After nearly two years of shadow boxing, the camps of Stan Kroenke and Alisher Usmanov are about to start to the real battle for control of the Gunners. Arsenal’s 4th largest shareholder, Lady Bracewell-Smith is looking to sell her 15.9% share and his retained the U.S. based brokers Blackstones to find a buyer. With both potential owners well within the the minimum threshold, the temptation to bid for the chunk that Lady Bracewell-Smith wishes to relinquish will be tantalising.
The additional issue here is that the Arsenal board view Kroenke as the friendly option and have assisted him by selling him shares between £8,500 and £10,000 each. Usmanov is rightly or wrongly, viewed as an unwilling option to most of the remaining board members. Whilst the animosity that both suitors faced is certainly nowhere near the levels it appeared when they began to buy up stock, Kroenke is now in poll position to push his shareholding in to the realms of making a bid for the entire club. He’s been on the board since 2008 and has quietly and effectively bought up stock and shares as it’s been made available.
Of course, the news has come as something of a surprise but it would now seem as if Arsenal are quickly moving toward new ownership, sooner rather than later. Kroenke currently holds 29.98% and Usmanov holds 26.26%. If anyone goes over 30% then they must make an offer for the rest of the shares, similarly to the situation that Manchester United had on the build up to the Glazer takeover.
Yet critics of Kroenke will point to the walking disasters that the Glazer reign and the Hicks/Gillett pairing and the fact that both groups that now own Liverpool and Manchester United came from U.S. sporting backgrounds. The difference for me is that Kroenke holds an MSL team and is well aware of the nuances of English football, having seen the issues that have blighted English footballs two most famous clubs.
The animosity is similar yet different, Ferguson has the full support of the fans who can see his hands are tied. Benitez uses the situation to cover the dreadful tactics and signings he makes to garner support with the fans. Both set of fans are completely at odds with the owners and it would take an amazing series of gaffes for Kroenke to alienate the Arsenal support to anywhere near the level his compatriots have.
Silent Stan would seem to be the prime candidate to make a bid for Lady Bracewell-Smith’s shares and so trigger the takeover threshold. Ironically, Kroenke is currently facing a similar situation over his stake the St. Louis Rams, which I still can’t get used to them being known as even if has been 16 years since the left Los Angeles. Or maybe I’m just showing my age!
Currently a bid of $750 million dollars is on the table for 100% of the Rams, Kroenke currently holds 40% so could be set to make a tidy amount of around $300 million, which would probably leave him more than enough to purchase the remaining 70.02% of the Gunners. Add a fantastic stadium recently built, consistent top 4 finishes and a constant conveyor belt of talent groomed by Arsene Wenger and you have a fantastic opportunity to take over a top quality Premiership side.
The only possible issues for financial outlay are the clubs debt, which currently stands at just over £200 million and strengthening the clubs playing squad. Arsenal do not require major surgery either off or on the field, regardless of whether Cesc Fabregas stays or rejoins Barcelona in the summer. One things for certain, Kroenke is definitely in pole position to take control of Arsenal, sooner rather than later and the rivals saddled with massive debts, disappointed fans and player squads and grounds in need of overhaul will be watching with trepidation. Arsenal could be about to embark on another glorious era.
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Brickthrower
April 13, 2010 at 3:45 pm
What do you think requires more maintenance:
The Rams
Arsenal
Or his hair and mustache
I know which brings him the most profit 😉
Jon
April 13, 2010 at 1:35 pm
Let’s start from the perspective that I think Arsenal’s multiple-ownership model is a good one. It is much better than the Glazer/Gilette&Hicks or Sheik Moneybags/Russian Oligarch models at work in other clubs. That way the club is responsible to many parties who have diverse interests and some of whom do not care about on-field success but about running a profit and getting a return on their investment. More owners benefit from the wisdom of crowds – there are less likely to be stupid transfer deals made because the manager has only to convince one greedy owner.
There has been a lot of speculation since Lady Bracewell-Smith announced her intention to sell her stake in Arsenal and appointed Blackstone to find a buyer. Some people expected Kroenke to SELL his 40% interest in the Rams to Khan, raising the money to buyout the rest of Arsenal. But Kroenke was never going to do that before May. Under the rules for the stock market and mandatory purchase offers, the person who acquires a 30% stake must offer to buy out the rest of the shares at the highest price offered for any one share in the preceding 12 months. Kroenke purchased some shares last May for 10,500. His most recent purchases were for 8,500. That means if he buys 10 or more of Lady Bracewell-Smith’s shares, he is paying a premium of 2,000 per share more than he has to if he waits. Which he does not want to do because that is a difference of millions. So his PURCHASE of the Rams is good. He won’t have the money to buy Arsenal, and frankly, he can make the Rams more profitable because they have no where to go but up.
Usmanov has also said that he is not interested in acquiring her shares either, for the same reason, or better yet, for the very insightful reason provided by Eric Altshule above.
