The State of our Club and its future prospects part II

In the second part of my look at the club, I assess the performance of the Board and give them a rating. Being a Board member at the Arsenal is a labour of love. Mainly due to the fact that it must remain true to the business principles of prudent expenditure and cost control whilst presenting an upper class flavour which would not seem out of place with the fabled Marble Halls at Highbury. In an era when money seems to be no object to several football clubs, Arsenal fans continue to wonder, how a club such as ours can boast a Diamond Club with exclusive invitation only membership who cuisine is provided by one of the most famous chefs in France, whilst at the same time telling fans that they must live within their means when it comes to player transfers.
It may be these contradictions in terms that leave many people speechless. How can we be paying the second highest season tickets in the Premiership, yet noone is allowed to bring in a flag to celebrate their team. Add to that the way in which the new crest and the choice of the team anthem were made, it is clear that there remains an elitist air to this North London club which some fans may find objectionable if they fall foul of the double standards. Harsh criticism I’ll admit, but when ringing a club which is reputedly the richest in England, I expect more than a wobbly message on an answer phone with the rest of the Box Office team chattering in the background.
This article is not going to slate the club for these minor imperfections, but the marketing department needs to be aware that if the first point of contact with the club leaves one feeling that all that glitters is not gold, then they really ought to do some customer satisfaction surveys, as not everyone has Danny Fiszman’s mobile number. But after all is said and done, I would rather have this Board than some of the kamikaze Boards that have graced the Premiership. Take Leeds United or the wage bills of West Ham United as an example. The fact that Harry Rednapp has left Portsmouth before it becomes one of the first clubs to go into administration is testimony to the excellent stewardship that this Board has provided us over what can only be described as turbulent times.
It was for the second AGM in a row that our Chairman Mr Peter Hill-Wood had to explain why the Board had lost one of it’s members in unusual circumstances. Now to lose one director (Dein) may be called unlucky, but to lose two (Edelman) is careless, or so the political phrase goes. This year I understand that there is a mutual vow of silence, so noone will really know what happened behind the scenes. This is in essence the contradiction that is our Arsenal Board. We say one thing one day, and do the total opposite the next. Take the Adebayor transfer stance in the summer. Rumoured to have turned down £30 million , when a possible replacement for him came around, we couldn’t give him away to AC Milan at half the price according to a letter waved around by AC Milan’s spokeman on an Italian news show.
At least we do not now  chant songs about the Board or ask for resignations as some did three decades ago. The Club has been in the grasp of two family for a combined 150 years. 80 years with the Bracewell-Smiths and 70 with the Hill-Woods. If one takes a look at the composition of the Board and the relevant family trees, one begins to wonder why the plans for succession to the Board are shrouded with Intrigue. The latest additions have been either family friends, old school boy or business acquaintances or like the amiable Ken Friar, just having been part of the furniture for so long, he was the natural choice. Having someone like Ken Friar, who has given his entire life to this club is amazing, and if there was a set of memoirs that I would love to read, it would be his.
The Board is comprised of:
Chairman Sir Peter Hill-Wood, 72yrs
Peter Hill-Wood was born in Kensington , South London . His father, three uncles and grandfather all played first-class cricket for Derbyshire. An old Etonian, he was a classmate of former Arsenal Director Sir Roger Gibbs . After a spell in the Coldstream Guards, Peter Hill-Wood entered the banking sector eventually becoming the vice-chairman of Hambros Bank.
Sir Peter Hill-Wood has since retired from his post at Hambros, he holds directorships at Cavenham Ltd and The Hellenic and General Trust. He took over the Chairmanship of the Club in 1982.
The Hill-Woods first joined Arsenal in 1929 through Major Sir Samuel Hill-Wood first Baronet. Spanning 3 generations and 80 years with the club.
He recently acquired 152 free shares from Ken Friar, and owns around 500 shares in the club representing 0.80% (worth approximately £3.4m).
Acting Managing Director Kenneth Friar ?67yrs,
KEN FRIAR OBE was a former managing director. He owns 47 shares 0.07 per cent. He lives in Winchmore Hill , North London. He is currently the club’s acting managing director. He was born and bred in Islington and in 2004 along with Arsene Wenger he received the Freedom of Islington. This local lad went to school in Highbury ( St John’s School and Highbury County Grammar School). And he began working at Arsenal part-time as a 12 year old and has since been with the club for over 50 years.
