Breaking News Brown to be Club Shareholder - Innovative deal looms

[DTS]

Shareholder in a club that make a massive loss every year, you need a new financial adviser Phil :nope:

No he doesn't. He is already with the best firm in the business.

As I said two weeks ago three year deal was agreed weeks ago just not been signed as various parties been away.

 

[BlueBore]

I was given free shares in my last company. Unfortunately the company went bankrupt and they were worthless, but it was a nice little incentive at the time. You win some, you lose some...

 

[TJC]

What I don't quite understand is that SUFC is a private company, therefore no index prices are available, so shares are only worth what someone wants to pay.
Based on the way private shares are often valued, SUFC is surely worth nothing? http://www.investopedia.com/ask/answers/09/how-to-value-shares-in-private-company.asp

Maybe what Ron has offered means that his share holding dips below 50% but he remains the largest single shareholder and therefore needs Phils share allocation to maintain a controlling share meaning they are valuable to Ron?

What ever the deal is, I applaud Mr Brown for his bravery in entering a deal such as this with the formidable Mr Martin, mind you, I suspect Mr Brown is no-ones fool!

 

[Supa Shrimpa]

I haven't seen the article in the Echo yet. Has he actually signed the contract ?

 

[Supa Shrimpa]

Then again, here it is....
http://www.echo-news.co.uk/sport/bl...holder_when_he_signs_new_three_year_contract/

 

[Evening Echo]

Southend United manager Phil Brown to become shareholder when he signs new three-year

PHIL Brown will become a share-holder in Southend United when he signs a unique new contract with the club.

More...

 

[Leoblue]

Shares are always a gamble in all walks of life, even more so in a L1 club however, I see it as a positive move by both parties.

Both Ron and PB know more what's happening behind the scenes at the club and as already stated, PB is no mug and has obviously got advise on the contract terms.

Presently we're a L1 club who are running at a loss but with ambitions of Championship football 'again' in a new shiny ground, so surely if this ambition was to become reality, what has PB lost? There's more to gain from becoming a success and nothing to lose if our ambitions are not achieved within those next 3 years.

Personally I think it's a good move by both parties.

 

[Jam_Man]

What I don't quite understand is that SUFC is a private company, therefore no index prices are available, so shares are only worth what someone wants to pay.
Based on the way private shares are often valued, SUFC is surely worth nothing? http://www.investopedia.com/ask/answers/09/how-to-value-shares-in-private-company.asp

Maybe what Ron has offered means that his share holding dips below 50% but he remains the largest single shareholder and therefore needs Phils share allocation to maintain a controlling share meaning they are valuable to Ron?

What ever the deal is, I applaud Mr Brown for his bravery in entering a deal such as this with the formidable Mr Martin, mind you, I suspect Mr Brown is no-ones fool!

Not a chance in hell.

Ron would never risk losing control.

 

[Leoblue]

I forgot to add, Ron has to back this contract (incentive) by financing on the field so it could be interesting what's around the corner.

 

[tottenham541]

Does he realise that SUFC shares are about as useful as the toilet paper he will wipe his suntanned arse with, right?

Yeah and can Ron Martin buy my shares back then please, I might consider getting a season ticket then:'(

 

[Supa Shrimpa]

Nice try, but the company has a negative worth. Therefore, I think you'd have to pay him to take them back !!! :unsure:

Seriously, if I was PB i'd be asking, how exactly, will SUFC be benefiting from the proposed new stadium ?

 

[Ailsa Road Shrimper]

Practices such as these are common, especially in Financial Services. Typically it is the variable compensation such as bonuses that are deferred as shares, normally vesting over a staggered period of typically around three years. The aim is to promote loyalty and long term practices, rather than risky short term strategies whereby people can disappear into the sunset and leave everyone else to pick up the pieces. Also, shares can be an option to give staff as there is a shortage of cash to pay people large ad hoc payments, I'd imagine this is more likely to be the case with Ron!

 

[RHB]

Practices such as these are common, especially in Financial Services. Typically it is the variable compensation such as bonuses that are deferred as shares, normally vesting over a staggered period of typically around three years. The aim is to promote loyalty and long term practices, rather than risky short term strategies whereby people can disappear into the sunset and leave everyone else to pick up the pieces. Also, shares can be an option to give staff as there is a shortage of cash to pay people large ad hoc payments, I'd imagine this is more likely to be the case with Ron!

That sounds incredibly sensible and impressive. Will it stop him going if a bigger club comes calling - We will wait with baited breath.

