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A question for every answer

In the goldfish bowl world in which major clubs like Arsenal operate snippets of information that would normally pass unnoticed are quickly seized on with many attaching differing views as to their significance.

As the Arsenal PR department issued a very brief statement on Wednesday afternoon advising of some boardroom changes coinciding with the appointment of Ivan Gazidis as Managing Director they must have become aware almost instantly that it invited more questions. The original brief statement was swiftly followed with a more detailed comment from chairman Peter Hill-Wood.

The changes, apart from the election of Gazidis to the board of both Arsenal Holdings plc and Arsenal Football Club, involves Richard Carr, a grandson of former chairman Bracewell-Smith leaving the board of the Holding company but remaining a director of AFC. The significant change is that major shareholder Lady Nina Bracewell-Smith, holder of 15.9% of the shares, leaves the board of both companies. The question invited by the first brief statement was how does this effect the lock-down agreement restricting the sale of shares along with other board members which Lady Nina was party to? The unasked question was quickly answered by Peter Hill-Wood in his subsequent statement.

"Lady Nina is no longer representing the Club and therefore is released from the lockdown. However it was created to maintain stability in the Club and those participants are committed to maintaining the ownership structure as it is" he said.

This would seem to put her shares in play but what significance does it really have? The answer is probably less now than had these changes been made before Kroenke joined the board. Prior to his appointment the board along with Lady Nina made up 45.45% of the total shareholding. With her no longer on the board, together with Kroenke`s 12.2% shareholding, the board now represents 41.75%. Along with other 'friendly` shareholders, for example Richard Carr`s (himself a 4.6% shareholder) half sister Lady Sarah Phipps Bagge , yet another member of the Bracewell-Smith dynasty, who holds 2%, the board should still be strong enough to hold control over key decisions. There are also something like 18% of shares held by small investors thought generally to be sympathetic to the concept of multiple ownership.

Whether Lady Nina will now look to sell her shares or not is unclear but it must be a possibility given the changes made. However, the fact that she was willing to co-operate with the existing board in a lock down suggests she is supportive of their long term aims. A thought also echoed by PH-W.

"I don`t know for certain what she wants to do with her shares. I do know that the Bracewell-Smith family have been involved with the Club for many, many years and are great supporters.

'I know that Lady Nina is an advocate of the policies we have been following to make the Club self-sustaining and free from external injections of money. She has certainly been in favour of what we are doing."

No one can say for sure but a best guess would be that a process for shareholder succession is underway and a path carefully plotted with the other major shareholders which doesn`t include ceding control to Russian billionaires.

Hill-Wood also alluded to this objective in his statement on the club website saying "A number of the Board have indicated in the past that they are interested in buying more shares so the future stability of the Club is secure. The Board is very keen to retain control of the Club to ensure that its values and traditions are upheld and live on for many years to come."



