Newcastle Board Hold Useful and Constructive Meeting with Ashley


Newcastle United’s Board of Directors met with Mike Ashley and his team today to hear from him and his group their intentions for the club.
The Board is to consider Mike Ashley’s offer for the club – priced at just over £133M – and will make further announcements as appropriate.

We believe this is a good step forward to having Ashley eventually own Newcastle United.

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Potential Owner Mike Ashley

After the meeting the Board issued the following Statement:

“The board will now consider its response to the offer from St James Holdings Limited. “A further announcement will be made in due course.”

Thomson Financial issued the following news report concerning the meeting:

Newcastle United PLC said its board today met with Sports retailing entrepreneur Mike Ashley, who is bidding to take over the football club, adding the parties had a useful and constructive discussion.

St James Holding, which is the company Ashley set up to acquire Newcastle United PLC – bought a 41.6 pct stake in Newcastle United from Sir John Hall last Tuesday. Under the rules of the stock exchange, he was then required to make a formal takeover bid and today’s announcement appears to have taken his company (SJH Group) closer to that goal.
A statement from the board read:

“Further to the announcement by Newcastle United PLC on 25 May 2007, the board of Newcastle United announces that there was a meeting with Mike Ashley and his team earlier today at which there was a useful and constructive discussion. “

The board had announced last week their intention to meet with Ashley, who City analysts thought would have little difficulty in reaching the 50%-plus mark.
Chairman Freddy Shepherd, who holds a stake of around 29.8%, is the one key stock-holder who could stand in the way of SJH Group acquiring the 75% share needed to make full control inevitable.

Freddy Shepherd was not present at the meeting today due to his incapacitation – and is still in hospital. He was represented by his brother Bruce Shepherd and other board members Steve Walton and Timothy Revill.

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Newcastle Chairman Freddy Shepherd

However, this is a positive move forward and the fact the meeting was held – only eight days after Ashley’s initial offer of 100P per share is good – in that it may not be too long before Ashley’s bid is successful.
New manager Sam Allardyce however – is not letting any uncertainty stand in the way of bringing in players he thinks will make Newcastle a formidable team next season.

Sam has already been linked with six or seven players he seems intent on bringing to the club soon.

Once Ashley takes over – Allardyce may find himself with the funds to buy two or three world class players – to top off the team with some real class.

We’ll keep you updated as all this unfolds – comments welcome.



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20 comments so far

  • ross

    May 31, 2007 at 3:35 PM

    Comment #1

    Great news. I cant beleive its months before the new season starts. Even more exited than usual now

    Happy, happy days:-)))

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  • briss

    May 31, 2007 at 4:14 PM

    Comment #2

    Shepherd has done enough his time is up. he can’t even stay out of the hospital. Mike will bring new ideas and money to the club. the sooner the takeover is completed the better!

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  • Arthur Prince

    May 31, 2007 at 4:31 PM

    Comment #3

    I just hope the Mike Ashley takeover happens quickly and effortlessly so Big Sam can get on with the business of creating a team capable of mixing it with the so called top 4 . Fingers crossed !!!

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  • AndyT

    May 31, 2007 at 4:31 PM

    Comment #4

    “However, this is a positive move forward and the fact the meeting was held – only eight days after Ashley’s initial offer of 100P per share is good – in that it may not be too long before Ashley’s bid is successful.”

    Dont read too much into it. As I posted earlier, the board are required by law to go through this process. Caution aside however, the fact that FFS wasn’t present probably helped, and the inclusion of “constructive and useful” in an official statement is promising, yet sufficiently vague to not really mean anything.

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  • Arthur Prince

    May 31, 2007 at 4:37 PM

    Comment #5

    Ed is it true that some reports have credited Mike Asley with acquiring or at least on a promise to acquire more than 50 % shareholding already ?If that is true what is the situation re the Chairmanship of the Board . I presume Mike Ashley can vot Mr Shepherd out and by a majority do what he wants . Why does he need 75 % unless of course he wants to de register as a PLC and own the Club as a private individual

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  • Ed Harrison

    May 31, 2007 at 4:47 PM

    Comment #6

    Arthur – don’t think so – before i finshed this article i checked on this web-site – which will post when Ashley goes over 50% – not there so have to assume he hasn’t yet – but obviously he will be lining his targets up.
    http://www.lse.co.uk/ShareNews.asp?shareprice=NCU&share=NEWCASTLE_UNITED_PLC_ORD_5P

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  • Ed Harrison

    May 31, 2007 at 4:48 PM

    Comment #7

    AndyT – think you’re right !

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  • Outlaw

    May 31, 2007 at 8:54 PM

    Comment #8

    Look at Shepherd in that picture. Fat c*&^nt!

