- This topic has 59 replies, 21 voices, and was last updated 1 year, 10 months ago by
.
-
13 users thanked author for this post.
Copied and pasted if ok SST?
Special report: Scunthorpe United, a club on the brink
There was an air of defiance that punched through the gloom on the Doncaster Road End terrace of Glanford Park on Saturday.
Scunthorpe United had convincingly swept aside Maidenhead United and the supporters that have lived every recent struggle savoured the respite that came with a 3-0 victory.
This was only Scunthorpe’s eighth win in 82 league games, a torturous run stretching back to Easter of 2021. No club in English football’s professional pyramid has had it worse. Interminable suffering.
Relegation from League Two was the club’s unavoidable fate last season to end 72 years in the English Football League (EFL) and this campaign, a first in non-League football since 1950, has only brought further ignominy.
Scunthorpe are bottom of the National League, the fifth tier of English football, and facing up to the dismal prospect of playing regional matches in 2023-24 if marked improvements are not found between now and May. Five points is the deficit to safety, even after Saturday’s cherished victory.
Yet the fortunes of this patched-up, inexperienced team do not cause the deepest lines of worry.
“People are very much afraid for the future of the club,” says John Needham, secretary of the fans group, the Iron Trust. “Fans are worried about the club ceasing to exist.”
A win against Maidenhead brought much-needed respite
The cupboards appear bare at a club that is up for sale and only a takeover can offer any genuine hope of a recovery. A winding up petition, served by His Majesty’s Revenue and Customs — the taxman — this week, brought the confirmation that times are parlous.
Peter Swann, majority shareholder since 2013, is seeking a way out of a club that is thought to have eaten up over £20 million of his wealth.
Losses have been made every season since Swann’s arrival at Glanford Park and Scunthorpe continue to lose in the region of £100,000 a month in the National League. Debts are building and the time for fresh investment grows urgent.
Swann, once a popular figurehead with grand plans, is the focal point of supporters’ ire. Every other chant from home fans on Saturday demanded his exit.
Two local businessmen watched on from the directors’ box against Maidenhead acutely aware of the club’s predicament. Simon Elliott and Ian Sharp thought they had a deal in place to buy Scunthorpe on December 1, pending “final due diligence”. Money was even forwarded by Sharp to help pay November’s wage bill.
That agreement soon found complications and last week the impasse led Swann to appoint Begbies Traynor, a firm specialising in corporate recovery and insolvency, as advisors in the sale of Scunthorpe.
Elliott has reaffirmed his interest in taking over from Swann, appearing on BBC Radio Humberside before the win over Maidenhead, but the fears for Scunthorpe’s future persist.
Scunthorpe United is the club that made Kevin Keegan, the former England and Newcastle United manager and a two-time recipient of the Ballon d’Or.
It was in this industrial town in Lincolnshire in the east of England that, in 1966, he signed his first professional contract on a weekly wage of four pounds and ten shillings. Keegan would catch buses and hitchhike from his home 25 miles away in Doncaster and made up for his meagre wages by taking on a part-time job at Appleby Frodingham Steelworks.
“Scunthorpe had given me my chance in professional football and I was eternally grateful,” he wrote in his autobiography, My Life in Football.
The late Ray Clemence would concur. He had began as an apprentice with Scunthorpe and, like Keegan, owed his decorated career with Liverpool and England to the opportunities that had come at the Old Show Ground, Scunthorpe’s home until 1988.
This modest club in a steelmaking town has a rich history. There are banners inside Glanford Park in ode to the late Graham Taylor, another ex-England manager, whose love for football was forged where his father wrote for the local newspaper.
Outside there are murals that pay homage to the modern greats, like Billy Sharp, Gary Hooper and Andy Keogh. There is even a lounge named after Sir Ian Botham, the former England cricket captain, who made 11 appearances for Scunthorpe when at the peak of his powers.
The Sir Ian Botham Lounge at Glanford Park
All that heritage is in danger of being lost, though, because Scunthorpe are in a deep financial mess.
For all they preached sustainability during the years of former owner Steve Wharton, a golden period that twice brought promotions to the Championship under Nigel Adkins in 2007 and 2009, Swann has gone his own way.
