Thursday, 18 January 2018

Meeting Means Demo Off; Roland Daft To The End

I’ll bet a pound to a penny that Roland doesn’t believe in ‘rules’ when it comes to investments. They are for ordinary people and he is a visionary, so rules don’t apply to him. Stuff and nonsense of course, so here’s a rule that was drummed into me from an early age: when considering whether or not to continue with a venture you pay no account, absolutely none, to how much you have invested in it to date. Letting emotions (whether they be down to pride, stubbornness or just arrogance) interfere with the decision is a recipe for disaster.

I’ve no idea whether Duchatelet has been trying to engineer some sort of bidding war for us by having more than one interested party, to try to get the price as close as possible to his unrealistic demands. Neither am I sure that the mooted asking price is a reflection of his desire to come out of this with a profit (or at least a washed face). But from what we’ve learnt of the guy they are not outlandish assumptions. Perhaps he still hopes that some Chinese (or Russian) group with more money than sense will come out of the woodwork and afford him a dignified (in his eyes, not ours) exit.

Personally I’m surprised that anyone would pay more than £1 to acquire us, with everything else wrapped up in ‘if and when’ clauses. We are a loss-making company in League One and as such the only way to balance those losses is through player sales, which of course works against the goal of promotion. Barring some exceptional circumstances (which do occur), whereby a team with modest resources comes together under an influential manager and outperforms to the extent of getting promoted, getting back up to the second flight requires investment. And in the Championship you can expect to run materially higher losses just to hold your own. Perhaps the best way to handle this now is the approach adopted by Bournemouth – to get promotion to the Championship and then throw money in quickly to make the promised land in one or two seasons (and to hell with FFP requirements). That contrasts with Ipswich, who have been in the Championship since 2002 – and have as a result racked up substantial losses (I did see a figure quoted recently but can’t find it now).

Roland’s dream that FFP would create a more level playing field and that this, together with a network approach to move players around and contain costs, went out of the window a long time ago. All he is left with is a third-division football club. So just why anyone would consider paying the sort of price that has been suggested is beyond me. I would want to take over a debt-free company (with the debt parked only to be repaid if we get into the Premiership) with the purchase price reflecting an estimate of how much investment would be required to get into the Championship and then to cover say a couple of seasons there.

Of course the other way to value an asset is to use as a benchmark the price for similar recent sales (while accepting that no two football clubs are the same). This isn’t helped by the fact that it seems the norm not to disclose anything these days. The price for Barnsley wasn’t disclosed (nor was that for Northampton) but the talk was of £10-20m. We may consider them to be a ‘smaller’ club than us but they are of course already in a higher division.

I guess the bottom line is that so far at least none of our potential purchasers has budged sufficiently from realism into Duchatelet-pricing for a deal to be struck. That suggests that either he does materially lower his asking price – or we are stuck with him for a while longer, until he finally lowers his asking price.

All this is of course supposition and we now have a planned meeting of Richard Murray and the Trust before Saturday’s game, news of which has quite rightly prompted CARD to call off the planned protest outside the West Stand. I think it’s appreciated that there are issues of confidentiality involved and we are not going to get chapter and verse on who are the interested parties, what prices have been offered etc. But we will I hope get an insight into whether Duchatelet is really now just casting around for the highest price he can get and will indeed sell in the near future, how advanced are the negotiations, with some hint at least of the likely purchaser and their ambitions.

Because even to the last Duchatelet’s actions make no sense. Before we ground out a couple of 1-0 victories against poor sides our season looked like it was slipping away, especially with the transfer window expected to see the sale of another youngster. Now, with Holmes having departed (and I was sad to see some criticism of his actions, you can hardly blame the guy) but us clawing our way back into a play-off spot, I’d be looking to sell the club on the basis of promotion being a real prospect rather than trying to squeeze the last pips. Turning off the taps right now is obviously counter-productive for our promotion chances and this has to feed through to a sale price, as does any player sales. But we gave up on Roland acting rationally a long time ago.

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