“£50M Is Very Realistic”

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The recent blog on the subject of a Community Share venture created significant interest.

To the extent that a sizable figure of money was pledged in the space of only a few hours. *Cannot believe I didn’t put a PayPal button up. Idiot. Idiot*

But on a serious note, many questions were raised. After all, the full document has yet to be released into the public domain.

So I took your questions and added some of my own in order to get to the bottom of what I believe is a bloody good idea. My thanks to Tommy Maguire & Martin Cloake for their considered responses and for their suggestion that I might join the Spanish Inquisition if I ever needed a hobby…

Can you tell us in a nutshell, what the objective is? You want to raise £50M towards the NDP. Why and where will the money go?

The key objective for Supporting Our Future has always been to get NDP to a viable status first and foremost. And we believe the Community Share initiative is something that can contribute significantly towards driving this project to viability.

A lot of supporters of the club felt that viability was just a buzzword used by the club to justify a move to the Olympic Stadium. In fact a lot of, for want of a better description, ITK on the stadium issue said this was exactly the case. And the clubs silence from November of last year didn’t really help to dispel this notion.

We have come to learn from our meetings and communication with the key stakeholders that viability concerns are very real for a number of reasons. In fact, since 2006 when the idea of building a stadium was initially on the table, the same viability issues existed. If you look through the minutes of Trust meetings since 2006 onwards for example, when the stadium question came up in their meetings with THFC, the club stated that viability concerns existed at the current site. Even then and in the years since the club has looked at other sites, most notable of which was Tottenham Hale.

So the money will simply go towards off setting the cost of removing the road blocks that have stopped NDP from progressing further.

Why don’t THFC just release more conventional shares on the stock market to raise the shortfall?

Great question and one that has been asked of us a few times. Simply put, floating a substantial amount of shares on the stock exchange puts the club in extreme jeopardy.

In January of this year, holders of Preference Shares in the club were asked to convert these to Ordinary (or conventional) Shares to a value of 5p per Ordinary Share. Each Preference Share could be converted in to 1,562 Ordinary Shares. As a result there are 213,858,987 Ordinary Shares currently held by shareholders in THFC Plc.

So if THFC decided to go with Conventional Shares instead of the Community Shares initiative they would need to float, based on 5p a share, 1,000,000,000 shares to reach £50,000,000 we are proposing. Even if THFC were to float against the current trading price of THFC stock which is approx. 50p per share it would still need 100,000,000 shares to crack £50,000,000.

This type of Ordinary Share offering would then represent 30% of the club, with the majority stake held by ENIC et al also significantly diminished.

All in all using further conventional share proposals will probably create more problems than it resolves and perhaps lead to an aggressive take over of the club … perhaps.

Why don’t ENIC just give us the money?

One thing we have not been able to do as yet is drill down in to the NDP financials fully. If this is the £400,000,000 project we believe it is then, (outside of Community Shares, RGF applications, public subsidy, and corporate proposals, as well as ticket sales), where is the additional development revenue coming from?

We have asked the club to give us a better over view of the financials, how they will be balanced and who by, as well as a definitive figure on what they view as shortfall. Given some of the disclosures by third parties that were trusted by the club to the public on the clubs handling of the stadium development to date (which in turn have created further viability  issues), they have remained cagey about getting in to further detail with us.

However, we can confirm that we are due to meet with the clubs Finance Director in the coming weeks and hopefully we can get some clarity on where ENIC investment, if any, fits in to all of this.

So how come £50M? Why not £100M? We’ve massive support, after all.

Exactly, the sky is the limit depending on how deep the pockets of the WHL faithful are.

As we have stated throughout our proposal and in recent engagements, Supporters Direct have been our guiding light in bringing us to a position where we were able to offer this proposal. The best example of Community Share that reflected our ambition, and a project SD had been very much involved in, was the stadium initiative by FC United of Manchester.

Their proposal value was about 4% of what we are proposing. But the comparison from their fan base to our current One Hotspur membership, (Bronze and above), of 60,000+ and our current ticket pricing structure means that we are comfortable up scaling our proposal to an amount of £50,000,000.

Let us not forget as well we have an estimated 20,000,000+ supporters globally, the club has partnerships around the world, and of course we have the Haringey community to consider as avenues for investment. We had said in our proposal that One Hotspur membership should be a pre-requisite to investment. But we also have to think about the community in and around the stadium and also allow them the opportunity to invest.