The 57-year-old businessman, whose fortune partly comes from his marriage to Karin, the heiress to Wilkos who sold her stake in the hardware firm for £63 million in 2014, has demonstrated a thirst to get Scunthorpe back to its greatest heights only to lose huge sums along the way.
Wages have exceeded income in every season of his ownership and annual operational losses climbed as high as £4.5 million ($5.4m) in 2017-18. Budgets were slashed by Swann to begin the descent with relegation from League One in 2018-19 before the COVID-19 pandemic exacerbated problems.
An EFL monitored, interest-free loan was taken out to help Scunthorpe through the season played behind closed doors. Until its repayment, the club was made to recruit under a transfer embargo and the campaign ended with relegation from League Two.
“We had no cash (in 2020-21) as such and if we had not taken the EFL loan we would have been in administration and relegated through points deduction then or this season,” said Swann, shortly after stepping down as chairman in April.
“So I had to decide, and try to give us a chance this season (2021-22). However, the embargo attached to the loan put us at a huge disadvantage — one we have been unable to overcome.”
That EFL loan was believed to be for around £1.6million. But there are other, more pressing, debts that are focusing attentions. Like the money owned to HMRC, which amounts to about £190,000 in unpaid taxes and is the reason for this week’s winding up order — essentially an application to close down a company.
The strains felt in Scunthorpe’s finances have been evident in recent months. Players and staff were paid a day late in the November payroll (a first in Swann’s 10 years in charge) that was eventually subsidised by would-be owner Sharp, before cashflow improved in December with bumper home crowds for the visits of high-flying Chesterfield and Notts County, who both bought sizeable away followings.
Scunthorpe sold striker Joe Nuttall to relegation rivals Oldham Athletic, the club that accompanied them out of League Two in May, for £100,000. Little more than a week after that sale, it was decided that a Lincolnshire Cup quarter-final against Grimsby Town would be played behind closed doors at Glanford Park “due to the policing and stewarding costs”.
The only central funding this season following relegation from the EFL was a parachute payment in the region of £600,000. That is due to fall to £300,000 in 2023-24.
Whether Swann will contest the winding up order is unclear. Does he want to financially support the club any more? But whether it be January’s wage bill or HMRC’s winding up petition that bites first, time is running out for Scunthorpe.
“The next week or two is going to be crucial for the future of the club,” predicts Needham, whose affinity to Scunthorpe dates back to the 1970s. “We need to get a deal done, certainly within the next couple of weeks. Otherwise, it’s difficult to see where the wages will come from at the end of this month.”
Lines of communication between Swann and the Iron Trust are down to entrench a sense of helplessness among supporters.
Fan director Neil Wright resigned from the club’s board last week, owing to frustrations over transparency and “the very limited amount of information he was able to convey to supporters”, according to a statement from the Iron Trust.
Swann no longer attends Scunthorpe matches and leaves the day-to-day running of the club to interim chief executive Lee Turnbull, but did visit Glanford Park last Thursday to reassure staff after it became known that Begbies Traynor had been called in to assist on the protracted sale of the club.
All parties insist this is not the precursor for Scunthorpe to enter administration but it serves to underline the complexities of a sale.
Swann is not only the majority shareholder of Scunthorpe but also of Glanford Park and the surrounding land that adjoins retail parks on the town’s western edge next to the M181.
That has long been a proposed site for redevelopment, with North Lincolnshire Council giving planning permission in 2020 for 160 apartments alongside a rebuilt Glanford Park.
COVID-19 soon halted that and by April of 2021, Swann had transferred ownership of Glanford Park to another of his companies, Coolsilk Properties. In return, £11 million borrowed by Scunthorpe was written off.
“Anybody who wanted to come in and buy the club could buy it separately, or they could buy it with the assets, and we can go and get investment for the rest of the site so we can start to develop it, and make it probably a better business model as we go forward,” Swann told the BBC at the time.
“That’s all it is really, it’s nothing else, it doesn’t really matter. The only thing that will happen is there’ll be an agreement in place that the club will never move from that spot, it protects the club for 999 years under an agreement, and we don’t have to pay any rent until they can afford it. There’s nothing devious about it, it’s pretty open.”
Swann said at the time it remained his intention to “crack on” with property development on the site and that remains his best hope of clawing back money invested into Scunthorpe United, a football club with negligible value in the National League. He borrowed – via Coolsilk Property Investment – against Glanford Park and some of the adjoining freehold last year.
