Can fans buy West Ham?

Football Club Project Version 3.2 (4 September 2009)

Note that this is not an offer for sale and is not licensed by the Financial Services Authority (FSA).

Aim
To change an English football club (West Ham United plc) into a members' club based on the style of FC Barcelona.

Many fans, perhaps a majority, would support this move in principle but are doubtful that it could ever be achieved. Others take a simpler view and just wish for football success. They see nothing wrong with, for example, the paths taken by Chelsea and Manchester City.

For background information with additional references, please see earlier posts on this site.

Note
After this project was started in June 2009, my attention was drawn to a similar project promoted by ShareLiverpoolFC (SLFC) and Spirit of Shankly (SoS). Their ingenious revised plan was published on 24 July 2009 and seeks to raise a total of £350 million to cover Liverpool FC's estimated total debt. This sum is considerably greater than the expected equivalent for West Ham but in the continued official absence of the club's delayed accounts, it is impossible to be certain.

The Corporate Structure

The creation of new company A which will aim to raise the money to purchase, at least, a controlling interest in the existing football club (company B).

Company A (the holding company) will be a 'one member, one vote' company, with an 'asset lock' to prevent any takeover.

Company B (the football club) will still be a Public Limited Company which will satisfy the requirements of the football authorities.

The members of Company A will thus, through their voting power, be in effective control of Company B.

Company C (the final single corporate structure) will be based on the style of FC Barcelona, insofar as English law permits.

Please note that each of the following stages will need further detailed planning and consideration by the working party formed in stage 1.

Stages in the formation of Company A

1. Form a working party of ten to twenty fans who are prepared to offer their expertise and time to assist in the formation of the company.

2. Ensure that the working party can adequately cover the following five areas: administration, finance, football, information technology and law.

3. Consider the following possible types of corporate structure and decide which one is the most appropriate for company A.

(a) Industrial and Provident Society (IPS)

(b) Community Interest Company (CIC)
private company limited by shares

(c) Community Interest Company (CIC)
private company limited by guarantee

(d) Private Limited Company

4. Ensure that the company is licensed by the Financial Services Authority (FSA) so that it is allowed to invite investors to subscribe to the company.

5, Complete the legal formalities.

Stages in the purchase of Company B

6. Prepare a prospectus for the sale of shares in company A. This should include the following details:

(a) How the purchase of company B is to be financed.

(b) How the interests of investors will be taken into account in the management of company B.

(c) How company B will be managed.

(d) How investors will be involved in the management of company B.

(e) Consider if the offer for sale could/should be underwritten.

7. If the offer for the sale of shares in company A is successful, proceed with the sale of company B to company A. If the offer for sale is not successful, consider the question of acquiring a minority interest in company B.

The final stage: converting companies A and B to a single company C which follows the style of FC Barcelona

8. This would not have a high priority. The main concern is to ensure that the previous stages have not ruled it out or made it unnecessarily difficult. Note particularly the rules which prohibit changing one type of company to another.

9. To recognise the importance of safeguarding the interests of all who invested during the earlier stages.

What can you do now?

If you feel you would like to help, please go to West Ham United supporters on this site.

If you have any any questions or comments, please send me an email.

Thank you.