The CIC Meeting at The Louden - Twitter

[andy steel 0]

Sorry BH, been enjoying the unseasonally fine weather and only just back in.

[BrahimHemdani 1]

Sorry BH, been enjoying the unseasonally fine weather and only just back in.

 

You couldn't have been down in Ayr yesterday, I just thawed out.

[pete 2,499]

I actually liked the Calscot system that we invest via the Gersnet.

[andy steel 0]

Would it make the scheme any more attractive to doubters if it were considered as part-fan ownership rather than outright fan ownership?

 

If we had enough of a stake to put off the wider of the cowboys who have ridden into town, say, the power to deal with such types via legal measures at AGMs or EGMs rather than vague threats of boycott or a withdrawing of financial support?

[Bluedell 5,627]

I said that under the original IPS Supporters Trust model e.g. Gersave, Arsenal Fanshare Society, the Clubs simply ignored the supporters;

 

I'm not sure that's a fair comment. Under Gersave the club legally could not promote it, but were certainly sympathetic towards it, particularly initially.

[rea 0]

Apologies again for the delay and I have not been able to contact Andy at the moment to have him review the following.

 

REPORT OF MEETING TO DISCUSS A RANGERS COMMUNITY INTEREST COMPANY

LOUDEN TAVERN GLASGOW

14 APRIL 2014

 

The room was full with approximately 50 persons representing various bodies and some fans in an individual capacity. (I have asked for clarification of the numbers.)

 

Paul Goodwin, Head of Supporters Direct Scotland, opened the meeting by saying that Community ownership allows an increased level of involvement and engagement by fans leading to financial responsibility, sustainability and transparency by clubs.

 

He gave examples of clubs in fans ownership around the world especially Germany, Spain and Argentina as well as Scotland and England, the most striking example of which was Portsmouth.

 

Richard Atkinson, a member of the Scottish Council of SD and former St Mirren FC Director https://www.linkedin.com/pub/richard-atkinson/28/5b1/699

http://www.bbc.co.uk/sport/0/football/23721154

 

then gave the main presentation.

 

He confirmed (as I said earlier in this thread) that because of its SG funding, SD in Scotland has a wider remit than SD in England (where the Football Supporters Federation undertakes this kind of work). Therefore SDS can speak to anyone interested in Community Ownership of a Scottish Football Club. The motivation (not sure if he said his motivation) is that certain football club assets should be community owned. He gave the following examples:

 

• St Mirren – Target £2 million

 

1007 @ £13.50 per month committed but not drawn down (implying other funding and/or approx a 7.5 year commitment). He said there were community companies who would provide the capital.

 

• Dunfermline – HNW individuals & Donations.

 

Regular giving after the event was approx 1,000 @ £20 per month.

 

• Hearts (FOH) – out of CVA

 

7,600 @ £15.50 per month to repay funder.

Equivalent to approx 50% of season ticket holders.

 

He made it clear that the circumstances were different in each case.

 

• Rangers? should be 20,000 pro rata excluding overseas supporters.

 

Say £15 per month = £3.6 million per year

 

Company Law prescribes:

 

5% shareholding – Can call and EGM (at current prices and assuming availability this would cost £800,000 which he claimed was achievable in 3 months).

 

10% shareholding – can block the purchase of all shares

 

25% shareholding – can block special resolutions e.g. to sell assets

 

30% shareholding – must make an offer for all shares.

FAN OWNERSHIP

 

The purpose of the scheme should be to achieve CONSULTATION and TRANSPARENCY.

 

He said that if the Club was willing to conceded these objectives then it would not be necessary to buy shares but instead the money could be put into special projects e.g. youth academy. “A fans group with sufficient capital can engage with the Club in a number of ways.”

 

A COMMUNITY INTEREST COMPANY is “designed to be wide ranging, open and transparent” (RA) and can have various different structures. A holding company would own the shares. The members would decide who sits as the trustees. The structure would be one member one vote + high net worth individuals.* The company could buy shares from the 12% of individuals who currently own shares in their own right. A CIC must meet the so-called ‘community interest test’.

 

* Here I took slight issue with Richard. According to http://www.supporters-direct.org/wp-content/uploads/2013/11/Supporter_Share_Ownership.pdf “CIC’s that are structured as a CLS or Plc can issue shares but work to the principle of one-share-one-vote, thus allowing an individual, entity or small group of people to have overall control” (page 7) and do not conform to co-op principles and “CICs work to the principle of one-share-one vote, it is also possible for them to issue a category of share that provides certain rights on a one-member- one-vote basis (page 8).

 

Also according to http://www.supporters-direct.org/wp-content/uploads/2012/07/Financing-Supporter-Community-Ownership-Briefing-3.pdf

 

“i) A CIC does not have to conform to co-operative principles.

 

ii) Shareholders in a CIC usually have one vote per share, meaning that the more you invest the more influence you have, which contrasts with the IPS ‘one member one vote’ structure.

 

HOWEVER

 

iii) The CIC model can replicate one member one vote if required or provide for weighted voting.

 

AND

 

iv) There is also the ability to allow for different classes of shareholders or members with different voting rights. This means that a CIC might be useful where both fans and high-net worth investors are involved in the ownership and governance of a club.” (Pages 36/37)

 

So what is clear is that the precise structure of the CIC is critical.

