Dear Mr Usmanov,
On the eve of a meeting scheduled between The Arsenal Supporter’s Trust (of which I am a life member) and the CEO of Arsenal Football Club Ivan Gazidis, you have chosen to give an interview to a member of the tabloid press. I believe that you may have been poorly advised in choosing a tabloid newspaper to make your views known, and that it is a mistake to distance yourself from any active position upon the Board. I also think that parts of this interview will be misinterpreted and undermine your genuine intentions towards the supporters of Arsenal Football Club. I shall expand upon this later. However the reason for this letter is to humbly suggest ways forward that may allow serious discussions to take place between your representatives and the Club, based upon my ideas which I accept may or may not be feasible, but if you were prepared at least to respond to them then it would in my view clarify your position as a major shareholder of Arsenal football club.
Let us both be frank, and accept that your long term intentions towards the club have not been clearly expressed in a manner that would prevent others making mischief. This is a pity as it has allowed those who appear hostile towards you based upon what you have always asserted as being inaccurate allegations of your past, to consolidate those anxieties within the Arsenal faithful. I have to confess that I too shared these anxieties, however further detailed scrutiny of the archives clearly backs your position. With the assistance of another source, I am now convinced that it is clear that these inaccurate allegations have been based upon poor translations, the existence of two other individuals called Alisher Usmanov and the fact that no-one has published a detailed rebuttal based your presentation of the original charge sheet to Iain Cobain of the Guardian in 2007.
In June of last year I expressed the following views on this blog about the possible takeover options for the club
“For what it is worth, I am against any Usmanov or Kroenke buy out for that matter. A plague on both their houses. Neither shareholder has the club’s interests at heart, as the purchase of the club would be merely a vehicle to make more money. A business opportunity nothing less. “
Now Mr Stanley Kroenke has control of Arsenal football club, and in the light of recent share dealings at the club, I welcome your decision not to sell your holdings. I feel that now is not the time to allow further misunderstandings of your intentions to flourish, and I would like to politely suggest a possible way that you can move the debate further forward. This would enable those of us with open minds to have an explicit and positive gesture from Red and White Holdings which would benefit the club that we all profess to love.
In May of this year, I issued a call to you to become more directly involved in Arsenal Football club in the light of Mr Kroenke’s acquisitions. It may be helpful for the benefit of others who have forgotten your past efforts to remind ourselves that in 2009 you made a Rights Issue proposal which received a mixed reception. This would have had two possible consequences.
- To deliver much needed capital to the club and enable more funds to be released for investment in the playing squad.
- The possible expansion of Red and White’s percentage holding within Arsenal by the purchasing of rights not taken up by existing shareholders.
In July of 2009 Ivan Gazidis on behalf of the Arsenal Board finally rejected the proposal from your company Red and White Securities ltd for a share rights issue. In response to your proposal, the CEO of Arsenal Ivan Gazidis said the following
“With regard to debt, the conclusion reached is that the Club has a very efficient capital structure with long-term debt on attractive interest rates. We can comfortably afford to meet the annual costs of this debt while at the same time generating surplus funds to invest in the Club. Using permanent capital to pay down debt would not, therefore, radically transform the annual cash flow of the Club.”
The Arsenal Supporter’s Trust in the same month responded thus:
“In the absence of more details the AST cannot comment specifically, but our view is that a rights issue could be beneficial in reducing the club’s debt and perhaps also freeing up some funds for Arsene Wenger to use to build a winning squad. We would welcome further discussion on this concept and the appropriate structure a rights issue would need to take as most companies would prefer to increase equity rather than hold debt. That said, we are committed to plurality of ownership at Arsenal, and would not support a rights issue that could lead to a sole majority owner of Arsenal ‘by the back door’, nor the raising of funds that are spent on unsustainable transfer fees and wages as at Real Madrid.”
Today we read comments attributed to you from a source that most genuine Arsenal fans will feel has let down our hopes for unity at the club. The tabloid press have no morals, In my opinion they exploit and abuse the rights of others by pedalling controversial items ensuring increased profits from the sales of their copy. Your comments are reported as follows:
“If the role of a board member is to oversee a trophyless period, while making significant personal profits and asking fans to pay inflation-busting ticket price increases then, no, I would not want to be on the board.
