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Thursday, August 16, 2012

Article : Pompey Supporters' Trust and Trevor Birch

All eyes now turn to the Pompey Supporters Trust and Trevor Birch. This situation is now a rather simpler one. That may be a minority opinion, but one that is supported by the facts.

Pompey is for sale. It is a business with 8,000 season ticket holders, no players and £4m in the bank. Considering the Trust's break even budget put aside £2.65m for player salaries and we have a small handful of first year pros earnings a few hundred quid per week, the club is like any football club, far better off financially without all those footballers hanging around.

There is one buyer, who have a limited amount of money. The club has one tangible asset, a stadium worth £2m according to an independent valuer. The Trust submitted a bid weeks ago. It has a fully costed business plan that passed muster with Portsmouth City Council. It has actual, real money to invest, unlike any other bidder in recent years.

So what is the problem, why doesn't Birch just sell to the Trust? Well, for one, there is Portpin. They still hanker after their lost money and are still scrambling for a way to get it back. However, again this is quite a simple one. They can howl all they like, there is one sum of money on offer. There won't be any more. They can take it or leave it. Birch said himself that if necessary he can take them to court and force them to accept the best deal on offer. Well, it's the only deal on offer.

Then there are the players and the compromise agreements. Well, all those compromise agreements were negotiated by Birch with Portpin in mind. Well, their offer is off the table so those agreements are gone. I for one don't believe for a minute that Portpin allowed Birch to spend £9m on compromise agreements. It is far more likely to be 50% of that at best. Even so, there is going to have to be some renegotiation, because like Portpin's lost money, there is no-one around to pay it, and all those agreements were made conditional on a Portpin takeover as I understand it.

Portpin and our former players are rather like the Arabs in George McDonald-Fraser's excellent post-war memoirs, hanging on to a treasure chest full of pre-war Italian lira, not having heard the news that all the security and football creditor rules in the world are worthless without someone prepared to pay the sum assured to the bearer.

Which brings us to liquidation. Portpin do not own Fratton Park. In the event of liquidation, the money in the bank goes to PKF and Gaydamak. The player contracts are all cancelled. All football, creditors become unsecured. The one remaining asset, Fratton Park, is sold by the liquidator to the highest bidder and the money goes to Portpin as secured creditor.

As discussed, Fratton Park is independently valued at £2m, and a substantial proportion of that value is based on renting it to a football club that no longer exists. As there could be no football played and no rent earned, the value is substantially reduced. In any case, it comes back to what someone is prepared to pay for it. The development brief, approved by government, means Fratton Park is subject to compulsory purchase and severe planning restrictions. No developer is going to buy it, for the same reason no-one has bought the Gaydamak land. It's worthless. Even if you could get planning permission it is for light industrial units, not retail or residential, so you would be lucky to even get your money back, let alone make a profit. Industrial units in Fratton aren't exactly priceless.

In other words, in a liquidation scenario we are back to the same buyer, Pompey Supporters Trust, but they would be prepared to pay even less for the stadium. The current pledges would have to be returned to fans and business and the money raising effort would have to start again for a non-league Pompey. The chances are substantially less would be raised.

So the situation is only complicated by people's unrealistic expectations. In reality it's very simple: one club, one buyer, one amount of money. Birch needs to get people round a table and try to thrash out a deal - fast. If Portpin won't take the offer, get into court and make them. If the players won't, well they can have nothing instead.

PKF, the players and Portpin all came to Pompey to make a lot of money. Time to wake up and smell the coffee. Money's gone. All that's left of Pompey is the fans, a fine young manager and some young braves preparing to do the football equivalent of the Charge of the Light Brigade.

It's time you all got real and took your leave. The fans have got a long road in front of them whether the club survives or is liquidated and reborn. Hit the road, and let us get on with rebuilding our club. Starting at Fratton Park against Bournemouth.

Micah Hall ( www.fansnetwork.co.uk/football/portsmouth )

The Pompey Supporters' Trust is still seeking pledges from Pompey fans to back their bid. Information can be found here

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