Charlton look like a Polo takeover ...a hole in the middle where the money should be
THERE is a very straightforward way to prove you have the funds for any transaction. Pay up. Write the cheque, hand over the cash, put it on a card if you wish. Just get the money over.
Tahnoon Nimer appears to be finding many ways to avoid this at Charlton. It is very likely there is trouble ahead.
And big trouble, too. Charlton could even face administration and, therefore, a points deduction. The coronavirus crisis has led to speculation that the Football League will relax their financial rules and punishments, because so many clubs are in jeopardy, but Charlton’s problems are of their owner’s making.
True, football’s suspension will have worsened the situation, but even before the country was in lockdown, Charlton’s takeover was controversial.
The Football League have now opened an investigation into it, but not before asking Nimer for proof of funds on six separate occasions; and failing to receive a satisfactory answer each time.
The last thing Charlton need right now is an investigation carrying the risk of misconduct sanctions, or withdrawal of approval for the takeover. And Nimer (right) could take that threat away in one communication.
So there really is only one explanation for his reluctance to pay or prove.
It is this thought that terrifies Charlton’s support as their club teeters on the brink of a return to League One.
Nimer was supposed to transfer £1million to the club at the end of last week, to keep it running. By the weekend, nothing had materialised. Marian Mihail, a club director based in Bucharest, answered a series of questions from supporters last Thursday and only added to the uncertainty. ‘There has not been an injection of funds into the club by East Street Investments or by any of its two shareholders,’ he confirmed. ‘I know there are concerns about the finances of the club. These concerns are very valid.’ Nimer’s reasons for withholding funds are the increasingly bitter dispute with his takeover partner Matt Southall, who was initially going to be Charlton’s chairman. Southall was suspended, then sacked, and accused of misusing club funds. Nimer says he won’t provide further investment until Southall and director Jonathan Heller are no longer part of the company. This appears a convenient mitigation for denying investment. Mihail says the funds may now be provided as a loan, yet even that is open to question. Would the EFL sanction a loan from an investor who is yet to prove his funding exists?
Isn’t this an echo of the Bury debacle? A Polo takeover — a hole in the middle where the money should be?
Indeed it is, and this is the greatest scandal. Charlton, like Bury, were purchased for £ 1. And Charlton, like Bury, transferred ownership between parties without proof of funds being given to the EFL.
They seem to like acronyms in football’s marketing departments these days, so here’s one that applies in this case: WTFF? How could the EFL go through the complete collapse of Bury under Steve Dale and still have the same rules in place for Charlton?
How can its many shareholders have missed the opportunity to tighten regulations so that no takeovers can proceed without a thorough investigation and to the complete satisfaction of the governing body?
Only after Dale got his mitts on Bury did the EFL address funding, and it is the same here. When Roland Duchatelet relinquished
control of Charlton, the EFL stood idle. Only once the equally dubious Nimer took charge did it become an EFL matter. Too late. At the point of change of control is too late. Within 10 working days of the takeover is too late.
In advance, is when Nimer should have proved he could buy Charlton, before he was given the opportunity to harm a damaged club yet further. No deal should have been passed until that point. Yet the EFL lost Bury, in part to this dereliction of duty, and nothing changed.
They deserve limited sympathy, however. If £1 buys your football club it will be very hard for football’s administrators, however gifted, to save it. If your entire club can be bought for 50p less than a Cadbury’s Caramel, its problems are far greater than executive governance.
So Bury were best part doomed when Dale took over in December 2018. Their finances were a mess and they probably would have crashed either way. Yet, certainly, football had the chance to learn from that experience and ensure better practice. At the AGM last June, rules could have changed so that the league had to approve the sale of a club, with proof of funds, before any takeover was formally ratified.
As it stands there is conformity between the EFL and the Premier League, who share a rule stating that changes of ownership, even directorship, have to be revealed to the governing body 10 days before they are due to take place; but one size does not fit all.
As fit and proper persons investigations can take anything from two weeks to a month, technically there is nothing to stop Mike Ashley selling Newcastle for £300m then letting the Premier League worry whether the new owners are fit, proper or even have the funds to pay next month’s wages.
What stops the deal going through without due process is that figure: £300m.
Who would risk paying £300m only to be told by the Premier League that the takeover does not meet standards? In the
EFL, it is different. To buy Charlton cost £1. What works in the Premier League, leaves EFL clubs horribly exposed.
The official EFL explanation is that events overtook them — that the AGM was in early June and it wasn’t until later in the summer that the full horror of the Bury takeover became plain. But that isn’t entirely true. Dale had been in charge close on six months by then.
EARLY in 2019, there were reports that wages were not being paid, and these continued, off and on, through the remainder of the 2018-19 season. A winding-up petition was to be heard in May — but was adjourned due to the presence of three supposedly credible takeover options.
In other words, if Bury were not going to suffer from the EFL’s absence of curiosity before their takeover, it was more luck than judgement.
There were significant grounds to change league rules that June before Bury’s fate was sealed, to expand the demands of the fit and proper persons tests to include proof of funds.
It might not have saved Bury, but it would have guarded against other clubs being hurt by chancers.
For here are the EFL’s rules as experienced by Charlton seven months after Bury went into liquidation. A new owner can be barred for failing the fit and proper test, but not for failing to provide proof of funds.
The league can refuse to approve a takeover if a person has engaged with the process in advance but not if the deal has been done, without meeting league requirements.
The penalty for failing to provide the necessary information after a takeover is a player registration embargo, but the takeover stands.
So whether he has the money or not, whether the club is heading for administration and League One — the first practically guarantees the other –— Nimer owns Charlton.
Whether he should or not is another matter entirely. He’s no Yasir Al-Rumayyan; hell, he’s not even Mike Ashley.