Dick Knight Share Dispute - Unnamed Director offer £0.01 per share

[Goldstone1976]

My guess: 1p offer is from Derek Chapman, the £1 offer from Norman Cook. I'm only guessing here though. I've not been told who the other shareholders who made offers are.

Snap! Like you, I'd just be guessing. Assuming the non-Director shareholder has offered £1, as DK says, I would expect the requirement for an independent valuation to fall away, since both buyer and seller have agreed a price. The auditors are only coming in because DK wants £1 and the Director Shareholder has offered 1p.

Of course, if the deal is done without an independent valuation, a key part of what DK says he wants to happen will not - the shares would go to the unnamed non-Director shareholder!

 

[stss30]

DK wrote the rule, to protect the interests of the fans, not to offer an opportunity to the directors to play silly games like this one.

I don't think Dick would have endeared himself to the directors by publicly advertising shares to fans, before having behind the scenes discussions. I can fully understand the club's stance.

 

[Gritt23]

Maybe not, but I still don't think it's particularly wise to start trying to find fans to buy the shares before others behind the scenes processes to take place.

It fits with the vision he always had for the club when he first came in and kicked out the Archer regime.

He always gave the fans plenty of credit for the role played in saving the club, and his vision of it being a family / community club was always there. Unwise? This always seemed like a very natural route for his shares to eventually take.

What makes me uncomfortable (and I sincerely hope I'm wrong) is the feeling that we, as fans, are not only unwanted, but people will go to some lengths to keep us at the tills, and not anywhere near the back of house.

Am I cynical, untrusting, and quick to hit the panic button when it comes to ownership of our football club? Yes, absolutely. But that's what Archer did to me. It was like seeing the love of my life being taken from me. Of course it leaves me with trust issues.

 

[Lord Bracknell]

I'm sorry LB but you're making out that this is some great thing that DK did to protect the club but it really isn't. it is a completely standard position that 99.99% of companies in existence will have.

It may be standard practice, but it wasn't in place under the Archer regime. As we know, Archer tried to revise the Articles of Association to allow him and his cronies to do what the hell they wanted.

 

[Brighton Breezy]

Was genuinely surprised to hear the 260 odd fans who expressed an interest in purchasing shares 'applied' for around 95,000 in total.

 

[Lord Bracknell]

Snap! Like you, I'd just be guessing.

I'd guess slightly different.

 

[seagullsovergrimsby]

I don't think Dick would have endeared himself to the directors by publicly advertising shares to fans, before having behind the scenes discussions. I can fully understand the club's stance.

The actions of a Mad Man

 

[Goldstone1976]

I'd guess slightly different.

On the Director Shareholder? Hmmmm - maybe....

 

[Buzzer]

It may be standard practice, but it wasn't in place under the Archer regime. As we know, Archer tried to revise the Articles of Association to allow him and his cronies to do what the hell they wanted.

I'm not sure what point you're making. You describe it as if the club are trying to do something underhand. DK himself approved these rules when Chairman. He never offered the shares to fans when he was in charge. He also knew about the requirement to inform the other shareholders prior to offering them at large. He's the one playing silly beggars here by not informing the board and also asking for a value well in excess of their net worth. The other shareholder is completely within their rights and seeing as DK was the one who gave him that right, he can't now claim that it's unfair.

 

[Ernest]

Same Dick Tight wasn't so keen on giving shares away when he had the begging bowl out at Withdean instead of offering BRICKS

 

[stss30]

It fits with the vision he always had for the club when he first came in and kicked out the Archer regime.

He always gave the fans plenty of credit for the role played in saving the club, and his vision of it being a family / community club was always there. Unwise? This always seemed like a very natural route for his shares to eventually take.

What makes me uncomfortable (and I sincerely hope I'm wrong) is the feeling that we, as fans, are not only unwanted, but people will go to some lengths to keep us at the tills, and not anywhere near the back of house.

Am I cynical, untrusting, and quick to hit the panic button when it comes to ownership of our football club? Yes, absolutely. But that's what Archer did to me. It was like seeing the love of my life being taken from me. Of course it leaves me with trust issues.