 

Richard said that they have a standard/proposed structure.

 

The differences between the Community Benefit Scheme model (the current RST BuyRangers Scheme) and a CIC are clearly set out in these documents (which were not referred to at the meeting) but according to Richard “the essential difference is that a CIC is not tied to buying shares and has the ability to offer institutional shareholders a different method of return (e.g. by offering them (or others) a coupon or interest on their money at a rate between 0% and 8%.

 

THE WAY FORWARD

 

If it is agreed to form a CIC, Richard proposed that the First Trustee be a solicitor and that the second director is a Corporate Member who he suggested would be SDS. (In my opinion this requires clarification because, so far as I am aware SDS is not itself a legal entity but part of SDUK.) He proposed the formation of a working group under this initial structure which he said would not be legal until a significant number move from the working group to be trustees.

 

He also suggested that one way to kick start the new scheme might be to seek £1 per person.

 

An information page and sign up has been launched on scottishfans.org/rangers.

 

Andy was kind enough to say that I made a plea for unity which was warmly received. I said that under the original IPS Supporters Trust model e.g. Gersave, Arsenal Fanshare Society, the Clubs simply ignored the supporters; under the CBS/RST/BuyRangers scheme the RST were only back to the position they were in with oldco and (if Shoredbear is correct about the numbers paying monthly) it will take them 10-20 years to get to 5% as well as having to raise £100,000+ for a rights issue in order to prevent dilution of their current holding; and that what was needed was a scheme to bring everyone together; and that I saw a CIC as being that vehicle.

 

The meeting closed with those present unanimously agreeing to proceed along the CIC lines suggested.

 

(To be fair to the RST, Gordon Dinnie had left by that point and Christine Somerville was sitting behind me so I do not know if she had her hand raised.)

 

Thanks for this a few corrections but nothing major.

 

Main ones a CIC can be established with Coop Articles which is what i refered to, thus ensuring OMOV

 

You are correct that SDS is a committee of SD rather than company in its own right, and it may or may not be able to be legally or from a policy point of view be a Corp Director of a CIC, the relevant point is its facilitation of the working group as that is what SDS is about, increasing the capacity of Fans to engage with community ownership, not if someone is a trustee or not

[BrahimHemdani 1]

Thanks for this a few corrections but nothing major.

 

Main ones a CIC can be established with Coop Articles which is what i refered to, thus ensuring OMOV

 

You are correct that SDS is a committee of SD rather than company in its own right, and it may or may not be able to be legally or from a policy point of view be a Corp Director of a CIC, the relevant point is its facilitation of the working group as that is what SDS is about, increasing the capacity of Fans to engage with community ownership, not if someone is a trustee or not

 

Thanks for your kind comment and I would just like to add that I found your presentation very impressive though I disagreed on a few points.

 

I was only quoting from SD documents and have taken further advice about the CIC vehicle over the weekend but see no need to pursue ahead of a discussion tomorrow night.

 

I should know how SDS is constituted since I was its first Chair but have also written to the Secretary of SD to ask about the Corporate Director situation. I raised it only because you put it forward that way and I didn't see how that could work. However I agree that the important aspect of SDS' involvement is facilitating the Working Group and that is something I am certainly looking forward to.

[BrahimHemdani 1]

I'm not sure that's a fair comment. Under Gersave the club legally could not promote it, but were certainly sympathetic towards it, particularly initially.

 

As far as Gersave is concerned I believe that the Club could have helped more e.g. allowing leaflets on seats and ultimately despite the (albeit modest) shareholding communication was difficult at best which may have been for a variety of reasons.

 

As far as the Arsenal Fanshare scheme is concerned they have 1800 members (more than twice the number of members in the Trust) with a £500,000 total investment but according to my well placed contact "Suffice to say Stan Kroenke gave up meeting AST or any other fan group the instant he got majority control. As we suspected the charm offensive before that was just PR fluff."

 

Anyway, in a sense that is all academic as we have moved on from there and hopefully can make progress with the Working Group.

[the gunslinger 3,366]

As far as Gersave is concerned I believe that the Club could have helped more e.g. allowing leaflets on seats and ultimately despite the (albeit modest) shareholding communication was difficult at best which may have been for a variety of reasons.

 

As far as the Arsenal Fanshare scheme is concerned they have 1800 members (more than twice the number of members in the Trust) with a £500,000 total investment but according to my well placed contact "Suffice to say Stan Kroenke gave up meeting AST or any other fan group the instant he got majority control. As we suspected the charm offensive before that was just PR fluff."

 

Anyway, in a sense that is all academic as we have moved on from there and hopefully can make progress with the Working Group.

 

I'm pretty sure I spent two days putting leaflets on seats about gersave.

[BrahimHemdani 1]

I have been advised that there were 43 people in attendance at the first meeting but my attempts to establish how many of these were representing groups or orgs and how many (like me) were there in their own right, have thus far been thwarted.

 

Apparently there are "around 20 or so ready to meet tomorrow night (in the Working Group) at the Louden. The meeting will decide the structure of the Working Party and role of specific groups, the conducting of a skills audit to get the right people in the right place and how it is coordinated. The meeting will also look at I.T stuff to get us cracking."

 

More anon.........