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Here's the latest article by regular viewer and contributor, Colin Wilkes [colin.wilkes@gmail.com]:
OLD GROUND NEW GROUND SHARED GROUND
A few days ago I was rereading the minutes of the EGM(1), in an attempt to glean what we have in store for us from the mouth of paternalistic Bill. After all he has been very quiet of late and I am sure he is absolutely bursting to blurt something out regarding the off field situation of EFC. Equally he is probably salivating at the prospect of shouting from the highest TV Gantry what he has done to turn the teams performances around from last year. Was it not he who wanted DM to take the final decision on the sale of Wayne Rooney and thereby pass the buck, wringing his hands Pontius Pilot style. Likewise now he would want to take the plaudits for the teams present success. He did make the funds available for the purchase of Marcus and Tim so he should get a pat on the back for that. My arse.
Whether it be the new financial arrangements to be put in place from Fortress Sports, the repayment of the Philip Green Line of Credit, the winding up of TBH, the immanent AGM, the possibilities of what may happen when the looming transfer window opens. And for now,last but not least the demise of Goodison as OUR HOME.
I am drawn to this last element because I see today, bonfire night, the red shite announce they lost near £22 million last year. This figure does not include the summer signings so they must be even further into the red.
Of late there has been at least four enquiries from people having a desire to pump money into LFC. The Prime Minister of Thailand and Steve Morgan, aka, Bob the Builder. Both of whom have walked away from the situation having vetted the books. Presumably neither liked what they saw. Consequentially both did the offman. Post haste.
The other two GMM Grammy, a Thai music company and Los Angeles based Milkshake Films have also departed the scene.
Milkshake Films in the form of two ex Merseysiders were wanting to take over LFC lock stock and barrel for £100 million.(3).
There are 42,000 shares in LFC Davey Moores owns 18,000
Second largest shareholder is Steve Morgan. Who is believed to be waiting in the wings with another bid to up his interest and also wants to share the new ground facilities with EFC.(4).
The third largest shareholder in LFC is Granada who it is believed are wanting to off load their stake of 3,500 shares
There is a block of 15,000 unallocated shares witheld and can be used as the directors see fit.
Share prices in LFC of late have been selling down as low as £1800 and the max at about £4000. The Times business section state the value of £2000 per share is a more realistic figure and that this gives LFC a book value of £70 million.
So here then we have LFC not in the best of financial health about to embark upon the building of a new stadium that will accommodate 60,000 people.
However, from what is likely to happen now is that Milkshake and Bob the Builder are joining forces to enter a joint bid. Knock out the Thai bid and reduce the Moores Family holding to a minimum.(5).
The initial offer from Milkshake was for them to put in £100 million and the offer from Bob the Builder was £70 million. So if those two figures are still available there is plenty there for the debts to be cleared and purchase of the stock to make them the majority shareholding group and any residue, possibly £100 million, for the new stadium. On this basis do they need EFC as tenants of any new stadium?
Well if EFC throw in their lot with LFC then there is £40 odd million available from the NWRDC towards a joint stadium. Then there is the share EFC would have to stump up. For arguments sake we will say its 50%. As the costs have already risen from an initial £80 million to a figure approaching £120 Million the final figure could be guestimated at £150 million minimum. So the EFC share of the cost would be circa £55 million. Exactly the same as the cost to LFC.
But hang on that means we are paying near half of what they initially were prepared to pay and in turn leaves them with another £50 million to spend on new players. Therefore if they have any success then we from EFC will be the ones paying for it. My arse.
SO THAT FOR ME RULES OUT ANY GROUND SHARE
What then we are left with is a new stadium of our own or modernise GOODISON.
In his only speech on EFC to date ,as far as I am aware, our potential new major shareholder,(in the guise of Fortress Sports), Christopher Samuelson said he thought Everton has;
"great potential and that it could draw regular crowds of between 55,000 and 60,000 people."(6).
