Have issues relating to the DW Stadium been holding up the Garrido group takeover?

Lisa Nandy put the cat among the pigeons in her interviews with Jay Whittle and the PWU Podcast a couple of days ago. Her suggestion that the exclusivity rights for the Garrido group should not be extended was a bombshell. The prospect of other bidders coming into play at this stage of the proceedings was something that split opinion between fans on the message boards and social media.

“We are pleased to report that substantial progress has been made with the Council regarding the assignment of the lease.  In addition further discussions have taken place between the EFL, the bidder and ourselves and, in our opinion, all information requested of the bidders has been supplied including but not limited to proof of funds for the next two seasons.In the light of this progress, the exclusivity period, which expires today, has been extended.  We now await a final answer from the EFL, and no further comment will be made until that is received.”

The administrators’ communique yesterday put the ball back firmly into the hands of Jose Miguel Garrido and his associates.

But what was surprising was to learn that there had been issues involving the Council. Has the issue of the lease been a sticking point in the drawn-out takeover bid by the Spanish investors?

When Dave Whelan built the DW Stadium in 1999 he made a deal with Wigan Council over the lease of the land it was built upon. The agreement contained a requirement that “two sporting clubs be granted a licence for use of the stadium by the tenant.” Wigan Warriors were given a sub-lease for the use of the stadium until 2025. When Ian Lenagan bought the rugby club in 2007 the lease was extended for another 25 years.

Whelan’s ownership of Latics involved him setting up different companies to control the various operations of his purchase. The company that controls the stadium – Wigan Football Company Limited – is currently under administration. Wigan Council owns 15% of its shares.  If the Garrido group are to purchase the remaining 85% of the shares they need to come to an agreement with the Council over the lease. This necessitates the Spanish group coming to an agreement with Ian Lenagan over stadium rental.

Whelan’s agreement with Lenegan involved the Warriors paying rent according to their attendances. Reports have suggested that they contribute around 10% of their attendance money. Local journalist, Phil Wilkinson, estimates the figure to be around £300,000 per annum, although it can hover above or below that figure depending on attendances.

Mudhutter’s revealing tweet – click here to see his analysis on Twitter – reveals the extent to which the stadium is a white elephant to Wigan Athletic.

The figures Mudhutter has compiled show the stadium company losing some £1.5m for the 2018-19 season. With only £800,000 coming in rent from the Warriors and the separate company that runs the football club the stadium company was struggling to meet its expenses of over £4m.

There has been concern among Latics fans that Ian Lenegan might be intent on buying the stadium for the Warriors. However, the administrators have made it clear that the stadium was part of the overall package, although they did sell off the Euxton training facility separately. Moreover, why would Lenagan want to buy a stadium that cannot break even financially? Better to continue to pay rent, especially if it is pitched at such a modest level.

With spectators not able to attend games at the DW due to the Covid-19 crisis the stadium stands to make even greater losses this season. With no share of gate receipts and no income derived from food and drink sales on matchdays there is minimal income coming in. One wonders if the Warriors are getting off virtually rent-free during this period. Or is there a proviso in the agreement that covers such instances?

The administrators’ statement suggests that the bidders have now provided the EFL with the necessary information requested. In the meantime, the terms of stadium lease by the Warriors will need to be finalised between Garrido and Lenagan so that Wigan Council can give approval.

When Dave Whelan made the agreement with the council more than 20 years ago would he have envisaged that the stadium would become a veritable millstone around the club’s neck?

John Sheridan: the right appointment to keep Wigan Athletic in League 1?

I first saw John Sheridan play in March 1987 when second division Leeds United visited Springfield Park for a 6th round F.A. Cup match. Under the management of Ray Mathias third division Latics had knocked out first division Norwich in the previous round. However, on a wind-swept day, in front of a crowd of 12,479, they were beaten 2-0. The Leeds side was workmanlike with Sheridan adding class in the centre of midfield.

A year later, after seven years at Leeds with 230 appearances and 47 goals under his belt, he moved to join Brian Clough at first division Nottingham Forest for a fee of £650,000. Sheridan only made one appearance for Forest before he joined Sheffield Wednesday, where he was to spend seven years making 199 appearances, scoring 25 goals, including a scorcher which helped the Owls beat Manchester United in the 1991 League Cup final. After spells at Bolton and Doncaster he completed his playing career at Oldham Athletic where he spent six years, retiring in his fortieth year. Born in Manchester, of Irish parents, Sheridan made 35 appearances for the Republic of Ireland.

It was at Oldham where Sheridan began his long managerial career.

