Reviewing the issues surrounding the club, one can only arrive at the conclusion that there are currently more questions than answers. As fans, that makes it very difficult to assess how the land lies with any degree of certainty? However, arguably it is still possible to take a critical and considered view based upon what the philosopher Vico called the basis of all truth, probability!
We cannot say that we are 100% certain about the scale of debt being carried by the club. The delay in making the latest set of accounts public means that there is not a reliable and up to date yardstick against which to measure the current state of the club’s financial affairs. Nature abhors a vacum, but our press and media love it! The vacum has been filled by wild speculation about the club having an estimated £100m of debt, which has been further ‘talked up’ by some interests in an alleged attempt to push through a cut price deal for the club.
Personally, I would be very surprised if the debt amounted to any more than c.£45m in total, which set against our c.£85m annual turnover is both manageable and serviceable. If this assessment of the situation is true, then it is indeed a joke that we are constantly being portrayed as a crisis club, in an impending state of financial meltdown, when the scale of our debt is so much more manageable than some other very prominent PL clubs.
Another big question mark is the strategy and intentions of C&B Holdings. Some would have us believe that we totter on the brink of administration, dependent upon the whims of Straumur’s faceless creditors! The truth is that C&B Holdings is a flag of financial convenience for maintaining and eventually exploiting the major asset that is West Ham Utd FC. In that sense it is probably best characterised as a relatively safe short to medium term life boat than a long term ownership arrangement.
However, the administration and asset stripping scare stories doing the rounds can probably be safely dismissed. West Ham is arguably ‘firewalled’ against the debts of its majority stakeholder company and the PL can only take action against the club if it is proven that it is the club itself that is financially insolvent. Also, there is clearly no advantage in plundering the playing staff, as this will just devalue the asset and decrease its value in the market.
Which begs the question, are we as financially stable and self-sustaining as Duxbury and others have claimed? The probability is that the good work undertaken by Duxbury towards the end of BG’s reign has greatly reduced the club’s annual expenditure against its turnover. In particular, the wage bill at the club will have been brought under control and Duxbury will have worked on increasing the sources of income flowing in to the club from areas such as merchandising and sponsorship.
In addition, moves are afoot internally to negotiate new, improved contracts for the likes of Collison and Hines. Whilst one can only hope that the same is true of Robert Green and Matt Upson. This is a good indicator of the club’s financial state, as clubs in financial crisis tend to have trouble paying existing wage bills, let alone striking new lucrative deals! And as I have said previously, another powerful indicator is the activity of the PL around West Ham’s finances. The PL have already reacted to previous horror stories in the press by seeking assurances from the club regarding its solvency. They have been satisfied with West Ham’s response and one can only assume that the club’s assurances still hold good.
Are C&B Holdings ready to sell in the current economic climate? The consensus seems to be that a bid of £120m is the threshold to spark off a sale. It is still not clear what influence external factors such as the acceptance or otherwise of Straumur’s re-structuring plans by its creditors will have? Nor the extent of the role West Ham Utd FC as a balance sheet asset will play in those restructuring plans and the longer-term future of Straumur. If they stabilise the ship around a long term restructure, is it possible that C&B Holdings might hold on to and seek to maximise the value of the club, before disposing of it in a better economic climate.
Of course, the discussion about the future of the club is being skewed at the moment by our current position in the league. Whilst we are in the bottom half of the PL, there will be a morbid pre-occupation with the disastrous impact of another relegation upon the future of the club. If we continue to struggle, and C&B Holdings retain control, we can only hope that they are able to release transfer funds in January. It is all very well promising a transfer pot of c.£30m next season, but that investment will not materialise if we were to fall into the 2nd tier.
Certainly relegation is unthinkable. This squad probably does have the quality to move away from the relegation zone, but investment is still needed to strengthen the squad to ensure that this is most definitely the case. If our PL position does not improve before the New Year then a move into the transfer market in January becomes absolutely vital to stave off relegation.
