Thursday, April 2, 2009

Parent Move A Lowe Blow.

When a team goes into administration, they get to back away from the debts they have assumed and start again. Poor management, bad decisions at every level. It doesn't matter. Debts are restructured/wiped out and the way is made clear for a new investor to roll into town and start again. Acquiring the team at a snip of the previous value. The punishment for shafting your debtors and getting to start again is a ten point deduction from the league. However, Southampton and their bungling money man Rupert Lowe have discovered a way to avoid that. Blame your Parents.

Southampton Leisure Holdings own Southampton football club. Making them a 'parent' company. Southampton Leisure Holdings went bust yesterday. Rupert Lowe, SLH's chairman and former Saints chairman, resigned from his position and so did current Saints Chairman Michael Wilde. Today the administrators rolled in. However, Southampton Football Club could avoid a points deduction from the Football League as it was their parent company that went belly up, and not them.

The problem is that they are both the same thing really. Southampton Leisure holdings amassed huge debts, over 27 million quid worth from the football club, including the building of St Mary's Stadium. The club's failure to fill St Mary's and the money the club has swallowed led to this situation.

Fry: Looking for a quick sale.

Administrator Mark Fry took questions on the Southampton FC official website earlier today and detailed his urgent need to find a buyer for the club as soon as possible.

The decision to put the business into administration was taken because it was clear that the business was insolvent. We have to find a buyer before the end of the season because there is not sufficient cash in the football club to support it's ongoing trading beyond that time. - Mark Fry.

While this sounds cruel, in the interest of fairness, Southampton FC must be docked points. To not do so would just tell every club in the country to form a parent company and encourage irresponsible financial management. It would surely also lead to appeals from Luton, Leeds, Bournemouth and others whose failings were rewarded with point deductions. In Luton's case, they are likely to drop out of the Football League all together after falling into administration. The League will have a tough decision to make, as this case will set a precedent in football. League officials have suggested that a deduction is still possible regardless of the 'parent' trap.

Assets for sale. Andrew Surman will likely be sold.

St. Mary's was an ambitious move for Southampton. They moved there from the Dell back in 2001 and have never really established the support needed to justify such a grand arena. A huge leap from the 15,000 who enjoyed the football of Le Tissier and Mick Channon at the Dell. This season's support has been pretty poor and inconsistent. Southampton have drawn as few as 14,000 for home games. Terrible for a club who live in a stadium that accommodates over twice that number. Today Southampton have slashed ticket prices for their last few games in an attempt to get bums on seats for the run-in. A run-in that could see Southampton relegated regardless of any point deductions.

It's not just the club that will be sold. Southampton have some good young players at the moment. Players like Adam Lallana and Andrew Surman. They will have to be flogged this summer. The writing has been on the wall all season and it was no secret that Southampton were struggling. To add to their woes, the team has been awful. Jan Porrtvliet was the wrong man to hire as manager and his naive 'total football' approach to the Colaship made his Saints a pushover.

Football can be cruel off the pitch as well as on it, and I feel for Southampton, I really do. The stadium is great and Saints fans are a good bunch. I've always enjoyed going there and I feel sorry for the supporters who will now suffer because of the ineptitude of Rupert Lowe and his cronies. But rules are rules and to change them now because of one shady man who thought he could play the system would be wrong.

Southampton Leisure Holdings ARE Southampton Football Club and must be treated as such.



Kopper said...

As a Norwich supporter, I was already rooting against Soton. With this move, I think everyone in football is rooting for them to lose and go down, for karma's sake.

PregSF said...

Let me say a couple of things about the Saints here. Back when SMS was built, the Saints were pushing for growth, and were on top of the world in 2003 with an FA cup final loss to Arsenal and a good league season.

Gordon Strachan saw the writing on the wall, however, and knew this was as good as it was going to get, and promptly buggered off (something to do with not being able to bring in players to sustain the level of play). From there it was a quick spiral downward, towards the trapdoor of relegation. Then, once relegated, management pissed away our parachute payments on a gamble to go back up quickly, and that gamble was snuffed out with a loss in the Colaship playoffs to Derby (who went on to show us just how bad a Prem team could be).

As a Saints supporter (and one from Texas, with no ties to Southampton before starting to support the club back in 2004), I am of two minds. Obviously, my heart says no deduction, and my anti-establishment mentality says no deduction as well. But the way the club are looking at it is abusing the spirit of the rule, which was put in place to protect football clubs from conglomorate parent company failures. SLC was only brought into existence to be a parent for the Saints, so it's hard to argue that case.

In the end, I have to say that I think the Saints get a pass based on the rules as they are written, and the FA will have to close this loophole after this incident. I'd like to think that were I fan of Norich, I'd feel the same, but I honestly don't know.

In the end, I just hope it doesn't spell the end of my adopted, beloved club, but I do honestly fear it may be. I do know this, we won't be the last to go.

Bigus Dickus said...

Tough one. Norwich also pissed away the parachute payments but we have a strong support and sell out every game so that helps, otherwise we might be in the same boat as the Saints. If RL was in charge of my club I could imagine many staying home.

I really doubt that local businessmen, rich fans will let the club disappear. Just wont happen, someone will buy it but you may well be in for a few lean years.

Matt said...

The Pinkun this morning reports that a Football Leage points deduction may be a moot point if a buyer can't be found pronto. Should Soton fold, then all results will be wiped from the slate and only two teams get relegated. This is good news for Norwich as some of the teams around us picked up 3 or 4 points against Soton, and so with those gone, they are pulled more deeply into the relegation battle, and thus giving Norwich better odds of survival. We would lose just a point I think.

Of course seeing any football club go under is a real shame. I lived in Southampton for 18 months and so always keep an lookout for their results. But at the end of the day my loyalty is with Norwich, and most imnportant of all is that they stay up, however that happens, ideally through great performances, but right now I'll take anything.