Mike Ashley has given up on Newcastle United
My feeling is that Mike Ashley has given up on Newcastle United.
There are several reasons for this feeling.
1) Sports Direct is collapsing, the global economy is collapsing, and his core business needs his full attention to avoid a splattering final collapse.
2) Ten days into the transfer window and we have made no signings of any kind.
3) He is not stupid and knows his strategy for football club stewardship is a total failure, but he is not changing it because he will never compete with more successful clubs on managerial ambition or investment.
4) He has no intention of staying around for our forthcoming sojourn in the Championship, because he knows we will be down there for years, which is no good to him from the marketing point of view.
5) The decline of Sports Direct’s share price means that his ability to source cheap funding is reduced. Ashley doesn’t like borrowing, but he certainly doesn’t like borrowing expensively.
6) He is discounting the loss of Premiership income by not properly investing in a relegation-bound squad. Ashley often loses face, but he never loses money. Until now (see below).
7) He doesn’t know anything about football, but understands business very well, and can see that his Newcastle experiment has been a failure and the club is a basket case, so he won’t be throwing good money after bad.
8) He knows Charnley is a proven failure, so won’t be giving him money to spend.
9) He has satisfied himself that nothing can be done to rescue Newcastle this season, and so won’t be trying.
10) Sports Direct’s latest profits warning is in the light of Christmas trading. All retailers need a good Christmas, and some retailers make all their money at Christmas time.
11) Sports Direct is encountering the Morrison’s ‘Old Hat’ problem – Morrison’s went half-heartedly into online trading and home delivery, and have never recovered. Twenty years ago they were the supermarket starlets. Now they are nowhere, with uncompetitive big stores they can’t sell. Sports Direct has never managed to compete online in this country, perhaps because their customer base is old- fashioned and poorly educated.
12) Newcastle United are also looking a bit Old Hat. We are mistrustful of foreign managers who are often forward-looking, we don’t build teams but instead buy young foreigners for whom the fondest hope is that they will be sold on, and we are miserably parochial, our only thought being to lose in the cups and stay in the league. But our stewardship model is ludicrous. It has never been in fashion at all. Nobody else has adopted it.
For the past three years I have been convinced that Ashley was desperate to sell our club, and of course he hasn’t sold it, and he hasn’t been trying to sell it, as far as I am aware. But I am more convinced than ever that the only reason Ashley has not been trying to sell it is that he knows he wouldn’t be able to.
I think he will now be trying to sell our club. And he is prepared to take a financial hit in flogging us off.
He has to protect his main business, and he has to avoid losing his entire fortune and empire. Newcastle is holed below the waterline and its conspicuous failure is in danger of dragging the reputation of Sports Direct even further into the depths. Ashley hasn’t the time or the money to look after Newcastle. And he has never had the interest in doing so.
You read it here first. Ashley will, as he intimated some months ago, sell the club in six months. And he will be able to do so because he will flog it at a rather substantial loss. He won’t need to find a billionaire.
I wonder if Freddie Shepherd has had a call over the festive period?
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