A Continuing War Of Words At Port Vale
There’s no close season in the financial trials and tribulations of modern English football, as Port Vale and Plymouth fans are discovering. June will see, if not the end, then the beginning of the end of the clubs’ respective takeover sagas. There will be new dawns, lessons learned and an outspoken determination not to let “things” happen this way again. And if the tales so far are a guide, most of what will be said will be bollocks. Over the next few days, Plymouth will come under the Mark Murphy glare. But first, you can’t beat a bit of Burslem…
It takes some doing to make Mo Chaudry into the good guy but at Port Vale, Chaudry is the future. The “motivational speaker” (oh, and property investor) has motivated Vale fans to almost total opposition to self-styled supporters group Valiant 2001, who have been in charge since 2003. And, if he and his unremitting hype are to be believed, V2001’s reign is coming to an end. Chaudry has had help; partly from local businessman and genuine life-long Valiant Mark Sims, a voice of near-reason; but mostly from Vale’s board, who have looked increasingly desperate to cling to power.
Yet real progress has been made. Predictably, it has been away from the main protagonists. Less predictably, it has come from some 130 miles away, in London. The local Sentinel newspaper interviewed both ‘sides’ – chairman Bill Bratt and Sims having column inches to themselves recently – and has made, ahem, ‘valiant’ efforts to be even-handed. This has infuriated anti-board campaigners, even though ‘Mo’ is no stranger to the Sentinel’s pages and his personalised website is one long right-of-reply. Indeed, until recently, he dominated the media agenda and frankly has had plenty of opportunity to say all he wants to say. And when the board has challenged this, they have usually looked foolish.
Bratt’s lengthy interview, which appeared in the Sentinel on April 8th, contained some salient points, notably about Chaudry’s arrogance. This first manifested itself last December, when Chaudry demanded the right to appoint the club’s next manager, despite having only received guarantees about his bid’s success from voices inside his own head. “We did not meet his deadline,” Bratt said of Chaudry’s most recent bid, “because we are running the club not Mr Chaudry.” And more recently, Bratt warmed to this theme: “Mr Chaudry appears to be repeatedly subject to the misapprehension that simply because he arbitrarily announces yet another deadline to respond to one or another of his many pronouncements, the club is obliged to jump to attention and meet that deadline.”
Bratt, however, was on shakier ground in trying to portray Vale as a well-run club with no financial worries. He countered Chaudry’s claims that club debt was £3.5m by painstakingly detailing various loans Vale had outstanding, reaching a figure of “only” £2.188m. This, however, disregarded everyday trading losses, which were £372,000 in 2010. Even his declaration that the club had money in the bank (£13,000) was used as evidence of imminent financial ruin, as opponents noted that this figure had been £400,000 in 2010.
It was clearer than ever, though, that the board’s opposition to Chaudry was as much a personal mistrust issue as the admittedly arguable principle that “absolute power in one man’s hands is not healthy.” “By his own admission, Mr Chaudry is not a Port Vale fan, so what is his interest in Port Vale Football Club?” Bratt asked. “When he has control, he could sell the ground or do anything else he likes,” he noted, darkly, before doubting whether Chaudry’s ‘secret millionaire’ status was enough to fund Championship status, the ultimate stated aim of the property investor’s “five-year plan” for Vale. And, anyway, Vale were “in negotiations with potential investors and hopefully that will come good.” These alleged investors were “one English-based group” and another consortium of English and foreign businessman, although most Vale fans were convinced they were “based” in Bratt’s imagination, having heard such tales before, usually involving former Oldham, Everton and England defender Earl Barrett.
The first group were “willing to at least match Mo Chaudry’s offer on the basis of gaining a minority stake.” And Bratt felt bullish enough to challenge Chaudry: “Why doesn’t he invest up to the 24.9% level (the maximum individual shareholding permitted under club rules)? If his intentions are honourable, he could put money into the club as an investor, but without gaining a controlling interest.” This was another salient point. But it became submerged in Chaudry’s systematic refutation of Bratt’s comments in an “open letter to the board.” However, the letter did contain something new when it finally reached its “ultimate purpose” in about paragraph 94. “To take up your invitation,” Chaudry declared, “I have formed the ‘Port Vale fan-based consortium.’
The ‘fans’ upon whom it was ‘based’ were, slightly comically, “myself and Mark Sims at this stage.” And between them, they were constitutionally able to acquire only 49.8% of Vale. But Chaudry added “ultimately we want control,” and claimed he would get it by this method “because of the backing we already have from other shareholders.” Naturally, Chaudry slapped a 10-day deadline for the board to accept this bid. Equally naturally, the board ignored it. And Bratt later noted that the offer breached both the club’s constitution and company law as Chaudry and Sims were “acting together to secure control of the company.”