I have seen an interesting break down of the proposal in one of the forums yesterday which kind of took me by surprise. It was broken down that if only one supporter buys one share; it means it would take 250,000 individuals to invest. Or in other words proposal was unrealistic and I believe the writer was trying to prove it (the proposal) is flawed.

While this scenario is possible it is highly unlikely this is how people will choose to invest. We will almost certainly have a significant number of 1 share investors, we will have a significant number of top tier investors, and we will have our greatest numbers somewhere in the middle of the two.

There are a number of case studies concerning community share online that give a fascinating insight in to investment patterns in these types of schemes. And this is why we are confident the £50,000,000 is a very realistic target.

Even in respect of that, it may come to pass that we possibly have over estimated the uptake of the offering. In which case the answer is simple; we reduce the value of the total proposal accordingly. Or indeed if the initial offer is oversubscribed then there is nothing to prevent a second round of investment offers.

Is this in effect just a loan then?

More or less yes, or to put it another way it is a cheap loan for the club.

On the flip side though, it is the investor that gets the annual return as opposed to a financial institution. And wherein the average High Street investment savings plan offers base and only a few points above (if you are lucky given the current climate), Community Share will give you base plus 2% (or 20 points) above.

So, to come back to likely investors, if I am sitting with a significant amount of savings earning average interest, love Tottenham Hotspur or I am part of the Haringey community, want to earn more from my money, and want the club to stay in Tottenham, where would I be happier for my money to be?

And there is also the added bonus to investors for potential tax breaks on investment from HMRC

Financially, how does this stack up as an investment compared to other conventional options I might wish to sink my money into?


You say I get a vote. What sort of things might I be voting on?

This is something we want to clearly define when we next meet with the club. With the greatest of respect to anyone reading this or thinking about investing, we feel that allowing votes on players wages, transfer budget, or anything that can lead to a possible detriment of the on pitch development of the club should not be considered as part of the voting rights. Daniel Levy has managed the club finances, to date, very well (and probably why we haven’t dived in to NDP in the way some people have expected him to) and we believe he should be allowed to continue to manage the same.

What we also do not want to do is to leave investors with votes on “what kind mustard to use in the stadium hotdogs”, or, “which brand of soap should be used in the stadium bathrooms”. That would be nothing short of insulting.

Tottenham Hotspur supporters are among the most passionate fans in the world. If proof was ever needed show up for a game at the Lane. Or better yet, look at the online discussion regarding NDP. For the longest time we have been asking to have a voice that can be heard within the club. And if a fan is prepared to put a stake in the club to move it forward then they should have their voice heard. The where and how of that voice is still to be decided and agreed.

***Still really doesn’t answer the question of what rights or say I will  have as an investor?

We see issues around ticketing, stadium facilities, use of the stadium for purposes other than the staging of top-calls matches and community initiatives as being legitimate here, but there needs to be detailed discussion. It’s potentially a chance for fans and the local community to have a meaningful voice that is hard-wired into the set-up of the club.

 Obviously there’s going to need to be some compromise on both sides. The club may not want to concede any influence, but if they want to access the funding this scheme could provide, they are going to have to give a little. Similarly, fans and the local community may not get everything they would ideally want, but the chance is there for a more meaningful input than there is at the moment.

 Don’t forget too that hard-wiring in community involvement, however that community is defined, is something that could be extremely beneficial politically in securing other funding schemes the club is investigating. Localism is very much in favour politically, and this could be key to the thorny question of how to balance public and private input and benefit.

This is completely separate to the ‘on the football pitch’ side of things, so this isn’t a share in Gareth Bale’s big toe on his left foot. What is it actually a share in?

As it stands the proposal we have submitted is for a share in community initiatives delivered by THFC Plc and the NDP. What we need to agree with the club is if an investment of this type can fit in with the current Plc structure .If not then will investors be required to invest solely in NDP and as a separate entity? And how will this affect the community aspect?

As we stated, and I also believe you said in your own blog on this subject, the proposal document is only a framework, or first draft, of a final agreement. Of course we will try to keep the integrity of the proposal as it is and keep to what we have outlined as the support for the proposal has been overwhelming.

What we will not do is support anything that the club could propose that takes away from the key purpose and elements of community share. We are confident though that is not a bridge we will have to cross given the feedback to date and we are sure the club, and council, will do what they can to make this work.

But in short, this investment will go in to NDP and community initiative but the specifics on the investment expenditure, voting rights, maturity, etc still need to be settled on, as we mention above.

You mention Community Benefits. It’s a big reason for me to potentially get involved in this that the Community and the Club come together. What’s the strategy there, how will it effect the local community?