 

[Fish]

Practices such as these are common, especially in Financial Services. Typically it is the variable compensation such as bonuses that are deferred as shares, normally vesting over a staggered period of typically around three years. The aim is to promote loyalty and long term practices, rather than risky short term strategies whereby people can disappear into the sunset and leave everyone else to pick up the pieces. Also, shares can be an option to give staff as there is a shortage of cash to pay people large ad hoc payments, I'd imagine this is more likely to be the case with Ron!

But this isn't what we've got here. Phil has been given the shares as a part of his contract now. It's not dependent on his performance, nor are they being deferred.

Also, deferred bonuses are short term incentives, not long term, because the size of the award relates to annual performance. Just because some of them are deferred, doesn't mean to say they prevent short term risky behaviour. That's the job of the long term incetives, which have performance periods over 3-5 years, and then only pay out after that. It would be more interesting if Phil Brown's end of season or end of current contract bonus was related to what he achieved during it - THEN make him a shareholder.

Anyway, it's all irrelevant because as has already been pointed out shares are only valuable if there's a market for them. I can't imagine there being a stampede to buy SUFC shares in three years time any more than there is now, unless (and this is a big IF) the stadium is complete and revenue-generating for the club. But even then, I can't imagine there being much financial demand for shares - can you imagine a Championship club paying dividends to shareholders?!?

 

[Liam AAS]

Nice try, but the company has a negative worth. Therefore, I think you'd have to pay him to take them back !!! :unsure:

Seriously, if I was PB i'd be asking, how exactly, will SUFC be benefiting from the proposed new stadium ?

These days having a nice stadium with top facilities bring in a whole new raft of revenue. I work for a company that recently held a departmental meeting at the emirates. This like wedding receptions can now be held by the club all year round. The Ricoh arena has a casino built in and brings in about £7m a year!

That's why things like a cinema and housing are a good idea (business wise) as it ensures revenue all through the year rather than just from August to May. Stuff like this would even subsidise the empty seats.

 

[united we stand]

There is no where near enough detail in the press release for anyone to have any idea of how this would actually work in practice -- and frankly why should there be -- glad to see that hasn't stopped pages of speculation and opinion though so I will add my own :smile:

• Ron gives the shares to Phil-- these are/were Ron's personal shares
• Ron/Phil agree upfront various forward values on the shares based on a number of targets - league position etc etc
• The price agreed has no relevance to other share holders as it is Ron buying them back- not the company
• I work for a publicly quoted firm and getting shares is normal to me. However that is very different as the shares are publicly quoted, and I get them from my firm, The bit that makes no sense to me is that the wording is stating that Ron is paying press Phil, not SUFC. That seems 'weird' to put it mildly

 

[Fozzie]

I used to be a student in Huddersfield, and the Galpharm stadium (John Smith's Stadium now) made money by sharing with the Rugby League team, offering corporate events, concerts etc. There is also a massive Odeon next door with restaurants etc. Also, the stadium is a joint venture with the council with the sponsors of the stadium being Heineken and having companies paying for stand sponsorship too. I believe Southend might be approaching a similar thing with their proposal - not sure about sharing the stadium with rugby teams just yet though, but it could be a good business venture if done right.

This is my first post here by the way, so hi all!

 

[Bearded Shrimper]

surely we are now trying to corner the market in the John Lewis-style football clubs and get a few more of the well off fans along to go alongside the new Waitrose burgers (onions optional)?

that's the first step, a real share-ownning cooperative football club

of course, the longer term objective is to become an anarcho-syndicalist commune which gives me the chance to post this

<a href="https://www.youtube.com/watch?v=rAaWvVFERVA" target="_blank">[video=youtube;rAaWvVFERVA]https://www.youtube.com/watch?v=rAaWvVFERVA[/video]

 

[buffalowolf]

Some understandable cynicism being expressed but is there really any harm in a deal like this ? Normally making employees stakeholders is seen as a positive move isn't it ?

Now you may understand why this is called SHRIMPERMOAN ,and the Aussies have given you all the label as pomme whingers,becoz no matter what you can never look to the bright side of life ,this is not you shrimper43 but all the others who just find fault ,look to the negative etc .

 

[RHB]

Now you may understand why this is called SHRIMPERMOAN ,and the Aussies have given you all the label as pomme whingers,becoz no matter what you can never look to the bright side of life ,this is not you shrimper43 but all the others who just find fault ,look to the negative etc .

I seem to recall that during the latter half of last season virtually every one of your posts was negative, especially about Phil Brown. Pot, kettle??