by Paul Holmes 

Rights Issue:

INVESTORS CHRONICLE January 2004 Tottenham Hotspur: open issue  Announced: 23/12/03 Last payment: 19/01/04  Total amount raised £15M (before expenses)

“Along with other football clubs, Tottenham has a miserable record of value destruction.  This offer is for the die-hard fans only.”  IGNORE!

So Spurs' new rights issue “got away”.  They buy Defoe, try to buy Robinson, and shore up the previous loss with a bit of working capital.  Not financial fireworks.  A guaranteed £12M (after expenses) does not go a long way, even in today's deflated transfer marketplace. 

So would an extra £12M really transform our club's fortunes?  Without a doubt, if handled properly, by the right professionals.  However, is anyone seriously suggesting that the current Board be trusted with any more money?  To give them £12M more after the rights issue would simply be applauding their baffling business methods and lack of self control.  Does anyone honestly believe they would only spend the money in the transfer market and not patch up other areas of the business, yet still fail to build an academy?

I think we can safely expect more disingenuous empty offers from Mr Kenwright as the realisation grows that the only pockets to dip into from now on belong to the Premiership's most impoverished fans. Strange how we're suddenly such an interesting species.  Not through increased merchandising, or season ticket sales is the club considering raising money... desperation leads to inspiration?

An argument could be put forward that, having got us into such a mess, it's up to the Everton Directors to get us out of it without the need to call for the fans financial help.  There is a lot of varied business talent on the Board.  If the desire is really there, they do not need to ask independent small shareholders for help.  It strikes that the rights issue is a lazy and opportunistic obvious last ditch effort from those that have given up.  If that is so seek a buyer or investor.  Sell the 70% holding for £10M, take the financial pill you so richly deserve for your baffling incompetence, and let someone else with fresh money and ideas take up the helm.  How dare TBH and the directors of EFC ask the fans to bail them out.  If, as we are led to believe, relationships are at a low key amongst the board, how will £12-15M from the fans help heal wounds and deep seated rifts?

The intentions of the ESA are genuine, it is admirable that some can dedicate so much time to genuinely help the Club move forward.  The selflessness of their acts is all the more compelling with the realisation that, despite the fact that the value of each share will fall dramatically, monetary gain is not their objective.  That’s assuming it's like for like of course.  TBH could decide that any new share does not rank equally with the existing shares (a frightening likelihood given the recent antics at Celtic).  This cunning ploy would achieve the goal of diluting their own equitable value by as little as possible.

Paul Holmes
25 March 2004

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