Wednesday, November 05, 2008

A proposal to the Malaysian government to buy Port Vale Football Club!

The global economic slowdown is set to arrive on the terraces of English Premier League clubs, and potential investors from the Gulf are already getting cold feet. There are dark days ahead for the beautiful game.

When an Abu Dhabi Government-backed group spent around $400m in September to snap up Premier League club Manchester City, the mood was one of euphoria.

Dish-dasha-clad fans danced outside the club's gleaming 48,500-seat stadium, and thousands of miles away in the Gulf, millions of football supporters suddenly had a new ‘second team'.
But now the mood has changed. The beautiful game is no longer such an attractive investment in a world reeling towards economic recession, and even the richest league in the world is losing its lustre in the wake of concerns over future ticket sales and merchandising opportunities.
The situation is so dire that some clubs even risk slipping into insolvency, as they struggle to secure financing for the huge levels of debt that they have racked up.

And in the Gulf, would-be investors are going sour on soccer as a result. "We're not interested in football - it's seen as a ‘silly' investment and we don't want to be associated with it," a source at a major private equity house told Arabian Business last week.
This shift is supported by the statistics. Bloomberg's European Football Index, which tracks the fortunes of Europe's 25 listed clubs - including Premier League giants Arsenal and strugglers Tottenham Hotspur - has dropped almost 30 percent year-to-date, and 24 percent in the two months since the Manchester City deal was first announced. Only three clubs have seen their share prices rise over the year-to-date.

"There are less people out there now who are willing and able to acquire an English football club, than there were 12 months ago, six months ago, or even six weeks ago," says Paul Rawnsley, a director within the Sports Business Group at accountants Deloitte.
The general economic climate and in particular the challenges of the credit market have reduced the likelihood of more deals, and the level of interest has certainly dropped."


R. Nadeswaran
SAY whatever you want but if you can’t give them an "A" for excellence in achievement, they’ll definitely get an "A+" for effort. The peddlers, the middlemen and the Mr Fixits are at work again in the name of sports – albeit to make a quick buck. Now that the Brickendonbury project in the United Kingdom is dead and buried, someone has come out with an even more "brilliant" idea. And of course, it involves "investing" large sums of money and suckers are being sought out.
Instead of building a forward training base or a high performance centre in England for our athletes, why not buy over an existing facility which has its own grounds and even a club for which our Malaysians can represent? Why buy a cow when the milk is free? Sounds logical but then, there’s always a catch.
Word is around in London and also back home that a group has sent in a proposal to buy an English football club. It is understandable if such a proposal is being considered by a corporate organisation like AirAsia which has already tied up with Manchester United and the FA of England or Petronas which is already involved in motor racing and wants to spread its wings. But who in his or her right sense of mind would invest in a team of non-achievers? Datuk Tony Fernandes and Tan Sri Hassan Merican are no fools. But the proposal to the government (you can guess which agency or department) to buy Port Vale Football Club which is languishing in the bottom half of the English Second Division, rates right up there in the Book of Dubious Records.
If only the people behind the proposal had done some research, they would not have wasted their time, effort and money on this venture. The club says it is run as a non-profit operation and is committed to re-invest any surplus funds generated back into the business. The club also has other contractual commitments which preclude the payment of dividends to its shareholders.
It says openly and without inhibitions: "The likelihood of a dividend being paid either now or in the foreseeable future is therefore extremely remote."
Never mind that. According to the club’s website, its authorised share capital is £5 million (RM28.8 million). As at January 2008 about £1.2 million (RM6.9 million)worth of shares have been issued and fully paid-up, leaving around £3.8 million (RM21.8 million) worth of shares available.
Are these the shares which are to be purchased by the Malaysian government? But then, there’s this caveat: Port Vale Football Club is a private limited company and cannot lawfully issue shares to the public. But of course, there are back-door entries. The Port Vale Association can, however, issue shares to its members; anyone can buy shares by becoming a member for just £5.
The club itself is in the dark on this proposal. Its commercial manager Mike Aldridge in an email to theSun said: "I have discussed it with the Chairman and we have no knowledge of the details."
So, there’s another theory or hunch, so to speak. Someone has invested £5, hoping to make a big bundle by buying and re-selling the shares at an inflated price! Very possible and with just less than 15% of the share capital, there’s no guarantee that our mediocre footballers will even be able to sit on the substitute’s bench! But then, there’ll be plenty of reasons, such as "giving exposure to youngsters"; "acclimatise our juniors"; "using the club as a springboard to play in the English Premier League or Bundesliga" and the like. And there’ll be no dearth of people raising their hands and voices in support.
But then, our entrepreneurs always have a trick up their sleeve by throwing in a couple of famous names and incidences. Didn’t former Thai premier Thaksin Shinawatra once own Manchester City? Isn’t Elton John linked with Watford? The entrepreneurs would say: "We have the perfect link" but who?
Singer Robbie Williams is also a shareholder. He grew up in that area and had supported the club since he was a kid and two years ago, bought some shares in the club. "Although I can’t be at the Vale often, my investment is just to say that my heart is still there and I’m a huge supporter," he told BBC.
But there will be gullible decision-makers who would buy the line that he can help promote Malaysia and that by our country being linked to such a famous person, it will help to draw tourists to Malaysia. (Didn’t someone propose making Datuk Michelle Yeoh our tourism ambassador for a whopping sum of money? But the rest of the world have always considered her a Hongkie!)
But be assured, Robbie Williams like most rich and famous people, will do nothing without incentives – not even for a song (pun intended).

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