust (just over 10%) for much the same reason that the CT exists really - to act as a block to one person having "absolute" control of the club. There's no guarantee of that, but it would make sense to me that the CT and Smith & Jones at some point enter serious conversation pool about the pooling of resources to this effect.

Thanks, Shef.

Am I right in thinking that if any one person/party acquires 90% of the shares, then they must automatically acquire the remainder and thus become sole 100% shareholder?

[sgncfc 1,259]

I wouldn't expect anyone to fully invest in a football club if they are not majority owners. I think this is very much an interim stage and assuming all goes according to plan over the next three years, I think it likely that Attanasio will then buy DS and MWY out. Of course it's possible that DS and MWJ will give some shares to the CT but even if they hold a large minority there isn't much they can do to block anything. They would get a voice at the table, but that's all.

I still don't really understand though why Attanasio is being allowed to acquire his large minority so cheaply. He could end up owning an asset worth £150m for about a sixth of what it's actually worth and making some serious interest on his loans. I realise that DS always said she would take no profit - but why should that mean Attanasio gets such a bargain?

Edited September 22, 2023 by sgncfc

[GMF 757]

@Feedthewolf mindful not to make this about the Trust, as that’s likely to irritate some.

However, whenever we are approached by a shareholder looking to sell, we make a point of highlighting that they always have at least three options; first, find their own buyer, second, list their shares on our website and, third, ask the Trust for an offer. This choice is clearly a matter for each shareholder.

@shefcanary makes an interesting observation relating to a potential outcome for D&M, which is logical, notwithstanding any potential interest from the Trust.

For those who may not have picked it up, the Shareholder Agreement highlights that the all the parties already have pre-existing estate planning in place. Hardly surprising, given the ages of those parties. It isn’t intended that the Shareholder Agreement would override those pre-existing arrangements. Make of that what you will!

[shefcanary 2,468]

17 minutes ago, Feedthewolf said:

Thanks, Shef.

Am I right in thinking that if any one person/party acquires 90% of the shares, then they must automatically acquire the remainder and thus become sole 100% shareholder?

Under normal plc takeover rules there is an automatic right to the body that has acquired 90% of the shares to force minorities to sell, although I understand it would be down to the 90% holder to trigger this formally - they may be happy to allow the minorities to retain their shares. Hence why I see Smith & Jones holding >10% of club's shares in the long run is a potential outcome. 

[shefcanary 2,468]

22 minutes ago, GMF said:

For those who may not have picked it up, the Shareholder Agreement highlights that the all the parties already have pre-existing estate planning in place. Hardly surprising, given the ages of those parties. It isn’t intended that the Shareholder Agreement would override those pre-existing arrangements. Make of that what you will!

Given the complicated ownership of Norfolk I am not sure how the Attanasio's can retain total control if Mark (let's hope not) pops his clogs before ultimate control of the club passes to this entity after the cessation of the Shareholder Agreement. Oh to have a look at his will. As long as Norfolk does ultimately gain total-ish control, I would expect the ownership of Norfolk to simplify in due course with all its shares passing to the Attanasio family. But there again we may be regularly taking part in the ECL by then and the club may be considered one of the big boys in the top 8 of the EPL. 🙂 

Smith & Jones estate at this stage seems pretty easy to predict, with any shares they have control of passing to Neppo Tom. But she may just throw a curve ball in and leave it all to the Pope, or the Labour Party. Who knows? The Pope's representative or Kier Starmer regularly appearing in the directors box at the Carra. 🙂  

 

Edited September 22, 2023 by shefcanary

[GMF 757]

@shefcanary I think we can safely presume that Norfolk will have similar shareholder agreements with the various parties involved. 

[essex canary 508]

2 hours ago, shefcanary said:

Under normal plc takeover rules there is an automatic right to the body that has acquired 90% of the shares to force minorities to sell, although I understand it would be down to the 90% holder to trigger this formally - they may be happy to allow the minorities to retain their shares. Hence why I see Smith & Jones holding >10% of club's shares in the long run is a potential outcome. 

Presumably then the only potential exit for existing shareholders is when, or if, Norfolk Group cross the 50% mark and at who knows what price?

Of course we may not want to exit. Then again it is quite possible to be more in favour of trust style arrangements rather than the current ineffective ones. Moreover neither the Pope nor the Labour Party nor Boris Johnson (who got an invite to Carrow Road during the pandemic) will be everybody's bedfellow cup of tea. 