“If instead it is to try to deliver sustained success, to increase your personal investment in the club, to help develop the commercial position and to ensure the fans have a say in the running of the club then, yes, I think I certainly have something to contribute.
“In terms of doing things differently, let me give you a very clear example. Arsenal has all of its major commercial contracts coming up for renewal in the next couple of years.
“It’s no secret that to maximise the value of those you want to have success on the field and be winning trophies. To do that you need to invest now in building a winning team. This is simple commercial logic. Whether it comes to pass, we shall see.”
“There is a widely-held view among most commentators – and one that I agree with – that the club needs to stiffen the defensive spine of the team, with a dominant keeper, strong centre-halves and a powerful defensive midfielder in the mould of Claude Makelele,”
“The Premier League is one of the most competitive in the world and whilst we have consistently challenged for honours, the club needs to develop talent and buy top-class players to win the trophies we all crave. This requires greater investment which, I believe, has been lacking thus far.
“What however is not clear is whether the board shares this view. For too long they have seemed happy to sanction second, third and fourth as being acceptable, whilst at the same time they are planning to sell their shares.”
Had this interview been given to the AST or the official website of the club, I believe that it would have had a greater impact. The problem as I see it, is that some may use parts of the statement for their own aims and suggest that the club is in crisis. They will also exaggerate the extent of divisions within the fan base. The concern that I have is that the very real positives within your interview will be lost by the tabloid headlines which will present this as an attack on the Board of Arsenal Football Club, thus confusing the issues still further.
So how can we achieve clarity? You have correctly identified the future opportunities for the club to increase it’s commercial income. In addition you have repeated the desires of all genuine Arsenal supporters to have success upon the field by the additional infusion of proven successful players to the squad. I along with others have been calling for many seasons for Arsenal to attract high profile players to the club, but let us be honest the current wage demands of players must be seen as a barrier to those aspirations. However to ignore the advances of our rivals who have the funds to meet those demands will eventually lead to an erosion of confidence in the club. Equally the continuing lack of success in achieving major honours such as the Champions League title will mean that the club will become more and more unattractive to those players that may help us deliver those objectives. We must also be mindful that any future major transfers made will have to be done within the club’s position of self sustainability.
So how can we rise to the challenge of decreasing the indebtedness of the club? In so doing one would divert capital away from paying expensive loan interest and instead free up this money towards major player investment ofthe squad. I believe that in order not to fall foul of the UEFA Fair play regulations due to come into force in 2012 which require football clubs to balance their books, an innovative way must be found to increase Arsenal Football club’s income to an extent that would enable the necessary player targets to be obtained without breaking the principles of the club living within its means. Any transfers made this season will impact upon our continuing and correct desire to run a club with balanced books. By virtue of your great wealth, I would like to ask you to demonstrate your love as an Arsenal fan and do what all Arsenal supporters the world over have done and continue to do, and that is to donate some money to the club.
Here are my suggestions
- The removal of the outstanding stadium loans would release over £20 million of additional income which could be made available each season to Arsene Wenger to strengthen the squad. This would mean that if you were prepared to purchase that debt standing now at well under £300 million, you would set a precedent that major shareholders should invest in Arsenal by putting their own money directly into the club.
- To state clearly that any plans or decision to introduce share dividends should only take place once the club is truly debt free, and by implication successful upon the field of play. In leading by example, you would finally win the hearts and minds of many Arsenal supporters would then support your involvement in the club’s affairs.
I want Arsenal Football Club to regain it’s rightful position at the head of the game. By setting examples in how to play and win football matches, and delivering further honours to the trophy cabinet. I want this to be achieved in an environment of shared custodianship of the club, with a common vision of self sustainability by not increasing the indebtedness of the organisation. I want the directors of the club to do what all Arsenal fans do, and that is support the club by putting their hands into their own pockets and increasing the income of the club. Your assistance and ideas of how to do this is pivotal. I ask you to demonstrate the leadership that you have alluded to in your recent interview by realising these aspirations. Mr Usmanov, if you truly love Arsenal Football Club, then the amounts involved for you are relatively small in cash terms, but you will have the opportunity to write yourself into the annals of the club’s history by breaking the current impasse that we now find ourselves in. I hope that I may receive a favourable response to this letter.
Yours sincerely
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