Updated Timeline for Investment Process

Wycombe Wanderers Trust are now able to update members on a revised timeline in the process relating to potential investment to provide long-term stability for the football club.

As previously communicated, a meeting was due to be held on Monday 28th January whereby Legacy Members would hear a presentation of a formal offer made by two American businessmen – Bill Luby and Jim Collis – who are seeking a majority stake in the club. This presentation, to include more details of Bill and Jim’s vision for the club, would then have initiated a voting process whereby Legacy Members would be asked to approve the deal (requiring a 75% of ‘yes’ vote).

This meeting was postponed at short notice after the Trust Board was made aware that Andrew Harman, a local businessmen and former player, was also interested in submitting an immediate formal bid for investment. Having previously held tentative discussions with the Trust board., Mr Harman met with a number of Trust directors in mid-January 2019 to present the outline of his proposal, which he also shared with supporters at a public meeting, Together with Bill Luby and Jim Collis, the Trust Board has agreed to halt the process in order to allow Mr Harman time to submit his offer.

Mr Harman was initially asked to submit his formal offer in three weeks’ time (week commencing 18th February) but requested an extension of two weeks, which has been granted. While the Trust Board are keen for the process to move forward quickly, to enable the club to undertake long-term sustainability planning and start the planning process for next season. Mr Harman has indicated he needs more time to complete his due diligence and submit his offer.

The new agreed timeline is that Mr Harman will submit his formal offer in the week commencing 4th March, including a meeting with the Trust Board to present his offer in detail. The Trust Board will then consider his offer alongside that of Mr Luby and Mr Collis, and call a Legacy Members meeting to update them on the situation as it stands. Further details of this meeting will be communicated in due course; it is very much the Trust’s intention to hold this as soon as possible after their meeting with Andrew Harman.

At the Legacy Members’ meeting on 28th January, a request was made to reconsider the cut-off date for Trust membership which, providing the criteria is satisfied (i.e. Trust membership and season ticket holding for four consecutive years), would lead to Legacy Membership status.

It has been agreed that the cut-off date for applications for Trust membership that would allow such applicants to become Legacy Members, has now been set at Saturday 23rd February. Applications can be made by completing the form which can be downloaded here or by obtaining and completing a form from the Trust Table at the next home game.

Visit the website for a full summary of the Legacy Members meeting on Monday 28th January, or apply to join the WWT Live Stream group on Facebook to watch the full video of the event (Trust members only).

The Trust board held a meeting for Legacy Members last Monday (28th January) at the Union Baptist Church on Easton Street in High Wycombe, attended by 227 Legacy Members, with a live stream available on Facebook for those unable to attend, plus all Trust members (receiving more than 600 views to date).

During the meeting, chairman Trevor Stroud made a presentation in three parts – the slides of which can be seen here.

The first part covered a timeline of the process which has led to the position outlined above; where the Trust will consider both bids in mid-March and explain the rationale for their recommendation to Legacy Members.