In a similar vein Prof Tom Cannon speaking at the EGM stated;
"I want to see within months, by the AGM, specific proposals about a new ground-maybe not within a year, maybe not within three years, but I'm damn sure within five years because whatever you think about this plot, it is not big enough as it currently stands to maintain our ambition."
This magical figure of 60,000 I have seen and heard before. How fantastic it would be, just like in the old days when leaving the ground, you didn't have to walk out you would be carried out, in the upright position, by the crowd. Those days are gone stop living in the past and get real. To embark upon a scheme of building a new stadium now would without a doubt be like the lemmings going over the cliff.
The economic system we happen to live under is, unfortunately, the capitalist model and as such we are all subject to the cycle of growth and slump. The season 2003-2004 EFC had a take up of 96% of capacity so far this season 2004-2005 the take up is 88%.(5).The main factor in this is the extortionate hike in season ticket prices and to achieve some sort of parity with other clubs the prices will continue to rise for the next few years. Therefore the affordability of football at EFC becomes increasingly less. And so down goes the attendance figures again. Then to redress the balance there has to be another increase and so on and on we go.
Overall for the last two years there has been a year on year decline in attendance's throughout the premeirship of 5%. Even Sky is not immune to the decline in those revenues derived from football. There may be more watching the live games in the pub but certainly not in the comfort of their homes. Figures show that for the first 25 games screened this year compared to last year there was a 22.7% drop.(7). Less income for Sky equals less income for the clubs. The match of the day BBC figures are also down on last years ITV figures by 9%.(7).
I have not as yet mentioned the fact that the housing market has slumped due to increased interest charges for borrowing. This in turn will feed its way into all those activities and luxury items that will have to go as people tighten their personal purse strings and attendance at football matches, and or paying to watch Sky is not excluded from this.
On this basis do you think EFC need a new 60,000 seater stadium? Can we afford it. I know some will say can we afford not to?
Bums on seats is the name of the game. That only comes with success on the pitch.
There is however like all other things a saturation point.
If we had the most successful team in England could we fill a 60,000 stadium?
Its obvious to me the CEO has the economics near correct even though he fails to comprehend what ground sharing means to both sets of supporters.
In the Financial times of 4/10/2004
Everton's new chief executive, Keith Wyness, has said that;
" Merseyside could be the one place in Britain where ground sharing could work on a permanent basis. He said that finding a new ground was paramount to achieving success after years of under achievement. 'Goodison has so many flaws that a new stadium is crucial', He warned that the club could not afford to spend too much of the £30m it will receive from selling Wayne Rooney to Manchester United. With debts totalling about £40m, it was essential to balance the books before chasing new blood. 'We are fully aware that the squad is very low in numbers and badly needs strengthening, but the long-term viability and security of the club has to come first.'
SO THAT'S A NEW GROUND OUT THE WINDOW ALSO FOR ME
If the long term security and viability are of paramount importance then we have to learn from the past and not allow previous excursions into debt laden adventures to reoccur. The only ones to prosper from not doing so are the banks.
So what are we to do to rebuild GOODISON? Or am I a lone voice? Or has GOODISON been sold off already to pay for some of the debt? Is it earmarked for a TESCO or one of Phillip Greens stores? Am I therefore just wasting my time ?
The question has already been asked a few weeks ago in the Echo regarding why not move the Park End back 20 yards or so. So that Gwladys Street and the park End could be enlarged. (Yes yeh car park will have to go ). This will give a few thousand extra seats.
Any redevelopment of GOODISON can be done piecemeal and paid for out of funds accrued and not borrowed. Or has someone got shares in the bank?
Please don't anyone tell me it's cheaper to build a new stadium rather than redevelop GOODISON.
(1)Thanks to Colm
(2) GiveMeFootball.com, UK
(3) http://business.timesonline.co.uk/article/
0,,11472 1277902,00.html
(4) http://wyngrant.tripod.com/WGFootballPage.html
(5). http://www.footballeconomy.com/
(6) http://business.timesonline.co.uk/article/0,,
11472-1268610,00.html
(7) The Big Turn Off Dennis Campbell The Observer
Sunday 31 October 2004
colin.wilkes@gmail.com
