There is more news coming out this morning on the Ashley Takeover and its time-frame.
We had speculated on Monday – because the shares of Newcastle United PLC had gone up 30% since March â€“ there must be something going on â€“ especially since the performance of the club during that time was not good. We ran an article Monday Are Newcastle a Takeover Target suggesting it could be caused by a takeover in the offing.
But it appears that talks between the Halls and Ashley – to buy Hall’s shares in the club – started only about 10 days and that Freddy Shepherd was probably not aware of the move – which has severely weakened his bargaining position.
Newcastle Chairman Freddy Shepherd
Not surprisingly an emergency board meeting was held yesterday afternoon to formulate the board’s strategy – and initial reactions are that Shepherd will fight the takeover.
Stock-holders in Newcastle United apparently have up to 60 days to accept Ashleyâ€™s offer and we are being told that Ashley is confident he can acquire more than 51 per cent of the club, which would weaken Shepherdâ€™s position so much – he would be forced to sell.
A banker close to Mike Ashleyâ€™s business methods talked anonymously about the plan yesterday:
“He likes to park his tanks on peopleâ€™s lawns,” “He wants to completely take over the business,”
“The plan is to buy out Freddy Shepherd in a matter of weeks. It is a very strong offer, 19 per cent above the premium.
“If Freddy accepts, then there are other shareholders who would have to accept as well. If we get there more quickly, he will then set out his aims and plans.
“Mike Ashley is a winner. Just look at what he has achieved. Itâ€™s about building a business and then maximizing the brand.
“There are opportunities with this club to take the brand more widely.”
Mike Ashley – recently
Once Ashley wrestles control of the club from Shepherd (which we expect he will) he would appoint a new board of Directors and a new Chairman.
The choice of Chairman will certainly be interesting.
It is also being reported that Ashley plans to attend home games at St. James’ Park – which is strange for a man who shuns publicity. We can only assume that before he launched his bid – he was aware he would need to appear more in public than he has in the past.
Sam Allardyce was given assurances by Ashley yesterday he would continue to be Newcastle’s manager – but we understand this is not necessarily a long term thing – and his tenure at Newcastle will depend on a dramatic improvement on results from last season.
That’s not altogether unexpected – but it does say the pressure on Allardyce to produce results quickly – has been ratcheted up a notch or two. We also expect Allardyce to be given additional transfer funds and initial estimates on that say about â‚¤40M would be made available.
This may significantly alter Sam’s strategy in the summer transfer market – so it is not surprising he is trying to get with Shepherd to understand what all this means.
That’s the situation as we understand it – and our view is that Ashley will finally wrestle control away from Shepherd – but we think Shepherd may try to stall for time.
But this is too good a deal for the Newcastle club, the city and the fans to let pass.But as usual – we will have to wait to see how this all unfolds.
Note: Because of these changes we will delay parts 4 and 5 of our Season Review which are Clear-Out and Look Ahead – because they will all change if the takeover is successful – we’ll keep you posted on this.