Tag Archives: alisher usmanov

Are Everton getting too excited over Usmanov links?

4 Replies

Fans of Everton are getting excited. Some fans of Arsenal are getting angry. The reason? Alisher Usmanov.

Evertonians have already spent his billions, turning the Scousers into champions; Gooners are sitting there saying “that could have been us”.

The truth is this is all very presumptuous. Usmanov has not invested in Everton, has not started spending billions, so it is a lot of fuss about nothing.

What Usmanov has said is interesting, however.

“Should there be a proposal or a possibility to invest in them with good potential returns, I would consider the deal.”

Usmanov has made a lot of his billions making smart investments. What he is talking about with Everton is investing in them. Most interesting is his “good potential returns” comment. This indicates that he would be investing in Everton to make money, like he did with Arsenal.

He invested around £180,000,000 into Arsenal, with a £550,000,000 return. Not a bad profit after 11 years. It should also be noted that bar buying shares, he did not put any other money into the club.

Some recent quotes around his sale of his Arsenal shares make interesting reading.

“When I bought the stake in Arsenal I believed that football brands would be able to generate a profit”.

So in two quotes in a short space of time, we have learnt the true intentions of Usmanov owning football clubs.

He is looking to invest in them to make money. Not to treat them as a play thing like the Manchester City’s owners and Roman Abramovich.

It should also be remembered that having $13bn “worth” is very different to having a lot of disposable cash.

Both City and Abramovich have plunged £1bn into their respective clubs, financing transfers, salaries and ground improvements. In City’s case, that is over a 10 year period. Abramovich has now been at Chelsea for 15 years.

Anyone that thinks that Usmanov will turn up at Everton and throw millions at them to turn them into a force is deluded.

For a start, football is a different world to when Abramovich turned up.

Roman could spend £100million a year on new players, and that was double what Manchester United or Arsenal was spending.

This summer Fulham, Leicester and West Ham all spent £100million on transfers. Everton themselves spent £89million.

It would probably take a good £200million a year investment over 3 or 4 years for Everton to become a top 4 regular, let alone competitors, taking into account transfer fees and the wages – Everton currently pay about £100m in salaries less than Manchester United, Manchester City, Chelsea, Arsenal and Liverpool.

Usmanov is a very rich man, but his wealth is tied up in investments, in other companies. Does he have £1bn to throw at them, with no guarantee of return? And that is before we even discuss the £500m needed for their new stadium.

I imagine what Usmanov thinks when he sees Everton is a massively undervalued club. A huge chance to make some money, grow his wealth even quicker then he did at Arsenal.

With Everton valued at £200million they are clearly undervalued. When you consider that Tottenham – a similar sized club in terms of historic and recent success – were valued in 2016 at £450million.

Everton need a new stadium, I can see a scenario where Usmanov is thinking the follow:

Spend £100million on the remaining Everton shares – becoming co-owner with friend Farhad Moshiri taking their joint investment to £180million.

Spend £500million on the new ground, whilst selling Goodison Park to Usmanov’s own development company for a nominal fee (the ground it sits on is worth about £6million). Usmanov then develops Goodison into flats for profit.

New buld flats in that area are going for about £300,000, that should yeald about a £150,000 profit per flat. That’ll generate about £80million profit for Usmanov.

So in total, Usmanov would have invested £680million in Everton – with a return already of £80,000,000.

In the time it will take to build the stadium, and with very little debt repayments, over a 10-year period, the club could well be worth nearer £1bn. All with little investment on the playing side.

£1bn would not be unreachable with a 55,000 seater stadium, a top 7 side and new TV deals. It is similar to what Tottenham are worth once the new ground is taken into account.

This is all back of a fag packet stuff, but with Usmanov saying he is looking for good returns, he is clearly talking about money, not trophies.

So Evertonians, cancel that bus period, Arsenal fans, stop talking rubbish about what we could have had.

Usmanov is not going to turn Everton into Manchester City or PSG.

Keenos

Wenger GONE… Gazidis GONE… Usmanov GONE…

6 Replies

The fall out from today’s news about Stan Kroenke being set to take full control of Arsenal was as expected. It was overwhelmingly negative.

I have always thought life is too short to be negative about everything, especially about football which for me is a release from the Monday – Friday of work.

When the news first hit, my thoughts were simple.

“I can not wait until Sunday to have a beer with my mates and watch some football”.

You see, football is not just about the 90 minutes. It is about meeting up with friends, old and new, having a few beers and releasing the tension from the working week.

The reality is as Arsenal fans we can do nothing about Kroenke taking full control. Just like we can not do anything about South West Trains having delays every single day, or the Central Line being boiling hot.

Protests, petitions and moaning on Twitter will do nothing.

