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There’s nothing like a bit of blackmail to liven up English football in a quiet news week (and, alas, FA Cup third round replay week is such a week). Good job, then, that Hull CITY owner Assem Allam isn’t resorting to blackmail in order to force English football’s governing body (the Football Association, in case you didn’t recognise them from the description) to accept his thoroughly-researched, precisely-budgeted rebranding of his club to Hull Tigers. Allam met the FA recently. His “promise to go away within 24 hours” if either the Hull “community” or the FA reject the rebrand suggests that meeting didn’t go according to his plan.
The “antics” of the more high-profile egomaniacal football club owners constantly put me in mind of Woody Allen’s 1971 film Bananas (one of his early funny ones), where the newly-installed revolutionary leader of the fictional republic of San Marcos announces his reform plans, including the requirement for “all citizens to change their underwear every half-hour. Underwear will be worn on the outside so we can check.” Allam’s theory, purloined from the Harvard Business Review (so it must be true), is that companies with shorter names perform better when floated on the stock market. Hull Tigers isn’t “shorter” than Hull CITY of course. But Allam told the Guardian newspaper’s David Conn that “everybody knows it now as Hull City Tigers”; which was news to… well… almost everybody. The idea that the official language of San Marcos should be Swedish seems better thought-out.
I can’t quite pinpoint the exact phrase for Allam’s threat to “walk away”, given that it isn’t blackmail in any way whatsoever. On the face of it, flouncing out would make no financial sense, given that he’s plonked seventy-two million quid into CITY to get them into the EPL & would have no way of getting that money back. And, as Private Eye magazine noted last month, CITY’S current losses have been used to the benefit of Allam’s increasingly less profitable marine engineering business, the modestly-entitled Allam Marine. According to the Eye, Allam Marine’s 2012 accounts noted that “’utilisation of tax losses from group companies’ reduced its tax liability by £3.8m over 2012 and 2011.”
This is important because, as the Eye added: “Allamhouse” – which owns Hull CITY and Allam Marine – “ended up in the red for 2012, as a result of lower Marine profits.” There were, it must be reported, any number of mitigating circumstances for these lower profits – such as political turmoil in its Northern African markets. There were also £12m and £16m losses, in 2010 and 2011 respectively, attributed in the company’s accounts to “dividends for which the company became liable during the year,” and paid to company shareholders… erm… Assem Allam and his… um… son Ehab Allam.
Of course, the idea that Allam himself is in any way responsible for Allam Marine’s recent business misfortunes is preposterous. He’s said so himself. This week, on Sky Sports News, he filed another few words in the “he said what?” column, alongside his suggestion to the “City ‘til I die” supporters protest group that “they can die as soon as they want, so long as they leave the club for the majority who just want to watch good football.” Apparently: “No-one on earth can question my business decisions. I won’t allow it. I can give you my CV to give you comfort, for what I do in business. But for someone to come and question me is not allowed.” This was a direct response to opposition from what he referred to as the Hull “community”, of which he has been a long-standing pillar, it would be unfair not to re-iterate, donating to Hull University, local theatres and hospitals and £1m to Hull Kingston Rovers Rugby League Club.
“If the community say go away, I promise to go away within 24 hours,” he added, echoing a threat he made to “City ‘til I die” in November (“Do they want me to stay? If its ‘no, thank you’, fine, in 24 hours the club is for sale, I do not put in one more pound”). Of any potential FA opposition, he added: “Still the same thing, it is a free country” – free until you start questioning his business decisions, that is. Yet, as we have seen, there are reasons to question his business decisions. After all, as the actress said to the Bishop of Rome, “no-one is infallible” (one for the Catholics there). For example, the website companycheck.co.uk includes a paragraph of caution in its “Director Overview” of Allam: “The combined cash at bank value for all businesses where Assem Allam holds a current appointment equals £4,479,238, with a combined assets value of £169,351,854 and liabilities of £246,454,837.”
