THE HALF DECENT FOOTBALL MAGAZINE

Tuesday 24 March ~

Sheffield Wednesday had hoped to have new investment in place by March 31. But the supporters have known for a while that the club will fail to make that deadline. In December Wednesday acquired a new chairman, local telecoms entrepreneur Lee Strafford, who promised to revitalise a club crippled by debt while also attempting to attract new investment from overseas. Strafford has plans to boost annual revenue by around 50 per cent to £17 million, thereby providing additional funds for transfers and player wages - currently Wednesday’s budget is one of the lowest in the division. 

Other more cosmetic, and popular, changes have so far included a two-year free shirt sponsorship deal with the city’s Children’s Hospital, as per Aston Villa with Acorns; ticket giveaways; abandonment of irritating post goal music - recognition at last that the Hillsborough crowd is capable of celebrating a goal without any assistance; the introduction at half-time of past players waving to the crowd; and a physical sign of future intent in the form of a lovely new flag that reads ‘Forward Together’.

To entice investors, interested parties would be invited to fund a new share issue, effectively handing them control of the club. This is subject to both the approval of existing shareholders, whose influence would subsequently be diluted, and a reduction of the £26 million debt. With the latter in mind Strafford asked the Co-operative Bank - owed around 80 per cent of the total debt - and other creditors to discount a significant portion of the amount due to them pending the arrival of new investors. The Co-op were willing to do this, reputedly allowing their amount to be reduced by around half, provided all other creditors followed similar suit and, of course, that the investment actually materialised.

The plan has failed, however, as not all the parties would accept the proposal. Former chairman Dave Allen, himself owed around £2 million, is one objector. Earlier this month he told the Yorkshire Post: “They [the board] are wanting everybody to take a hit on the loans. As far as I’m concerned it’s a debt that has got to be paid.” The money owed to Allen originates from various player deals made during his reign which at key times stabilised the team and its league position. In the club’s return to the Championship in 2005, for example, Deon Burton was signed permanently and Scott Carson brought in on loan; Wednesday finished 21st with both players contributing significantly to survival. Doubtless, then, Allen has a right to this money back, particularly as it was always made clear that some of his contributions were loans and not gifts.

And so the self-imposed deadline set by the club to conclude the investment saga, March 31, will pass, a fact freely admitted by Lee Strafford: “The board is not able to seek shareholder approval at this time,” he said. And there are even doubts whether any investment is likely to materialise at all: “It’s all spin without substance”, said Allen, “all hype and talk”.

Despite such concerns many supporters appear satisfied with the positive changes made since Strafford’s arrival, and equally so with the prospect of increased funds that should result from the new business strategy, funds destined for Brian Laws’ already well performing team. However, were the new £17 million revenue target not reached, and the club managed to overspend, there should be no excuse for any increase of what currently is a relatively stable debt. Huge expectation was created last December. No-one can say whether Strafford and company will be able to deliver on it. Tom Whitworth

Comments (2)
Comment by ad hoc 2009-03-25 08:53:30

[i]Doubtless, then, Allen has a right to this money back, particularly as it was always made clear that some of his contributions were loans and not gifts.[/i]

Yes, but then so were the loans from the bank and from others. I don't have the overwhelming anti-Allen antipathy that many Wednesday fans do - I'm glad he stood his ground when Bates came knocking and I think as chairman he helped stabilise the club and its debt (while also noting some of his less helpful acts such as suing fans for criticising him on a message board, bringing in a certain CEO, and fair few others)- but this latest act of vengeful anger against the club is, for me, the final straw. He'd clearly rather the club went into administration and consequently get almost nothing back from his loans to the club than try and do something to help move the club forward. It's fairly clear that his bitterness at his treatment by some fans is leading him to cut his nose off to spite his face.

Comment by Houdi Elbow 2009-03-25 23:04:42

I pretty much agree with you, ad hoc. Strafford confirmed at a Q&A last week that Allen is the only creditor not to agree to reduce the amount owed to him by the club. Also the only way that Allen will receive his money back is if we return to the Premier League (ie. no time soon).

However, I have to question Strafford's wisdom in his high profile courting of two of Allen's most implacable enemies from the Bates fiasco, John Hemmingham and Jim Harrison.

Good luck to Lee, but a lot depends upon the ability to both attract sufficient crowds and compete on the field against recent ex-Premiership clubs with much greater budgets. At least he has put smiles back on faces for the first time in years which is something.

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