Delighted supporters of Portsmouth have barely had time to sit down or savour promotion from League Two before facing a new character-shaping decision over the future of the club.
Portsmouth, whose financial collapse into administration while in the Premier League seven years ago embodied English football’s reckless wage spending and the risks of relying on far-flung investors, have been rescued, stabilised and begun to rise again because of the ownership and hard work of their supporters.
A remarkable partnership forged during the crisis, when the existence of the club formed in 1898 was plunged into doubt, has become a beacon to the wider game. The Pompey Supporters Trust, structured according to mutual, not-for-profit principles, raised enough money from 2,750 members to take on 48.5% of the ownership burden in 2013, in cooperation with 16 “presidents”, mostly local Portsmouth supporters wealthy enough to buy larger individual shares amounting to 51.5%.
Ashley Brown, the trust chairman who was widely recognised to have done sterling work in helping to forge this fan‑owned alternative to the parade of financial investors who left Pompey on the brink, was appointed last year as chief executive of Supporters Direct, which exists to enhance fan involvement in clubs.
Now, barely three weeks since Paul Cook led his team up from League Two after four tough seasons, the trust and presidents must decide whether to abandon their supporter-owned partnership at this moment of success and sell the club. The proposed buyer can seem unlikely even in today’s gathering of international football investors: a California-based former Walt Disney executive, 75-year-old Michael Eisner.
Eisner, having stepped down in 2005 as the chairman and chief executive after a 21-year expansion of Disney, runs a more modest series of media ventures in his US company, Tornante LLC, of which Topps, the sticker company, is the best known. He followed the interest of other US investors in the rising fortunes of English football last year and is known to have looked at other clubs before landing on Portsmouth as his best prospect, and making a bid.
Eisner’s plans will be further interrogated on Thursday evening in Portsmouth’s Guildhall at a meeting of the supporters’ trust members, whose vote will determine whether the sale happens. During his visit, Eisner explained the genesis of his interest in investing in English football by pointing to sport’s central position in the modern, on‑demand media landscape: “It’s the only thing you have to make an appointment for.”
He has been attracted by the passionate support of Portsmouth and the club’s history but acknowledged that, like all the US investors in football, he will want to see a return on his investment in what he described as a daunting financial prospect.
“It seems to me that this would be an investment my children and grandchildren could participate in. We are not doing it to have a failure financially, obviously, but that is not the only reason why we are doing it.”
His offer, which has divided opinion among supporters, is not a golden ticket back to a star player wage bill and Premier League status. Eisner has bid £1,000 for each of the 5,673 shares in Portsmouth to buy the club outright, which amounts only to what the supporter-owners paid to buy the shares from the fraught administration process in 2013. Unlike the recent £100m sale of Swansea City, in which the
original shareholders made 100 times their initial investment when selling to the US investors, the presidents will not be making any personal profit, although there is an alternative long-term formula by which they can double their money if Pompey reach and stay in the Premier League.
With the club’s chief executive, Mark Catlin, making public interventions highlighting the need for £5m to pay for improvements to Fratton Park over the next five years, Eisner has said he will invest at least £10m new equity into the club.
The partnership agreement between the trust and presidents set out that a 75% majority of all shareholders is required to approve the sale of the club. The trust will vote as one block, determined by a simple majority of the 2,750 supporters who have paid to be members. Contemplating the dilemma presented by the Eisner bid, the trust board and presidents’ advisory board have set out key points to consider, without explicitly endorsing a view either way. The trust board said its 11 members had not reached a consensus so could not recommend acceptance or rejection. But their letter makes plain a series of disappointments that in negotiations Eisner has not been prepared to retain some trust ownership and work with supporter directors on a future Portsmouth board.
Money, of course, is the heart of the matter. The trust and presidents agree the club needs a lot of it and they see over the horizon the wage inflation in the Championship and the vast financial advantage of parachute payments banked by clubs relegated from the Premier League. Catlin and Tony Brown, Portsmouth’s financial director, have issued their own advice, signalling a clear view investment is needed, cautioning that even League One clubs made average losses of £1.7m in 2014-15, which were mostly covered by owners.
The trust recognises the £5m needed to maintain and improve the ageing Fratton Park, £2m having been spent under the supporter-owners, who have also invested in a training ground. Minimal work was done on the ground or other infrastructure throughout the years of multimillion-pound spending on extravagant players wages financed with loans from the owner Alexandre Gaydamak, which put Portsmouth’s name on the FA Cup in 2008 under the management of Harry Redknapp. Pompey’s crisis was precipitated when Gaydamak stated the following year he was unable to subsidise losses any longer and the club plummeted through a crowd of financially driven owners before becoming the first Premier League club to fall into administration.
So the supporters’ divide about whether to hitch the club’s future to Eisner is not about whether Pompey have a money mountain to scale if they are ever to sniff the Premier League again. It is more about the details of this deal and whether it has to be done now. Brown has said he does not believe there is a sudden, urgent need for cash and the trust was already planning for a new community share issue, envisaging further investment from existing or new presidents, to maintain momentum.
Mick Williams, one of the 16 presidents, says he is preparing to vote in favour of selling, arguing a further round of fund-raising from supporters and trust members will not necessarily generate the money needed.
“My heart is for fan ownership and we never expected to get our money back,” he says, “but fans are weary of fundraising and we just won’t get the money needed for the club. If you had to choose a prospective owner you couldn’t have written a spec for Michael Eisner: he’s a businessman, philanthropic, he is involved in sport; to me it’s a no-brainer. I’m in the yes camp.”
Pam Wilkins, the trust’s vice-chair, speaking in a personal capacity, said she was against and is concerned by the lack of concessions Eisner has made to supporter involvement.
“I don’t think it’s a good offer,” she said. “He would be getting one of the most stable clubs in the entire Football League, with no debt, for very little. After all the hard work we’ve gone through to save the club, get it up and running again, build a training ground, get promoted, I don’t think we should just give it away to the first offer which has come along.
“I believe supporters should be involved in football clubs, that supporter ownership is the right way. Once it’s gone, that’s it, we will never have the chance again.”
After Eisner’s visit to rally support this week, Portsmouth’s supporter-owners will vote by 19 May whether to cede their precious, hard-fought mutual ownership and entrust it to him and his promises of future investment.
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