[Indy 3,323]

Of course this timeline isn’t set in stone and if things go badly we stay mid championship for the next two years build debts to MA to the point that the assets don’t cover the loan, MA could make an aggressive move to buy on the very very cheap! You might get that £1 per share you keep going on about Essex!😂

[BigFish 1,988]

31 minutes ago, essex canary said:

Presumably then the only potential exit for existing shareholders is when, or if, Norfolk Group cross the 50% mark and at who knows what price?

Not sure what relevance 50% has?

I presume that any future purchase of share by Norfolk Group above 30% would require a general offer or another waiver.

On the other hand you are free to sell your shares at any time if you can find a potential purchaser.

[stratton canary 135]

On 20/09/2023 at 11:44, essex canary said:

 

 

Edited September 22, 2023 by stratton canary
Wrong post

[Indy 3,323]

38 minutes ago, BigFish said:

Not sure what relevance 50% has?

I presume that any future purchase of share by Norfolk Group above 30% would require a general offer or another waiver.

On the other hand you are free to sell your shares at any time if you can find a potential purchaser.

I believe the next figure will be 90% according to Purple..might be wrong in my interpretation.

[daly 512]

Voted YES rather than NO as had I voted Don’t know I would be classed as ignorant but then I don’t know why I voted Yes🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸🇺🇸

 

[shefcanary 2,468]

1 hour ago, essex canary said:

Presumably then the only potential exit for existing shareholders is when, or if, Norfolk Group cross the 50% mark and at who knows what price?

Of course we may not want to exit. Then again it is quite possible to be more in favour of trust style arrangements rather than the current ineffective ones. Moreover neither the Pope nor the Labour Party nor Boris Johnson (who got an invite to Carrow Road during the pandemic) will be everybody's bedfellow cup of tea. 

No, as always and as many people on here have counselled you (so I am assuming you are just on a wind up), the facility offered by the CT is there for you or you can go to any respectable high street share trader (virtual or real) and ask them to find and make a deal with someone willing to buy your shares.

As Big Fish says, Norfolk may take up the opportunity afforded them under company law to buy you out once they get to >90% - although there is no absolute requirement for them to do this, but if they do you cannot refuse.

[TIL 1010 4,801]

1 hour ago, Indy said:

 You might get that £1 per share you keep going on about Essex!😂

Never seen him mention it once, a hundered times yes but never once.

[essex canary 508]

1 hour ago, BigFish said:

Not sure what relevance 50% has?

I presume that any future purchase of share by Norfolk Group above 30% would require a general offer or another waiver.

On the other hand you are free to sell your shares at any time if you can find a potential purchaser.

Doesn't the Takeover Code get re-enacted as the Resolutions only provide the waiver for the 40:40 plan or, whilst apparently unlikely, the 46:36 plan? 

[BigFish 1,988]

1 hour ago, Indy said:

I believe the next figure will be 90% according to Purple..might be wrong in my interpretation.

 

39 minutes ago, essex canary said:

Doesn't the Takeover Code get re-enacted as the Resolutions only provide the waiver for the 40:40 plan or, whilst apparently unlikely, the 46:36 plan? 

With the caveat that I am not an expert I believe you are correct @Essex Canary. My understanding is that the waiver applies to this transaction, and this transaction only. Should Norfolk Group wish to buy further shares (including S&J's) the whole process begins again. NG would have the choice of a general offer or seeking another waiver. It makes the takeover of the club in piecemeal stages impossible, and rightly so if the rights of minorities are to be protected. In summary the TP are interested in transactions in the 30% to 90% range. Above 90% NG would have the entitlement to buy out all remaining shareholders at the highest price paid in the last twelve months by them whether the shareholders want it or not. Below 30% NG are consider a minority shareholder. A total separate matter is while 50% + 1 share gives majority control, 75% is required to pass special resolutions.

Unlike others, I am not convinced the holding in Trust of a blocking 10% + 1 share is actually practical. The most logical endgame is that NG buy 100% and take the club private again. I do understand why this has been suggested and see the reasons for this.