Stats courtesy of Wikipedia

John Sheridan has not been the kind of manager to take charge at a club high-flying in its division.  His relationship with Oldham Athletic has been remarkable, spending different five spells there, so often steadying the ship. He won the League 2 title with Chesterfield in 2010-11, followed by the Johnstone’s Paints Trophy in 2012, but so many times he was brought in to help a struggling club.

After leaving Chesterfield he joined Plymouth Argyle in January 2013 on a short-term contract until the end of the season. Argyle were two points off the bottom of League 2 and had only won one of their last 16 games. Sheridan helped Argyle to avoid relegation by winning 8 and drawing 4 of their last 19 games.

In October 2015 he took over at Newport County who were bottom of League 2, with only 5 points from the first 10 matches. They got only one point from his first three games, but then went on a 10-game unbeaten run. They finished in 22nd place, nine points clear of relegation.

In February 2016 he joined Fleetwood Town who were 20th in League 1 having lost their last eight games under Uwe Rosler. By the end of the season they finished in 14th place seven points above the relegation zone.

Sheridan has certainly had his ups and downs as a manager. But he has experience of working under relegation pressure and producing results.

There will be Wigan Athletic fans who are less than enthused about his appointment. But given the instability of recent months at Wigan it is important to steady the ship and avoid a further relegation. Sheridan will work on a low budget, his team likely to be a mixture of youth and experienced professionals who have become free agents in the era of Covid-19.

Although the majority of last season’s squad has departed it would be no surprise to see more of them leave over the next couple of weeks as the club continues to cut back its wage bill. Sheridan will then have the opportunity to bring in some of his own players.

John Sheridan may not be a marquee appointment, but he could prove to be just what Wigan Athletic need at this moment in their history.

Thoughts on a trip to Fleetwood and Ian Lenagan

 

Click here to view the Administrators’ Press Conference.

What has been happening at Wigan Athletic over these weeks? Or perhaps we should say what has not been happening. Trying to get an accurate picture of what is going on is akin to that of finding a needle in a haystack.

The footage from the administrators’ conferences with the press and supporters club did little to clarify that picture.

Prior to that I had listened to Jonathan Jackson and Caroline Molyneux. The love the two of them have for the club shone through during the broadcast, even if the mechanism by which the funds donated by the fans would be used as a back-up to help the club survive did not really crystallise in my head after viewing.

The ins and outs of what we have heard from the administrators and Alan Nixon have left me confused. What is the real case scenario?

But Gerald Krasner had said that the club and the stadium would not be sold separately……….

With my mind in a state of confusion I found Jay Whittle’s interview with Wigan MP, Lisa Nandy:

Nandy’s clarification of events and procedures was welcome after the conflicting information that had preceded it. Nandy backs the Jackson/Molyneux initiative and sees a supporter-run club as an alternative if a buyer is not found. Her reference to the efforts of Warriors chairman, Ian Lenagan, to raise funds for a local buyout of the club was of particular interest.

My mind was boggled but then I remembered that the administrators said that we can at least start the incoming season. Of course, amid all the financial talk one can forget: we have a Carabao Cup game in eight days time at Fleetwood. What a pleasure to think of that, rather than the depressing, worrying stuff about the long-term future of the club.

I watched Wigan Athletic play at Fleetwood in my early teens. Decades have passed since then. It was when Fleetwood were in the Lancashire Combination and Latics in the supposedly-superior Cheshire League.

Despite having so many school friends who derided Latics as “tin-pot”  I used to love watching them as a non-league club and I built up a resentment towards those who thought everything in Wigan revolved around the cherry-and-whites at Central Park.

I must admit my mindset has not changed so much, despite the academic degrees I have accumulated and having lived and worked in far-flung beautiful countries around the world. To say that I retain a lack of empathy towards the rugby club is an understatement. It is nothing rational: it just is.

I was brought up just around the corner from St Patrick’s, a prolific breeding ground of rugby league players. Ian Lenagan went to primary school there before going to West Park Grammar School in St Helens, which provided him with a base to launch a distinguished career. Lenagan went on to academic success at Manchester and Liverpool universities before making his money in software products for workplace management on a global scale. He was also a successful theatre producer, with over 30 productions before becoming the major shareholder in Harlequins and Oxford United, then becoming chairman of the Football League. Lenagan bought the Wigan rugby league club from Dave Whelan in 2007 and his record speaks for itself.

The rumours of Lenagan trying to buy the DW Stadium this week have provoked a shockwave among Latics fans. Part of their anxiety rests in the problems that English football clubs have had after selling their stadium. But more of it lies in the enmity between football and rugby in the town of Wigan.

