The Queen Bee

Football is a multibillion dollar business in today’s world and who knows it better than Gooners like us. A lot has changed in Football in the last decade. Billionaires have been queuing up to grab stakes in English Clubs. And football has never been same since their arrival. Something on the same lines is imminent to take place @ Arsenal. We @ 11Gunners are happy to demystify all that for you..

At this moment Arsenal is not owned by any particular individual unlike clubs like Man Utd or Chelsea. Arsenal’s parent company, Arsenal Holdings Plc, operates as a non-quoted public limited company, whose ownership is considerably different from that of other football clubs. Only 62,217 shares in Arsenal have been issued, and they are not traded on a public exchange such as the FTSE or AIM; instead, they are traded relatively infrequently on PLUS, a specialist market.

In total, Arsenal FC’s board of directors currently hold 45.2% of the club’s shares; as of March 2009 the largest shareholder on the board is American sports tycoon Stan Kroenke, who launched a bid for the club in 2007, and as of May 2009 holds 17,613 shares (28.3%). Other directors with significant holdings are Danny Fiszman, who holds 10,025 shares (16.1%), and club chairman Peter Hill-Wood, who owns 500 (0.8%), with all the other directors holding nominal amounts. Former director Nina Bracewell-Smith (wife of the grandson of former chairman Sir Bracewell Smith) holds 9,893 shares (15.9%).

This is not as straight forward as it looks like. A lot of drama has already taken place. Thankfully we are in time for climax. Two Men came into Arsenal’s life in 2007. Both them are powerful, ambitious, intelligent and ‘filthy rich’. They have been courting Arsenal since the first time they laid their eyes on this beauty. And no you can’t put them in same bracket as ‘Roadside Romeos’. Their ‘LOVE’ for Arsenal has a reason. Yes Ladies and Gentlemen (mainly Ladies) “Love Is Not Blind”. It is a cold war of sorts between them. The American in this battle is Mr Stan Kroenke and Alisher Usmanov represents Russia.

Arsenal’s stock has been rising literally. Experts believe that in 5 years time (when the club’s youth policy starts bearing fruits in totality) Arsenal will be as big an entity as Man Utd or Real Madrid, if not bigger, economically. It is already the 3^rd richest soccer club in the world.

The Perfect Suitor?

In the early 2000s the club sold a 9.9% stake to Granada Holdings Ltd, a subsidiary of ITV plc, and a significant stake was also bought by hedge fund Lansdowne Partners. US sports team owner Stan Kroenke bought ITV’s 9.9 per cent stake in Arsenal on 4^th April ’07. David Dean left the club just ten days after this deal was inked. He had irreconcilable differences with the board over the takeover row. The departure of David Dean created a vacuum on the corporate side of Arsenal. It was as big as departure of Viera from the footballing side of Arsenal. David Dean had accomplished something special with Wenger. Dean’s departure did destabilise the whole set up @ Arsenal. And many believe that Dean’s departure had bearings on TH14’s departure as Dean’s son and TH14 were very good friends. TH14 could not put things in place in the wake of Dean’s departure and this triggered his impending departure. Many believe that even Wenger was contemplating a move in wake of Dean’s departure. Thankfully Arsene stayed.

Dein teamed up with Alisher Usmanov and he sold his shares to Red and Whites Holdings, of which he has been made chairman, and declared his intention of playing an active role in shaping the club’s future. Red and White Holdings is the takeover vehicle of Russian billionaire Alisher Usmanov. Dean decided to take the bull by its horns. The board decided to go with Kroenke as he was perceived by them as lesser of the evils. Kroenke was initially treated with hostility; he is now regarded as an ally of the Arsenal board and was appointed a non-executive director of the club in September 2008. Kroenke brought his stake in the club up to 20.5% following a purchase of shares from fellow director Danny Fiszman. On the 1st of May 2009, Arsenal announced that Kroenke had bought a further 4,839 shares from the Carr family, including Richard Carr, a current member of the board. This purchase took his share to 28.3% and made him the largest shareholder of the company.

Russian Roulette Anyone?

Red & White Holdings, which is co-owned by Russian billionaire Alisher Usmanov and London-based financier Farhad Moshiri was not far behind. Red & White bought the stake held by former Arsenal vice-chairman David Dein, as well as stakes owned by Lansdowne and many other minor shareholders, and as of February 2008 own about 24% of the club, the largest single stake owned by a non-board member.

The board decided on a lockdown agreement in 2007. This was done to prevent Red and White Holdings to make any further inroads towards a possible takeover of Arsenal. Kroenke agreed not to purchase more than 29.9% of the club until at least September 2009, while the rest of the board agreed not to consider a sale of their shares to “non-permitted persons” until at least April 2009, and have first option on each others’ shares until October 2012.

But things took a different turn last December. The board ousted long-standing director Lady Nina Bracewell-Smith leaving her free to sell her stake to the club’s biggest shareholder, Russian steel magnate Alisher Usmanov. Bracewell-Smith had been marginalised in recent years and didn’t get her candidate for chief executive appointed. She was also unhappy about being sidelined about a commercial deal in India, despite bringing the proposition and contacts to the table. She is related by marriage to the Carr family, who sold their shares to Stan Kroenke just a few months ago. However, December events may push her into an alliance with Red and White Holdings.

Meanwhile, Russian billionaire steel magnate Alisher Usmanov is becoming increasingly frustrated at his treatment by the Arsenal board. Mr Usmanov and his associates feel that they are being treated like any other shareholder.

Lady Bracewell-Smith has been considering her options since December when she was ousted from the board by Arsenal chairman Peter Hill-Wood and Fiszman. Her shares are keys in the growing battle for control being fought by Fiszman, Usmanov and his company Red & White Holdings and American sports tycoon Kroenke. Lady Bracewell-Smith is also thought to have received overtures from a second Russian businessman interested in investing in Premier League soccer. But the main focus remains on Usmanov and Kroenke. Both were introduced to Arsenal in 2007 by former vice-chairman David Dein and have raced each other to buy up shares. Usmanov has been operating outside of the club, while Kroenke has been embraced by the board. An ugly fight is forecast with Fiszman and Kroenke tipped to resist any takeover.

A takeover is inevitable. The only thing that we fans are concerned about is by whom and when. It should not take place while the season is on. It will disturb the players and yet another season will go down the drain. And the new owner should be a GOONER all the way. Only a Gooner can relate with the club. We don’t believe the new owner to be an emotional fool but he has to have some emotional connection with the club. The time is ripe for addition of more scenes to this ongoing melodrama. It is the only ‘BIG 4’ club in premiership which has not been taken over. It is still fighting the after effects of the ‘ROMAN RULE’ at the bridge. And Manchester City has not made things any easier.

BTW I have heard a rumour that Usmanov is a Man Utd fan. If that is the case then “Kroenke, come take us. SOS.