He held posts such as company secretary, and was invilved in discussion about a ground share with Tottenham Hotspur at the Alexandra Palace site in the early seventies. He became managing director for the first time in 1983. he has negotiated many transfers and is held in the highest regard by all who know him. He has a wonderful sense of humour and is fiercely loyal to the club that he loves.
Danny Fiszman has Belgian jewish ancestry and he has made his fortune in diamonds. He owned the Star Diamonds Group based in London which was worth about £80m, mainly trading in rough diamonds. He was the major shareholder with 24.11 per cent until Alisher Usmanov came along. He currently lives in Geneva as a tax exile and is rumoured to be allowed 90 tax free days a year in this country. When Keith Edelman left the club, he took centre stage fuelling rumours of a previous rift between the two directors, no evidence or substance to these rumours have surfaced. He is a very forthright individual and is not afraid to speak his mind. He was against David Dein proposal of moving the Club temporarily to Wembley.  He sold 659 shares to Stan Kroenke  worth some £4m, taking his allocation below the blocking 25 per cent mark.
Danny Fiszman  was keen to see the Emirates Stadium project succeed, and once completed, it was widely thought that he would dispose of his shareholding and leave the club and become a naturalised Swiss National. Any takeover of the club would be dependent on the acquisition of Fiszman’s stake, and moving to Switzerland would substantially reduce any Capital Gains Tax liability that would come with a sale of his stake in the club. He is extremely wealthy and a qualified commercial jet pilot. On the Sunday Times Rich list he was ranked 207th in 2004, 305th in 2005, 273rd in 2006, and 351st in 2007.
He wa s recruited by Peter Hill-Wood, who was a former colleague at Hambros Bank, to strengthen the club’s City links with the financial ties with the City of London. This was going to be escpecially usefuo when it came to establishing the finance for the Emirates Stadium. He holds 20 shares in Arsenal representing 0.032% of the Company. He too is an old Etonian and he married Lady Sarah Ramsay, daughter of the 16th Earl of Dalhousie. His elder brother Henry and younger brother Simon Keswick are Chairman and Director ofthe Jardine Dynasty, Mathieson Holdings. He holds Directorships in a number of Blue Chip Companies if you’ll excuse the pun, including De Beers and Investec Bank. He also served as a director of the Bank of England following in his father’s footsteps before him.
Richard Carr is the grandson of Sir Bracewell Smith (chairman from 1948 to 1962). He owns 4.38 per cent or 2,722 shares in the club. He is responsible for the club’s youth development and academy.  He has a wife, Edda, whom he married in 1960, but has no children. He currently resides in Camden. His half-sister, Lady Sarah Phipps-Bagge, holds 2% of the shares in the club, and his  brother  Clive Carr is the football club’s Life President.
CLIVE CARR: (life vice-president):
He is the brother of Richard Carr and a former Business man in the Hotel sector. He married Isabel daughter of Vicomte Devezeaux de Rancougne in 1963. He is the grandson of former Arsenal Chairman Sir Bracewell-Smith. He has no children.
He is a Conservative life peer with an estimated wealth of £285million who joined the board in 2005 and holds 53 shares via holding companies. He is the Chairman of a Carpet company having been Chief Executive for Harris Carpets. He holds Directorships at other retail concerns including Great Universal Stores. Lord Harris is ranked 206th in the Sunday times rich list 2006. He is also a fund raiser for the Conservative Party. He was appointed to the Board in November 2005.
She is the second wife of Sir Charles Bracewell-Smith, grandson of Sir Bracewell Smith. Family fortune is estimated at £70m. She had the shares transferred to her and the they consist of 15.9 per cent. She is from Delhi, India. The Bracewell-Smith Family are a family dynasty of hoteliers,
The Bracewell-Smith dynasty has along association with the club. It began with
The Bracewell Smith dynasty began with the 1st Baronet Sir Bracewell Smith
Sir George Bracewell-Smith, 2nd Baronet MBE, was the son of Sir Bracewell Smith, the 1st Baronet. He was educated at Wrekin College and Emmanuel College Cambridge. He married Helene Marie Hydock from Philadelphia in 1951. They had two children, Guy Bracewell Smith and Charles Bracewell-Smith. He was Chairman of Park Lane Hotel Ltd and the Ritz Hotel before retiring in 1966. He died the same year and was succeeded by his eldest son, Guy.
Sir Guy Bracewell-Smith, 3rd Baronet ,  was educated at Harrow School, He died in 1983 and was succeeded by his younger brother, Charles.
Sir Charles Bracewell-Smith is the 4th Baronet  He too was educated at Harrow School. He was the founder of the Homestead Charitable Trust. He succeeded to the baronetcy after the death of his brother Guy Bracewell Smith in 1983 at the age of 30.
