The Morning After Coventry City’s Night Before

By on Jun 19, 2013 in Finance, Latest | 1 comment

A battle may have been lost, but the war certainly isn’t over yet. As anger amongst Coventry City supporters hit a new crescendo at the end of last week following the decision by the administrator of the club, Paul Appleton, to sell it back to, effectively, the company that had put it into administration in the first place, albeit via a different legal entity – exactly the sort of legal sleight of hand which give the industry such a bad name in the first place – it is starting to feel as if the times are a-changing, with a new spirit of protest having been born amongst some and even, albeit a tiny minority at the moment, are even starting to say that it might even be better to sever links and start afresh with a new club than to continue to fund SISU’s desecration of their club.

The Football League’s statement on the matter of the take-over itself was cagey, to say the least. Given the way that they seemed to raise an eyebrow at the whereabouts of the elusive Golden Share, which seemed to have gone missing somewhere deep within SISU’s  corporate structure and which still hasn’t been absolutely clarified, and their reaction to the messy situation that Portsmouth FC found itself in earlier this year, which resulted in the League intervening to state that it would only deal with the Portsmouth Supporters Trust as the preferred bidder for the club at that time, it might have been expected that the League would have been robust in its response to a short period in administration which seems to have run to the absolute contrary to the spirit of its own rules on that particular subject. Instead, all they could muster was this:

At its meeting yesterday, the Board of The Football League noted the decision of the administrator to accept a bid from Otium Holdings for the assets of Coventry City Football Club Limited (in administration). The League will now work with the administrator and the proposed purchaser with regards to the fulfilment of the requirements of The League’s insolvency policy.

This response, which might be described as either “cautious” or “cowardly”, depending on your perspective, doesn’t seem to have dampened the flames of anger amongst the club’s supporters. A petition to request that the Football League carries out a thorough investigation into this administration process has now reached almost seven thousand signatures, while the Sky Blues Trust took a coach-load of supporters to the London headquarters of SISU to demonstrate against the removal of the club to ground-share elsewhere whilst a new ground is built. Tim Fisher, the CEO of the club and a director of, amongst others, Coventry City FC Ltd (which was placed into administration towards the end of last season), Coventry City FC (Holdings) Ltd (which wasn’t put into administration towards the end of last season) and Otium Entertainment Group Ltd (which has agreed to purchase the club from the SISU-appointed administrator), has previously claimed that “the boat has sailed” on the club staying at The Ricoh Arena but that any ground-share arrangement will be temporary, with the club returning to a new stadium “in the Coventry area” in two or three years. How it will manage to get back in that space of time, though, remains something of a mystery, and the number of supporters who will actually follow them to Walsall, Birmingham City or whichever other ground some distance from the city of Coventry itself the club ends up playing at. We must refer back to the Football League’s own rules to establish what this might mean:

13.4 Ground sharing will only be approved at the discretion of the Board. The Board will not generally approve any ground-sharing arrangement where the club plays its matches outside the conurbation, as defined by the Board, from which the Club takes its name or with which it is otherwise traditionally associated.

The Football League, however, doesn’t define in the same set of rules how the word “conurbation” might be “defined by the Board”, but it may be instructive to know that, in 2001, the Football League initially blocked the departure of Wimbledon to Milton Keynes because “League rules clearly state that clubs should play in the conurbation from which they derive their name or are traditionally associated unless given the approval to do otherwise by the board.” Given that the Football League’s own rules state that “The Board will not generally approve any ground-sharing arrangement where the club plays its matches outside the conurbation” and that Coventry only just falls within any definition of the West Midlands Conurbation by the skin of its teeth – indeed, some would argue that the existence of the Meriden Gap, a piece of Green Belt land which separates Coventry from Solihull, means that Coventry is not in the West Midlands Conurbation at all – there may even be cause for arguing that permitting a ground-share at Walsall or Birmingham might even be a breach of its own rules. It might, however, be counter-argued that the Football League keeps these definitions deliberately fuzzy in order to approve whatever it sees fit to. After all, they allowed Brighton & Hove Albion to play at Gillingham at the end of the last century, although at that time Brighton had no ground in their own town that they could use. SISU do not have this excuse, and the Football League should be pushing the hedge fund harder over how the club is to survive a ground-share and then move back to the city than it seems to be at the moment.

Meanwhile, Coventry City supporters are, as so often seems to end up the case when clubs find themselves in this position, divided. It is difficult to gauge precisely whose feelings lay where, but there remain many who feel that ACL, the Ricoh Arena owners, have acted as unreasonably as SISU over negotiations regarding the rent dispute which led to the position in which the club finds itself today – and to get the final £400,000 per year rent offer into perspective, we might consider the £100,000 a year paid by FC United of Manchester, who had an average home crowd of 1,794 people last season paying considerably lower season ticket prices than Coventry supporters do and without the access to sponsorship money that Football League clubs have, to rent Gigg Lane in the Northern Premier League - and those who, bizarrely, take any opportunity they can to attack the Sky Blues Trust, as if somehow or other the condition in which the club finds itself is their fault. If Coventry City supporters do wish for their voice to have any effect, it will be stronger if they are united. Some, however, seem to wish for this to not happen.

So, if SISU were attempting a game of divide and conquer over the supporters of the club, it’s a battle that they have won, and it may be that if they are attempting to cow the Football League into allowing them to do whatever they like, then there’s a chance that they might have managed this. It hasn’t been all bad news for supporters, though, with rival bidder Preston Haskell IV having confirmed that he will continue to press on with his attempt to purchase a fifty per cent share in the Ricoh Arena and to buy the club itself, but at the time of writing it seems most likely that the club will at least start next season playing well away from Coventry in front of small crowds and with assurances that a new home will come in the fullness of time being based on little that has been made public so far. If there are supporters of Coventry City that want this, then that is, of course, their prerogative. If, however, they don’t, then boycotting this husk of a club may well be the only way to tip the balance back in favour of what they actually want. When season tickets for next season finally go on sale, we might finally get a clearer picture on what the next move for supporters of the club will be. Until then, though, the sale of Coventry City back to its previous owners has achieved little of any value to anybody apart from SISU itself. That, however, was most likely the plan all along. It’s time for a through investigation by the Football League and the Football Association into what on earth has been going at Coventry City over the last year or so.

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    1 Comment

  1. On the ground share point, I suspect that a precedent might exist in the way that the Football League dealt with my club, Rotherham United.

    When RUFC exited administration into the ownership of the present chairman, Tony Stewart, it couldn’t agree terms on a lease for Millmoor. In some ways, the situation was similar to Coventry’s, in that there was a ground capable of being leased, just not any form of agreement on the terms of that lease. The result was a decamping to the sterile Don Valley Stadium, in Sheffield.

    The Football League weren’t particularly impressed by the proposed move, which they considered breached the proximity rule, by virtue of DVS lying outside the Metropolitan Borough of Rotherham. However, they were assured by the new chairman that the club would be back inside Rotherham by the start of last season and so accepted the move, with conditions. Those conditions were (1) the requirement of a £500,000 bond, forfeit if the club failed to move back in the timescale provided and (2) the club agreeing to relinquish its “golden share” in the Football League if it failed to move back in time.

    Given the parallels (in RUFC’s case it wasn’t wholly clear where the responsibility for the breakdown in lease negotiations over Millmoor lay either), I wonder if the League will be tempted to go for a similar solution in Coventry’s case?

    David Rawson

    June 21, 2013

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