And what are we protesting? What are we petitioning? What are we moaning about? We do not know Kroenke’s intentions will be as sole owner of Arsenal Football Club. Fans are getting their knickers in the twist based in rumours, based on speculation. Based on the unqualified Arsenal Supporters Trust releasing fake news.

If the deal goes through this week, will it actually affect me, as a match day going fan? No it will not. I will still go Sunday. Meet my mates. Have a few beers before, during and after the game.

In fact, The George shutting will have more of an affect on my life than Kroenke being sole owner of Arsenal.

How about we look at the positives of the situation of Arsenal?

We have long complained about Arsene Wenger’s influence on the club. His 22-year spell at the club went on too long. His autocratic style of leadership centralised power in his office. Wenger is gone. Unai Emery is in charge.

Power has also been further spread around with the appointments of Raul Sanllehi and Sven Mislintat. No longer do we have one single man in charge of the entire football side of the club. Overseeing everything from set up to scouting, transfers to training.

We have seen the effect of the new men this summer. We have spent nearly £70million on some very good signings and moved decisively in the market.

Ivan Gazidis was also holding the club back.

Ignore the fact that he let Wenger remain in charge too long – although he was key in removing the Frenchman and if it was up to him, Wenger would have gone a year earlier.

Gazidis oversees the business side of the club. It is up to him to oversee the commercial team who bring revenue in.

For too long, this commercial team has under performed.

I ma not expecting Arsenal to be up with Manchester United. Their £268million in commercial revenue (and growing) is incredible. Alongside Real Madrid and Barcelona they are a level ahead of every other club in world football when it comes to reach, fan base and brand recognition. And that feeds down to the commercial revenue.

But to be £151million behind them is poor. To have the 5th highest in the Premier League is poor – although Manchester City’s high commercial revenue comes from within.

I do not see why Arsenal, with a motivated and successful commercial revenue team could not be close to £200million a season.

Manchester City have just signed a £50million deal with Puma; Chelsea’s deal with Nike is £60million a year.

Arsenal’s £30million deal with Puma runs out at the end of this season. Taking into account our shirt sales and brand – which are both superior to Chelsea and Manchester City – we should be looking at a minimum £60million a year from Adidas or whoever we do the deal with.

Kit manufacturers do not really care who is “successful”, they care how many units they sell. It is why Liverpool still command high sponsorship revenue despite it being 28 years since they last won the league.

We have recently signed a very good £10million a year deal with Visit Rwanda.

Under Gazidis the commercial revenue team has under performed, leaving us nearly £100million a year short of where we should be.

£100million a year is a lot of money. In very simple terms, it would enable us to buy an additional £80million player on £350,000 a week, every season.

How much better position would we be in if in the last 4 summers, we were able to have purchased 4 £80million players?

The commercial revenue team have held us back for years, and Gazidis is ultimately to blame.

If Josh Kroenke does come in as CEO, as expected, he brings a world of knowledge as president of the Denver Nuggets, Colorado Rapids and Colorado Avalanche with him. American sport is the bench mark as to what commercial revenue you can bring in.

Gazidis leaving should be seen as a positive.

Then we have the final change, the biggest. Stan Kroenke buying out Alisher Usmanov.

For too long, Arsenal have been stale, not really moving anywhere, and I am certain the civil war between the two largest share holders was the reason for this.

One had to go for Arsenal to move forward under the vision of a single owner with no restrictions. Whether you think Kroenke or Usmanov was the “better choice” does not really matter. What is important is the Arsenal Civil War 2007-2018 is over. And hopefully Arsenal can move on and rebuild as one unit.

Rather than be negative, and return to protests and divisions on the terraces, lets look at the positives.

Wenger is gone
Gazidis is going
The Arsenal Civil War is over

Keenos

 

Should Arsenal fans fear Stan Kroenke owning 100% of Arsenal?

2 Replies

With the rumours floating around that Alisher Usmanov is looking to sell his shares in Arsenal, the spotlight for a few days has fallen on majority share holder Stan Kroenke.

I am going to be controversial here. Whilst I do not “support” Stan Kroenke, no more than I would support the majority share holder of Tesco, Sainsbury’s or Waitrose, I actually do not think he is that bad an owner.

A lot of people point to him as being greedy. Only in Arsenal for the money. This is probably true, but the money he is in Arsenal for is the rising share price.

He has often been criticised for “taking money out of the club”, but do we actually know how much money he has taken out? Well we do.

According to club accounts, he has taken out £6million. Two payments of £3million. That is over an 11 year period, for “services rendered” apparently associated his own STATs DNA company (or whatever they are called).

£6million is not that much in the grand scheme of things.

Compare this to the Glazier family at Manchester United.

It was reported in May 2017 that they were going to pay themselves a £18.7million dividend. This was following a £15million dividend the year before.

