A horse called “Owls FC” was due to run at Sedgefield racetrack this week. It didn’t. At first this seemed a very appropriate analogy for current affairs at Sheffield Wednesday – the “Owls.” But in reality it couldn’t be more inappropriate, as the Wednesday takeover tale keeps on running. A few days ago, the local papers that cover Wednesday in detail – Sheffield’s Star and Telegraph and the Yorkshire Post – ran the story that the takeover was “thought to be” a few days away. Now, a few days later…
Indeed, every time you allow yourself to think that Wednesday’s affairs couldn’t take on a more bizarre aspect, they do – in-fighting, out-fighting, shake-it-all-about-fighting and, this week, the real prospect of a Moody Blues revival. All sorts of poison has been injected into the affair by the recent publication of unratified minutes from a meeting held between Wednesday board members Nick Parker and Bob Grierson, chief executive and finance director respectively, and representatives of Wednesday’s long-standing Supporters Trust, Wednesday-ite. The meeting was held on July 8th. The date is significant.
The fact that the two sides were talking at all was unusual, historic relations between the sides have been frazzled for some years. But the focal point of the publication was the series of additional “notes” supplied by former Wednesday chairman, Lee Strafford, who resigned in May, after Wednesday’s relegation. Strafford’s key phrase, used four times, is “this is a lie.” And when he doesn’t introduce a comment in that manner, he uses the phrase “that’s an interesting thing to say”, which roughly translates as…er…”this is a lie.”
At the meeting, Wednesday-ite asked all the pertinent questions about Wednesday’s plight, on and off the pitch. The club had not only just been relegated but had also turned down the most transparent investment offer/takeover bid they’d received since they have supposedly been looking for such things (Chicago-based “investment firm” Club 9 Sports – see previous Wednesday articles). So the lack of investment was the natural focus of the questioning, i.e. why hasn’t there been any when “several clubs have received substantial investment in recent times?”
The focus of the answers was a mixture of “dunno” (“Bob Grierson says he genuinely doesn’t know why”) and “not our fault” (“it isn’t a case of blocking by board members or loan-note holders”). Grierson claimed “we haven’t had offers to reject,” which surprised those of us who’d trawled through Club 9’s…um…”offer.” And, he added, he “didn’t know why there isn’t a Sheffield person who has come forward,” which will have surprised “Sheffield” boxing promoter and “local personality” Dennis Hobson, who has “come forward” on a number of occasions over the years, only to be told to go back again. “Lee Strafford came with a potential investor but it didn’t happen,” Grierson is quoted as saying. “This is a lie” noted Strafford, sparing no words explaining why.
Strafford’s tenure as chairman, from January 2009 until May 2010, centred on a detailed business plan, which proposed a gradual turnaround of Wednesday’s finances on the back of a huge PR and rebranding exercise to make the club look attractive to potential investors. This was dismissed as mere cosmetics by some (me, for one), but was certainly a vast improvement on the club’s public relations over more recent years, as acknowledged by many fans. And it was the stage before actively seeking investment. “I did not come in with an investor,” Strafford noted, claiming he told Grierson in “September 2008” that “no-one is going to invest in something with such a poor recent public relations profile until they see it start to turn around.” Only once the business plan was up-and-running did Strafford “(find) four investors and tried to get them to do a deal.”
Grierson told Wednesday-ite that at the time the club was “cash neutral.” Strafford had disputed Grierson’s further claims that this cash neutrality was not dependent on “player sales and other exceptional income.” And, worse still, once Strafford and Nick Parker became chairman and chief executive, they “found that the club was not investor-ready and would not have passed a formal due diligence process.” In other words, a proper look at “the books” would have revealed the club’s “cash neutrality” claim to be “a lie.” Strafford used the phrase “not operationally clean” which translated as a “£1.5m hole in the accounts.” Parker told Wednesday-ite in July that he “did not recognise” the claim “at all” and added that “there was always a £1m-£1.5m buffer in the reserves (for) when targets were not achieved.” And he blamed Strafford for “putting expectations higher” and setting business plan targets which were not achieved.
Stafford, however, had the minutes of a January 2010 board meeting, which exposed Parker’s version of events. Grierson’s mantra has been “what goes on in the boardroom, stays in the boardroom.” Little wonder he thought like that when the minutes showed “Parker had concluded his forensic inspection of the club’s historical accounts following the discovery of the cash hole of £1m-£1.5m in November/December 2009” (my emphasis). “This is a huge issue,” noted Strafford, correctly, “as the business plan for running the club was based on false assumptions and all information given to the investors was based on the same false assumptions.”