In that scenerio, spending is the only sensible option available to C&B Holdings to preserve the value of its prized asset. If they retain control, let us hope that wider developments provide them with greater scope for investment in the playing squad this winter. C&B Holdings are arguably the architects of our bad start to this season via the failure to adequately invest in the squad this summer. They need to put that right or they will stand accused of repeating the old board’s mistake of not releasing funds in the winter window of 2002-03 to avoid relegation, only this time the demotion would come with even more dire consequences.
Then we have factor X! The proposed bid for the club by the InterMarket Consortium. The commissioning of Rothschilds to seek investment in the club can only logically mean one of two thing, C&B Holdings are seeking an outright buyer or are prepared to give up a % of ownership to generate external investment. If it is the latter then perhaps it is part of a phased deal for transfering control of the club.
Some commentators have dismissed the InterMarket bid as not viable. Yet, sources close to the consortium still maintain that their bid is deadly serious! Indeed, it has been reported that they have cleared the first hurdle by convincing Rothschilds that they have the resources at their disposal to mount a take over bid. The ultimate confirmation of intent will be if and when they follow up on any non-disclosure agreement by entering into a period of due diligence prior to a sale.
Will they try to force a deal through or will they shadow the club and try to exploit Straumur’s perceived weakness to get the most advantagous price? If front man Jim Bowe’s prior reported statements are an indicator of their intentions then they want a deal that ensures ‘that everyone wins,’ which means Straumur agreeing a deal for c.£100m plus.
Also, there would arguably be a strong business imperative to conclude a deal to allow the club funds to operate in the winter transfer window. It is crucial to stave off relegation and ensure that West Ham remain in the PL. If they miss the transfer window then their ability to use their wealth to influence events is greatly reduced.
Interestingly, elsewhere it has been reported that representatives of the InterMarket Consortium have allegedly met with the Olympics Authority to discuss the future use of the Olympic Stadium post 2012. Cold, hard economic realities are pushing the Olympics Authority towards the only long-term solution possible for the future use of the facility, to secure a deal with a PL club. Allegedly they are far more amicable to the idea of coming to an arrangement with West Ham on their future usage of the stadium.
Not only will this secure an ultra-modern stadium with a suitable capacity for the future growth of he club, but it may also possibly free up capital receipts on the possible sale and re-development of Upton Park. Whether this is a significant factor in any new consortium’s plans is an open question.
There is no doubt that we Hammers fans, as they say, live in ‘interesting times’ as far as the ownership andcontrol of the club is concerned. However, they are also times that are inherently uncertain. As fans we can only stand by and watch as events unfold that will hopefully negate that uncertainty and provide the best possible solution for the future investment and success of West Ham Utd FC!
One thing is certain and that is that the next change of ownership needs to be the right one for the long term future of the club. We cannot afford a ‘frying pan’ to ‘fire’ scenerio emerging. Any takeover needs to be by ambitious, cash rich new owners who will continue ‘Project Football’ but supplement it with some top class imports. A formula that can finally increase the chances of the sustainable domestic and European success that this club’s fans so richly deserve.
SJ Chandos.
The biggest certainty of all time if as loyal fans we have survived The Terence Brown Regime,The tight fisted Cearns Family,Bg and the firesale of truly international English superstars,just imagine what a superclub we would become if we had a serious West Ham run by proper people who only wanted the best wow how great would we feel as champion,s!
The most gutting thing is Abramovich should have flown his chopper East instead of turning those bankrupt blues into the club they are today,but you know what it could always be our fortune soon,PLEASE!
SJ, I must say you have brought some real value to to the site and I am sure Iain is very happy to have his name associated with your content; another excellent and interesting article. We have been through a lot in the last few years and there are only two things I currently wish for as a lifelong Irons fan:- 1. Our quality of football played is matched by our goals tally and that will move us up the League 2. We are bought by those with real commitment to turning our massive potential into reality, and soon. Keep up the good work mate. COYI
Interesting times indeed.
