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Trust meets City finance director
Published : 14 Aug 2012 21:36:16Rss feed
On Monday 13 August , Keith Morgan , one of the Cardiff City Supporters Trust board had a meeting with Doug Lee (DL) , the Finance Director of Cardiff City
in order to discuss some questions which had been raised in recent weeks by Trust members concerning the club.
The Trust would like to thank Doug for the considerable time he gave to answer the questions raised in a full and frank manner.
The questions raised , and the answers given are set out below:-
1. Is the often discussed conversion of the current debt owed to Vincent Tan and associated parties to equity a legally binding agreement subject only to the prior settlement of the debt due to Langston/Sam Hammam?
While there is no such legally binding agreement in place or a firm conversion timetable , the club`s executive directors remain extremely confident that this conversion will take place. This confidence is based on ongoing reassurances received on a regular basis from Vincent Tan himself who has the option to convert in his financing agreement with the club.
As far as Langston is concerned , DL stated that settlement remains in the hands of Sam Hammam/Langston , who have received a series of settlement offers from the club who are now awaiting a formal response. The club do not intend making any further offers.
2. The board of Cardiff City Football Club (Holdings) now has more directors than at any time in its history , but little is known about them or their roles at the club by either the fan base or many minority shareholders. Could Trust members who raised the question be given this information?
The current board can be divided into two main groups – Executive directors and Non-Executive directors. The Non-Executives can then be further sub-divided into two groups – UK based directors and non UK based directors.
Dato Tan Tien Ghee is Chairman of the club , overseeing and contributing to all board activities. He is a long term business associate of Vincent Tan. Despite being based in Malaysia , he is a regular attender of board meetings when in the UK.
The Executive directors are Alan Whiteley (Chief Executive Officer) and Doug Lee (Finance Director) , although Doug is not formally listed as a director at Companies House. They are responsible for the day to day decision making and running of the business , working with senior employees such as Julian Jenkins and Wayne Nash.
The UK based Non-Executives are Steve Borley , Michael Isaac , Paul Guy , Mike Hall and Mehmet Dalman.
SB is a long standing director and fan of the club , MI is the second largest shareholder (11%) behind Vincent Tan (36%), PG and MH are the main directors and shareholders of PMG Estates who are major creditors of the club. Mehmet Dalman was introduced onto the board by Vincent Tan due to his extensive experience in finance raising , his knowledge and interest in football matters , and his extensive business connections in the Far East.
All UK non-executive directors attend the vast majority , if not all , board meetings which tend to be held on a quarterly basis or when a specific business matter requiring attention arises.
The non-UK based non-executive directors were all appointed to the board by Vincent Tan. They are all Malaysian based employees of his Berjaya Group businesses brought on board for their specific skills. Derek Chin – legal , Len Kong –marketing , Ming Lim – accounting.
Danni Rais was also appointed by VT in June this year and also has a marketing background and an employment link with VT companies.
The Malaysian based non-executives usually attend board meetings by teleconference , and occasionally in person.
3. Why has an Annual General Meeting been called for 16 August rather than an Extraordinary General Meeting needed to pass a resolution to increase the share capital needed to bring about future conversions of debt to equity?
The aim of the meeting is to provide minority shareholders with an opportunity to question directors on recent events and to formally accept the audited annual accounts for the year to 31 May 2011.
No EGM with resolutions has been called as the directors are of the view that it is best to await the outcome of the Langston position and , thereafter , the timing and quantum of the required debt to equity conversion before convening such a meeting.
4. Erskine Finance Limited and Edgedale international limited are mentioned in the 2011 accounts as investors in the club and also have debentures over company assets , but don`t appear to be registered at Companies House. Who are they?
These are non-UK registered companies having an association with Vincent Tan . No further details of their structure or ownership were given at the meeting as this was deemed to be commercially sensitive information.
5. Is there a specific plan in place to deal with the Financial Fair Play requirements adopted by Championship clubs and which take effect from the season just ended?
This is a complex area which will not take full effect until season 2013/14 but is already being worked on by the directors (in particular DL) Complexities involve the timing and extent of new equity investment , and the reduction of current levels of trading losses being incurred by the club at Championship level. Variations to the required standard model include spend on stadium infrastructure , youth development and education and depreciation of the new stadium cost.
6. Why was the change of club home kit from blue to red notified to the League at such an early stage , when League rules allow this to be done at any time during the close season , which was several months later?
DL stated that this is as a result of the League pressing the club hard for the information to incorporate in various publications and circulars , even though their own rules say it could be submitted at a later date.
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