Meeting at 11.30 Saturday 15 November 2003 in the Chairman’s suite at Loftus Road
Present:
* From QPR1st: Justin Pieris, Andrew Goss, Peter Gridneff and David Anderson,
with Roger de Freitas as minute taker.
* From QPR: Bill Power, Kevin McGrath, Nick Blackburn, David Davies, Samantha Taylor.
Apologies: Ross Jones (abroad).
Rules of engagement: It was agreed at the outset that matters relating to finances could not be discussed. This was because there were sensitivities around negotiations in progress with an interested party. It was agreed that David Davies would have approval of minutes before they were released.
This caused some frustration amongst the Trust representatives as it had been our intention to focus on finances, but also an agreement that we were prepared to wait two weeks for the sake of the club. It also led to an encounter full of discussion and observations and sometimes light on straight question and answers. The questions went in both directions, with answers coming from all sides of the table.
1. The back investors.
*David Davies (DD) has been dealing directly with David Thorne’s bankers, whilst the discussions had been encouraging; so far there has been no sign of money. The potential of a bigger deal and its impact on him had been given as reason, along with a number of other difficulties, for non-completetion.
*Haleem Kherallah has been talking since the summer of 2001, in part encouraged by the board. However, lately he has introduced preconditions some involving a third parties that could not be met by the board within the timescale he required. The Board pointed out that it had made an open offer to HK to join the board on terms he felt comfortable with, and are still awaiting his response.
*JR Ivan has recently re-surfaced and his deal is yet to be tabled. However the club is assured it will be structured differently to his last one.
The board were not confident that any of the above would definitely complete first, although there was hope that some of the parties would come in on the back of completion by the un-named party. The board confirmed that the un-named party was brought to the board by Paul Garland.
*Peter Ridsdale wanted 51 per cent of the shareholding. This was presented in a perfectly professional manner. This proposal would have involved a seven-figure investment. He outlined the deal with DD, which involved DD leaving the club. The outline was agreed and PR met the two chairs on the morning of the Oldham play off game. However, no formal offer was ever received.
It is acknowledged PR had maintained interests in a number of clubs the board was genuinely surprised when PR surfaced as owner of Barnsley a few days later, as the Board was still waiting for his formal offer.
2. There was a discussion around why investors always seem to fall at the last hurdle? DD said the general picture is good as losses are being reduced. Players’ costs have been reduced, and there are real savings on the youth scheme. DD believes investors are not put off by the ABC loan itself. The main stumbling block is 3 below.
3. The sticking problem said DD, is not the loan, but the plc. There is a real problem simply of being a plc and a rule 9 bid. The people who would want to put in a seven-figure sum want control. Getting control would mean buying Chris Wright’s (CW) shares. Buying CW’s shares would see money going out of the club and seen as dead money.
4. The cost to change the company’s status was not negligible, and
certainly not possible within the current financial climate. Much discussion over the actual cost involved, £10-50k, and agreement that the board would listen to offers of help from supporters who could donate their professional skills to bring the cost down.
5. Discussion around the ‘fit and proper person’ criteria. The board believed it was hard to see how the football league could draft an effective test that would identify sound long-term interests, as well as keeping out the men of straw. The current suitors would certainly, by any objective standard, meet any proposed criteria.
6. The Trust enquired whether the potential investors provided a proposed business plan as part of any offer. They enquired whether different investors/owners have distinctive plans? Potential investors have all seen the cash flow and accounts. Was there a vision that took them to their bankers? The meeting recognised football was not a normal business.
NB emphasised that each director and owner had to learn the business of their club afresh. That takes time. A business plan would then have to be very flexible, and of course it is driven by what happens on the field, so any busines plan requires some ‘what if’ scenarios.
7. What is the extent of the financial crisis? How long have we got? DD described a stressful hand to mouth existence. Directors would if necessary put their hands in their own pockets to see the season out. Fans are frightened, but some of the board don’t see it in quite the same way.
8. Discussion followed on the implementation of CVA and was this desirable and could it be achieved. DD outlined the inconsistency that has occurred in these arrangements since Leicester City FC. Leicester’s was only achieved after Keith Vaz; the local MP went into bat for it, insisting it would severely damage the local community. The CVA’s that had followed had not followed a consistent pattern of settlement, these ranged from 100p in the pound, in the case of Bradford, to 40p in the pound, in the case of Port Vale.
Any CVA at QPR would involve many local trade creditors, which may not be in the long-term local interest. A CVA was not on the agenda.
DD/NB view that any point’s deduction for a CVA would be challenged legally. A CVA is a perfectly legal way of sorting out a business problem, and if the FL deducts points then it is kicking a club when it is down. The FL’s job is to keep clubs going.
9. Groundshare. DD stated the priority was to clarify FFC and Wasps positions for next season.
10. Wasps ground share decision in the spring. They may decide to buy out the option to return to Loftus Road, as Adams Park seems to suit the size of their support.
11. FFC waiting for planning approval for the changes at Craven Cottage. FFC still interested in alternative sites, even if FFC supporters aren’t.QPR1st reported that local political support had been detected for a new stadium north of White City station. NB/DD – ground share not a problem if the stadium is to be jointly branded. QPR1st reported that its survey showed supporters not keen on permanent ground share.
12. Discussion of the problems of raising money from supporters. Agreement that even amongst some of the most well-informed people in the crowd there’s little perception of a crisis – they just don’t see a problem off the field.
13. The club needs to generate further income now. Sam Taylor (ST) described new lottery to support youth development paid by monthly standing order. Prizes will be affinity awards, going on the team bus, sitting near the directors etc. First draw 3 Jan. One thousand tickets would raise £40-50k.
14. QPR1st welcomed this venture, but worried that this might create more problems for the Hoops fund. NB raised the possibility of creating a special scheme that would bring the wealthier supporters into the Hoops Fund. JP reported a strong response to the questionnaire invitation to pay an extra amount on the ticket price in order to avoid having to ground share. People were prepared to pay more on a voluntary basis for a real benefit.
15. This meeting had been the first between the two parties for 6 months and the QPR1st team asked for a return to regular meetings. The board were amenable once every two months, and reflected that it had been a much more constructive session than they feared. Both parties reflected that they hoped it marked the beginning of a new era of working in partnership for the good of the club and the supporters.
The meeting closed at 13.10 with the heralded arrival of Michael Foot and the Plymouth Argyle directors