Bratt even allowed himself a trip to sarcasm city, claiming “their argument is ‘we are working together (on) a joint bid which is entirely valid because we are not working together.’” And, technically Bratt was right. Chaudry supporters argued that 49.8% did not represent ‘control.’ But Chaudry’s reference to gaining…erm…’control’ by forming this… erm’consortium’ allowed Bratt to note, correctly: “This is not…subjective opinion, it is a matter of company law.” Mercifully, this to-ing and fro-ing was overtaken by events. Supporters’ organisation the ‘North London Valiants’ (NLV) were the curious-sounding basis for freeing the ownership logjam. The group (South London-based, as if they didn’t sound unlikely enough already) undertook a detailed consultation of Vale shareholders – as the board had long-promised but somehow not got round to.
Predictably, but genuinely, the consultation revealed strong opposition to both the board and the ’24.9%’ rule. And, within a fortnight, NLV obtained sufficient shareholder support to call an extraordinary general meeting (EGM), tabling resolutions to remove each director, form an interim three-strong board and facilitate Chaudry’s bid for a 51% shareholding, as he’d originally planned back in the sixties. The board called the meeting for June 1st. But not before examining methods of controlling proceedings and, reportedly, not before trying to find a way of avoiding calling the meeting altogether. “We were going to call an EGM before the end of May,” Bratt claimed, convincing approximately nobody whatsoever, “but the NLV have pre-empted that so we will call one now.” Bratt also said that the board had considered “adding our own resolutions” but “have now decided to let the EGM be called on only the NLV’s agenda,” (trans: our lawyers said we have to). “We have received a lot of support from a good percentage of people,” Bratt claimed, adding defensively: “it’s not a foregone conclusion.” And the board have certainly put in plenty of campaigning work recently.
The formal notice of the meeting included six pages of board recommendations to shareholders to vote NO to everything in sight, a four-page “additional statement” questioning Chaudry’s motives and business past, and a natty leaflet asking the same questions. Not surprisingly, this sparked another round of public argument. The board noted that Chaudry was portrayed as the owner of successful local leisure facility ‘Waterworld’ and had said that commercial links between the two businesses would help fund his future plans for Vale. But Waterworld’s accounts showed that its sole shareholder was a Mr G Qadir. The board highlighted Chaudry closing “community broadcaster Focal Radio” in 2009, three months after buying it out of administration, implying that “community football club” Vale might suffer the same fate at his hands.
Meanwhile, they were criticised for setting the EGM for 10.30am “during half-term week”; the timing, and the response to it, neatly summing up how detached from reality the arguing had become. Some company EGMs are legally required to take place during “office hours.” But the board allowed the suggestion to go unanswered that they’d deliberately made it a half-term morning to minimise attendance and somehow maximise their chances. This assumed that board opponents – and only board opponents – were somehow incapable of exercising a proxy vote. And it also suggested that the meeting itself might somehow change peoples’ vote, as if positions weren’t already 100% entrenched and the arguments rehearsed to mush.
Again, key questions were overlooked amid the frenzy of words. For Chaudry to be able to take 51% control of the club, 75% shareholder support is required to abolish the 24.9% rule (and take away the first number you thought of). The NLV’s consultation exercise revealed 80% support for abolition. But the exercise was undertaken on one-shareholder-one-vote, while the EGM vote is one-share-one-vote. And board members have sufficient shares between them to preserve a rule which still has merit, despite their (ab)use of it to obstruct Chaudry’s bid. Vale’s board have also received justified flak for “targeting the man, not the bid.” Not only because attacking Chaudry’s integrity has appeared hypocritical, but also because aspects of Chaudry’s plans require more scrutiny than his past.
And some plans don’t stand up to scrutiny. His “player recruitment philosophy,” his business plan ‘overview’ declared, “is to acquire players who will perform competitively at the League above whichever league Port Vale finds itself in (within) a wage structure commensurate with whichever division Port Vale finds itself in.” In other words, League One players at League Two money, a nice trick if you can pull it off. Nonetheless, the NLV’s actions in forcing the EGM have been a beacon of sense in the debate over Vale’s future. As one Sentinel reader noted, “all the victories have come from their actions.”In the vacuum left by the lack of a supporters trust, fans’ campaigns have taken on the destructive nature of a last resort, not least the “Starve ‘Em Out”(SEO) campaign, which has already had a significant effect on season ticket sales for 2011/12. Should the board survive the EGM, SEO will definitely come into play. But if Vale’s finances are as precarious as they claim – and “certain matters” have been “brought to” Chaudry’s attention to back this view – then SEO threatens the club’s very existence – dangerously pre-emptive when all-else has yet to fail.
So Vale shareholders are left with a stark choice. Stick with the current board, whose chairman admitted YEARS ago that they couldn’t take Vale any further. Or support your local benefactor, replacing supporter control with the generalised, uncosted ‘vision’ of a smooth-talking salesman with a fine track record in business, but no track record whatsoever in football – a combination with a dismal success rate in football to date. The board’s inability to find investment, combined with their various manoeuvrings, would not attract my vote. And only in such grim circumstances would Chaudry do so, with the blind faith of his supporters leaving fundamental questions unanswered – and the merest hint of doubt portrayed as being “pro-board.” Even if the voting on June 1st is clear, Port Vale’s future remains anything but.
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