Arsenal AGM – Wenger Says Trophies This Season

Around 650 Arsenal Holdings shareholders gathered this morning (Thurs 22 October 2009) for the company’s annual general meeting.
The two main stories to emerge were manager Arsčne Wenger’s statement that he felt the team could win trophies this season and biggest shareholder “Silent” Stan Kroenke maintaining his silence on his intentions for the club.
Chairman Peter Hill-Wood, who maintained a tenuous grip on proceedings at times, opened with apologies for absence from long-serving director Ken Friar who is in hospital recovering from hip replacement surgery. He also welcomed new chief executive Ivan Gazidis to his first AGM.
The meeting then moved on to the annual accounts. Nigel Phillips on behalf of the Arsenal Supporters’ Trust (AST) asked what plans the club had to inject new equity into the club. Ten years ago Granada/ITV plc had bought £80 million of new shares. £100 million in long term sponsorship had been heavily “front-loaded” to help pay for the construction of the new ground.  Phillips felt this money had essentially been used as equity and should be replaced with a rights issue. Hill-Wood replied that only the sponsorship from Nike had been heavily “front-loaded”. The board had carefully studied the question of a rights issue but didn’t feel that it was needed.
A shareholder then asked about the lack of investment in players over the past three years. He referred to the lack of trophies over four years. Other clubs such as Aston Villa, Manchester City and Spurs were catching up. Hill-Wood responded by saying that the club had bought where it had identified players to improve the squad. The club budgeted on the basis of missing out on qualification for the Champions League in one out of every four seasons. The club had invested heavily in keeping players at the club with improved contracts. Hill-Wood got a laugh when he said he didn’t consider the likes of Aston Villa and Spurs as “rivals”.
Phil Wall from the AST asked what plans the club had to improve its income from commercial sponsorship as it was falling behind deals negotiated by other clubs. Hill-Wood replied that Ivan Gazidis was examining the club’s sponsorship and commercial contracts and he expected an increase from this source. Contracts could not simply be broken however.
A shareholder then asked why the details of shareholdings by board members weren’t included in the annual report as previously. Ivan Gazidis explained that the Companies Act 2006 no longer required this but there was no attempt to hide information from shareholders.
Stephen Cooper from AST then asked why the club had a policy of a net zero spend on transfers over five years when revenue was increasing. Hill-Wood replied that over the last five years the club had spent £150 million and had received £90 million from player sales.
The accounts were received and approved. Deloitte were re-appointed as auditors.
Ken Friar, Lord Harris of Peckham, Sir Chips Keswick and Ivan Gazidis were all re-appointed to the board for three year terms unopposed. A new memorandum and articles of association (company constitution and rules) incorporating various legal changes were approved without opposition.
The AGM then received a powerful address from chief executive Ivan Gazidis. Arsenal represented the joy of the game and 123 years of history. Since joining the club on 1 January he had been involved in the Andrey Arshavin transfer right up against the deadline in the snow. Eight players had been re-signed to new long-term contracts and further announcements on players re-signing were expected.
He had engaged with the Arsenal fan base, which he felt was critical. This had resulted in season ticket prices being frozen for the current season. The process of turning the new stadium “a home” had started with much more to come.
The Premier League had the chance to become THE world sports league. Arsenal must place itself at the centre of these developments.
The management team had been working very hard on Highbury Square. The bank debt on this project had been reduced from £133 million to £47 million. He was no confident that the project would produce a profit for investment in the football club.
Now that four new senior executive positions had been filled after a world-wide search he was leading a major review of the club’s strategy. This review would involve the fans both here and abroad. The club needed to ensure that it had a clear strategic direction in the new digital age. It must however never lose its core fundamental values. The club was not about financial results, or property nor the stadium but was a shared Arsenal community. Success that was built was far more rewarding than success that was bought.
General questions from shareholders were then taken. Martin Patrick asked why there were no reductions for supporters over the age of 65 years. Hill-Wood said this wasn’t commercially acceptable. Gazidis added that there were additional problems with this in the Club seats as many of the tickets belonged to corporate concerns. He also pointed out that the family enclosure had doubled in size from 2,500 at Highbury to up to 5,000 at Ashburton Grove.
Terrence Sparks asked why the “Arsenalisation” of the ground had been restricted to the lower tier when the most expensive football tickets “in the world” were located in the upper tier. Gazidis replied that attention was being given to the upper tier. This was an ongoing project.
Wendy Barry congratulated the club on its charitable work. Hill-Wood said that the people who should receive the thanks were the staff in the community department. He also said the manager and players were making an increasing contribution to the club’s charitable work.