I wonder whether our current low position in the league standings may in fact work in our favour. If we were comfortably middle table or even higher, then selling an Upson/Green/Cole to pay off some debt would not lead us to relegation. But as it stands we cannot afford to sell any of our best players otherwise we risk falling out of the premiership altogether which would be disasterous.
We have to pray this consortium are for real and if they do not buy us, they will, at the very least, flush out other potential buyers. This January will either be quite exciting or absolute hell…
The times of European football and the past history of our historic club, with managers pacing the corridors of UP in length mirroring those of the like of Sir Alex & AW lost through the annals of time. We now turn to a new era of the club (or so we hope) with owners and stability we have not seen in many a year. If those past had the club at heart and not their pockets I feel we would be in a far better situation now than we currently are. We now hope that negotiations are being held behind closed doors will be promising & beneficial for all concerned and that our future will be secure. If we did things the easy way that would not be the West Ham way. We are West Ham fans of Upton Park & the elite of Green Street and we would have it no other way.
I always felt we would end up at the Olympic Arena. Common sense will hopefully prevail. Far superior transport links and more modern stadium. Also, hopefully property prices will have picked up by then and UP can be sold for a nice sum.
Good post SJ, as Christmas approaches I hope we all get a nice present! Ambitious but sensible owners. Hopefully as reported they are true hammers fans. If so then they will be able to see the good work Dux and Zola and the team have done and give them the support and finances that would enable us to make big strides forward. I am sure everyone would agree we have the academy we have the coaching staff and the manager we just need a transfer kitty that would see us build a team rather than keep striping it and making it weaker.
Great post. In other news it looks like Cole will be fit for Hull!
Good post SJ, but a bit long winded considering its the same old story. We have been going through this scenario since the collapse of the Icelandic banking system.
Christmas countdown, 1 preseant i think we would all love is new owners who are loyal hammers fans with the money to give our club some stability, and you never know it might be what we get as they want a deal concluded before december 11th. Fingers crossed for that one and January could be good for us.
As for the future, i personly don't want to leave UP as i feel the atmosphere is crazy, although it would be great to have a big stadium, but i would much rather make the chicken run stand much bigger, then the we would have a nice cappacity stadium of around 48,000. Anyone else agree with me there?
Cole will hopefully be back in time for the hull game, both hull and burnley are big games which we must look at and aim for 6 points or at least 4 points.
Cole sale: No chance in my opinion. He is getting regular football, scoring goals, fans love him and he has a good football relationship with GZ and SC.
Heres hoping to a brighter future.
Come on you irons!!
The doom mongers will have you believe we are in financial meltdown but surely that can't be true. If we were there would be a lot more official/FA 'noise' about our ability to carry on as a club. I believe GZ when he's said in the past that he will only sell players who don't want to be at the club. For what it's worth, I don't think there will be a fire sale, but I'd take £20m for Upson!
[...] More Questions Than Answers? | West Ham Till I DieReviewing the issues surrounding the club, one can only arrive at the conclusion that there are currently more questions than answers. As fans, that makes. [...]
IF our financial state was in a position that our good friends in the media constantly tell us on a daily basis why then are the PL not stepping in to run or at least guide us through this difficult period. As for a firesale this is a non starter as we would be back to the media frenzy scenario. We only need to sell those at the club who wish to move on in search of more first team football of sitting on the bench and enlarging their wallets & those who will not renew their contracts when offered so for us to sell those to the highest bidder for us to bring in new blood to the club to help us move up the table into a potential european place.
Now there is only one thing to say to all this and that is: WATCH this SPACE!!!Lol!
Moving to the Olympic stadium would be disastrous imo. Traditionally the fans have been very close to the field of play at Upton Park, which can make for a fantastic atmosphere for the home side and an intimidating one for the opposition. Put in an athletics track between them and you immediately cut off the link between playres and fans. No, if we cannot develop Upton Park into a totally enclosed stadium then we should look at other sites, but not a soulless athletics venue.
Unfortunately I have always been a pessimist, and I fear for the future. We are going to continue to sell our better players until we are in the black or have a sugar daddy that is prepared to lose money.
