Charlton Athletic: From Pillar To Post

by | Jul 28, 2020

In a footballing culture that treats all relegations like the closing act of Romeo & Juliet, it can be difficult to judge whether dropping a division might actually be existentially damaging to a club. Tears will have been shed over the last seven days by supporters of clubs falling through various trapdoors, but only in a tiny number of cases could a drop in revenue come to have ramifications beyond wage bills and transfer budgets. On the last day of last season, Charlton Athletic were relegated back to League One, following a 4-0 defeat against Leeds United. It wasn’t a hugely surprising relegation. After all, Charlton had only been promoted into the Championship at the end of the previous season through the play-offs, an outcome which seemed to surprise the club’s own supporters as much as anyone else.

But in another sense, Charlton’s relegation this season is a disaster for the club, and the story of how and why has come about has been somewhat subsumed by news stories both within the game and beyond. At the end of lasts year, the club seemed set fair for the first time in quite a long time. Roland Duchatelet, the detested owner of the club, had finally gone, and the club’s new owners were making familiar promises about what they would do in the January transfer window. It has taken just eight months for any optimism to evaporate, though, with embarrassing online slanging matches, a deeply unhealthy separation of club from stadium, and now a further change in ownership which has not been approved by the EFL and which might yet send the club into a further downward spiral from the start of next season.

Last October, things all looked very different. Charlton had been promoted into the Championship and Duchatelet was finally ready to sell up, to a group called East Street Investments (ESI.) By the new year, though, money promised to strengthen the team during the January transfer had failed to materialise, and the new owners’ total “investment” in the team in that critical month amounted to just four loan signings – Andre Green from Aston Villa, Aiden McGeady from Sunderland, Matt Smith from Manchester City, and David Davis from Birmingham) – and none of them, it turned out, particularly set the team alight. To put it another way, the new owners had not put in a single penny to try to strengthen the team.

By April, the takeover was being investigated by the EFL. ESI had purchased the club for £1, and with a promise made to spend £50m purchasing the rest of the club’s assets this summer. Six months on from the takeover being completed, though, the EFL had yet to see proof of funding for any of this, and by this time is was clear that all behind the scenes at The Valley was not going according to plan. In March, majority shareholder Tahnoon Nimer removed former agent Matt Southall as chairman of the club, but Southall claimed that he would not be stepping away from his role with ESI, saying that the steps Nimer had taken to get him out were ‘invalid and unlawful’. His statement read as follows:

Mr Nimer brought in to the meeting two other men with no standing in Charlton Atheltic Football Club and he and those two men have collectively decided they are now the board of an English football club.

We presume that in due course they will make an application to the English Football League to take the owners and directors test.

Protocol has not been followed and resolutions have been passed which are both invalid and unlawful.

Nothing from the board meeting changes the circumstances of my employment or mine or Mr Heller’s status as directors of the club.

Until such time Mr Nimer fulfills the obligations that he promised when purchasing the club, there shall be no discussions about me stepping away from Charlton in my day-to-day capacity or as an owner through my shareholding in East Street Investments.

Companies House confirmed that Southall’s position with Charlton Athletic had been resigned on the 19th March, the day before this Talksport story was published. Another director, Jonathan Heller, made his exit from the club at the same time, along with lawyer Chris Farnell. Southall, however, refused to leave the board of ESI, the company which as a legal entity owns it.

If Southall was hoping that washing the club’s dirty laundry in public was going to win him favour with the club’s supporters, he was misguided. In April, both parties were interviewed by TalkSport about the unravelling situation at the club, and neither side of the argument did themselves too many favours. Nimer accused Southall of continuing to cause issues for the club, stating that, “They are no longer there, but they’re still fighting and they’re still hammering the club. Matt Southall, he keeps sending his invoices to the club to get paid for his consultancies. I want the fans of our club to know that I have already sent my response to the EFL and I’m cooperating fully with them. There’s nothing to hide from the EFL.”

Southall’s response was bullish, denying accusations that he had misused club money and claimed that Nimer had made no attempts to satisfy the EFL’s previous demands over the source and proof of funding. As you know given previous experiences with clubs last year, we all know what the potential consequences could be. In terms of what Tahnoon is saying, this has been going on since November, this isn’t a case of ‘I’ve removed Matt Southall and now I’m going to show the EFL where my funds are’. This has been going on since November, December and January and February. Not once has he provided any evidence to the EFL to satisfy them. If he had done, even if he had put any money into the club whatsoever, the EFL would not have opened this investigation.”

So far, so undignified then, and it was perhaps inevitable that such a childish war of words would end up with threats of legal action. Nimer claimed that Southall  had been using club money to fund a luxury lifestyle, including renting a £12,500-per-month London flat, purchasing four Range Rovers for himself and fellow directors, and payment of large consultancy fees. Southall’s response to this was another statement of his own, making various allegations about Nimer. In June, Southall’s solicitors confirmed that they would be launching various legal actions through the High Court against the club, with his lawyer, Paul Daniels of Keystone Law, stating that:

We believe that Mr Southall has been treated in an extraordinary manner in the last few months and that he has been treated blatantly unlawfully and wrongfully dismissed in breach of contract.

Substantial claims are now in process against the club, which will be vigorously pursued, if they are not resolved amicably. We believe there is no basis whatsoever for a spokesman for the club to make any suggestion that there are any valid claims against him.

Such allegations are completely without foundation and appear to be part of an unfortunate and unfounded attempt to yet again smear and defame our client.

