Arsenal Supporters Paying The Price Of The Greed Of Custodians?

In the football world there is a trend to view shareholders and directors of a club as custodians rather than owners. Fans are considered to be the heart and soul of a football club and it’s real owners. In the past the Arsenal directors/shareholders have released statements recognizing their role as caretakers. But did they really mean it?

As the club announced a 6.5% hike in general ticket prices one wonders whether the Fiszman and his fellow owners could have done more for the fans. I don’t recall the exact details of the transactions but there can be no denying the fact that the previous owners have made obscene profits from their shares.

How do the so-called custodians justify enriching themselves when they haven’t put in millions into the club in the first place?

Now, there can be an opinion that it’s their shares and they have every right to profit from those. But that’s a matter of fact argument that goes in the face of everything that football clubs stand for. If we accept such a justification one can easily say the wages and transfer fees are continually increasing so the supporters have to shell out more to keep their team competitive. Football, as most of us realize, doesn’t work that way.

On one hand we have owners like Abramovich and Sheikh Mansour who have poured in hundreds of millions from their personal wealth into their club. On the other we have the likes of David Moores, Danny Fiszman, Nina Bracewell-Smith, and others who have made a fortune from their clubs.

It’s understandable that not every owner can incur the kind of lavish spending we have seen at Chelsea and Manchester City. But would it have been so hard for these owners to bring funds into the club via a rights issue? It would have diluted the personal wealth they created from selling shares, the extent of which could easily have been controlled in a reasonable manner.

In other words, Kroenke and Usmanov could have invested some of their wealth into the club instead of fattening the bank accounts of the ‘custodians’. Even a 10-15% investment into the club could easily have lessened the burden on the supporters and would have kept the ticket prices in check for the next few years. The personal accounts would still have received a very healthy boost.

It is interesting to note that fans of Liverpool and Manchester United have been against the likes of Hicks/Gillett and the Glazer family. The key point being that the owners were taking money out of the club to service their debts. But if you think about it, these businessmen had purchased a business and were treating it like one. The real problem should have been with the previous owners who were supposed to be the caretakers but had sold out their custodial rights for a mindboggling profit.

Arsenal could easily end up in a similar situation but the plurality of ownership and the management style of Arsene will keep things in control, at least for the time being.

Another interesting point worth mentioning is the paltry sum that Arsenal receive for some of the commercial deals. Every other big club has significantly better deals while Manchester United’s commercial revenue is almost twice that of Arsenal.

One can understand the need for the stadium and shirt deal with Emirates. It helped the club move into a new stadium and there can be an argument that the loss of commercial revenues has been made up by the increase in Match-Day income. Considering the fact that many other clubs are trying hard but have failed, thus far, in building a new stadium, the work done to move Arsenal to the Emirates Stadium must be appreciated.

However, questions can be asked about the lack of equity funding in that project. If someone like Kroenke had been invited at that stage to invest into fresh shares it could have given the club a lot more flexibility in terms of the commercial deals and the transfer market. Could this be the key point over which David Dein had a fall out with rest of the board?

More importantly, what is preventing the club from renegotiating the deals? Surely, the commercial team is good enough to find better offers that ensure a substantial gain even after the cost of buying out the current deals? Most Gooners will be extremely disappointed if the reasoning behind the failure to improve on the contracts turns out to be – it’s not the Arsenal way. I’m pretty sure milking one’s shares for personal profit instead of the club’s development is not the Arsenal way either!

I would not be surprised if a more detailed and impartial analysis, at a future date, of such an important event in the history of Arsenal reveals that the board at that time were narrow-minded and wanted to safeguard their own interests, perhaps unwittingly, ahead of those of the club. Calling them greedy might be a stretch but they certainly haven’t acted as true custodians.

Ultimately, it is the fans that have to pay the price for their mistakes, bigotry, or avarice. It could be in the form of a trophy drought triggered by lack of funds or a financial pinch from the increased cost of supporting the club. Worse still, the combination of the two over a period of time could drive a wedge through the heart of the passionate and loyal support. The early warning signs are there for all to see and it won’t take long before the cracks begin to appear.

Stan Kroenke has a real challenge on his hands and Gooners around the world are hoping that he will be able to do a better job, with the support of Usmanov and other minor shareholders, than the other American owners have done at rival clubs.