A synopsis of that timeline – which can be viewed in more detail on the slides – is as follows:
– 2015: Trust identify need for additional funding for the football club, and initiate the Share Scheme
– 2016: Share Scheme raises c.£700k but Trust recognise that outside investment is likely to be required
– 2017 (January): Trust introduced to Steve Horowitz, who has completed transactions of football clubs to new owners including Liverpool, Inter, Portsmouth, Crystal Palace and Dagenham & Redbridge. He advises the Trust that he will introduce them to suitable partners that he believes would be good custodians of the club
– 2017 (November): Trust meets Andrew Harman, who puts forward an outline proposal for investment
– 2018 (January): Mr Harman’s proposal is declined due to it being based on club debt, rather than equity. The Trust are keen to learn lessons from the past and not see the club fall into significant debt to any individual or organisation which has loaned money into the club
– 2018 (January): Mr Horowitz introduces Trust to two American businessmen, Bill Luby and Jim Collis
– 2018 (March): Mr Luby and Mr Collis visit the club for introductory meetings
– 2018 (July): Mr Luby and Mr Collis return to the club to meet whole Trust board. Talks with other interested parties are ongoing
– 2018 (August): Trust call members meeting to inform them of board’s recommendation that the club requires investment. At this time, Mr Harman is informed that the club have received two offers – one for a majority stake, one for a minority stake. Mr Harman acknowledges the information in writing and wishes the Trust well with their progress with these two bids
– 2018 (September): Trust outlines the need for investment to members, and asks for mandate to proceed with talks and bring their recommended proposals forward. A show of hands in the room indicates that this mandate is given
– 2018 (October): Proposal offered by Mr Luby and Mr Collis is selected unanimously by the Trust board as the recommended route forward
– 2018 (November): Mr Luby and Mr Collis visit Adams Park to meet members and answer questions. After this point, the Trust enters into formal discussions with a view to an offer being made. Also this month, Trust recognises need for a Plan B in the event of Mr Luby and Mr Collis’s offer not being accepted by Legacy Members, and Mr Harman is asked to sustain his interest in investment
– 2019 (January): Trust are made aware via a post online that Mr Harman wishes to revitalise his offer as a Plan A, and arrange to meet him to discuss. At this meeting, Mr Harman presents an outline proposal which is not rejected but the Trust board raises concern at the timing and the lack of detail in the proposal. Mr Harman calls a public meeting to share his proposal with supporters. The Trust board – together with Mr Luby and Mr Collis – agree to postpone the scheduled Legacy Members meeting and vote in order to allow time for Mr Harman to submit a formal bid
2019 (February): Trust board initially ask Mr Harman to submit an offer within three weeks, but agree to an extension of a further two weeks, as requested by Mr Harman.

Trevor Stroud commented that Mr Harman has been asked to clarify the size of his investment offer, over what time period, and what type (i.e. debt or equity). The Trust board also require further detail on Mr Harman’s plans to settle existing club debt, his recommendation for rent payable to Frank Adams Legacy Limited by the club for the use of Adams Park, and the envisaged ongoing relationship between club and Trust. The Trust would like to explore Mr Harman’s plans for further investment beyond the initial injection of funds, and the structure of the proposed academy, plus its benefits to the football club.

The Trust board have arranged to meet Mr Harman at the end of the five-week window, where he will present his offer and a new recommendation to members will be made. Arrangements for meetings with Trust/Legacy Members will be made in due course. In the event that Mr Harman does not submit an offer, the Trust will proceed with a Legacy Member vote on the offer made by Mr Luby and Mr Collis. Bill and Jim have been kept updated throughout this change in proceedings and have reiterated their desire to see the best possible outcome for the club, appreciating the magnitude of the situation and offering their full support.

At this stage, questions were taken from the floor:

Q) Why was the Trust’s position (from 2016) not communicated to members sooner?
A) The update was given to members at the meeting in September 2018 once a position had been agreed by the Trust board that they should proceed with talks with potential partners. There is a commercial sensitivity to publicly declaring the club is for sale.

Q) Why have members not received details of Bill and Jim’s proposal?
A) Members would have received details prior to originally scheduled meeting on 28th January, but this was placed on hold once it was revealed that Mr Harman wished to make a bid.

Q) It looks as though the Americans might now be changing/improving their bid once they know the details of Andrew Harman’s offer
A) Bill and Jim want to be involved with the club, but they want the best for the club, and recognise that if there is a better offer out there, they will walk away. We’re looking for a level playing field where we have two offers that can be placed alongside each other to enable us to make our recommendation to members.

Q) Were all bidders allowed to take a majority stake?
A) They were all aware that a majority stake was available if they desired. One party wished for a majority stake, one wished for a minority stake – a third party in August was aware of the other two bidders and wished us well.

Q) Why can’t we see both bids?
A) At this stage we only have one bid, and an expression of interest from another. We’ve had lots of expressions of interest down the years but once pushed, they have not made an offer.

Q) Andrew Harman said the reason for his re-engagement in the process was that a Trust director had approached him to do so. Is that the case?
A) We have continued to engage with other parties throughout the process. It had previously been indicated that Andrew was willing to remain in the background as a fallback. The Trust formed a sub-group to explore a Plan B in case the offer by Bill and Jim was rejected. Andrew was asked by one director in November if he would be available to come forward if required with a Plan B, and the answer was yes. Plan B (which was discussed with a team deputed by the Trust Board) was intended to be a fallback, not an alternative, which it now is.