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  • ross

    May 31, 2007 at 11:53 PM

    Comment #9

    rofl

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  • lee

    Jun 1, 2007 at 12:00 AM

    Comment #10

    Two things come to my mind. Would it be good for Ashley to have absolute control (75% shareholding) over the club? … this means that he can take the club into private hands later on, would this be good for the club? Or should Shepherd hold on to his shares so that the club is still a PLC? Of course we want a new Cairman, but this is possuble if Ashley gets 51% shareholding… maybe we want him to have effective control of the club but not absolute control. The money can still flow even without absolute control, but how much?… it is up to Ashley. My bet is, with the investment he already puts in, I am sure all the shareholders incl. Asheley want the best return from their investment. On the other hand, if Ashley will only invest tons of money on players and management if he has absolute control, then it may be good for the club if Shepherd sells his shares. 3 or 4 world-class players we need… one striker, one midfield and two central defenders…

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  • lee

    Jun 1, 2007 at 1:58 AM

    Comment #11

    Ashley would want to take full 100% control of the club to make sure that no shareholder gets a free ride out of his intended huge investment in the club… this would be akin to Abramovich-style control of Chelsea. If results are priority for the fans, then there should be no hesitation to place under the club under completely private hands. The fact that we have been a PLC all this while may explain why it is that we don’t invest as much as the current Big 4… to raise funds was difficult because it has to go through so much red-tapes, endless shareholders meetings and so on… by the time we made a decision, the amount agreed to be raised would be compromised by shareholders and it was always too late to buy the first-choice players. This not only affected current squad-building but also world-class players’ perception of the capability of the club to move forward… in the end they chose to go to clubs that can make their decisions fast and big. Mike Ashely in absolute control won’t have to wait for anyone to make a decision and since he has the money, I am sure we will be seeing top players like Ronaldinho and Kaka coming to SJP.

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  • Len Smith

    Jun 1, 2007 at 2:57 AM

    Comment #12

    I am absolutely sure Ashley’s high priced legal talent already has Fred in the cross hairs so this technical question for the legal community is moreof a how will they roast him. If Ashley has 51% majority could he simply invest through rights issues so that Fred either has to match his investment or see his share of stock fall to below the magic 25%? My excel suggests another 35 to 40 million should do it.

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  • Jeff

    Jun 1, 2007 at 8:10 AM

    Comment #13

    Hope the take over gets sorted quickly one way or another……Sam needs the funds now to build his squad and doesnt need the take over to drag on..

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  • Andy T

    Jun 1, 2007 at 8:42 AM

    Comment #14

    Len,
    Thats not really possible. Firstly you cannot alter the share structure of a company while it is under offer. Secondly issuing new shares requires a qualified majority decision from the board. FFS holds enough to stop that and finally their are a whole raft of stock market regulations to effectively stop that occuring within a PLC.

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  • Andy T

    Jun 1, 2007 at 8:54 AM

    Comment #15

    Lee,

    I agree with many of your points. It is worth noting however, that with proper budgeting and sensible directorship, a footbal club run as a PLC shouldn’t have problems going after the players it wants – thats more the fact that the current crop are out to line their own pockets and every million spent on players was a million less to feather their nests. Why do you think Shepherd managed to come up with idiot stuff like a bid of 4.5 Million for Ronaldhino 2 months before he went to Milan! He was quite rightly laughed out of South America.

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  • Ed Harrison

    Jun 1, 2007 at 9:55 AM

    Comment #16

    AndyT – we’ll need to make you our takeover lawyer expert – you seem to know quite a bit about this stuff 😀

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  • lee

    Jun 2, 2007 at 12:10 AM

    Comment #17

    Andy T,

    Yes, I agree with your suggestion that proper budgeting and directorship would pave the way to big spending, but the underlting foundation of the club is still a PLC, and that means going through a lot of meetings with shareholders whose agreement are required for any proposed major player investment. This can lead to delays and especially with the transfer window system FIFA/EUFA currently impose on European clubs, it means that speed is vital, and as such Newcastle are at a slight disadvantage compared to Chelsea or Man Utd, even though we have the money to buy players. This affects potential world-class players as they are always looking at a club that is able to make its moves in the transfer market quickly in future… to keep improving the squad.

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  • Ed Harrison

    Jun 2, 2007 at 8:31 AM

    Comment #18

    lee – that’s a good point – these types of things take time – but if Shepherd sells his shares shortly – we at least know who’s going to be taking over – and hopefully – minimize the impact. We need Shepherd to sell – and Owen to commit his future – both quickly.

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  • AndyT

    Jun 2, 2007 at 10:49 PM

    Comment #19

    “AndyT – we’ll need to make you our takeover lawyer expert – you seem to know quite a bit about this stuff”

    He He Ed I hope so I’m a consultant in regulatory compliance software to the assest management industry in the City. Oh and I’m a Director of the consultancy – So i need to know all this guff on both counts!

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  • Ed Harrison

    Jun 2, 2007 at 11:11 PM

    Comment #20

    AndyT – OK you get the job 😀

    I’ll put an update on the takeover tomorrow – or Monday – thanks !

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