Both ourselves and Mr Southall are confident that, when the fans learn the facts, they will have a very different view of what went on in the last few months and who was truly acting in the club’s best interests.

A couple of weeks ago, Southall and Jonathan Heller told Sky Sports that they had launched legal action to remove five directors from ESI. However, Southall and Farnell had already burnt many of their bridges with supporters by this time. It was reported at the start of May that Southall wanted a “high six figure sum” for his 35% shareholding in ESI, even though ESI had only paid £1 for its shareholding in Charlton in the first place. But even this felt like old news by this time, considering that ESI had been sold to another businessman, Paul Elliott, at the start of June. Elliott began his career with a property management company, which he subsequently turned into a large portfolio of residential and commercial units. Whether that’s a good thing for the club or not is open to conjecture.

If your head is spinning with all these accusations and counter-accusations, that’s hardly surprising. But underneath all this mud-slinging, something far more serious was going on. On the one hand, the team went into the lockdown off the back of three successive defeats, and when matches began again in June, they followed two straight wins with a complete atrophy in form. With other other teams near the bottom of the table all winning matches, Charlton got themselves sucked into a relegation battle and went back down to League One on the last day of the season.

And on the other was the small matter of what would happen to the club, given this lack of money coming through and lack of compliance with EFL regulations regarding takeovers. Last night, the EFL confirmed that they still hadn’t received the required paperwork to approve Elliott’s purchase of ESI, and that, “The League is aware of the frustrations and concerns the current situation is having on all those associated with the Club, including staff, players and supporters, particularly in recent weeks whilst it has attempted to try and work through the various and complex challenges out of the public eye.” Somewhat more ominously, they closed it by saying that, “The Club is aware of the consequences of not meeting those requirements.” Those consequences could include expulsion from the EFL, of course.

As if that’s not enough, there’s also the small matter of The Valley. Charlton Athletic were sold for £1 on the basis of a further £50m being spent this summer, so Roland Duchatelet remains the legal owner of the ground and training ground, as well as other assets, for the time being. The separation of a football club from ownership of its ground is seldom a good thing for a football club, particularly in London, where vultures seem to keep a constant eye on the well being of football clubs in the hope of profiteering, should the circumstances be right.

Charlton Athletic have been here before, of course, with their period of exile at Selhurst Park and The Boleyn Ground from 1986 to 1992, so it’s understandable that fans would be jumpy about talk of moving the club out of its locale. In view of this, it was almost inevitable that talk would start to circle that the club could be forced out of its home again. There doesn’t seem to be anything particularly substantial upon which to base this at present, but if the new owners – whoever they might be, once the dust has settled on this latest protracted period of barmpottery has drawn to a close – don’t stump up the £50m that Duchatelet wants for all these assets, then it starts to become a possibility. The Valley, which is built on a large drainage ditch which has caused the club particular problems before, isn’t quite an ideal site for redevelopment, but merely being in London alone may be enough to tempt the unscrupulous to try and make a killing off it.

As if all of that wasn’t enough, there’s another grouping, led by another businessman, Alan Barclay, alongside former club CEO Peter Varney. Barclay, former owner of the Ritz hotel, likely has the means to be able to secure the club’s future at The Valley whilst few would doubt long-time servant Varney’s commitment to the club. They’re understood to have been involved in discussions over it for the last couple of months, but there is little to suggest at present that ESI will allow them anywhere near it. And just this morning, Charlton issued the eight billionth public statement made about the club this year, concerning the latest conjecture surrounding its future:

Following the EFL and club statements on Monday, there is understandably some nervousness among the fanbase about the consequences of the club not meeting the EFL’s regulations.

Getting the change of ownership approved remains the top priority and the club is confident that the finalising of the change in control of the club, to Paul Elliott’s consortium, will be completed shortly.

The club was asked to submit further documents on Monday by the EFL and provided them within hours of the request. The club has been in communication with the EFL again today [Tuesday] and has requested that a meeting with the league takes place as a matter of urgency.

This statement, however, is mostly notable for what it doesn’t say rather than what it does say, and what it categorically doesn’t say is that the required paperwork has been submitted to the EFL. Judging by the replies to their tweet on the subject this afternoon, supporters have completely lost faith in the very notion that ESI are going to ever come good on their promises to buy all of the club’s assets, or that they even able to. And when we consider what happened to Bury less than a year ago – something which might have happened at dozens of other clubs over the last two decades or so – to suggest that fears surrounding the club’s future are groundless feels like a reckless degree of optimism.

So, less than a year on from the start of a new era that would definitely secure Charlton Athletic’s future in the long term and this time we mean it honestly, the club stares down a barrel of a gun while businessmen fire broadsides at each other on social media and argue over who owns it while failing to provide the paperwork which confirms that they even have the means to be able to do so. Plus ca change. And if you want any reminding of just how feeble the EFL under such circumstances, then all you have to do is consider that it’s less than a year since Bury were expelled from the EFL over a situation that has some parallels with what is happening at Charlton right now.

We didn’t trust the EFL then, and we didn’t trust them when they relegated Wigan Athletic with a points deduction brought about because of the actions of people who were nothing to do with the running of the club any more. In such turbulent times, they simply cannot afford to be blasé over situations like this. The future of its member clubs is on the line in a way that it never has been before. If Charlton Athletic were to end up facing expulsion from the League, responsibility for this would rest as much with them as it would with any number of shady owners or would-be owners that have darkened the club’s doors in recent years. And unlike so many end of season football stories, the expulsion or displacement of Charlton Athletic would be a real tragedy, which would stain the reputations of all involved irreparably.