Investors in Everton
The group set up by
Everton Fans Network to
promote City and corporate interest in Everton as an investment
EVERTON FANS TABLE 0FFER TO PETER JOHNSON
IiE Press Release, 1 September 1999
Investors in Everton (IiE) wish to make it clear that they have put a firm
proposal to Peter Johnson, Everton Football Club's majority shareholder ahead
of the announced 2nd September 1999 "auction deadline".
IiE are offering Mr Johnson the opportunity to dispose of his shares via
a legally binding trust fund which would sell his shares at ?850 each to
supporters and other
interested parties. This deal would allow Mr Johnson to recoup the ?20million
that he has invested in the club.
IiE are aware that several other parties are interested in making an offer
for Mr Johnson's shares. However, IiE believe that if the September 2nd deadline
prompts an auction among rival bidders, this will be to the advantage of
Mr Johnson and to the detriment of the club as the winning bidder would be
left with less funding to spend on restoring the fortunes of Everton Footbal
If the IiE offer does turn out to be the only offer tabled, then it is clearly
the only practical solution to the pressing problem of Mr Johnson's dual
ownership of Everton and Tranmere Rovers.
Investors in Everton spokesman Chris Klopper said: "We look forward to hearing
Mr Johnson's response. The reaction we have had to the trust idea from many
existing shareholders, fan organisations and individual Evertonians from
around the world has been overwhelmingly positive.
"They love this idea and are totally behind our plans for broadening share
ownership, introducing a full-time professional management and commercial
structure to the club and redevelopment of the ground. This would undoubtedly
be a very popular solution."
FANS INVEST FAITH IN EVERTON
By Matt Barlow (PA Sport), Waldorf Hotel, London,
23 June 1999
Everton supporters today launched an investment partnership which they hope
will signal the start of a new era for the club based on fan-power. Blue-chip
fans met in the City of London to officially unveil "Investors in Everton"
and hear football finance experts air their opinions on the future prospects
for the club.
All agreed the Toffees could enjoy a happy and prosperous 21st century despite
recent crises which left Everton fighting successive relegation battles and
slipping behind the Premiership's big hitters. City analysts insisted the
club had all the raw materials to become a major player in the future of
English football but must act quickly to get Everton onto a sound footing.
Mike Owen of "Investors in Everton" stressed this was just the part of a
campaign which he hoped would increase in strength and purpose and prove
the club would make a good investment. He said: "We have demonstrated the
tremendous potential in Everton FC. Different people have put forward different
ways in going forward to do something positive and constructive.
"We can't finish it today but we have adopted a partnership approach and
we will be continuing and you will hear more of us."
After presenting the idea of "Investors in Everton" to the City and a number
of blue-chip Evertonians, Owen hopes the body will grow and a groundswell
of interest will enable the group to have a powerful say in the future of
the club. Everton's want-away chairman Peter Johnson has been unable to find
a buyer for his majority shareholding in the club. Supporters are keen to
see the back of him but desperately want his departure to signal an end to
the years of disappointment rather than a further step away from Everton's
Speakers Stefan Szymanski, of the Imperial College Management School; accountant
Tony Lloyd; Simon Banks, of City-based research company Soccer Investor;
and finance expert Professor Tom Canon all agreed Everton had a healthy fan-base
linked to an identifiable brand. Growth prospects were enormous at Everton,
said Canon, because of the nature of the club's support which included thousands
who go to the games and even more, spread around the globe, who rank the
Toffees as their favourite club.
Research has shown Everton enjoy a large section of young support, especially
among the student population, he added. Canon said: "Everton has a very powerful
brand. One of the best in English soccer. It is the fifth most highly-recognised
brand in English soccer. This is a massive asset." He also said Everton were
not hugely disliked by other club's supporters, which was another benefit
in an adversarial sport like football.
Expert speakers also recognised that Everton's commercial branch hadn't maximised
its potential in recent years, either by getting the most out of Goodison
Park or by selling merchandise. Chartered accountant Lloyd wanted to see
the appointment of a full-time commercial director to work alongside a chief
executive and a player investment director, to make the most of the investment.
Evertonians agreed the club had fallen behind the leading money-makers in
football at a crucial time, as the Premiership embraced new, improved earning
powers for the successful, and that something had to be done.
"Investors in Everton" now hope to channel the energies of those supporters
who want to do something to change the way the club has been run. How this
will be done exactly is yet to be seen, said Owen, but a start has been made
and hopefully the interest in the group will prosper.
EVERTON AN EYE-WITNESS ACCOUNT
Mike Owen opened the conference outlining what Investors in Everton is all
about. The following speakers then did their bit.
Dr Stefan Szymanski, co-author of Winners & Losers, The Business
Strategy of Football
Gave a simple introduction into the factors that affect footballing success.