I can fully understand that, what I'm saying is that is there is usually a side to both arguments. Maybe if Dick had gone to the directors before offering his shares to the fans they would have been more willing to let the shares go. If he didn't have these discussions with the directors, it could be perceived as a petty swipe at the club causing them an extra administrative headache. I'm not sure whether these discussions took place or not, but if they didn't I can fully understand why the club were unhappy.

 

[Couldn't Be Hyypia]

Thank you for your patience. Other club issues aside, I need to let you know where things stand on my proposed share sale.

Before reporting the latest developments, let me recap…

As I explained earlier, the Albion’s Articles of Association mean that before I could sell any of my shares to supporters I first had to offer them via the club to existing shareholders. I informed the club of my intention to sell 100,000 of my shares, and I then received a letter from the club containing an offer from an unnamed shareholder to buy the £1 shares for a penny each.

This was unacceptable, as I am sure they knew it would be.

(It was also surprising. The Articles, which I helped to draft in the 1990s, were designed to stop shares being sold to predators who would damage the club. They weren’t intended to stop them being sold to supporters.)

The next stage set out in the Articles was that the club’s auditors would be asked to come up with a Fair Value price for the shares. The figure would be binding on me and the unnamed person wanting to buy them.

After a delay the club’s auditors, Mazars, have now detailed the fees they will charge for valuing the shares. Given that the shares represent a minute proportion of the club’s issued capital, and that their sale would have no effect on the running of the business, one would expect this to be a simple matter and the charges to be low. Especially as a strong valuation guide has just been created by supporters willing to pay £1 each for 100,000 of my shares.

In fact, Mazars inform me the process is likely to cost tens of thousands of pounds. Presumably reflecting a brief given them by Albion’s board, a team of staff from the auditors would be involved at hourly charges of up to £450.00. And there would be a lot of hours involved – the first item in the details Mazars sent to me is a series of meetings to consider the terms of reference for the scope, methodology and timetable for their work. And I am expected to be personally responsible for 25 per cent of these charges.

This is entirely unreasonable – I would be forced to pay what could be a five figure sum to the auditors to consider a proposal - almost certainly instigated by a club director - to reduce the value of my shares by 99 per cent.

A situation of this kind was not envisaged when the Articles of Association were drawn up. The club cannot claim ‘’we are simply following the rules’’. This is a deliberate misinterpretation of Articles written to protect the Albion from predators, not its true fans.

Whether these actions are aimed at me or to stop supporters being shareholders I don’t know. I suspect that the former is a major consideration and that saddens me – like every true supporter I believe that because of its history the Albion is at its best when marching as one. This latest development suggests that not everyone in the club agrees.

The club and auditors also want me to sign a Non-Disclosure Agreement to keep this whole matter out of the public arena. While of course I would never disclose information commercially sensitive to the club, one can understand why they want to keep this private – but an impossible task given that they are aware I need to keep share applicants (over 270 now) informed of developments.

The overwhelming message I received from people following my Share Update of March 31, is that they are hugely disappointed by the club’s response. Because they genuinely wanted to show their commitment to the Albion beyond just as fans – as privileged owners of a tiny part of the club they love, and have fought for. Proud possessors of a share certificate they can frame and display on the wall – and hand down to future generations of their family.

These are not my words, but those of supporters like yourself disillusioned that the Albion, of all clubs, is taking this hard-nosed stance against the worthwhile wishes of a small group of its fans.

Some Albion fans who don’t share your intentions will no doubt accuse me of trouble-making in continuing to pursue this share sale at a difficult time for the club – and dismiss it as an irrelevance.

But this is nothing to do with the club getting prepared for the Premier League – it is about the club never forgetting its roots. About giving a few more of our supporters the chance to maintain the family traditions of the Albion, a cause that not only myself, but Tony Bloom, holds so dear.

The club can easily end the auditors’ valuation procedure farce by the mystery shareholder withdrawing his derisory 1p offer for my shares. But I suspect they want to drag this process on – seemingly prepared to pay tens of thousands of pounds in auditors’ fees to stop me selling a few of my shares to you, the fans.

I truly hope the club recognises the ludicrous and ill-judged nature of this situation, and allows your share dream to be realised.

Your only motivation is to cause trouble. Such a shame you're muddying your immense reputation for no real gain.

 

[Betfair Bozo]

I don't think Dick would have endeared himself to the directors by publicly advertising shares to fans, before having behind the scenes discussions. I can fully understand the club's stance.

