The two-man tussle for Newcastle United

[Craig 6703]

As billionaire businessman Mike Ashley launches a £133.1m takeover offer for Newcastle United, whether his bid succeeds or fails lies in the hands of one man - Freddie Shepherd.

 

Mr Shepherd, Newcastle's infamously blunt chairman, owns a 28.1% stake in the club - enough to block Mr Ashley's bid for full ownership.

 

And with Mr Shepherd yet to declare his intention, it remains far from certain whether he will agree to sell up.

 

Mr Shepherd could simply refuse to budge, meaning that while Mr Ashley will probably be able to gain majority control, he would not be totally in charge, and Mr Shepherd would remain a major player at the club.

 

'Geordie Abramovich'

 

Amid reports that Mr Shepherd was in hospital yesterday recovering from pneumonia when he first heard the news of Mr Ashley's shock bid, the Newcastle supremo's recent comments on the possibility of a takeover have been somewhat contradictory.

 

Last week, Mr Shepherd - who takes a salary of more than £500,000 a year from Newcastle - claimed that the club was "impossible to buy", yet he has also said he would be happy to sell to a "Geordie Abramovich".

 

This is, of course, a reference to the nickname of people from Newcastle and Chelsea's Russian owner Roman Abramovich, who is worth an estimated £15.7bn.

 

And while Buckinghamshire-based Mike Ashley is not a Geordie, he is a billionaire, albeit with a fortune of just £1.7bn.

 

Spate of takeovers

 

But with apparently little previous interest in football, let alone Newcastle United, why has Mr Ashley paid more than £55m for a 41.6% stake in the club from Sir John Hall, with plans to go on and buy it all for £133.1m?

 

Mainly because Newcastle United represents a great investment, says City analyst Richard Hunter of Hargreaves Lansdown.

 

"The recent re-negotiation of overseas TV rights, along with potential merchandising forays into other countries, has meant that the larger clubs have become seen as potential cash cows," he says.

 

This has led to a spate of takeover activity in recent years, with billionaire investors, mostly from overseas, swooping for everyone from Manchester United to Liverpool, Aston Villa to West Ham.

 

And while Newcastle may not have won any silverware since 1969, and its form has languished in recent years, the club is one of the best supported and most lucrative in the Premiership, despite it making a loss last year.

 

With sell-out crowds of more than 50,000 at every home game, and fans determined to kit themselves out in the club's famous black and white strips, Newcastle is Europe's 13th wealthiest club by annual revenues.

 

Past bidders

 

Other analysts point to the three-way synergy that buying Newcastle would give Mr Ashley.

 

His company Sports Direct is one of the UK's biggest sellers of football tops, and earlier this year Mr Ashley bought a 3% stake in Newcastle's kit-maker, German sportswear giant Adidas.

 

And a more successful Newcastle under new manager Sam Allardyce would mean yet more sales of the Magpies' black and white strips.

 

Yet whether Mr Ashley gains full control of the reigns remains with Mr Shepherd.

 

And with analysts blaming Mr Shepherd's refusal to budge for the failure of two possible bid approaches earlier this year, from investment fund Belgravia and hedge fund Polygon, Mr Ashley may have some persuading to do.

 

Source: http://news.bbc.co.uk/1/hi/business/6686737.stm

 

Given the amount of re-building we need to do this summer, a fight over the ownership of the club is the last thing we need. If Shepherd has any feelings for the football club rather than the business, he'll expediate this takeover as quickly as possible.

[Jimbo 175]

Agreed, this needs sorting as soon as possible so not to get in the way of the rebuilding, however you can imagine Shepherd loving being in the spotlight once again.

[Gemmill 47302]

Two-man tussle. Sounds like they're gonna bum one another to decide the club's fate.

[ewerk 31618]

Tussle? More like fucking sumo wrestling.

[Guest alex]

They should have a sumo match to decide who wins.