This boils down to the clubs that pay the best wages doing best in the league
over time. Turnover was also closely linked to success on the pitch. Probably
stuff we already knew but backed up by some graphs.
Presented Investors in Evertons business plan / plan for the future,
entitled "Everton Football Club: A Blue Print for Change". A measured
performance. This outlined a financial package to implement the takeover
and detailed plans for moving the club forward post takeover. I wont
elaborate too much here as the full text will be available on the Internet
very shortly. The document outlines many of the things Everton has been crying
out for in the last 5 years and that seemingly everyone but the current board
can see we need. The fundamental issues addressed are the lost revenue due
to our outdated stadium (estimated at £25 million over 5 years), our
failure to capitalise on the commercial side, and our poor transfer dealings.
Simon Banks, of Soccer Investor, the City of London research house
Very interesting presentation outlining the current football investment climate.
The city has cooled a great deal on football recently. This seems to rule
out a float of the club, and Everton is not currently in any state to be
floated (generally float on the crest of a wave). He talked about the difficulty
of valuing clubs using standard business techniques. Various methods based
on turnover and profitability could value the club at between £27.9M
and £46.46M on a debt-free basis.
Generally very positive about the upside for investment in Everton. His general
approach was that Evertons commercial performance is currently so poor
(pretty much the worst in the Premiership) that the only way is up, giving
excellent potential for growth for a hopefully relatively small investment
(contrast NTLs £100M + bid for Newcastle who are faced with spending
£45M to install 15,000 new seats at St James).
Simon didnt see the Sky / Man Utd ruling precluding the purchase of
clubs by media companies in the future (he said NTL may have been better
going for Everton!). The current OFT versus Premiership court case could
have a big impact on the game if the deal is ruled out by the court. This
will affect valuations of clubs very seriously, although he did say that
this might not be a bad thing for Everton with our large fanbase. The downside
was the amount of debt the club currently has.
Prof Tom Cannon
A lightning quick presentation from Tom Cannon detailing some very interesting
facts about the Everton fanbase (I believe his figures are partly from
Everton are estimated to have 500,000 supporters in the UK and 250,000 worldwide.
Regular match goers (3 games or more a season I think) number between 75,000
Of all plcs in the country, Everton are the best represented club at
board level. We have one of the youngest fanbases in the country and a large
percentage of graduates. He also said that our fanbase was one of the most
geographically diverse in the UK. All this set the scene for what massive
potential Everton has.
At this point Prof Cannon outlined another possible method to takeover the
club. He favours a Venture Capital backed approach, effectively a management
buyout. This was over my head Im afraid. He said that there was the
potential for an investor to double their money within 3 years, but warned
against people trying to carpetbag the club. A question later from a City
person said that the Venture Capital route would not be very likely due to
the current debt at the club.
The key to success for the club is in forging very close links with our immediate
and 2nd tier of supporters.
Q & A Session
One shareholder asked if any attempt had been made to approach Peter Johnson
about some sort of agreement by which P would remain as a shareholder but
relinquish the running of the club to others. Prof Cannon said, "No, not
at the moment."
Ian Nolan of the shareholders Association made an impromptu speech
about how the Association had forced EGMs etc. Think he wanted his
moment of glory to honest!
Someone from the city stressed that e.commerce is an excellent way for the
club to tap into its fanbase. Hed seen the official website and liked
Someone from the Merseyside press then asked: What next? Mike Owen replied
with a ready prepared answer. I cant remember the wording but it mentioned
a partnership approach.
Overall, the conference increased my faith in the future of Everton FC. There
really are too many good people out there who are Evertonians for things
to stay as they are. Thats just my view but I think something good
can grow form Investors in Everton.
INTERESTING FACTS FROM TOM CANNON
My take from the meeting was that the club has been going backwards for 20
years, but the business potential was huge. Everyone has an 'Everton story'
when it comes to gross commercial incompetence this year's season
ticket cock up for starters. There is a mass of people out there who will
pay more, will buy more merchandise, will attend more games home and
away will invest in the club, IF they had faith in the management,
and perhaps even if the process of supporting the club was easier.
We had another poor season, and yet we had 10 full houses (discounting obstructed
views) and getting a ticket for an away game is nearly impossible.
Tom Cannon didn't see a 'Jack Walker' appearing, and didn't think Kenwright
would succeed. He went on to suggest a way of moving forward involving a
Management Buy-In, the process being that a team of professional managers
buy into the business with a view to running it for a period of time. He
reckoned that the club could double its revenues in the next 3 years just
by getting its commercial operations in order. This management buy-in could
possibly be done in cooperation Johnson, but there needs to be an catalyst
to make it happen.
There was also a man from the Everton Independent Supporters
Association. I think his name was Ian MacIntosh, and he had come down from
Merseyside for the meeting. He gave an short, but heart felt speech about
the club, its supporters, the history etc etc.
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