Its a form of ‘Pass the Parcel’. A crowd of Russian, Israeli, Hungarian, Hong Kong and even British businessmen sit in a darkened room and spin poor old Pompey around until it ends up in the hands of one or more of them. The holder then has to keep it going until he finds an exit strategy. Then it goes back on the table with the same players and gets spun around again. Each time a layer is stripped off and the club gets diminished further. The last one holding the parcel will watch the final despairing whimper of a once proud football club.
It was announced today that Convers Sports Initiative, the parent company of Portsmouth Football Club (2010) Ltd, has gone into administration. Some of us got the news yesterday – courtesy of a Southampton fan. Galling. But it didn’t surprise us. Five days ago I wrote that Pompey Chairman, Vladimir Antonov was the subject of a European arrest warrant and said there was more to come. Since then, events have moved with some acceleration. There have been hasty background dealings, described by co-owner Roman Dubov as ‘trying to save the company.’ These dealings have made it highly possible that Hong Kong businessman, Balram Chainrai, will end up with the parcel for a third time.
To recap – on 16 November Antonov’s bank, Snoras was nationalised by the Lithuanian government and on 21 November his Latvijas Krajbanka closed down by Latvian financial services.
We now know that on 22 November Balram Chainrai, the reluctant owner that bought Pompey out of administration in October 2010, took out a charge on CSI’s assets. According to David Conn, “CSI is understood to be overdue paying Chainrai instalments” for the purchase of the club. Chainrai becomes a secured creditor of PFC again. On 23 November the Lithuanians issued the EAW.
Antonov handed himself over to the City of London police on 25 November, appearing in court and being bailed for an extradition hearing on 16 December. He claims that he is, ‘scared that I may get killed,’ if extradited to Lithuania. His partner Raimundas Baranauskas is contemplating seeking asylum. On the same day it appears that CSI were put into administration although this was not made public. CSI’s remaining directors, Roman Dubov and Chris Akers, were entertained at Fratton Park on 26 November as Pompey play Leicester, drawing 1-1.
Today, 29 November, the administration of CSI was made public and our old friend, administrator Andrew Andronikou reappeared, signing autographs again.
To be absolutely clear, Portsmouth Football Club is not in administration but its parent company, CSI is. The Club seems to have enough funds to keep running in the short-term. However, there is a CVA payment of £5m due at the end of March. Meeting that will be a problem without funds from CSI. It will be interesting to see if we can even keep paying our players up until then.
There is the worry of a points deduction hanging over the club. Our neighbours up the M27 had the same problem a while back when the company owning them suffered the same fate. However, Dr John Beech suggests that ‘there is a strong case that CSI’s Administration should not result in a points deduction for Portsmouth.’ Unlike Southampton Pompey is not the only company owned by CSI, which has a number of sporting and entertainment ventures in its portfolio, nor was it due to the business of PFC that CSI went into liquidation. Pompey could easily be separated from CSI and stand alone as a going concern. More like West Ham and the Icelandic Bank in fact. Of course, if Pompey does fall without the support of investment from CSI and go into administration as a consequence then the points will be deducted – how many is at the discretion of the Football League.
It seems the reassurances emanating from Fratton Park last week, assuring the safety of CSI, were hollow. As fans feared, the unavailability of Mr Antonov’s money leaves the club exposed and vulnerable. It seems that, according to 5% owner Chris Akers, Mr Antonov has invested £10.5m since June for transfer fees and players’ wages. We don’t yet know what form that ‘investment’ takes, loan or equity, and whether the Lithuanians or Latvians will be asking for it back, as they have done of the money Antonov invested in Saab. CEO David Lampitt, in a masterly understatement, now finds it all ‘incredibly disappointing.’
CSI’s administrators, Hacker Young, have said that the companies under their umbrella can be sold as going concerns – but for PFC that needs to be achieved in a frighteningly short time-frame. With Mr Chainrai’s charge in the equation it is not exactly going to sell for a bargain price.
Mr Chainrai’s new position is a concern. If he does take the club back in charge again there will no hope of development or inward investment if his record last time is a measure. No doubt he will seek another person to pass the club onto. His frequently avowed intention to get his money back will hopefully ensure he will keep the club running, but his track record for finding suitable buyers is not encouraging.
Meanwhile the Supporters’ Trust is endeavouring to build a fighting fund. The Pompey Trust was born out of our last illiquid ownership and is still finding its feet. A proper scheme for donations is being worked on but already membership is being driven up. Yet again fans are prepared to come to the support of a club stricken by the broken model of private ownership and the inadequate regulation by the football authorities.
The Pompey Trust statement on the situation and membership details can be found here.
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