Q) You have said that an equity-based deal is preferable to a debt-based one. Why is that?
A) The Americans would not be coming in as a creditor. They would be coming in as a partner to help us clear debt. We are placing as many safeguards as possible into the deal, to make sure that lessons from the past are learned, and mistakes are avoided.

Q) Have you considered a Plan C – where the Americans and Andrew could work together?
A) That has been put on the agenda for consideration.

Q) Why have other opportunities not been heard about previously?
A) Until 12 days ago we didn’t believe another proposal was there; we now know we will be receiving a second bid. The third offer has been there for a long time but has not been sufficient to bring to members.

Q) Why are you allowing Andrew Harman back into the process now if it could scupper things?
A) It’s fair, and we have to consider the best thing for the football club, so it is only right that we give him the opportunity to make an offer that we can consider. We want a level playing field.

Q) Now we have two offers, can we not just vote on which one we prefer, and go with whichever gets the majority?
A) We will look into the voting process once we have more information about the second bid.

Q) Have you checked for proof of funds from the Americans?
A) We have engaged an independent consultancy to carry out due diligence on both Bill and Jim, and will be doing the same on Andrew Harman. Everything we have received so far has confirmed they are men of substance.

Q) Is Bill and Jim’s proposal based on personal investment, or through venture capital?
A) It would be personal investment.

Q) Are you accepting any new proposals, and are you setting a deadline?
A) We think it’s unlikely there will be any new entrants into the process. We will agree a timetable with Andrew Harman and communicate that. We don’t have long; we need to move forward.

Q) I understood from Andrew Harman’s meeting that he was not aware until January that a majority stake was available.
A) Our communication with Andrew in August explained that we were in discussions with two parties; one regarding a majority stake, one regarding a minority stake. He wished us well with those discussions.

Q) Will you reopen the process for new Legacy Members (i.e. season ticket holders of 4+ years who have not yet joined the Trust)?
A) We will take advice on that from the relevant authorities.

Q) If you go with the minority stake option, could the Trust accept this without a vote?
A) The rules provide that a majority sale requires 75% approval from Legacy Members. There is nothing to say that a minority sale requires any vote/approval. There is a provision that if a significant change is made to the club, the Trust should seek to run a ballot of members.

Trevor Stroud then continued with his presentation, relating to the loan which has been taken out with Bill Luby and Jim Collis, which resulted in a charge being placed on the stadium as security for the loan.

The key points from the slides are as follows:
– A bridge loan was required due to the critical cashflow situation through November and December (which was eased in January due to solidarity payments from the EFL). Bill and Jim were approached and the response was quick and supportive.
– The loan came in two tranches; the first was definitely required, the second was dependent on ‘football fortune’. Once the club had exited both the FA Cup and Checkatrade Trophy in November, the second tranche was required. While the first tranche carried a charge on the club, the second carried a charge on Adams Park.
– These details were not communicated due to the commercial sensitivity of declaring the financial position amidst negotiations with sponsors and players
– If Bill and Jim are successful, their loan will be transferred to equity, and the charge will be lifted
– If Bill and Jim are unsuccessful, the loan will be repaid by the new investor, and the charge will be lifted
– There has been suggestions that the Trust may have broken rule 102 by securing a loan with a charge on the stadium without seeking approval from members
– The Trust board admitted that this rule was overlooked; the rule was introduced in 2014 after two previous loans had been taken out with charges on the stadium. The board acted on the precedent of these loans
The Trust board has sought independent legal advice which has clarified that the rule has not been broken, but the board will now seek member approval for any future charges against Adams Park

Trevor Stroud then went on to clarify his position:
– His role as chairman of both Trust and club was approved by the Trust board
– The Trust board was elected by members
– His position can be reviewed by the Trust board at any time, and the position of the Trust board can be reviewed by members at any time
– If Bill and Jim are successful, there will be two Trust board members on the club board
– No decision has yet been made on who the two Trust representatives would be
– No Trust or club director would be employed by the club if Bill and Jim are successful, or stands to make any financial gain
– Trevor reiterated that it is an honour to serve as chairman, and everything he and the Trust board does is considered to be the right thing for the club

The floor was then opened to questions:
Q) Have you sought loans from commercial partners?
A) We are in constant dialogue with commercial partners, but have yet to find anyone willing to loan £500,000 unsecured.