Andrew Johnson asked about Arsenal TV and the club’s strategy for its expansion to “underserved” areas like North America. Gazidis replied that this would form part of the club’s strategy review. The club would need to get agreement from the Premier League which held the rights collectively for all League games to, for instance, show matches live on Arsenal TV which weren’t being picked up by the broadcasters in that territory.
A question about the pitch being watered before the game and at half time came from a Mr Bloomfield. Hill-Wood responded that the club had an outstanding ground staff and that pitch preparation was under the direction of the manager.
Tim Payton of AST asked about the time-scale for the review and whether the club would remain committed to the concepts of custodianship and plurality of ownership. Gazidis replied that he didn’t want to pre-judge the timescale of the review but that supporter input, including from AST would be a crucial part of it.
Ron Neal then asked two rather odd questions on behalf of his 7yr and 12 year old sons. Which season ticket holder travelled the furthest to attend games and did the Gunnersaurus do visits? Hill-Wood replied that the club had season ticket holders all over the world, including as far away as Australia and New Zealand. Answering the second question Hill-Wood revealed the bizarre factoid that the Gunnersaurus had visited Chernobyl in Ukraine, the site of the nuclear power station disaster in 1986 (when Ukraine was part of the USSR). That must have been a surreal experience for all concerned!
A shareholder asked what Stan Kroenke’s future intentions were. This was the 40 stone gorilla in the room in terms of ownership. Silent Stan stayed true to his nickname by remaining silent. Hill-Wood said Kroenke was a long-term investor in the club but that he couldn’t say much more for legal reasons. The City Takeover Panel was watching closely but the board did not envisage any change in the current arrangements which worked well.
A shareholder asked if the club shouldn’t buy back the naming rights to the stadium from Emirates as part of the “Arsenalisation” process. Hill-Wood said there were no plans to do this and that most people had got used to Arsenal playing at the Emirates Stadium.
A questioner then asked about the current second strip. We had used yellow as our second colours for forty years now. The current blue was “dowdy”. Gazidis replied that the club had to work out what was “non-negotiable” on such issues and work from there. Manchester United was planning to issue a new home strip every season.
Before Arsčne Wenger was invited to speak a short video covering his time at the club was played, after which he received a standing ovation and was presented with a book of congratulations signed by all present at the AGM to mark his 60th birthday. Wenger was now the longest-serving Arsenal manager having exceeded George Allison’s time in office.
Wenger addressed the meeting in his usual lucid, articulate style. His thirteen years at the club was unusual in the game but Arsenal was special. That’s why he had been loyal. The last season had tested the strength of the team after a “sloppy” start. Not everything was right. The players lacked some belief. In the end though, he felt it had not been such a bad season, reaching the last four in Europe and in the FA Cup. The most disappointing aspect had been effectively surrendering the League so early, and having to fight for a Champions League place rather than the title.
Arsenal was one of only three clubs to have played twelve consecutive seasons in the Champions League along with Manchester United and Real Madrid. This shouldn’t be taken for granted.
The Premier League was the most attractive League in the world and was attracting international investors from all over the globe. Two competing models were emerging. One where investors poured unlimited funds into clubs without worrying about returns, another where UEFA wanted to limit clubs to spending what they earned. He felt the latter “will happen” and that this would place Arsenal in a very strong position.
He had noticed when he joined the club in 1996 that when at away games the hosts talked about “the Arsenal way”. “I’m convinced that this year this team will do it” he said, referring to bringing silverware to the club. It was much easier to develop a team when you had the players at age 16-17 or even younger.
In answer to a question about whether he would prefer to win the Premier League or the Champions League, “Both!” he said.
He ruled out pre-season tours outside Europe. Every other year there is a European Championship or a World Cup, he said, and it was critical that the team was prepared for the Champions League play-off round if the club needed to play in that. He also felt it was wrong to tour without the club’s international players which it would in years when there were big international tournaments. This appears to rule out tours to Asia or North America in the near future. Clubs that undertook such tours spent time travelling and not training he said. He preferred the solution of the Emirates Cup at home.
He then fielded two questions, one on our continued tendency to let in too many goals and on whether he felt our current corps of goalkeepers was good enough to win trophies. He agreed that we had let in too many goals last season. We had changed the formation this season. He expected to end the season conceding fewer goals than last term. Our offensive style would mean we would concede goals from time to time however. On the goalkeeping situation he said this was the most complex position on the pitch and had a lot of “negative stress”. People tended to talk about goalkeeping errors far more than any other position.
Finally, a shareholder rose to congratulate both Alex Song and Emmanuel Eboué on the way they had overcome criticism from certain sections of fans.
Hill-Wood then called a halt to proceedings. With so much going on behind the scenes with the club’s ownership the meeting was a little unsatisfying in some ways, although both Gazidis and Wenger spoke articulately and passionately. Let’s hope Wenger is amongst those to re-sign soon!
Keep the faith!

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