Sky Sports: Newcastle takeover relegation clause ‘expected to be major sticking point’ – Could have been easily avoided
After weeks of fevered anticipation, Monday night saw progress on the Newcastle United takeover.
News was leaked (see below) that Amanda Staveley had made a formal offer for the club.
After that new broke, there has then followed much coverage (read below) of what has allegedly happened and what the exact offer is.
As well as a predictable difference between the two sides when it comes to valuation in these opening exchanges (who would ever give their best offer first…?), there has also been a number of other issues, with chief amongst those, an insistence on a relegation clause from Amanda Staveley’s side.
Keith Downie of Sky Sports:
“Negotiations for the sale of NUFC continue…
“With the buyers’ request for compensation if relegated expected to be a major sticking point.”
Various other media have also reported on the existence of such a clause and surely no surprise that this would be the case.
I have already seen some Newcastle fans arguing either way, with some saying that if Amanda Staveley and her backers want to buy the club then risk of relegation comes as part of any deal.
Well it does – but if you are buying a club midway through a season then if there is a realistic chance of relegation then surely it has to be factored into the deal somewhere, whether it is knocking money off the actual sale price, or a relegation compensation clause as Sky Sports are indicating.
Which to me, simply brings us back to the timing of Mike Ashley announcing the club up for sale on 16 October 2017.
Surely it would have made sense for everybody, that if Ashley seriously intended to sell the club this year with the minimum of problems, it should have been put up for sale six months earlier…24 April 2017 to be precise.
That night saw Newcastle United beat Preston at St James Park to ensure automatic promotion back to the Premier League.
Mike Ashley should have then instantly on the final whistle got his mates from Sky Sports to put up the for sale notices right then.
At that point there was still nine and a half weeks until the summer transfer window would open and indeed four and a half months until the window would shut at the end of August.
Plenty of time prospective new owners to come forward, do due diligence, put in an offer, negotiate, reach agreement, buy the club, then agree a plan with Rafa Benitez on how to attack the new season.
At that stage a relegation clause wouldn’t even be talked about, you are buying a football club and knowing exactly what you are getting, with your own chance to mould it how you see fit ahead of the next season.
People might say ‘Well new owners would have the January transfer window to assist Rafa’ but the day the transfer window opens, Newcastle play their 22 Premier League match of the season and by the time the window closes there are only 13 games still remaining. Very little time if you are struggling to bring in and settle new players to get them performing at their best.
I have always wondered about the timing of Mike Ashley putting Newcastle United up for sale over two months into the season and I can’t help thinking that like a lot of things he does, it is impulsive and a snap decision made.
Amanda Staveley turned up at that Liverpool match on 1 October and at the final whistle Newcastle had 10 points after seven matches, having won three and drawn one of their last five games.
So did Mike Ashley think this is the ideal time to get a quick deal done at the best possible price, a manager like Rafa Benitez in place and more importantly the team suggesting it would be nowhere near relegation struggles.
A day after Newcastle got a draw and played very well at Southampton, the formal for sale signs went up. Plus the upcoming games were against Crystal Palace, Burnley and Bournemouth – giving at least a few weeks grace where extra points and confidence could be added to impress potential buyers, before a tougher looking schedule presented itself.
From everything we have ever been told about Mike Ashley (parking tanks on the lawn if he wants a deal done etc etc) he drives a very hard bargain.
With three defeats in a row now and a difficult fixture list ahead, you just hope that he hasn’t come up with a massive over valuation sparked by the early points total this season and will refuse to budge on that.
It is the same with everything you want to sell, a football club is worth what somebody will pay for it.
Overall, I do believe that Ashley is interested in selling the club but then if that is the case, you do have to ask why he didn’t put it up for sale in April when both parties would know where they stood in the close season.
The Mag – Earlier today (Tuesday 21 November):
Monday night brought breaking news of an Amanda Staveley bid for Newcastle United, reported to be ‘in the region of £300m’.
Great news for Newcastle fans that there has been proved to be substance in reported interest in buying the club and various media, including the Press Association, confirmed last night that the club had indeed accepted that a bid had been received.
Mike Ashley was reported to be furious that the bid was claimed to be around £300m, with The Mail (see below) and others revealing that the bid was nowhere near that figure, with also claims of the bid including ‘relegation clauses’.
Tuesday morning has seen The Times (see below) report that Mike Ashley was also ‘disappointed’ that news of any bid had been made public at all.
Very amusing to see such a manipulator/user of the media seeing somebody do the same to him.
It turns out the Amanda Staveley bid was put in last week and quite clearly it is her camp leaking news of the offer, using the media to put the pressure on Mike Ashley.
Nobody wants to see Newcastle United lose any game but the fact the Magpies have won only one of their last seven games certainly doesn’t strengthen Ashley’s hand when bargaining on the price/terms of any deal. if Newcastle had six or seven more points towards Premier League safety from these past two months of football, then the NUFC owner would be sitting pretty.
The Times also say that their sources claim the Staveley offer is ‘take it or leave it’ and with the two sides seemingly so far apart, then to some Newcastle supporters the situation might look hopeless.
However, it is not unusual in any type of business, especially where the two sides are using the media to get their respective messages out, to hear such bluster when the opening shots are being fired in a battle to get the best deal possible.
If the two parties (or indeed a third party joins the bidding) then no reason why a deal can’t be reached, if both sides are committed to a sale/purchase of the club.
The Times – Tuesday 21 November 2017:
‘Sources close to the negotiations suggest that the offer, which was made at the end of last week, is “take it or leave it”, although it remains to be seen whether this is the case.
As of last night, Staveley, 44, was awaiting a response from Ashley’s representatives, who are said to be disappointed that details of the bid have been made public.’
The Mail – Monday 20 November 2017:
‘Amanda Staveley and PCP Capital Partners have moved closer to a takeover of Newcastle United after making an opening offer – but Mike Ashley is set to reject the approach.
The Middle East and Chinese investment fund – fronted by the Yorkshire businesswoman – have been working through the due diligence process since last month and have now tabled an initial bid.
However, Sportsmail understands that Magpies owner Ashley was furious at reports which emerged on Monday night suggesting the figure was in the region of £300million.
Sources close to the club insist it is way lower than that and Staveley will need to return with an improved offer if there is to be progress. It is thought the deal is complicated by clauses in the event of relegation.
Ashley still wants to sell the club but will do so on his terms, which could include an advertising package for Sports Direct.
If a takeover is completed – and sources close to the deal are ‘confident’ it will be – then we understand Staveley, 44, will be installed as the new head of the club.
Negotiations will now continue but hopes of a deal being completed by Christmas have rescinded given the disparity in valuation.’
If you would like to feature on The Mag, submit your article to [email protected]