Football has had a hard time establishing itself over rugby over the decades. In August 2011 I wrote an article entitled “Is Wigan a Rugby Town” providing stats to show that the football club had better attendances in that era. Latics were in the Premier League and blue and white was starting to challenge cherry and white in the town centre.

Wigan is a small town, albeit in the massive conurbation that is Greater Manchester. Rugby League runs on low budgets and Warriors can excel at being a big fish in a small pond. Latics are a small fish in a huge pond. To spend eight years in the Premier League, reach the League Cup Final, win the FA Cup was a massive overachievement that will probably never happen again.

Part of Latics’ problem is that they have fans from that era who have high expectations, based on the years that were funded by Dave Whelan’s benevolence. It is hard for those fans to envisage a club that is probably never going to reach such levels again. Gate receipts over these years have been poor, despite generous season ticket prices. Attendances were never going to be high in an environment where not only rugby is competing, but thousands travel to Manchester and Liverpool to watch the elite clubs play.

But let’s get back to that perhaps irrational fear of Lenagan and the rugby taking over the DW Stadium.

We have heard that the stadium company loses money year upon year. So why would Lenagan like to take it on?

On the face of it Latics might be better served financially by a rugby takeover of the stadium. Reports suggest that Dave Whelan charged the Warriors 10% of their gate receipts to use the DW. Should Lenagan succeed he would have to deal with a Wigan Athletic on its knees, possibly unable to pay the kind of rent he would need. Why would he want to buy the stadium?

Some things don’t add up.

“We strongly believe that Wigan Athletic is better being locally-owned. As sustainability and ownership of the stadium is equally important to both clubs, we are currently working with our longstanding advisers KPMG and talking to external parties. Our intention is to identify other investors quickly and start due diligence on the football club with the intention of making a bid in due course. We have made the Administrators aware of our interest and hope to explore this with them further over the days ahead.

Wigan Warriors and Wigan Athletic are both local sporting institutions and it is our belief that this is a unique opportunity here to bring the ownership of these two great clubs together under one roof, each operating independently as before, but under a Wigan Sporting Partnership banner. It is envisaged that each club would retain all its training grounds, management and facilities.”

The announcement on July 7 came on the Warriors’ web site. It was light years away from that infamous 80’s interview with the controversial Maurice Lindsay that really stirred things up with the football aficionados of the town:

Lenagan has not adopted such a tone. He has been a breath of fresh air coming from a club that rarely provided it towards its football counterparts. His message in July was positive and conciliatory. But there has been a lack of communication since then.

The administrators today poured cold water on the prospect of somebody buying the stadium but not the football club. But will that position last if no club buyer comes through? Is Lenagan simply looking after the well-being of his own club by ensuring that they can continue to play at the DW Stadium whatever happens to the football club?

Ian Lenagan is a bright and talented businessman. The question is whether his motives towards Wigan Athletic are primarily well-intentioned or business- minded.

As an early teen I enjoyed the games at places like Fleetwood, Congleton and Hyde.

The Fleetwood club of those days has had reincarnations, the latest result being Andy Pilley’s Fleetwood Town. I would not be surprised if they beat Latics by a big score next week. But I will nevertheless make every effort to watch the game and stay hopeful. The circle has tuned halfway, Latics falling two divisions from their zenith, Town at their highest point.

I remain nervous about our club’s survival but look forward to the game at Fleetwood in eight days’ time.

In the meantime the Daily Mail reports that what Nixon referred to as the French American team are ready to buy the club. Let’s hope the deal happens soon and it includes the DW Stadium.

A debt-free fresh start for Latics?

Why did Au Yeung Wai Kay waive his rights to the £25.3m “loan”?

We may never know the real reason but there is no shortage of opinions from Latics fans on the social media, with conspiracy theories abounding. But whatever the reason it is great news for the survival of the club.

There remains a £6m debt to be paid off to football creditors and another £4m to non-football creditors. To avoid a 15-point deduction for the coming season Latics need to pay the football creditors in full and pay 25% of the other £4m.

When the change of ownership is completed the administrators will need to be paid off and a figure around £2m could be needed.

There has been consternation among some fans regarding the fire sale that we have seen in recent weeks. Three outstanding youth players were sold off, ifollowed by regular first team starters Kieffer Moore, David Marshall, Antonee Robinson and Joe Williams. Sheffield Wednesday’s purchase of Joss Windass was no surprise, given that he had been on loan there. However, although those players have been released for sums well below their normal market values, the combined revenues will go a long way towards paying off the creditors.

The fire sale may well continue until the ownership issue is resolved. With the debt much reduced than it was a couple of weeks ago the club is now a more attractive package for purchase. However, although five major earners have departed there will need to be more shed if the wage bill is to be commensurate with the division Latics find themselves in.

