Arsenal Claims No Interest In $2.25B Takeover Bid From Middle East Consortium
Arsenal is "poised to be subjected to" a £1.5B ($2.25B) takeover bid from a Middle East consortium in the next few weeks, according to Jason Burt of the London TELEGRAPH. The bid would be "the world’s biggest ever" for a football club, dwarfing the £800M paid by the Glazers for ManU, and "will be backed by funds from Qatar and the United Arab Emirates." The group does "not want their identities made public yet," but a bid source said that the intention is to "buy out Arsenal’s American owner, Stan Kroenke, whose perceived weak stewardship of the club has also been called into question by frustrated supporter groups." The cash offer is more than twice the amount at which Arsenal was valued two years ago, and will be for 100% of the club. If successful, it would "wipe out debts" that stand at around £250M ($375M), according to the last full year’s financial results. There would be "substantial transfer funds made available to transform the club into a major force in European and world football." There would also be "a pledge to reduce ticket prices at the Emirates Stadium" -- currently among the highest in the world -- as well as an attempt to recreate "some of the feel of the old North Bank" at Highbury. The deal would provide Kroenke with an approximate profit of £400M given the majority owner is believed to have paid around £430M to build his stake in the club since he first became involved in '07. A meeting has "already been requested with the American to discuss the proposed offer." Any takeover would "inevitably raise questions" over the future of Manager Arsène Wenger, although the Frenchman is "understood to be highly-regarded by the consortium." They "do not want to lose his football knowledge and want him to remain at the club." The bid group believe that the ownership of Kroenke and his son and heir, Josh, "has been at the heart of the club’s lack of competitiveness." A source said, "The biggest problem with Arsenal is that it has no owner, no face and there is no one to report to" (TELEGRAPH, 3/2). In London, Steve Tongue reported billionaire Uzbek businessman Alisher Usmanov "could be behind the bid," which would seem to make Kroenke "even less likely to sell." Kroenke was labelled "Silent" Stan because of his "low profile and infrequent appearances at matches." The Arsenal Supporters Trust said that one of its aims for '13 was "to seek further explanation from Stan Kroenke as to his vision for Arsenal and to encourage him to engage personally with Arsenal fans" (INDEPENDENT, 3/3).
NO CONTACT: In London, Mark Cue reported Arsenal has insisted that Kroenke "has no intention of selling his majority stake in the club." Arsenal has also stressed that "there has been no approach, informal or otherwise, from potential bidders," and that Kroenke, who holds a 66.8% majority stake, remains "in it for the long term." If he did accept a deal, Usmanov, the club’s second-largest shareholder who does not have a seat on the board, "would be asked to sell" his with a 29.11% stake (LONDON TIMES, 3/3). Arsenal Communications Dir Mark Gonnella said, "Stan Kroenke is committed to Arsenal for the long term and has no intention of selling his stake. There has been no contact from any potential investors." Gonnella noted that Kroenke, who also owns the NFL St. Louis Rams, had never sold any of his sports investments (REUTERS, 3/3). Also in London, Matt Law reported that Kroenke, worth £4B ($6B) by the Forbes rich list, has "told the club on several occasions that he is at Arsenal 'for the long haul.'" He has said in the past that he "does not want to sell." The feeling inside The Emirates is that "he will resist any temptation to sell to a so-far unnamed Arab consortium backed by funds from Qatar and the United Arab Emirates" (DAILY MIRROR, 3/3).
MUCH IN COMMON: In London, Ben Harrington noted American owners of British football clubs have "tended to sell out either to make money or avoid financial disaster." Take, for example, specialist private equity investor from Texas, Tom Hicks, and entrepreneur George Gillett, who bought Liverpool in '07 from the Moores family. The Americans "looked to emulate" the Glazer family’s acquisition of ManU and financed a takeover deal of more than £200M "using a vast amount of debt provided by Royal Bank of Scotland." Once the pair of entrepreneurs failed to refinance the £237.4M loan from RBS, Hicks and Gillett "were forced to sell the club by the bank." Kroenke, though, "does not appear to be in the same financial position as Hicks, Gillett and the Glazers." So, Kroenke’s decision to sell his Arsenal shareholding "boils down to whether he is purely a financial investor or whether he wants to be a long-term owner willing to pour millions of his own money into a British football team just to see them pick up a Champions League trophy" (TELEGRAPH, 3/2).
SILENT STAN: Also in London, Rory Smith opined "like most visceral nemeses, Arsenal and Tottenham have more in common than they might care to admit; more, certainly, than a simple, bilious enmity." Both have endured a number of seasons when they "have been forced, by brute financial reality, to watch the jewels in their crown depart for richer pastures." And both are "under the control of men who very rarely say a word." Tottenham Owner Joe Lewis, through the ENIC investment group he runs with Spurs Chair Daniel Levy, owns 85% of the club, and is often "described as reclusive." So "rare are Kroenke’s public utterances, of course, that he is known both here and in his homeland as 'Silent Stan.' Rams website Turf Show Times Editor Ryan Van Bibber said, "He stays behind the scenes" (LONDON TIMES, 3/2).