Also, while Allam chases global finances, he appears to be letting a near lust for power cloud his domestic business judgement. Plans to increase the capacity of CITY’S KC Stadium by up to 10,000 have foundered on Allam’s refusal to co-operate with the city council on the project. “Would you build an extension on a house if you were just the tenant?” he asked, demanding that the club be allowed to acquire the stadium freehold. The analogy was rubbish, of course, as City would benefit from the increased capacity. It also ignored the relevant history – an area of increasing Allam expertise, it would seem – given that the council built the stadium and, according to the stadium website, had it specifically designed “to make it possible to raise the capacity to 30,000” from its current 25,586, should the football club so require.
Meanwhile, Allam’s arguments about the power of the “Tigers” brand to bring financially beneficial global recognition to the club are not thoroughly market-tested. They are disputed by experts in the marketing field and, as even the market-ignorant know, they will mean two-tenths of five-eighths of Foxtrot Alpha if CITY are relegated. Steve Bruce’s astute management of the team suggests that Allam won’t have to decide yet between focusing his efforts more on rebranding or on avoiding relegation. And one suspects that his rebranding plans are designed for a world without relegation – the dream-world of egomaniacal football club owners everywhere.
In the dream-world of football club supporters everywhere, the FA would have the nerve to refuse Allam’s application to change CITY’S name… and to respond to Allam’s threats to go within 24 hours by calling his bluff with a cheery wave, wishing him “the best of luck” in his new job. And supporters would follow suit, perhaps conveying a more marketable “shorter” message in Allam’s leaving card. It is not beyond the bounds of logic for Hull CITY fans to take that decision, given the financial hit Allam would take if he was out by tomorrow. And Cardiff City fans might currently see more benefit in such a sacrifice, especially as owner Vincent Tan’s equivalent of half-hourly changes of underpants is tangibly threatening the BLUEbirds’ EPL survival anyway. Whether either CITY’S fans are ready to take that emotional leap of faith is another matter. But one day, one egomaniacal owner will take things too far. One crackpot and untested marketing scheme too many; one disrespectfully thrown-away comment too many; one “bluff” too many. And on current form, that could yet be Assem Allam.
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Dunno if it is private eye or this author’s error, but losses do not come from paying dividends to shareholders. Dividends are paid out of retained earnings, they are a distribution of profits, so do not appear as expenses and do not feature at all on profit and loss accounts/income statements.
When recently trying to source marine specified generator sets for one of our vessels I contacted ‘Allam Marie’ only to be advised that they do not sully generators for marine applications!!
‘Allam Marine’s’ core business is assembling generator sets to your specifications!! They don’t do marine specifications, therefore the name is a misnomer.
Its actually Allam Marine, not Allam Marie.
If changing a 100 plus year old name of an established football club and one currently in the EPL is such a good business idea to generate loads of money, how come Manchester United or anyone else for that matter have not thought of it first ?
This started off as a spat with Hull City Council over botched talks, which the council were equally as guilty (some say more than) about the freehold of the council owned KC Stadium which the football club share with Hull FC (a rugby league club) also added to the mix were the favourable terms the rugby league club had secured in secret talks with the council over their lease agreement.
I believe Dr Allam thought by taking ‘City’ away from the clubs name it would somehow reflect badly on Hull City Council. He has already threatened to move the club to a new stadium at Melton and he refused the offer of a civic reception after the club won automatic promotion to the Premier League saying ‘What has it got to do with Hull City Council?’
Now it has spiralled horribly out of control and Dr. Allam despite of all the good he has done is in danger of backing himself into a corner,
What Messrs Tan and Allam fail to realise is that changing kit colour or team name will not attract one more fan in the ‘lucrative’ world market. Although Tom Hanks has been quoted as saying he ‘supports’ Aston Villa as he liked the name.
The lesser lights of the ‘EPL’ are merely cannon fodder for the few teams with significant fanbases around the world. A group that now includes Manchester City. As Syd makes reference to, did Manchester City need to change their kit or their name to gain access to this elite group? No, they spend a f*ckload of petrol money on some of the finest talent in world football and started winning trophies. It’s not rocket science.
Unless Tan and Allam have that kind of funding then I suggest they give up on their dreams of world footballing domination and perhaps work with the supporters to build a sustainable football club that works together with its local community. But then I suppose that’s just naive of me, isn’t it?