 

[essex canary 508]

6 minutes ago, BigFish said:

 

With the caveat that I am not an expert I believe you are correct @Essex Canary. My understanding is that the waiver applies to this transaction, and this transaction only. Should Norfolk Group wish to buy further shares (including S&J's) the whole process begins again. NG would have the choice of a general offer or seeking another waiver. It makes the takeover of the club in piecemeal stages impossible, and rightly so if the rights of minorities are to be protected. In summary the TP are interested in transactions in the 30% to 90% range. Above 90% NG would have the entitlement to buy out all remaining shareholders at the highest price paid in the last twelve months by them whether the shareholders want it or not. Below 30% NG are consider a minority shareholder. A total separate matter is while 50% + 1 share gives majority control, 75% is required to pass special resolutions.

Unlike others, I am not convinced the holding in Trust of a blocking 10% + 1 share is actually practical. The most logical endgame is that NG buy 100% and take the club private again. I do understand why this has been suggested and see the reasons for this.

 

Thanks. I am not going to claim to be expert either but in so far as I can interpret it that is my understanding. 

[PurpleCanary 5,587]

13 hours ago, BigFish said:

 

With the caveat that I am not an expert I believe you are correct @Essex Canary. My understanding is that the waiver applies to this transaction, and this transaction only. Should Norfolk Group wish to buy further shares (including S&J's) the whole process begins again. NG would have the choice of a general offer or seeking another waiver. It makes the takeover of the club in piecemeal stages impossible, and rightly so if the rights of minorities are to be protected. In summary the TP are interested in transactions in the 30% to 90% range. Above 90% NG would have the entitlement to buy out all remaining shareholders at the highest price paid in the last twelve months by them whether the shareholders want it or not. Below 30% NG are consider a minority shareholder. A total separate matter is while 50% + 1 share gives majority control, 75% is required to pass special resolutions.

Unlike others, I am not convinced the holding in Trust of a blocking 10% + 1 share is actually practical. The most logical endgame is that NG buy 100% and take the club private again. I do understand why this has been suggested and see the reasons for this.

 

Not an expert either, but my reading of the Code is that a forced offer to buy (failing a waiver) only applies to someone whose acquisition will take them to at least 30 per cent, as here with Attanasio. Or someone who has between 30 per cent and 50 per cent and plans to acquire more, as might one day be the case with Attanasio.

My reading is that the Takeover Code does not come into play on any further acquisitions from someone with 51 per cent that do not hit the 90 per cent mark, and then at 90 per cent only to give the buyer the chance to forcibly buy the rest, as opposed to the previous two scenarios when unless a waiver is obtained, they have to make an offer to buy.

If - I stress the "if" - that is correct then I would say the likelihood is that after this transaction goes through there will be only one more time where this current process - with a waiver or without -  happens again, because it will take Attanasio from 40 per cent beyond 50 per cent. I doubt he is going to go from 40 per cent to 45 per cent, or whatever.

Edited September 23, 2023 by PurpleCanary

[BigFish 1,988]

12 hours ago, PurpleCanary said:

If - I stress the "if" - that is correct then I would say the likelihood is that after this transaction goes through there will be only one more where this current process - with a waiver or without -  happens again, because it will take Attanasio from 40 per cent beyond 50 per cent. I doubt he is going to go from 40 per cent to 45 per cent, or whatever.

Thanks @PurpleCanary, that makes sense. It looks like the big event is yet to come, although shareholders are between a rock and a hard place on this one. The rights of minority shareholders are extremely limited without a shareholder agreement so that will be make your mind up time.

Rights with standard articles and under the Companies Act

If the company has standard articles issued upon incorporation and no amendments have been made, in all likelihood your shareholder rights will be limited to the basic rights set out below :-

Shareholding of 5% or more

• Able to require the circulation of a written resolution.
• Able to require the company to call a general meeting.
• Able to prevent the deemed re-appointment of an auditor.

Shareholding of 10%

• Able to call a poll vote at a general meeting.
• Able to require an audit.

Shareholding greater than 10%

• Able to block consent to short notice of a general meeting.

Shareholding greater than 25%

• Able to block a special resolution.
• Able to block compromise arrangement with members or a class of members.

[The Real Buh 3,486]

I will only be responding to boring financial threads from now on via AI and I’d encourage others to do so. That being said.