In 1977 He married Carol Hough, who died in 1994 of Cancer. He subsequently re-married, in 1996, to Lady Nina nee Kakkar of Delhi. Sir Charles is the cousin of  Richard Carr and Clive Carr. He has no children so there will be no heir to the baronetcy.
Lady Nina is seen as the weakest link in terms of when the lockdown agreement ends. The theory goes something like this. The family fortune is declining, following the sale of Park Lane Hotel to the Sheraton Group. The fortune has decline from £108 million in 205 to £80 million in 2007. The absence of dividends from this major shareholding means that if equity is to be realised from this holding, it must be by the sale of a significant proportion. It remains to be seen if the Bracewell – Smith will dispose of the last major link with the club that has been in the family life blood for so long, but with the end of the Baronetcy, who knows…
An American Sports Entrepreneur and  billionaire owner of several U.S. Sporting franchises teams including Colorado Rapids (MLS soccer), Denver Nuggets (NBL), Colorado Avalanche (NHL), St Louis Rams (NFL) and a TV channel. He bought shares from Danny Fiszman before acquiring the ITV stake and broadband business. He owns just over 12 percent of the club. His invitation to the Board was thought to be the final nail in the coffin of Alisher Usmanov’s aspiration to own Arsenal Football club, whilst hopefully bringing along his expertise in Sporting management and the media, to establish new income revenue streams in the global markets, especially that of the far east. He was appointed to the Board in October 2008
Other Shareholders:
Landsdowne partners hedge fund =  3% , Small shareholders = 26.45%
The battle for the Club – The Timelines
It was in  April 2007 that a battle over the ownership of Arsenal football club seemed after the exit of David Dein. Mr Dein was a close friend of Arsene Wenger, the manager that he was responsible for recruiting. The suddenness of his departure from the board of the club after 25 years left many bewildered. It is said that Dein’s corporate mobile phone was switched off within seconds of the club’s announcement.
Peter Hill-Wood said that the departure was the result of “irreconcilable differences” between himself and the board. Within months two Billionaires were owners of large amounts of Arsenal Shares. Stanley Kroenke was the first, followed by Alisher Usmanov, a Russian Mining mogul in partnership with an Iranian Art dealer Farhad Moshiri.
David Dein sold his shares to Usmanov and became the CEO of Red and White Holdings and the relationship between Usmanov and the Board became very soured. Despite trying to commence a dialogue with the club, it soon became clear that there was no way in for Usmanov. The Board closed ranks and became even more bullish with the spectacular figures announced that saw Arsenal leap frog over many clubs to hold the third spot in the world league of rich football clubs.
The tug of war has continued ever since with sabre rattling by Usmanov as he makes his way towards the 25% blocking percentage, and the fortress mentality of the Board as the Lockdown agreement was extended. The stand off benefited only Stanley Kroenke, who went from being one of those kind not needed around the Arsenal by Peter Hill-Wood, to now a possible heir to the throne.
The sudden departure of Keith Edelman who master minded the Emirates project had been another twist in the tale. Everyone braced themselves for the next move from Usmanov, but nothing came. Opposition from fans  and the Board united. The small share holders were now the key to the battle. If they refused to sell, then Usmanov could never reach the 29.9% needed to trigger a mandatory takeover bid.
Board ratings:
Arsenal fans can sleep peacefully in their beds at night knowing that this Board has managed to keep this club independent and safe from the predatory hands of Alisher Usmanov. It has delivered the finest Stadium in the country on time and on budget, and despite a few gliches in the property market, this Board’s prudent stewardship of the club, by ensuring that we live within our means will ensure that as the economic down turn bites, and the Banking system comes under ext raordinary pressure.
Arsenal Football Club is somewhat insulated from the shock waves that pass through the markets. But we do have the Achilles heel of paying off large bank loans and without the sale of Highbury Square, the Club would find itself severely compromised in cash flow terms. The recent AGM sought to reassure shareholders and allay those fears.
I began with the negatives of this Board, but I can only end with a very positive ringing endorsement of this Board’s achievements. Yes the sponsorship deals could have been better, and yes the loss of two major Directors was unfortunate, and the current delay in making the new appointment is very annoying. But what they have managed to do throughout all of this is retain the one asset that will guarantee the successful future of this football club…. Arsene Wenger.
Score = 8 out of 10.
By Fabregas the King.
In part III of this state of this club analysis, I shall look at the managers and his players.

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