Which explains why she is seeking a buyer now. She hopes to pressure one of the two to feel like they HAVE to buy now, so she can make a windfall profit on her shares. She’s likely to make 80 million if there was a sale now. Thanks, daddy. That’s a nice little legacy.
Also, if she were selling to Kroenke, why appoint a banker to find a buyer? They are both Directors at the club. They could meet over tea and agree a deal, which is how inter-Director sales normally go.
My guess is either: she won’t sell at all and is really testing the market value of her shares; or she will sell to someone entirely different than Kroenke or Usmanov. The shares might be that rare occurence – a GOOD investment in a soccer club- Arsenal is returning a profit of 30-60 million a year. The value of the club is steadily rising.
Now if only I had the kind of spare change lying around to make myself a 15.9% owner.
Cheers,
Jon
maw4bc
April 13, 2010 at 11:22 am
He is challenging that rule. It is up to the other NFL owners if they want him to own the team.
“NFL spokesman Greg Aiello declined comment, saying the matter was between Kroenke and the current owners. ”
I highly doubt he takes over Arsenal. He is not the type of guy who uses debt to leverage acquisitions. If you know anything about him he is an incredibly genius businessman. His commercial real estate ventures make 100’s of millions a year.
Gary
April 12, 2010 at 10:23 pm
The Associated Press is reporting that Stan Kroenke had decided to exercise his right to purchase the remaining 60% share of the St. Louis Rams.
http://msn.foxsports.com/nfl/story/Kroenke-to-try-and-buy-rest-of-Rams-041210
sucka99
April 13, 2010 at 4:06 am
NFL still has to approve his cross-league ownership (unless he sells the Nuggets/Avalanche or finagles the ownership somehow) but this would seem to take him out of the running. Read something quoting John Cross that said the reason for hiring the financial advisor is that these shares were on the market essentially from the time she left the board and they hadn’t sold – which may be why she went public with her desire to sell. Makes sense. Not a lot of people with money to burn these days.
mtm
April 12, 2010 at 9:35 pm
Time to wheel Jay-Z into the bidding arena !
Luv Arsenal
April 12, 2010 at 9:25 pm
Last time i check, didnt Ivan the great reduce our dept to well bellow 100million?
ovalball
April 12, 2010 at 7:55 pm
“…the St. Louis Rams, which I still can’t get used to them being known as even if has been 16 years since they left Los Angeles.”
Too true. When Merlin Olsen died the obit mentioned him being on the ring of champions in St. Louis. It did not compute. My first thought was, “WTF. He never played for the Cardinals!” (And I remember when they played in Chicago!!) 🙂
Eric Altshule
April 12, 2010 at 7:29 pm
Kroenke’s strategy of getting within a few shares the 30% level is really interesting, and strengthened his had tremendously. For Usimov, he cannot get to 30% without Lady Bracewell-Smith’s shares (it is nto clear that anyone else on the board will sell him anything), but with her shares, he is still below 50%. It does not serve Usimov’s purposes at all to get in a bidding war, overpay for Lady Bracewell-Smith’s shares, and then still not be at 50% because nobody else will sell to him. On the other had, if Usimov starts to make the other board members nervous, they can sell a few shares to Krownke, get him to the 30% level, and he seems content to either buy everyone else out or stay as a minority share holder as long as Usimov is not in the majority.
PTangYangKipperBang
April 12, 2010 at 6:29 pm
The article doesn’t mention Randy Lerner by the way. He doesn’t even have a moustache.
Josh
April 12, 2010 at 5:52 pm
In response to the last sentence of the article, it is my belief that with Man U legitimately completely based on Rooney, and Chelsea still chugging along but aging, that Arsenal stands a great chance at becoming the best team in England for the next 10 years as long as they keep the current squad together. Even with Almunia being Almunia, I think the core of Arsenal, particularly in the midfield, is starting to become great. Both Song and Diaby were once compared to Lucas of Liverpool, but now they’re both seen as invaluable members to the 1st team. Of all of the teams in England right now, I think Arsenal require the least amount of work, maybe the purchase of a GK, and a CB is Gallas leaves. That’s about it though. The midfield is stacked and both the defense and strikers are good when healthy.
SeminoleGunner
April 12, 2010 at 7:31 pm
I think you make some great points. What worries me is the possibility of an aging Chelsea quickly re-tooling and signing a new team of stars in their prime, or United combining another star or two with Rooney, or Manchester City continuing to gain steam and spending silly money in the process.
I can, unfortunately, see Arsenal continuing to finish 2nd/3rd/4th to a revolving door of champions who are always just a bit stronger than the Gunners.
Jean-Christian
April 12, 2010 at 5:34 pm
In the ultimate litmus test, I’d rather see our players grow celebratory mustaches than cheeks, so I lend my support to Kroenke.
The Gaffer
April 12, 2010 at 5:36 pm
That is quite a mustache, eh?!
Cheers,
The Gaffer