That makes a total of £33m that the family members will have shared in the two years since the dividend was first announced in September 2015.

You add this dividend to the £790million they leveraged against the club when they bought it in 2005 – literally using Manchester United’s own funds to buy the club, and you see what a true greedy owner is.

Kroenke used his own money to buy Arsenal’s shares and has taken out £6million. The Glazier’s are using money generated by Manchester United’s to pay off loans when buying the club, and have taken out £33million in two years.

A 2015 report by Manchester United Supports Club estimates that Glazier’s have profiteered  by “more than £1 BILLION and it’s still rising” since buying Manchester United.

A bit like Ivan Gazidis, the recent actions by the club with the appointment of Unai Emery, Raul Sanllehi & Sven Mislintat are to be highly praised. How much Kroenke had to do with it is unknown. Chances are Josh Kroenke was more involved than his father.

But this is also something that Kroenke should be praised for. His “silent Stan” moniker is a criticism, but can also be praised.

Kroenke is a hands off owner. Some might see this as bad, but it is actually good in my eyes.

He is not a football man. He has no idea about football. He is an investor, no different to investors in Tesco, Sainsbury’s or Lidl. They do not know how to work in a supermarket, how to run it. There job is to put the correct people in place to run it. And Kroenke has finally done that with Gazidis, Sanllehi & Mislintat.

The last thing we want is to have an interfering owner who does not know about football, meddling. Going into the dressing room, attempting to influence the manager, picking the team, signing players based on who he wants, rather than what the manager wants.

We have seen plenty of owners who interfere, the likes of Mohamed al Fayed at Fulham. They want to become the footballer, they want to become the star. They own the club to push themselves in the limelight. Kroenke does not want that. He wants to sit quietly and let the football people run the football club.

But this is also where he is heavily criticised.

By sitting back, seemingly not doing much, he is also not putting his own hand in his pocket. He does not spend his own money on players.

A lot of fans look at Roman Abramovich at Chelsea, Mansour bin Zayed Al Nahyan at Manchester City, the blokes at PSG, and that is what they want in an owner. Someone who wants to spend £200m a year of their own money on the club. They want Arsenal to become a rich mans play thing.

As we have seen with Chelsea over the last decade, being a rich mans play thing might be exciting in the short term, but what happens when the owner starts to become disinterested, like Abramovich is now.

Chelsea Football Club owe its owner nearly £1bn.

Arsenal have always run with a self-sustaining business model. It is the way the best companies, and best football clubs, run.

Bayern Munich, Juventus, Manchester United, Barcelona, Real Madrid. All self-sustaining models who spend what they bring in (even if there are a few tax irregularities). The likes of Manchester City, PSG and Chelsea might be successful in the short term, but you can not buy a long term seat to the top table.

By spending within yourself, ensure the books balance, you ensure a natural future for the club. Not a boom and bust model.

When it comes to transfers, as far as I am aware, Kroenke has never stepped in and refused club funds to buy a player.

Other criticisms of Kroenke are also unfounded.

Those that claim he is using the value of Arsenal to raise loans to fund his stadium in LA, and to buy a ranch in Texas are commenting without proof. He bought the ranch with cash, and the $1.8bn stadium in Inglewood is privately financed.

And it also highlights that people do not know how things work.

Kroenke can not take loans out against Arsenal Football Club. He is not the sole, private owner, he is just a share holder. What he could do is take out loans against the value of the shares he owns, but this will have zero effect on the club.

Were he to default the loans, the bank would own the shares and sell on. He is not using club funds to secure loans but his own assets.

Now if he was in the position of Abramovich, owned 100% of the club and turned it private, he could use Arsenal funds to secure loans elsewhere, or take even more money out of the club.

There is a fear that if Usmanov sells, Kroenke might be the buyer.

If the American purchases Usmanov’s 30%, he would then be able to force through the purchase of all remaining shares. He could then follow the Glazier’s model and throw a load of debt into the club which he can profit from.

I do question how much debt he would be able to throw in.

Arsenal still owe the banks £200m-ish for the stadium build. Would too many creditors offer additional loans on top of what the club already owes?

It would be a bit like having a £200k mortgage left to pay on a £400k house. You go the banks to get a second mortgage, but they are only going to give you another (perhaps) £150k as you do not have the assets to cover much more.

Would a bank give Kroenke a £500m loan to buy Usmanov’s shares, knowing that the club is being used to finance the loan, and therefore putting Arsenal £700million into debt with the club? Probably not. So I think the fear of Kroenke using the club to leverage more debt is scare mongering.

Kroenke is certainly not the perfect owner, but he is certainly not the worst.

Could Kroenke have done things earlier with Arsene Wenger? Yes. Does he have his faults? Yes. Could he engage fans better? Yes. But is Stan Kroenke as bad as some people make out? No.

Keenos