Cynics may suggest that this was Strafford’s version of “not my fault,” as his plan’s targets were undeniably missed. But Strafford also published the “November 2008 Investment Financials” and other 2009 budgetary documentation which (a) are as interesting as they sound but (b) explain the points he made, if you’ve got a spare fine tooth-comb. Strafford disputed further claims. Parker said improvements in Wednesday’s financials under Strafford were “totally due to TV revenue.” Strafford noted a £1.8m increase in TV revenue alongside a £3.8m growth in overall revenue. “This is the first material growth in revenue not driven by TV money since 2002. Why the lie?”
Grierson, meanwhile moves his stance from “not my fault” to “it wasn’t my job,” claiming: “Prior to Lee’s appointment, I worked on the finances – the budget, the cash flow, liaising with the bank. I haven’t done much of that in the last year, Lee took that on.” Strafford noted that such changes in directorial responsibilities would have required a formal announcement as Wednesday is a PLC. And Strafford again had the details to show that Grierson’s recall of his responsibilities was, shall we say for legality’s sake, less than total.
Strafford’s technical points about the past were good ones, well made. But the weaknesses in Wednesday’s board were even better sum up by two briefer aspects of he minutes. When asked “do the directors need to be more visible?” Grierson casually responded: “I don’t think people are interested in what the directors are doing.” And he must have said this out loud, because it’s in the minutes. As proof of how out of touch Grierson is, that can’t be bettered. But what is not in the minutes is maybe most telling. The meeting was held on July 8th. Fifteen days later, HM Revenue and Customs issued a winding-up petition against Sheffield Wednesday PLC, over £1.1m in unpaid taxes.
So this debt was either accrued in a fortnight, or it was as big a shock to the board as to anyone else, in which case the board stand condemned of financial negligence on an indefensible scale. Or they were simply not giving Wednesday-ite a full and true picture of the financial situation, exactly Strafford’s claims over the aforementioned – and similarly-sized – “£1.1m-$1.5m “hole in the accounts.” Either way, the board come out of this as unworthy of being directors. It is, you could say, time for them to go. And an increasing, and increasingly well-organised, group of Wednesday fans are doing just that. Down through the years of turmoil, the Wednesday-ite supporters’ trust have largely tried a diplomatic route of representing fans’ interests. Occasionally, this has led to some very undiplomatic decisions, such as backing a Ken Bates takeover (that undiplomatic).
But their willingness to use their 10% shareholding in a positive manner has garnered less credit than it has deserved. And the desire to have such a dialogue with the board as happened on July 8th was also, largely, a “good thing.” Unfortunately, the latter has revealed how necessary protest groups such as “Time to Go” (TTG) have become. TTG have focused their anger on the three longest-standing board members, Ken Cooke, Geoff Hulley and, naturally, Grierson. They have exonerated current chairman Howard Wilkinson, whose long-standing Wednesday affiliation makes him a figure around whom to unite (exactly what a chairman should be, in fact), and Parker, despite his failing powers of recognition when it comes to million-pound accounts black holes.
The campaign is well-reasoned and well-focused, despite a false start after a last weekend’s home defeat to Southampton which saw some misdirect their ire at Wilkinson. A pithy 10-page document entitled “The rise and fall of Sheffield Wednesday, 1991 to 2010” neatly encapsulates what has gone wrong and when, and a very useful education for outsiders.
The website (http://www.timetogoprotest.co.uk) contains a number of campaigning ideas, the best of which is inspired by the facebook campaign which subverted the race for the Christmas number one single last December. TTG have suggested a co-ordinated purchase of the old ‘Moody Blues’ single, ‘Go Now’ to get it top of the national singles chart and give their campaign about the best national attention it could muster, especially at 79p per single. Wilkinson’s brave and admirable response to the misdirected abuse he got after the Southampton game included the dire warning that the club “would be in receivership next week…if Nick and I walk away,” which, if you think about it, is the ultimate indictment other board members, such as Cooke, Hulley and Grierson.
Yet TTG has the crucial quality of being “for” something rather than just being “sack the board” merchants. They, and Wednesday-ite, have latched onto recent attempts, spearheaded by local MP and genuine Owls fan David Blunkett MP to organise backing for Wilkinson and Parker, with the call going out for “21st century business acumen, strong leadership and good old cash.” But whatever the next step is, it has to be quick (“we’re that close,” Wilkinson claimed this week). The team’s bright start to the season is already a fast-fading memory, they dropped to 16th in League One while I typed this. The Co-Operative Bank’s £800,000 company bail-out last month can hardly be a regular feature. And Cooke, Hulley and Grierson’s unwillingness to depart is as damaging as Tom Hicks’ similarly grim efforts at Liverpool.
As TTG concluded in their inaugural rallying cry: “For the directors of Sheffield Wednesday Football Club who have overseen the decline from Cup finalists to the third tier, and the brink of financial ruin, it is TIME TO GO.”