“The asking price is not a problem,” said Elliott on Saturday. “It’s identifying which bits are relevant to buy for the benefit of the football club.”
It is Swann’s belief that the 15-acre footprint that is home to Scunthorpe is worth £5 million but he has confirmed to The Athletic a willingness to sell at a reduced price. Swann has indicated he would sell the football club for £1 and then the ground and adjoining land for £3.5 million to help secure the survival of Scunthorpe United.
He is in advanced negotiations with two parties interested in buying the club, which would include provision for HMRC’s claim to be settled in full. Those talks are set to be pushed forward as a matter of urgency.
Among the potential buyers circling is former Notts County owner Alan Hardy. The businessman sold up at Meadow Lane in 2019 but is perhaps best remembered for tweeting a picture of his penis when still in charge of Notts County.
Hardy, who is keen on a return to football, has been in contact with Swann and Begbies Traynor this week, who have rejected a new bid believed to be from Elliott and Sharp.
And yet, despite all of this, Scunthorpe retain an average attendance north of 3,000 at Glanford Park.
Adding a troubling layer to this tailspin has been the heavily-publicised gambling losses of Swann, a known horse racing enthusiast. These came to light before Christmas when court papers revealed he was taking Apollo bookmakers to court, with Swann claiming there had been a series of failures that had allowed him to gamble beyond his means.
Apollo had allowed Swann to bet on credit and between 2014 and 2018 it was estimated he had wagered in the region of £20 million. Papers state he would regularly bet between £5,000 and £20,000 on a single event, usually via a text message.
It is said that by 2018 he owed Apollo £1.64 million and in November of that year a settlement agreement was reached that would see Swann pay £420,000 back.
Swann responded to the publication of those papers by football finance expert Kieran Maguire with a statement on December 23 to say the financial dispute he had taken to the High Court was “entirely and categorically unconnected with the finances of Scunthorpe United Football Club”.
He added: “Monies which I gambled on various sports (I did not gamble on football) were all my own personal money, and the proceedings were brought because I felt (and still feel) that I needed to take an important stand against a company that I believe exploited and took advantage of me, during a very difficult time in my life.”
Apollo has defended its actions and says a £2million credit line was agreed and signed off by Swann, who was considered a “high roller” customer.
Although Swann has claimed his gambling losses were – and remain – unrelated to Scunthorpe United, Apollo has shown emails between the two parties in which Swann said the club was up for sale in 2018. That, he said, would see his cash flow improve and allow debts to Apollo to be repaid.
Apollo maintains it did nothing wrong and regularly sent Swann statements of his gambling record. It also pointed out that in 2018 Swann had obtained a gambling “marker” for £250,000 when visiting Las Vegas. The case between Swann and Apollo is yet to reach its conclusion.
Amid the off-field uncertainty, this season has been an unmitigated disaster for Scunthorpe. Despite winning on the opening day of the National League campaign, beating Yeovil Town 2-1, they have been unable to shake the malaise of relegation.
Keith Hill, the former Barnsley, Rochdale and Bolton manager, was sacked at the end of August before Tony Daws opted to step down from his position as interim manager in favour of returning to lead the club’s academy in November. That made Michael Nelson the Irons’ third manager of the season before the halfway point.
The thread linking Hill, Daws and Nelson has been a familiarity with defeats. Fifteen have come in 26 league games this season, with an alarming 53 goals conceded.
Hope has become a stranger to this club and even when it comes there are typically caveats. Caolan Lavery, the 30-year-old striker, scored an excellent hat-trick in Saturday’s 3-0 win over Maidenhead but will soon see his six-month deal expire.
Nelson and chief executive Turnbull have admitted that Scunthorpe cannot offer an extension due to current financial restrictions and Lavery will leave on January 22 if a takeover is not pushed through. Rob Apter, a young winger loaned from Blackpool, has returned to his parent club.
“There is no point in getting upset or disheartened with it,” said Nelson. “That’s the landscape at the minute and we just have to get on with it.”
Yet there is unyielding support for a side that is rooted to the foot of the National League and without an away win in over a year. The slide has stripped back Scunthorpe’s backing to its loyalist core and there is empathy towards a group that does not want for effort.