Without Premiership football for the next 5 years, our future would look very shaky.
We have the makings of a very good team, but if it’s heart is pulled apart by selling our best players, we have to go back square one, this has happened too often, we must stop the rot, to give our beloved club and its die-hard fans what they have always deserved a club challening in the league and in Europe.
I am dying to stop saying “maybe next season”
Tev: I think the plan is to remove the track and move the seating much closer to the action. I agree, football stadiums with running tracks must be avoided like the plague.
I hope any prospective buyers are not basing their bid on the ludicrous idea that they will be able to flog off Upton Park for their own benefit then set up shop at the Olympic Stadium FREE of charge or as rent paying tenants.
That was the cunning plan mooted by Kia Joorabchian and his shady cronies two years ago. That was given the heave ho by the Government and it is likely to happen again.
Quite a post SJC, (if a tad long), but whatever happens with the proposed takeover, as long as we don't move to a stadium without an atmosphere, I'll be happy. The atmosphere at Upton Park on a good day cannot be beaten for me, and I really miss it lately as I can't get there as often as I would like. However I would also love to improve the transport links as the tube route and constant queues make it feel like you have nearly reached home by the time you get to queue up to get back into the station! (As I would never leave before the final whistle)! Modern stadiums look great, but you will never get the atmosphere in the likes of the Emirates that you get at UP. We have the supporters to increase our current capacity and still sell out, but there isn't much point in getting too carried away or over stretching ourselves financially in the same way the likes of Arsenal appear to have done…(who's debts are bigger)???. I would always aspire for better players, more finance, possibly a 'completed' stadium, but I am also consious of what makes West Ham and it's fans special, and not having all of these things in abundance hasn't ruined it for us just yet has it? Forever hopeful all the same!
When the question arose as to what would happen with the Olympic Stadium after 2012 it waqs suggested that one of the eastend football clubs could take it over as M/city did after the commonwealth games. Either as a ground share with WH&Spurs or some other combo. As we well know Spurs have their own plans for a new stadium next to WHL. As for WH moving into the OS again I feel this would not work and after a referendum on moving from UP was a vote/decision taken by fans to stay put or at least move & staying close to West Hams roots.
With the new owners being WHfans as far as we know, when the decision to move or redevelop UP is taken we hope that this decision will be taken with the fans & clubs wishes in mind. As for the OS I feel that this may become a white elephant as the Millenium dome(nowO2arena) did. Time will tell but until this happens we have to hope that the takeover is not too far in the future and the decisions over the Boleyn ground will live to fight another day.
Im not happy with The Irons situation at the moment, bottom 3, no money, crap owners who wont sell the club, always relying on Carlton Cole for goals, not good…
What happened to the plans to develop East Stand?
I see on club website it reiterates we do not need to sell in January
It was snowballed due to the current financial crisis once BG took over
Hey everyone i'm coming to london 2nite from australia and really want to know a few things about my beloved west ham. First, could some1 tell me if fans are able to watch the team train and if training is on this week due to internationals and at what days etc its on?? Also need to know where the training complex is…would give anything to see a glimpse of the club even if it is training because the club is amazing!!
Irons66 the club train at Chadwell Heath which you can get to on the train from and National Rail station in central London. The club dont as such hold open training sessions but when I was younger I would often spend school holidays with my aunt who lived near the ground and would go down with my cousin to watch the team train. We were always allowed in by the staff who couldnt have been nicer. Its been a while since I was there but I would hope the club stil show the same courtesy to visiting fans as the did then. Martin Allen once gave me his shin guards after a training session and I got lots of autographs from various players.
I dont know what time you get to London but the under 18s are playing against chelski u18s at Little Heath in Romford at 11am tomorrow and addmission is free. There are also tours of Upton Park available if you contact the club directly.
I hope you get to see a lot of the club while you are here as I know what its like following the club from afar, although not as far as you.
Thanks so much Celtic really appreciate the information, will look into it greatly. Was going to ask about the tours too and glad u gave me some info about that. All the best man
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