Q) Have you sought advice from Supporters Direct?
A) Yes, there has been dialogue with them; Lawrie Read (Trust director) had a conference call just last week.

Q) What would be the makeup of the club board if Andrew Harman is successful?
A) That is yet to be discussed.

Q) Will you change the rules relating to charges being placed on the stadium, to require member approval?
A) Yes – this will be ratified in due course.

Q) Why did we find out about the charge on Companies House, and were not informed before?
A) As a fan, I’d want to be able to tell you everything. As chairman, we had to be conscious of the sensitivity of making things public.

Q) Have you discussed a minority share with the Americans?
A) Yes – they have indicated their preference in a majority share, based on the figure that they plan to invest in order to sustain the losses and develop the club.

Q) Will we be paying off the loan soon?
A) I don’t believe that to be the case.

Q) Is there a conflict of interest with you being the chair of Trust and club, in the Trust board’s view?
A) It has been raised, it has been discussed and it has been shared that the Trust board can review it at any time. The situation will be reviewed once this process is through.

Q) Why is the voting on this decision not open to all members, but just Legacy Members?
A) We wish it was, but in reality the rules were set up as a defence mechanism. There were concerns that it wouldn’t take much for somebody to get people to join the Trust and vote through the sale of the club. We set a high bar to ensure that the people that make the decision are season ticket holders, and in theory, the most loyal fans. To change that rule, we would need approval from 75% of Legacy Members.

Q) How many Legacy Members are there?
A) We have 810 Legacy Members. A Legacy Member is a Trust member who has held a season ticket for the past four consecutive seasons at least. We have close to 1,400 Trust members.

Q) Will Andrew Harman’s proposal be funded by loans or equity?
A) We are of the understanding that the answer to this at the moment is ‘don’t know’.

Q) Will the situation be sorted by Easter?
A) We very much hope so.

Q) What happens to the club if neither offer goes through?
A) It would be a serious situation. We’re performing really well on the pitch but need resources to help us keep doing that.

Q) Would Bill and Jim clear the existing debt?
A) They won’t come in and write a cheque to clear the debt, no. We have a deal in place to pay rent from the club to the Trust to help clear the debt, yes.

Q) To what extent is there an opportunity to use investment income to establish an academy to help bring through the next Roger Johnsons, Jordon Ibes?
A) The general view from the footballing side is that the academy model is flawed, for a number of reasons. The EPPP rules have changed since we sold Jordon Ibe, which restricts the amount of money that the lower clubs can receive. Sell-on fees can be a lottery, as with Kortney Hause moving on loan from Wolves to Aston Villa, rather than a permanent move. We feel there is a gap for a development/reserve squad, where talented youngsters from the Sports & Education Trust’s Elite & Development Academy might have an opportunity. Gareth Ainsworth is very good at identifying good players that have been let go by other clubs, such as Curtis Thompson and Alex Samuel.

Q) When will see the details of the Americans’ proposal?
A) It will be depend on the timetable agreed with Andrew Harman. Approximately three weeks, as it stands. [NB this timescale has since been lengthened to five weeks, as outlined above]

Q) Has Andrew Harman signed an NDA and been given access to accounts?
A) There is an NDA running from our initial discussions, but he will re-sign it and receive access to the accounts. [NB the NDA has since been signed]

Q) Are you aware that Andrew Harman came into the Woodlands Lounge to talk to supporters, and was of the impression that the vote would be going ahead tonight?
A) Andrew isn’t a Trust member so he wouldn’t have received the communication about it.

The meeting then concluded at around 8.45pm. A full transcript of the Q&A sessions from the meeting is available upon request by emailing tony@wycombewandererstrust.com, or apply to join the WWT Live Stream group on Facebook to watch the full video of the event (Trust members only).