“We don’t care about Swanny, Swanny don’t care about me, all I care about is SUFC,” was the chant on loop against Maidenhead.
There is an acute awareness of what this club used to be and what it has become, but doubts over its very existence now dominate discussions at the Iron Bar before and after games. The situation is not helped by the silence that generally surrounds the sale of football clubs — or the deals that get done, anyway — as they are being negotiated behind closed doors.
“It’s been a desperate few years,” says Needham. “We’ve seen some bad times here but the club has always survived. Now it looks as though that’s not certain. The town of Scunthorpe needs its football club.
“There’s a sense of powerlessness among the fan base but they also want information. They feel as though they’ve been kept in the dark about what is exactly going on. And when you’re kept in the dark, all it does is ferment rumour. People are very much afraid for the future of the club.
“People are talking about administration but who knows? Hopefully there will be bids but the majority of fans hope that it will result in the local consortium taking over.”
Scunthorpe are in poor health and in grave need of a remedy.15 users thanked author for this post.
Given Simon said that they have an offer which ticks all the boxes, and Swann is apparently willing to compromise, I wonder what the delay is. I know I am assuming some trust in Swann, but we have to take into account that it might be truthful.
I know some have pinned all their hopes on the Elliott-Sharp consortium, but I’d be happy with anyone reputable. The problem is that the other mooted figures, the London consortium, Smurthwaite, Hardy etc don’t seem to be those I’d want anywhere near the club.
4 users thanked author for this post.
Offline
Registered On:
Topics: 80Good to see the trust getting it out nationally
2 users thanked author for this post.
Clear as mud.
Don’t get me wrong, I have my suspicions as to the reason being an unwillingness to sell to them for personal reasons.
1 user thanked author for this post.
£3.5 million for the land and £1 for the club seems a good price to me. Don’t think Mr Swan is being greedy or unrealistic. Has to be someone out there that would want this.
1 user thanked author for this post.
So it is 5million as stated in the accounts and not the fantasy figure of 900k Awayswego was suggesting.
To be fair to Awaywego, I believe he stated that the land was worth £900K. The £5M refers to the land, ground etc. etc. (Which is very close to the £5.3M listed on the books).
Let’s all pray that a deal is pushed through soon.
1 user thanked author for this post.
5.2million is the price listed in the books 3.5million is the asking price from Swann.
1 user thanked author for this post.
You’d be lucky to get a Mars bar with that nowadays NI!
1 user thanked author for this post.
I can’t believe I’m saying this but if that’s true then Sharp and Co need to pull their fingers out because that price is fair. They should either stump the money up or walk away and stop wasting peoples time.
If they haven’t got the funds then fine but I wish they wouldn’t hang around if they don’t have a real chance of even being able to afford to do it.
1 user thanked author for this post.
Yep. £3.5 million seems fair .. but before we start on Elliott and Sharp we need to remember the small matter of 1.6 million for the EFL loan and just south of £200000 for the Taxman .. as well as an imminent staff payday. Simon and Ian need £5 million and more to sort the immediate … and then as Simon said … will need another chunk to put petrol in the Ferrari so we can move forward.
8 users thanked author for this post.
I’ve seen a number of posts on here and other social media telling Simon and Ian to just pay the money. Ridiculous and pointless. Not even going to begin explaining why. Shouldn’t need to really.
4 users thanked author for this post.
We need a new share issue. UTWI
1 user thanked author for this post.
Notts County fan here. I’m sorry to hear that Alan Hardy is interested in your club. I knew Alan Hardy before he bought us as he tried to buy the Semi-pro club i used to play for. His arrogance is astounding, and genuinely you’d be better off going bust and starting again if he’s your only option. He almost killed us, by giving Kevin Nolan a £3 million wage budget in League 2 something he couldn’t afford. I hope you find a decent owner, but trust me he isn’t the answer.
5 users thanked author for this post.
It’s promising when we have Notts County and Vale fans coming on here to warn us about prospective owners. Makes me confident about the future!
1 user thanked author for this post.
County fans are on Twitter warning us about this Hardy.
Will honestly be gutted if we sell to him or Smurfwaite. As the county fan states, we may aswell go bust because the supporters won’t buy into another sociopath on an ego trip.
1 user thanked author for this post.
- You must be logged in to reply to this topic.