The Falkirk FC Thread

[Disco Duck]

6 minutes ago, HopeStreetWalker said:

Remember any new shares issued dilutes the % of existing shares held by any grouping or individual unless the shares issued are exclusive to them

Yup.  Because they’re putting money in, and getting something in return.  Presumably the large shareholders could be offered the chance to stand their share as well.

[Disco Duck]

38 minutes ago, Bairney The Dinosaur said:

Yeah I guess, but I can see why the club doesn't want to do that. The statement talks about endlessly issuing shares as disproportionately inflating our market value (or something like that).

 

Can you quote that?  I can’t see it anywhere.  Shouldn’t be true - it would dilute the value of other shareholders and would be an admin burden, admittedly.

[FFC 1876]

Anybody heard anything on why Agyeman wasn't in the squad on Tuesday? Hoping he's not injured.

[Blame Me]

22 minutes ago, Disco Duck said:

Can you quote that?  I can’t see it anywhere.  Shouldn’t be true - it would dilute the value of other shareholders and would be an admin burden, admittedly.

It was at the end of the statement:

Quote

FAQs

Q: Will there be more shares made available?

A: There are no plans to issue more shares at this time. In the last three years the club has increased its share base from 2.4m to more than 5.2m shares. Directors have a duty to ensure that a company’s market capitalisation reflects reasonable market value and continually issuing shares doesn’t provide a sustainable operating model.

 

[Guest]

I just want to put the following as objectively as I can. I respect we all want to move on but it’s equally important to clear up some things that I feel have been a little misrepresented. 

Ultimately the most important part moving forward is that lessons have been learned however upon listening to the podcast it seems the blame has been pushed at members for getting the wrong end of the stick more than any miscommunication. 

It also has a go at the ‘noise’ made on social media and the inaccuracies, which undoubtedly feels like a shot at anyone like who has questioned recent activities. Again if lessons are to be learned and fans are to be listened to then surely there should be an openness about responsibility for any inaccuracies that have been acquired and to accept there was good reason for any members to bring light to the issues. 

Let’s not revise history and pretend like these inaccuracies have been created for any particular agenda.

For how many believed 25%+1 to be the target, here are some quotes. I’ve checked several times and can’t find any reference to ringfencing of shares. There may have been a mention in one of the AGMs but there are no notes I can find from each one in the FH commentary or FFC website that highlight these. The AGM slides don’t mean much without the context in which they were presented and were only available to the 70(?) or so shareholders that turn up to the AGMs. I was at the 2022 one and in all honesty can’t remember about any limits to shareholding being mentioned when presenting the future projections. 

Even in the FFC podcast, the patrons director states that when there are 1m shares left, they expected 750,000 to go to FSS and 250,000 to go to the Patrons but emphasised that it didn’t have to be that exact amount.

FSS newsletter, 9/12/21

‘We already have 95,000 shares in the club thanks to earlier fundraising campaigns and donations from large shareholders and the club itself. Our goal is to eventually reach 26% of the club, buying 750,000 shares in the next three years’

FSS newsletter, 21/1/22

That means we now hold over 110,000 shares in Falkirk Football Club, a number that will continue to grow with your support, and our journey towards 25% overall

FSS newsletter, 18/2/22

We invested £6,000 in the club in January, and expect to put in our next cheque imminently, meaning that FSS will hold 125,000 shares on behalf of its members.  The aim remains to achieve a 25% shareholding which will mean, standing alongside the Patrons’ Group, Falkirk fans will hold a controlling interest in the club and no group of shareholders can make decisions without agreement across the support

FSS newsletter, 5/5/22

The aim is to hit 10% ownership by this time next year, or even earlier, and ultimately the 25% we set as our target so fans can protect our club 

Falkirk Daft, Episode 1 28/7/22

Q: ‘What is the Ultimate goal of the FSS?’

A: ‘It’s not up to us….it’s up to the Falkirk fans at large how big they want this to be…we are trying to implement this balanced ownership model…it’s to make sure that fans have the security of being able to keep the vultures at bay…..if you want me to put a number on it, it’s 26% of the club. 

[Guest]

 

1 hour ago, Bairney The Dinosaur said:

Yeah I guess, but I can see why the club doesn't want to do that. The statement talks about endlessly issuing shares as disproportionately inflating our market value (or something like that).

