As I write this, the Arsenal Fan Share website is down, thanks to poor choice of web hosting (they really went cheap here) and a deluge of traffic from excited Arsenal fans thinking that they could finally own a piece of their club now and stop those dirty Russians / Yanks from taking over.
The Arsenal Fan Share scheme is a nice PR move (notice how journalists were quick to call it ‘Barcelona’ style ownership structure without even knowing what Barcelona’s ownership structure looks like), and ultimately the implementation of a modified MyFootballClub scheme on a Premier League club. Remember MyFootballClub?
What a nice dream that was, to be able to own a piece of a football club of your choice and have a say in all the important matters too. Except it didn’t achieve much apart from making the fans feel good about themselves at the start, and eventually that too faded.
AFS is different. Of course it, it’s Arsenal. But let’s look at the propositions, and then the fine print:
Proposition #1: This can provide fans with a chance to own a share of their beloved club.
Fine Print: You’re not actually buying a share. What happens is that you buy a portion of a share (currently priced at a little over £10k per share, but that price can change), but again you don’t buy that portion of a share. What happens is that once there is enough people buying small portions so that the total amount is equal to a single share’s value, the AFS then goes to the stock market and tries to buy an Arsenal share in the open market.
As the AFS website correctly states, there are plenty of individual shareholders who would like to sell their shares off to other Arsenal fans or to Arsenal supporter organisations. The Arsenal Supporters Trust (direct owners and managers of AFS) have planned to involve fans in buying Arsenal shares for a while, and this is the ideal way to do so.
Long story short – you don’t directly buy a share, you buy a portion of a ‘potential’ share. That comes with a basic payment of £100 (which can be spread over 10 months). If you buy 100 ‘portions’, or something around that number, you will be entitled to owning a full share. That will still need to be bought by AFS, it’s not being issued by Arsenal or any of the current major shareholders.
Proposition #2: AFS shareholders can attend the AGM and will have a say in Arsenal’s affairs.
Fine Print: AFS shareholders will enter a ballot to determine who can actually attend the AGM. Not sure how many members will be allowed but I’m assuming that it will be 1 per actual share, so 1 in 100, give or take.
There will be a voting system setup for next year which will allow shareholders to vote on key issues raised at the AGM. Your votes will be accumulated according to your # of portions and then normalised so that 1 actual share will still count as 1 vote.
This is democracy, for sure, no doubt about that, but it gives very little actual power to fans. As we saw with MyFootballClub, fans signed up to the scheme generally voted based on the information given to them by the administrators of the site, and sometimes that information was biased or presented in a certain way to favour certain outcomes. If the AST is presenting that information, then there is an element of presentational bias involved, although to be fair, AST are a more reliable indicator of what Arsenal fans want than the MFC administration was of their members.
Proposition #3: Anyone can buy a piece of Arsenal.
Fine Print: Actually, only those who hold personal UK bank accounts (with direct debit facility) are allowed to purchase their ‘shares’. Non-UK fans are only permitted IF they have a UK bank account. Also, only individuals aged over 16 can buy shares (legal requirement based on the way ASF is setup). All of this is fairly reasonable, but this is being lauded in the press as if fans around the world can buy into Arsenal when in truth it’s mostly the UK Arsenal contingent who would be able to do so.
And yes, the only way to buy a share is to set it up via direct debit. That brings the processing costs down (as this is a NFP organisation) and also ensures that fans will be locked in. You can sell your ‘shares’ at any time to other members for their face value minus a £50 processing fee. Again, fairly straightforward and common sense stuff. They should allow non-UK fans too, though.
Proposition #4: You can make a difference against takeovers.
Fine Print: No you can’t. If memory serves me, the two key rulings on takeovers are this:
1. If you own 30% or more of the club, you’re bound to make a takeover bid.
2. If your bid is accepted and you acquire 75% of the club, you can buy all remaining shares at face value without opposition.
#2 is something I’ll admit I’m not 100% sure on, but the language on the AFS site didn’t contradict this in any way nor did it suggest that your stake in Arsenal will enable you to hold out against the likes of Usmanov. What it does say is that in case of a takeover (and if it is accepted), your shares will be bought out at market value and you will be repaid the sums.
Funny thing is, with the major stakeholders owning most of the available shares, the decision will come down to the Russian, the Yank, the guy sitting in Switzerland and the lady who’s been kicked off the board. Not the fans.
Fan Ownership v Ground Realities
Fan ownership is an exciting idea, because eventually the local fans as well as the global fans make the club what it is. Keep in mind that it’s exciting for the fans, not necessarily for the club owners, who see football fans as consumers and therefore:
1. Acquirable from other clubs, particularly by targeting overseas fans aggressively or targeting young fans locally.
2. Monetizable assets, hence the emphasis on match day spending, merchandising, betting partnerships, etc.
Arsenal Fan Shares is based on a noble idea – that fans should have a say in their club’s future. The problem is that this idea is practically impossible to implement at Arsenal, because the ownership structure is locked in with 4 primary shareholders. 27 + 29 + 16 + 16 =
David Conn calls Arsenal ‘enlightened’. I respect his work, but I don’t respect the fact that he’s bought into the hype, because if anyone knows how to look beyond the PR, it’s the man who’s dedicated his career to uncovering the dark secrets of football. The alternative is that he’s gotten lazy and chooses to follow the national narrative that ‘Arsenal are good’ and thus airbrushes the whole idea.
Arsenal may be good. AFS may be a good idea in theory. But Arsenal fans won’t get what they are being promised. And to suggest anything else is to lie to them, which is what the English press have been doing since yesterday.
PS – yes, fans will eventually get to own shares if they spend enough money – but they could do that directly if they had £10k to spare, couldn’t they?