Edit: Bastard

Edited May 24, 2007 by alex

[Gemmill 47302]

http://www.newcastle-online.com/nufcforum/...41695#msg841695

 

Two hours late, sumo fans! Get with the programme!

[Bombadil 0]

The Guardian sums it up nicely.

 

Tycoon recluse buys 41% stake in Newcastle

 

· Tycoon buys Hall family's holding in club for £55m

· Chairman must decide whether to sell his 29%

 

Michael Walker

Thursday May 24, 2007

The Guardian

 

Mike Ashley, a 42-year-old billionaire from Buckinghamshire with no known previous connection to Newcastle United, dramatically altered the ownership of the club yesterday when he announced that he had agreed to buy the 41.6% stake of Sir John Hall's family for £55m.

 

That values the club at about £133m and City analysts believe Ashley would not have bought in without being assured he could reach the 51% holding that would give him day-to-day control. In turn that would force the current chairman, Freddy Shepherd, into a corner where he would feel obliged to sell his 29%. It appears therefore that Ashley, who made his fortune largely through sports retail, has staged a coup d'etat on Gallowgate.

 

Shepherd was in a Tyneside hospital when he heard of yesterday's developments. He was thought to be nursing a fractured rib, although he may now count shock among his ailments. There is no public record of Ashley, or a company representing him, engaging in due diligence and there has been no team of accountants commissioned and allowed inside St James' Park. There has been a flurry of buying and selling of Newcastle shares in the past eight weeks in particular but the volume was not enough to compel a single buyer to reveal himself and Ashley's move was not foreseen.

 

Ashley, well known in the City but described by most as a recluse, is unknown at St James' and on Tyneside. Beyond selling shirts in his many sports shops his interest in football is not known either. He came into contact for a time with the Wigan chairman, Dave Whelan - Whelan owns the JJB network of sports shops - and one leading football agent who has met Ashley yesterday described him as "entrepreneurial, dynamic and shy - really shy".

 

So shy that he agreed only recently, and reluctantly, to be photographed for publication for the first time. But he did issue a statement yesterday. "I am delighted to have this opportunity to invest in Newcastle United," he said. "The club has a fantastic infrastructure, for which Sir John and the board must take much of the credit. I am pleased that Sir John has agreed to remain as life president of the club."

 

Sam Allardyce, Newcastle's new manager, was not mentioned by name but should be partially reassured by Ashley's further observation that "Newcastle United has a wonderful heritage and the passion of its fans is legendary. I am sure that, like me, they are already excited about the prospects for next season under the new manager's stewardship".

 

Ashley's motivation in purchasing Newcastle remains unknown and he must have been reassured about the club's "off-balance-sheet" debt which has deterred at least one grouping that was previously interested in buying Newcastle.

 

Economic and personality difficulties have stymied other previous takeover attempts. Only last week Shepherd described Newcastle as "an impossible club to buy", an assertion made with a confidence born of the chairman's unwillingness to sell his own stake of 29%.

 

That stance has in the past frustrated the Halls. Sir John and his son, Douglas, have been willing to sell for two years or more but have seen efforts by bidders such as Polygon and Belgravia to acquire sufficient stakeholdings to control Newcastle falter, in part because of Shepherd's defiance.

 

A difference in approach between the two most important owners became a schism when Shepherd attacked Hall in January after Belgravia's official announcement of termination of takeover talks. Shepherd said: "Sir John Hall has to decide what his role is. The future of this club is in his hands. He has to decide whether he wants to stick or sell. The uncertainty is making it hard for me to run the club."

 

The full significance of those comments may be revealed in the coming weeks. Shepherd has to consider the timing of his next move because he seems to be in an impossible position at St James'.

 

He will collect about £40m when he sells and, when the dividends and salaries he has accrued in his years at the club are considered, supporters opposed to his regime will think he has done very well financially.