There have been rumours of other clubs interested in Cedric Kipre and Jamal Lowe. However, it remains to be seen whether the administrators would sell them off in the current buyers’ market or if they would allow the future owners to make such a decision. If a new owner were to come in and continue to fund the wage bill in the short-term it would allow them more time to get better fees for assets yet to be sold off. The administrators have needed ready cash to pay off the club’s debts, rather than following the usual route of transfer fees being received in instalments. Selling any further player contracts by means of instalments would surely provide a higher return and money coming in during the future.

Once the ownership issue is dealt with Latics can expect revenue coming in from the EFL and instalment payments due to them from previous player sales.

It remains to be seen what Latics and other clubs will do about season tickets and televising of matches. Reports suggest that fans will be welcomed back in October but with stadium capacity reduced to 25%.  The capacity of the DW Stadium is listed at 25,138 meaning they would be allowed to accommodate just less than 6,300, a figure close to the number of season tickets they have sold in recent years. However, the new rules are unlikely to include away supporters who pay at a higher rate per game than season ticket owners. Revenues will be relatively small, but at least there will be some money coming into the club.

The UK economy is in recession and football clubs, like other businesses, will be under pressure. More football clubs will most likely go into liquidation over the coming months.

The Swiss Ramble figures for 2018-19 show Wigan Athletic with a lower gross debt – £21m – than most Championship clubs, being dwarfed by the £142m of Blackburn Rovers. Given the recent actions of the administrators that debt is being reduced.

Some clubs are under benevolent ownership, as were Wigan Athletic to a large degree under Dave Whelan. Other clubs have owners willing to allow a club to go into considerable debt in search of a potential Premier League pay off. It is a dangerous path that is being followed by so many clubs.

During the coming week we most likely learn that Wigan Athletic have new owners. Whoever it is they will be taking over a club that has lower debts than many. Following the rocky period that the club has been through in recent months there is a need for stability and a long-term plan sustainability. Let us hope the new owners will be able to provide those things.

 

Ready for Brentford? The challenge for Paul Cook and his squad

What a tempestuous week it has been.

A wonderful performance by the Latics team in blowing away Stoke City raised our hopes of at least a mid-table finish, with lots of optimism for the coming season. Then it was all turned upside down by that stunning announcement of the club going into administration. The Wigan Athletic community is still reeling from that news.

Brentford away is hardly the fixture that one would choose following the turbulence of the last three days. They outplayed Latics at the DW Stadium in November to the tune of a resounding 3-0 scoreline. They have won their last four games and still have a chance of automatic promotion.

Latics were on the crest of a wave following the Stoke game on Tuesday evening. Hopes were high that they could go to west London and give the Bees a run for their money. But now we learn that the players, who had deferred 30% of their salaries in the lockdown period, will only receive a fraction of their salaries today. Paul Cook must somehow lift his players to concentrate on the here and now, despite the uncertain futures at the club that they all now face.

Sam Morsy’s rallying call was admirable and we can only hope that captain, manager and coaches can maintain morale in this difficult hour.

The news and social media have been awash with stories about what has happened to the club.

The EFL’s prompt notification that there will be an automatic 12-point deduction did not go down well with Latics fans. Questions abound how their “Fit and Proper Persons” criteria allowed a shady change of ownership leading to administration within a month of Next Leader Fund taking ownership.

The reasons for NLF opting for administration remain unknown although there is no shortage of conspiracy theories being put forward.

Fans have been putting forward their views on the social media and message boards. Some fear for the very existence of the club. Others are concerned that the points deduction will lead the club back to League 1, although there are optimists who believe the team can gather some 13-14 points from the last 6 games to avoid that happening.

In the meantime, Latics must find the funding to help them complete the season, by no means an easy matter with no money coming into the club from the owners and minimal revenues available from playing behind closed doors.

Should the club manage its way to complete its fixtures and somehow gather enough points to avoid relegation it would be a big step forward. A Championship club is more attractive to a prospective buyer than one in League 1. Moreover, the broadcasting revenues and larger away supporter attendances make it financially more viable, even if the club were going to run on a shoestring budget for a period.

My concern is that the very survival of the club is at stake. After following them to places like Congleton, Winsford and Oswestry I can deal with the likes of Rochdale and Oldham should the club manage to get through this sticky period.

It is a stressful and difficult time for us all who care so much for our club. The game at Brentford tomorrow pales in comparison with the mountain the club must climb to stay in operation. However, a win could really lift our spirits and give us a little more hope for what lies ahead.