The future of Norwich City FC ownership holds promise for continued fan involvement and financial stability. The club has made strides in recent years to engage supporters through initiatives like the Canaries Trust, allowing fans to have a voice in the club's decisions. Additionally, the potential for external investment or partnerships may bring new resources and opportunities to the club. With their commitment to nurturing young talent and their presence in the Premier League, Norwich City has the potential to attract investors interested in the long-term growth of the club. However, as with any football club, the future ownership landscape may evolve, but Norwich City's dedication to fostering a strong connection with its fans is likely to remain a key pillar of its ownership model.

[PurpleCanary 5,587]

6 minutes ago, BigFish said:

Thanks @PurpleCanary, that makes sense. It looks like the big event is yet to come, although shareholders are between a rock and a hard place on this one. The rights of minority shareholders are extremely limited without a shareholder agreement so that will be make your mind up time.

Rights with standard articles and under the Companies Act

If the company has standard articles issued upon incorporation and no amendments have been made, in all likelihood your shareholder rights will be limited to the basic rights set out below :-

Shareholding of 5% or more

• Able to require the circulation of a written resolution.
• Able to require the company to call a general meeting.
• Able to prevent the deemed re-appointment of an auditor.

Shareholding of 10%

• Able to call a poll vote at a general meeting.
• Able to require an audit.

Shareholding greater than 10%

• Able to block consent to short notice of a general meeting.

Shareholding greater than 25%

• Able to block a special resolution.
• Able to block compromise arrangement with members or a class of members.

BF, it is possible - and this is just a thinking-aloud supposition on my part - that if there is only one more such acquisition, because it takes Attanasio beyond 50 per cent, then it will be used to remedy the unfairness to minority shareholders there is in the current proposal. That, for example, he won't seek a waiver.

[The Real Buh 3,486]

3 minutes ago, PurpleCanary said:

BF, it is possible - and this is just a thinking-aloud supposition on my part - that if there is only one more such acquisition, because it takes Attanasio beyond 50 per cent, then it will be used to remedy the unfairness to minority shareholders there is in the current proposal. That, for example, he won't seek a waiver.

The future of football club ownership is poised for intriguing developments. The traditional model of wealthy individual owners or consortiums backing clubs will likely persist, but we can expect a continued shift towards increased fan involvement and community ownership. Fan ownership initiatives, like supporters' trusts and fan share schemes, are gaining momentum, allowing fans to have a more direct say in their clubs' affairs. Additionally, we may see more emphasis on sustainability, ethical ownership, and financial fair play regulations as football strives for long-term financial stability. Investment from tech giants and global conglomerates may also become more prevalent, potentially transforming the financial landscape of the sport. Ultimately, the future of football club ownership will likely be marked by a combination of traditional ownership structures, fan empowerment, and evolving business strategies to ensure the continued growth and competitiveness of the beautiful game.

[shefcanary 2,468]

16 hours ago, PurpleCanary said:

Not an expert either, but my reading of the Code is that a forced offer to buy (failing a waiver) only applies to someone whose acquisition will take them to at least 30 per cent, as here with Attanasio. Or someone who has between 30 per cent and 50 per cent and plans to acquire more, as might one day be the case with Attanasio.

My reading is that the Takeover Code does not come into play on any further acquisitions from someone with 51 per cent that do not hit the 90 per cent mark, and then at 90 per cent only to give the buyer the chance to forcibly buy the rest, as opposed to the previous two scenarios when unless a waiver is obtained, they have to make an offer to buy.

If - I stress the "if" - that is correct then I would say the likelihood is that after this transaction goes through there will be only one more time where this current process - with a waiver or without -  happens again, because it will take Attanasio from 40 per cent beyond 50 per cent. I doubt he is going to go from 40 per cent to 45 per cent, or whatever.

And as I read it, the next move is for Smith & Jones to sell part of the shareholding to the Norfolk Group. As I read it, that actually is a Trigger event re. conversion of the C Pref Shares which makes a return to the TP for snother waiver incredibly messy! But, both parties have both stated they never expect a Trigger Event to ever happen. I'm totally lost on this as in effect it means the 40:40 continues into perpetuity! 

Nah, 40:40 into perpetuity ain't going to happen, so yet more untruths in the GM papers?

[PurpleCanary 5,587]

22 minutes ago, shefcanary said:

And as I read it, the next move is for Smith & Jones to sell part of the shareholding to the Norfolk Group. As I read it, that actually is a Trigger event re. conversion of the C Pref Shares which makes a return to the TP for snother waiver incredibly messy! But, both parties have both stated they never expect a Trigger Event to ever happen. I'm totally lost on this as in effect it means the 40:40 continues into perpetuity! 