 

Those fans may also think of Douglas Hall and Sir John. Less than two years ago it was written that they had received a minimum of £36m in share sales and dividends from Newcastle United, and the £55m from Ashley on top takes them to £91m. There has never been a definitive report of their original investment but no one on Tyneside estimates it at above £3m.

 

Given that Ashley took £930m from a flotation of his sports retail business this may seem small. Unwittingly - to Shepherd - Ashley may be the "Geordie Abramovich" figure to whom Shepherd always said he would sell. As recently as 1999 there was no public picture of Roman Abramovich. Like Chelsea's Russian owner, Ashley has slipped in under the radar.

[2bias 3]

As billionaire businessman Mike Ashley launches a £133.1m takeover offer for Newcastle United, whether his bid succeeds or fails lies in the hands of one man - Freddie Shepherd.

 

Mr Shepherd, Newcastle's infamously blunt chairman, owns a 28.1% stake in the club - enough to block Mr Ashley's bid for full ownership.

 

And with Mr Shepherd yet to declare his intention, it remains far from certain whether he will agree to sell up.

 

Mr Shepherd could simply refuse to budge, meaning that while Mr Ashley will probably be able to gain majority control, he would not be totally in charge, and Mr Shepherd would remain a major player at the club.

 

'Geordie Abramovich'

 

Amid reports that Mr Shepherd was in hospital yesterday recovering from pneumonia when he first heard the news of Mr Ashley's shock bid, the Newcastle supremo's recent comments on the possibility of a takeover have been somewhat contradictory.

 

Last week, Mr Shepherd - who takes a salary of more than £500,000 a year from Newcastle - claimed that the club was "impossible to buy", yet he has also said he would be happy to sell to a "Geordie Abramovich".

 

This is, of course, a reference to the nickname of people from Newcastle and Chelsea's Russian owner Roman Abramovich, who is worth an estimated £15.7bn.

 

And while Buckinghamshire-based Mike Ashley is not a Geordie, he is a billionaire, albeit with a fortune of just £1.7bn.

 

Spate of takeovers

 

But with apparently little previous interest in football, let alone Newcastle United, why has Mr Ashley paid more than £55m for a 41.6% stake in the club from Sir John Hall, with plans to go on and buy it all for £133.1m?

 

Mainly because Newcastle United represents a great investment, says City analyst Richard Hunter of Hargreaves Lansdown.

 

"The recent re-negotiation of overseas TV rights, along with potential merchandising forays into other countries, has meant that the larger clubs have become seen as potential cash cows," he says.

 

This has led to a spate of takeover activity in recent years, with billionaire investors, mostly from overseas, swooping for everyone from Manchester United to Liverpool, Aston Villa to West Ham.

 

And while Newcastle may not have won any silverware since 1969, and its form has languished in recent years, the club is one of the best supported and most lucrative in the Premiership, despite it making a loss last year.

 

With sell-out crowds of more than 50,000 at every home game, and fans determined to kit themselves out in the club's famous black and white strips, Newcastle is Europe's 13th wealthiest club by annual revenues.

 

Past bidders

 

Other analysts point to the three-way synergy that buying Newcastle would give Mr Ashley.

 

His company Sports Direct is one of the UK's biggest sellers of football tops, and earlier this year Mr Ashley bought a 3% stake in Newcastle's kit-maker, German sportswear giant Adidas.

 

And a more successful Newcastle under new manager Sam Allardyce would mean yet more sales of the Magpies' black and white strips.

 

Yet whether Mr Ashley gains full control of the reigns remains with Mr Shepherd.

 

And with analysts blaming Mr Shepherd's refusal to budge for the failure of two possible bid approaches earlier this year, from investment fund Belgravia and hedge fund Polygon, Mr Ashley may have some persuading to do.

 

Source: http://news.bbc.co.uk/1/hi/business/6686737.stm

 

Given the amount of re-building we need to do this summer, a fight over the ownership of the club is the last thing we need. If Shepherd has any feelings for the football club rather than the business, he'll expediate this takeover as quickly as possible.

agreed