Friday 24 April 2020

Why a fan owned club is not the answer

The idea of Charlton being a fan owned club is being raised once again. I have to say that I am very sceptical about this concept, although it is understandable why fans would want to look at any hope of salvation in the current crisis at the club.

Could fans raise the amount that Roland would want to clear his debts, and having done that could they meet the inevitable losses? I doubt it. The example of Portsmouth is sometimes raised, but they had some wealthy individual backers to start with and eventually had to sell, although one could argue they secured the objective of saving the club.

Many supporters would like to see fan owned clubs. Some Spanish clubs are owned in this way, but Kieran Maguire in comments in his recent excellent book The Price of £ootball,‘The downside of this is that [club] presidents spend a lot of time campaigning for re-election and making populist promises that are not always in the club’s long-term interests.’

In England the history of fan owned clubs is mixed. Even with a prosperous fan base, raising sufficient capital can be challenging as AFC Wimbledon found with their planned move back to a new stadium near to their historic home in Plough Lane.

They were successful, but other fan owned clubs, such as FC United, started as a protest following the Glazer acquisition of Manchester United, have encountered greater challenges. Despite a one person, one vote constitution regardless of the sums invested, ‘This has not prevented fall outs between the club board and membership, which has resulted in conflict in terms of the future direction of the club' states Maguire. A more general problem he identifies is that fans can’t afford to underwrite losses and this may lead to an overly cautious financial strategy.

Wycombe Wanderers was acquired from the Supporters’ Trust in 2020 with American businessman and sports team owner Rob Couhig acquiring a 75 per cent stake. Manager Gareth Ainsworth later commented about his arrival at the club: ‘The Trust had just taken over and they were as wet behind the ears as I was. ‘ Former chairman Trevor Stroud commented, ‘Without [Couhig’s] contribution [in 2019], we were facing an extremely precarious position and I don’t believe the club would be in the position it is now had Rob not come forward.'

Kieran Maguire commented, ‘Wycombe Wanderers lost £868,000 in 2018/19 and are technically insolvent as liabilities exceed assets. This may further explain why the supporters’ trust sold the club to a private investor.'

Although those with relevant skills in law and accountancy can usually be found in the fan base, they can still be out manoeuvred by sophisticated financial operators. At Swansea the Supporters’ Trust played a key role in rescuing the club from near oblivion and took a 21 per cent stake. When a majority stake was bought in the Trust by two American investors, the Trust claimed that it had been bypassed and other investors made millions of pounds in the process.

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