Fan ownership

Discussion in 'Arsenal Talk' started by sammy89, Sep 3, 2017.

  1. sammy89

    sammy89 Well-Known Member

    Funny that the model of Barcelona and Real Madrid isn't discussed much as a solution to our ownership issues. The benefactor model isn't working for us and even if Kroenke was to pump in money, there would always be the question of what if he gets bored with us?

    Is it a possibility that he does an IPO to sell his shares to the public and then put in corporate governance in place that gives the fans who bought in a voice? Fan ownership has been shown to be a model that works for clubs that are already established and don't need massive investment to reach the next level. If the fans are the ones with the biggest say, we'd be able to vote to put that few hundred million in the bank to good use and also make sure that we're reinvesting most of the yearly profits.
  2. krackpot

    krackpot Established Member

    ManUre are basically fan-owned They depend upon their popularity for a lot of their income.

    Arsenal are self-dependant mostly, which is why our board can keep repeating the same mistakes.
  3. Bergkamp a Dutch Master

    Bergkamp a Dutch Master Well-Known Member

    If Kroenke was to sell to the public he would surely price each at least £20,500, the latest sold. How many ordinary fans could afford to buy 1?
    There are 62,000 odd shares currently, he could issue a 10:1 share distribution so that the shares numbered 620,000 and therefore become more affordable to the public, at above 2,000 each.
    But he doesn't need to do that, and what's in it for him? I've never seen any sign of him wanting to have the club fans empowered in any way.
  4. GeorgiaGunner

    GeorgiaGunner Closet United Fan

    Do you have a GoFundMe page as well?
  5. sammy89

    sammy89 Well-Known Member

    What's in it for him? Liquidity. Also, the football business is not as lucrative as people are making it out to be. The margins have been thinned out by lopsided player contracts, bad refereeing can cost you millions without recourse, relegation could make you insolvent within the span of a few years, then you have fans who's interests are at odds with his. He might want out at a point and this would be a perfect out cause I can imagine fans agreeing to a premium price on the shares.
  6. Bergkamp a Dutch Master

    Bergkamp a Dutch Master Well-Known Member

    eh? If he wanted the cash now he would have snatched Usmanov's hand off. Supposedly it would have been £500m above latest club valuation.
  7. sammy89

    sammy89 Well-Known Member

    Depending on popularity does not equate to fan owned. Fan owned means that a group of fans are the biggest shareholders at the club and have board control.
    blaze_of_glory likes this.
  8. sammy89

    sammy89 Well-Known Member

    That's nothing in investment terms. Investors usually want 5-10x return on their initial capital.
  9. Bergkamp a Dutch Master

    Bergkamp a Dutch Master Well-Known Member

    ah. So you think Arsenal fans will pay 10x the current Share value £20,500? - or 10x what Stan paid for them? - about £12k I think.

    I'm out of here - what total nonsense.
  10. krackpot

    krackpot Established Member

    I know, and fan ownership will never hapen at AFC.

    the only way I can see some sort of fan power is in the way ManUre runs. if AFC had a lot of commercial interest in winning trophies (worldwide fan base, etc). Then you would see them being dependaent on their success for their revenue.

    Right now, AFC does not depend on success for their revenue. They still own a lot of property in the old stadium site, and they have a good flow of capital.
  11. sammy89

    sammy89 Well-Known Member

    As you leave, read up on how companies increase total share capital to make individual shares cheaper and widely available to more investors.
  12. Garrincha

    Garrincha Wilf Zaha Aficionado Trusted

    Is it common when two major rival shareholders? Especially when the smaller one actively trying to gain total control. See no reason why Stan would be open to it just like the previous fan share suggested.
  13. Özillionaire

    Özillionaire Granit Xhaka Enthusiast

    If there's one thing Kroenke doesn't want, it's the fans having a voice on how the club is run.

    Shut up and buy the overpriced hotdog, robot.
    GeorgiaGunner likes this.
  14. sammy89

    sammy89 Well-Known Member

    There is no football club that does not depend on sizeable fanbases for money. Football clubs' business model is

    play good football>attract fans>sell matchday tickets and merchandise to fans>sell premium television packages to fans>sell adverts slots on your kit/stadium for advertisers to reach your fans

    As you can see, it's a very fan-centric business :). The Highbury real estate thing was just a debt repayment scheme to pay off the Emirates construction cost.
  15. samshere

    samshere Why so serieuse?

    Its not a margins game for him. He doesn't depend on Arsenal income for a return on his investment. His payoff is the increasing valuation of the club since the time he purchased it. He got the club at around 750million valuation its already close to 2billion as per the forbes report. And we haven't reached peak valuation yet, there's a lot of room for growth through increasing fan base, both for Arsenal and through the PL. He'll float an IPO when the growth plateaus, or if he needs liquidity. But by all reports he's raising cash against his ownership, so he won't be too short of cash anyway. All in all fan ownership is a distant dream, and will probably never happen. Our best bet for a change of things, is if some benevolent billionaire buys us off.
  16. sammy89

    sammy89 Well-Known Member

    Kroenke owns 67%, Usmanov 30% and all those other guys own 3%. Any entity wanting to own and control Arsenal need only deal with Kroenke.
  17. sammy89

    sammy89 Well-Known Member

    Let's try and keep it business-like in this business thread. No room for heated emotions in biz. Kroenke would be interested cause this is a case of fans buying his shares at a premium and hence making him richer.
  18. sammy89

    sammy89 Well-Known Member

    Last year Arsenal made 12 million pounds annual pre-tax profit on 191 million turnover. That's a 6% gross margin. Then let's not forget that taxes are quite hefty in the UK, so maybe the eventual take-home profit would be between 5 and 10 million. Let's call it 7.5 million for math's sake. If Stan is 'milking the club' through dividends as fans claim, he'd be taking out a fraction of 7.5 million pounds a year. Considering he spent about 500million on his stake, I doubt his end-game is to draw out dividends each year, football club margins are on the pathetic side right now. He's definitely in it to eventually sell his stock for a premium one day and the fans could give him that option. In fact I'd wager that that's his only remaining move. For him to buy an asset that generates 12 million a year at a 700 million valuation, he's already stretched the valuation beyond what any other reasonable investor will be willing to pay. It's IPO time.
  19. samshere

    samshere Why so serieuse?

    Football club valuations aren't a factor of their income, but of their revenue. Arsenal's income has remained fairly stable for ten years, but valuation has trebled.
  20. Fallout

    Fallout Well-Known Member

    the net income number is skewed by player transfers. you would have to look at some metric that excludes player transfers to assess our true profitability. this metric has probably grown in line with our revenue growth, leading to a higher valuation.

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