Nah, 40:40 into perpetuity ain't going to happen, so yet more untruths in the GM papers?

Shef, it all seems pretty obvious to me,😇 on my tax-haven island,🏝️ lounging in the shade🏖️ with a mimosa🍸 to hand, but then I have the advantage of just having handed MA his latest instructions📉📈, and he is flying🛫 back to Milwaukee🍺 as I type.

[essex canary 508]

23 hours ago, shefcanary said:

And as I read it, the next move is for Smith & Jones to sell part of the shareholding to the Norfolk Group. As I read it, that actually is a Trigger event re. conversion of the C Pref Shares which makes a return to the TP for snother waiver incredibly messy! But, both parties have both stated they never expect a Trigger Event to ever happen. I'm totally lost on this as in effect it means the 40:40 continues into perpetuity! 

Nah, 40:40 into perpetuity ain't going to happen, so yet more untruths in the GM papers?

So why are we being asked to approve something that is never going to happen?

Would Norfolk Group be happy with 46:36:18? Is it really any threat to them in practice?

[essex canary 508]

On 22/09/2023 at 11:49, Feedthewolf said:

I'm not a shareholder myself, but I'm a member of the Canaries Trust and they have canvassed the opinion of their members on how to vote in the resolutions (I hope I'm allowed to say that, as I'm not sharing any specifics).

As I understand it, the problem with Resolution 1 is that existing shareholders will not have the opportunity to sell their shares to Attanasio (Norfolk Group) as, due to the waiver, he will not be obligated to make an offer for them. While that may be a shame, presumably anyone wishing to sell their shares could still do so, and the Trust would then be in pole position to potentially buy them and increase its own shareholding?

If Attanasio eventually becomes sole proprietor then none of the shares will matter any longer, but for now I think it makes sense for a fan-owned group (CT) to continue to increase its holding wherever possible to hold the (potential) new ownership to account... therefore I would personally be inclined to vote in favour of Resolution 1, as the club clearly needs the capital investment that Norfolk Group can offer.

I'm sure there's a lot more to it than that, but these matters are a long way out of my comfort zone; I was wondering whether @GMF or any others well-versed in the process could set me straight?

The question raised there is firstly shouldn't a Canaries Trust member be considered to be a de facto shareholder with rights to attend the AGM? It would offer scope to freshen up the AGM alongside continuously providing for new involvement in shareholding outside inheritance and minimal share transfers.

The second question is why did the Club approve the formation of the Canaries Trust in 2001 seemingly with D&M's influence then in 2002 encouraged another raft of very small shareholders in their own right rather than funnelling them into the Trust? It doesn't seem to make sense given all the administration involved including changing the Club's status to public and all the resultant costs occurred recently.

Of course the answer to the last question maybe that they also wanted to attract larger investors such as myself in 2002 who would have wanted the shares in their ownership and some incentive to go with them. It is when they are seeking to pass that on to another generation or party without the incentive that I object especially given their apparent very costly poor management of the issues.

Of course we must hope Norfolk Group will administrate far better going forward but still good reason to vote against the current administration's continuing presence.

Edited September 25, 2023 by essex canary

[GMF 757]

6 minutes ago, essex canary said:

The second question is why did the Club form the Canaries Trust in 2001 seemingly with D&M's influence then in 2002 encouraged another raft of very small shareholders in their own right rather than funnelling them into the Trust? It doesn't seem to make sense given all the administration involved including changing the Club's status to public and all the resultant costs occurred recently.

The Club didn’t form the Trust, there was a group of individuals, with assistance from Supporters Direct, I believe, who formed it. 

[The Real Buh 3,486]

A shareholder waiver is a legally binding document in which a shareholder voluntarily gives up certain rights or privileges typically associated with ownership in a company.

[essex canary 508]

33 minutes ago, GMF said:

The Club didn’t form the Trust, there was a group of individuals, with assistance from Supporters Direct, I believe, who formed it. 

Your correction accepted. Nonetheless given that a recent Trust communication stated that it's setup had D&M's support in 2001 it doesn’t deflect from the logic I put forward.

Why have they wasted so much unnecessary money on lawyers and over complicated arrangements when simpler options were clearly available and supporters would have benefitted much better?