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The Journalist

Writer: Amos Mail feedback, articles or suggestions

Date:Thursday December 18 2008

Time: 12:44AM

Your Comments

All this financial stuff leaves my head spinning, but from what I gather the lockdown doesn't actually do anything. If you want to sell you shares you simply quit your position first? But wouldn't you lose your position if you sold your shares? I'm cunfused .... the room is spinning.
Rocky7
That was my first thought too Rocky. I see no point in the lockdown then,
gunnerkid107
Hmmmm wonder if there is a very very rich Arab, sorry middle eastern gentleman looking at us?
alwaysgunner
I'm not too concerned- Lady Nina was key in keeping Usmanov out, so even if she is annoyed at the board I'm sure she'll sell to anybody but him. We are the most financially sound club in the league and have, I'm sure, built up a nice nest egg for player purchases if Arsene wants to buy. I have no problem with Arsene's vision but if buying, say, Lionel Messi pushes Diaby or Randall down the pecking order, I'm okay with that too. It's a chicken and egg sort of thing, if you have a good manager. Over the past few years Manure has spent probably twice their real worth on Carrick, Owen, Anderson, Nani, yet they added something to the team and their transfer fees, while seemingly unreasonable, have been paid for by the two league titles and Champs League title winnings. We've spent ***** and won the same. We were unfortunate not to win the title last season- bad calls, bad injuries. If you include Rosicky and Eduardo, at the start of this season we were down five senior players, and we brought in Nasri, Silvestre and Bischoff. Arsene has bought many players in January- Walcott, Adebayor and Reyes come to mind- and I hope he does this coming January because we need reinforcements all over the pitch. If he buys a Flamini-type player who forces Diaby and or Denilson to the bench but lets Cesc go forward more and improves the team, that's okay with me. Cesc has proven to be an amazing player but not like-for-like with Vieira. Beyond that, I think the only two players in the current squad who are better than their peers in the invincibles are Clichy and Sagna. If we are three 20m players away from success or one 60m player away, we should spend it. In North American sports, it doesnt' mater which league or sport, when clubs are close the spend to get the best players to hopefully win a title. Arsenal is that close, they just have to splash some cash on proven superstars to get the trophies.
elbondo
elbondo in general i agree with most of your comments, but and its a big but the boss never said he would not buy it was just there were in his opinion no suitable players he could afford or were available. People moan and moan we have no won a trophy for years but in the last few years we have been in touching distance. Most feel this season we will be once again unable to obtain silverware. I prefer to remain with my rose coloured glasses on and say we will.
alwaysgunner
Exactly what I asked for Amos. A quick statement from PHW on the impact of Lady Nina's exit. To be honest, it only partially answers the questions. PHW has been in the game a long time and he manages to cover his ass well with this statement. He hasnt spoken to Lady Nina, so at this time, no one knows her intentions. Even though the legality of the lockdown agreement was always under question, atleast it was a statement of intent from the Board, and it quelled the takeover speculation to a large extent. So its purpose worked IMO. Lets hope Lady Nina doesnt cash out soon, but I'm certain there will be constant media speculation on a possible takeover. We'll just have to live with it.
prits
The lock down was a largely symbolic device designed to send a signal to Usmanov and maybe others that those shares held by the board were acting in concert. It worked in that regard but with Kroenke on board and apparently now acceptable there is less risk if Lady Nina were to sell assuming that's what she wants to do. Providing she is still broadly supportive, and given that she is still part of the Bracewell Smith dynasty who hold a reasonable number of shares through other family members chances are she is, then all should be well.
Amos.
As expected, speculation is rife. I read on another blog that there was disagreement at the last Board meeting involving Lady Nina. Apparently, this is part 2 of the transition strategy, whereby Kroenke will takeover the club eventually. That might be possible. Also speculation that Usmanov would sell his shares to Kroenke, which seems the only viable exit route for him. If Kroenke is gong to takeover the club, where is he going to get the money? I'm surprised if Kroenke wasnt affected somewhat by the recession.
prits
If there was a disagreement in one of the meetings, then isn't there a chance Lady Nina would not want to sell her shares (if she does want to sell) to an other board member. I suppose it depends on who the argument was between. It wouldn't surprise me if someone has been seriously affected by the recession, in which case they will sell to whoever will buy them won't they?
navydave
It's possible that there was a fall out at a board meeting but unlikely that it would have led to such a swift conclusion about board changes and shareholder intentions. It just doesn't work that way. These look like more considered changes that would have needed to have the support of the majority of the board if they were opposed. Lady Nina's stake is probably worth about 80m at current values. That probably wouldn't be too hard for Kroenke to finance. He has turned down the opportunity to buy shares (Dein, Landsdowne Holdings) in the past. That maybe because they came with conditions (Dein) or were priced too high (Lansdowne) so he clearly isn't a buyer under all terms. At the moment Usmanov wouldn't get back what he paid for his shares. If he and Lady Nina are trying to sell at the same time then their combined 40% could be of value to a new bideer if they can get both blocks of shares. On the other hand Lady Nina still has family connections through the other Bracewell-Smiths so is probably, despite any possible discontent, likely not to want to actively undermine the club.
Amos.
While it's true she has connections, it is important to remember she inherited the shares from a partner and isn't actually a Bracewell Smith in the first hand sense, though it's probably still true she wouldn't want to upset the family! My concern is Hill Wood's assertion that he doesn't know what she is doing with her shares, had the parting been amicable, surely she would have offered them to other board members? PHW hinted at a lack of dialogue which suggests she is being rather taciturn with the board.