As has often been cited by both David Lammy MP and HBC, THFC is a vital part of the Tottenham community. If the club was ever to leave the area, Tottenham would be in something of a state of crisis given the money and employment it brings.

Since Daniel Levy has taken the helm at our club, THFC have invested £80,000,000 to fund community schemes in the area. With NDP further jobs will be created, new housing, a complete regeneration of a very deprived area of London will happen. NDP is something that the Tottenham community badly needs to thrive and survive. And of course investment from the club in to community ventures will be ongoing. 

The added incentive of allowing the community to invest and make some kind of cash return also has to be, if anything, exciting. And as we have mentioned, voting rights still need to be settled on. But I would fully expect the club to allow some kind of voting on the community investment that will be ongoing from THFC.

I’m really, really interested. Can you give me an indication of the timeline this then, if the Club go for it?

As we have said, we are due to meet with the club formally again in the coming weeks to drill deeper in to the model and financials. We also had a fantastic response from Haringey Borough Council that further encouraged us to believe that this is the right approach for everyone with a vested interest in making NDP work.

It would be purely speculative for us to state a time frame. The Community Share proposal is only a part of a much bigger picture. And I guess it is when all the parts of the puzzle start coming together then we will have a better idea of the “when”.

To summarise, there is still a lot of work to be done to finalise a Community Share initiative to allow investment in NDP. What is available is simply the framework that we will build on together with the club, Haringey, supporters, and all other stakeholders. We will keep everyone updated through our website, Twitter, and Facebook on developments. And we are not a closed group; we are very open to all comments, feedbacks, and suggestions on how to progress things further.

Given the feedback from club, council, community, and supporters we are confident that this is the right approach and that everyone can benefit from and be a part of a potentially ground breaking move to build a World Class stadium worthy of the team we all love in its current home, Tottenham.

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  • Sid Trotter says:

    1st – Phew, my head is dizzy

  • Sid Trotter says:

    2nd – Here’s 50p, now leave me alone

  • Vanderfaart says:

    3rd – I’ll have £3 million quid’s worth please.Put it on my visa card, there’s a love.


  • hotspurhartley says:

    I would happily buy shares in this if it guaranteed that we stayed at the Lane and if this does happen perhaps it will finally kick start the whole project….I still don’t understand it though…

    • TMWNN says:

      There isn’t a lot to understand. Everyone chips in, the money is loaned to ENIC at a low interest rate that, hopefully, they pay back.

      You won’t have a vote on anything, but your voice might be heard (whether THFC listens is another thing).

      • hotspurhartley says:

        I understand that part…..but who manages the loan? who decides where and when it is used? do we get guarantees from THFC as to when the project will start once the money has been released ? etc etc.

        • LosLorenzo says:

          They’re not at a stage yet where they can start looking for an administrative party. However, it is reasonable to assume that some sort of investment bank, securities firm or other financial institution (like Goldman Sachs or one of their competitors) would have to handle the issuing of the Community Shares (or bonds, as they could arguably more rightly be labeled). It would also be possible for THFC to do this themselves, but it is doubtful that they have the expertise or capacity to handle it in-house.

          I don’t think the club would be interested in taking up the loan (on these “friendly” terms or otherwise) unless the stadium project was a guaranteed GO. That would be at a point when there was a clearly defined timeline in place, and “the concrete mixers had been ordered”. In other words, I don’t think there would be any risk whatsoever that the club might take the money raised through this initiative and then not develop WHL (either by not expanding or moving to a new location).

          As for seeing a return on the investment, THFC would be obliged to pay the investors back according to the scheme agreed upon. They would not be able to renege. Thus the investment would be “guaranteed”, with the only risk to the investor being that of the club actually going bankrupt.

          In terms of the quality of the investment, which is briefly touched upon in the article, it would not be “top, top”. True enough, it would yield higher returns than most people will get from their savings account. However, there would be greater risks involved. Contrary to what the last 3-4 years might have led you to believe, an investment in a high-interest bank account is much safer than an investment in a bond issued by a football club. The risk-reward simply will not be there for the “lay investor” (those poor ickle investment bankers).

          HOWEVER. If you also personally value the growth and success of the football club and surrounding community, the risk-reward scenario changes (from a utilitarian rather than purely financial point of view). So for a fan or local businessman, it might be a lucrative investment indeed.

        • Astromesmo says:


  • Ali says:

    Why dont you do one to raise money for a new striker!

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