Quite right, and Dick would be fully aware that this would be the case which is a little odd for someone who believes "the Albion is at its best when marching as one."

Rather unseemly in my view and a shame. Dick's role in the past should never be forgotten. Tony's £130m has left a couple more permanent reminders.

 

[PILTDOWN MAN]

Same Dick Tight wasn't so keen on giving shares away when he had the begging bowl out at Withdean instead of offering BRICKS

Now that made me chuckle.

 

[symyjym]

I don't think Dick would have endeared himself to the directors by publicly advertising shares to fans, before having behind the scenes discussions. I can fully understand the club's stance.

But he probably knew that by going to the club first they would have said no and it may have been something he had already discussed with them hypothetically. So the only way to try to do it is the way he has otherwise we would be none the wiser.

 

[ROSM]

Just to clarify here, are we sure that he didn't advise the club of the plan to offer shares? I can't be bothered to check back but thought they knew he wanted to sell and made no offer but only became interested when he made his public offer

 

[Buzzer]

I think the club made a statement saying they hadn't been informed of the sale.

 

[stss30]

But he probably knew that by going to the club first they would have said no and it may have been something he had already discussed with them hypothetically. So the only way to try to do it is the way he has otherwise we would be none the wiser.

If the directors weren't keen on the shares going to the fans I'd fully respect their decision. At the end of the day they are the ones who are contributing greatly to the welfare of the club, I just think it's an unprofessional way to go about it whether he knew they'd reject or not.

 

[Goldstone1976]

Just to clarify here, are we sure that he didn't advise the club of the plan to offer shares? I can't be bothered to check back but thought they knew he wanted to sell and made no offer but only became interested when he made his public offer

The first the club knew about the public invitation to treat was when the book was published.

 

[Hotchilidog]

My understanding is this:

Dick Knight gained most of the shares from converting cash loans to the company into equity shares (as have most other shareholders). When Dick Knight sold the majority of his shares to Tony Bloom, Bloom paid him at face value - well over any market value for them and so Dick Knight got the majority of his loan back. At no time prior to this did DK or any other shareholder expect to get a penny back from these loans. No other shareholder has ever been repaid for their loan in the same way as TB did with DK.

DK still held onto a relatively small amount of shares, I think about 100k and offered them to fans at a £1 each. If DK sells the shares to fans then he gets all his money back (or most anyway). Other shareholders are a little upset about this and one in particular is exercising his right to buy any shares offered to sale before they go on general sale. He (or she) feels that all the shareholders were in it together and it's now very unfair for DK to get all his money back when the rest sit there with worthless shares. I also understand that it isn't any club policy that is stopping DK but this one shareholder in particular who is acting completely legally and within his rights.

It's a real shame it has come to this with shareholder against shareholder but I can't help but feel that DK must take a lot of the blame here for not informing the other shareholders first as he was required to do and for deliberately pitching the fans against the Board when it should be an internal issue. I also think he's being mischievous by offering them to fans now when he had ample opportunity to do this as Chairman. I do, however, understand why he feels such enmity against the current Board especially the actions regarding AITC.

It's a mess for sure - but it's not the club trying to stitch up DK but rather one shareholder (and it's a moot point certainly from his point of view whether it's a stitch-up) and DK is certainly not blameless in this.

This post almost certainly hits the nail the on the head, but I think it is sad that we have been reduced to this sort of pettiness over something which actually will have no effect on the running of the club whatsoever. Dick should have undoubtedly let the club know of his intentions to offer his shares to fans before he sprung it on an unsuspecting public. However given that people will be buying these shares (and certainly not all 100,000) just to have their own little bit of Albion I see no harm in letting it go ahead.

I respect DK immensely for what he did for the Albion, the term LEGEND is for once well and truly earned, he is a legend FACT! He ensured that there was a club left for for Tony to rescue when he did. I do however recognise that it was impossible for Dick to carry the Albion torch on as he simply did not have the resources to do so, it is sad in the extreme that he has not been able to accept this with more grace than he has done.

Despite the apparent breakdown in relations between the board and Dick I sincerely hope that both parties can end what appears to be an unseemly petty squabble so that the contributions of both Tony and Dick can be recognised for what they have done for our club.

Seriously boys, grow up and just play nicely will you!