Little Dutch
She would only have offered them if she intended to sell immediately. PHW said he didn't know what she planned as he hadn't spoken to her about that subject recently. If she hadn't indicated plans to sell then there would have been no need to do so I guess. He also said that he hoped she would remain a shareholder so that must still be a prospect in the short term at least. Having gone as far as she has done, whatever her feelings towards the rest of the board, she seems considerate to the stability of the club. Hopefully that counts for something.
Amos.
"That probably wouldn't be too hard for Kroenke to finance". Amos, is there something that you have read to suggest that Kroenke is not so badly affected by the recession? I find it difficult to believe that this kind of money can be raised by anyone (apart from the Middle-east where they dont seem to care about these things) in these tough times, esp a businessman from the US. Lady Nina might be forced to wait before she sells, as its a buyers market today. If it had even been 6 months back, she could have set her price and demanded it. I doubt that can happen now. I have a feeling it will be status quo on the share ownership for a few months yet.
prits
I don't think that much will happen on share ownership for a while either. There are some smart businessmen that are profiting nicely from this current downturn. I don't think everyone is completely strapped for cash. Frankly I am not sure what Kroenke's position is but with a strong dollar his $2.3bln should go far. In dollar terms Lady Nina's shares are worth about 30% less than they were 6 months ago. The good businessmen will see this as a perfect buying period.
Amos.
I don't think much will happen short term, but I've a feeling that in the long term, the club will begin to move away from its current control. The board are hanging on manfully, but they can't fight off the predators forever. Money walks and talks unfortunately. On an entirely unrelated topic, does anyone else all of a sudden really, really, really hope Blackburn get relegated?
Little Dutch
Interesting: http://www.timesonline.co.uk/tol/sport/football/premier_league/arsenal/article5361767.ece And on Blackburn LD, me me me!
GoonerLou
Far from interesting that Times article is a masterpiece of conjecture and invention. How has Lady Nina 'been marginalised in recent years'? She has only been a director for 3 years and in that time has signed up to pretty much everything the board has done including the lock down. It's only purpose is to present a subject they know no more than anyone else about in the most dramatic way possible. Junk journalism.
Amos.
No Amos, what I find interesting is that the Times is the only paper making these allegations, nobody else. What happened inside the boardroom is anyone's guess really, so it's interesting to see someone claim the board had offered the 'life president' role to Lady Nina, etc. Also funny to see that the ANR has copied and pasted these views on their site. More to fall out of this and any claims are interesting to me when nobody outside of the board has direct access to what's going on inside, whether thye appear to be credible or not. Also interesting to see whether the Arsenal Supporters Trust will do something to seek clarification of any sort.
GoonerLou
Interesting comments from Lady Nina. It seems that the plans to remove her from the board were driven by Fiszman acting in concert with Kroenke and the other smaller shareholders on the board. Quite what their motives are isn't clear but it seems that they are calculating on the Bracewell-Smiths family holding (about 22.5% with Lady Nina's, Richard Carr, Sara Phipps-Bagge combined) remaining intact. She is quoted as saying; 'I'm in total shock and very upset about the appalling way I have been treated. The board have no manners whatsoever and my views were ignored on many occasions. I can't understand why I have been removed in such a ruthless fashion. I had no intention of selling my shares and was no threat to the lockdown agreement between the directors. I have also had no proper explanation as to why they wanted me out so much. It is very difficult to accept, especially after what my family has done for Arsenal for so many years. I am extremely upset at what's happened and the way it has been done. There is no way Richard would have agreed to this, he's family. I've never had a thought of selling my Arsenal shares, and I still don't.' It seems a very hard nosed business approach to the running of Arsenal is emerging from the patriachal benevolence of the Bracewell-Smith/ Hill-Wood dynasties.
Amos.
It has always been that way, Amos. Look at the ruthless manner in which Dein was ousted. These comments are a shame as the ideal way would be for the Board to operate in harmony, but that would be a pipe dream. Arsenal is a business and such disagreements are part of every business. So I'm not perturbed by it. Who knows what Lady Nina's ideas were, and whether they were financially and operationally feasible? This seems very much a power struggle, and the Board has flexed its muscles to show who's boss.
prits
Well, the fallout of this will rumble on I guess in light of Nina's comments. But at least it shows that the board aren't just sitting comfortably on their laurels. I wrote last month that I felt the club needed a bit of a shake up somewhere as the feeling was of a club gone stale and resting on its laurels since the Emirates opened. Maybe the arrival of Gazidis and the removal of Bracewell Smith represents that sort of shake up. I just hope I don't get more than I bargained for!
Little Dutch
Another question though, any relevance in the fact that Nina gave this interview to the Daily Mail? Obviously, being landed gentry, you'd imagine that paper absolutely loves her anyway, but the Mail have been incredibly pro Usmanov and most of the anti Aresnal board literature has emanated from that awful, awful publication.
Little Dutch
The Telegraph has gone with it too. Both Establishment papers of a kind that people like the Bracewell-Smiths and Hill-Woods would speak to I suppose. This looks a bit of a contest between businessmen and patriarchs. Sadly, in many ways, the future success of the club probably depends more on the businessmen. Fortunately Usmanov doesn't seem to be to the taste of either side.
Amos.
True LD. Perhaps the Mail was the 1st to jump on this story and approach Lady Nina, given that there was a good chance of getting some comments against the Board. Also, the anti-Arsenal stories have dried up after Dein left Red & White Holdings. Or is THAT a co-incidence? Anyway Lady Nina has confirmed that she is not looking to sell her shares now, so thats good news.
prits
 

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