 

On that note I have a few open questions for the FSS:

As part of the agreement it says that:

‘The FSS elected FFC Board members, whilst at all times exercising their fiduciary duties as directors of the Club, shall be visible and available to members of FSS, to listen to their views and to accurately represent those views in the Boardroom.’

From the FSS members meeting update that:

‘FSS had requested a transfer for the remaining 1% of shares…but this was retained for the PG’

The statement read on Falkirk Daft said that the agreement not to sell the shares was ‘a unanimous decision including the FSS directors at the time’.

The FSS are the largest shareholders and have the largest proportion of fans as representatives but were refused permission to buy shares. 

Does FSS have much of a say in the boardroom when this is the case and what is to prevent this from happening in the future despite this agreement? 

What if a majority of the members wanted FSS to be able to increase their shareholding and therefore have the club issue more shares? 

Also if FSS is the primary vehicle for providing crowd funding then why is it advertised equally alongside FF?

Why is it still necessary to have FF running when it is the exact same as FSS? 

Does the FSS have any say in how the money is spent as under this agreement the FSS is to hand all the subscriptions(minus fees and loan repayments) to the club?

[Bairney The Dinosaur]

35 minutes ago, Van_damage said:

Ultimately the most important part moving forward is that lessons have been learned however upon listening to the podcast it seems the blame has been pushed at members for getting the wrong end of the stick more than any miscommunication.

Caveat this with I haven't listened to the podcast so don't know what was said, but my understanding is that it wasn't the 25% target that was misunderstood but how to get there. 

The misunderstanding was that for FSS to get to 25% they would require share donation rather than buying the shares from the club. 

I agree with you though that this was on FSS for not communicating that clearly rather than members not understanding.

[StuartA]

At the risk of complicating things further, but hopefully to help, here's my understanding and recollection:

- the target of 25% (or 25% plus 1 share, or 26%) was always an aspiration set by FSS from the outset.  It was modelled on the Rawlins doing the same, and for a similar reason, i.e. to be able to block a harmful special resolution (e.g. around ownership).  In short, an element of control.

- that target wasn't achievable by straightforward purchase from the shares available from launch in 2021 given the ring-fencing arrangements, but wasn't seen as a big issue given pace of uptake in FSS.  Other options were also on the table, e.g. larger shareholders intimating that they'd be happy to see FSS inherit their shares or receive proxy if the organisation proved to be a success.

- The SG loan changed the whole landscape and everyone (myself included before I left the cttee) failed to keep up.  

- equally, the 25/25+1/26 target isn't a cap, as is clear from the recent comms.  The only cap for any of the stool-legs under the current consensus is 50% minus one share.

My personal preference is that FSS and Patrons combined can reach and maintain 50% no matter what.  Yes, the other c9% of small shareholders count, but as we saw during the Gow crisis, mobilising them to vote in a General Meeting is hard going.  So FSS scooping up as many of these shares as possible, perhaps in lieu of membership, would make sense from the perspective of the "Protect" pillar.

The future point when this matters is if there's an external investor.  As things stand, each leg of the stool has an effective veto over a malign investor, or an investor who didn't want to maintain the balanced ownership model.  The difficult question would be if that investor was significant enough for us to fold the principle of fan ownership, or if the club was in such dire straits that we had to. I/e rich bad guy comes along after we've posted another £1m loss and we've nowhere else to turn.

To me, that's the bigger picture here.  If we can make that a moot point, then we'll be a success.  And at the risk of putting some impossibly positive spin on things, I think it's telling that we're arguing about this rather than the closure of our Academy, preventing charlatans from taking over our club, or the revolving door of coaches and players.  That's progress.

Edited September 11, 2023 by StuartA

[AJ1981]

Some much needed perspective on this thread, that was then and now is a wee bit better...

[Guest]

4 minutes ago, AJ1981 said:

Some much needed perspective on this thread, that was then and now is a wee bit better...

Said it before but I believe the new board have done some great things to help progress the club on and off the field.
 

Gary Deans and co they are not but that doesn’t mean to say that we shouldn’t be open to discussing anything we think is wrong. The new board are much more open to conversation but if no solution can be sought then sometimes the only way to right a wrong is to get it out in the open. At least that way it can be debated and the result is determined by the many and not the few.

 

[Mr Grimsdale]

Just listened to the Podcast. All spoke well but I thought Charlene and Scott came over very well (maybe because they have lived and breathed it for months). 

 

[Disco Duck]

3 hours ago, Blame Me said:

It was at the end of the statement:

 

That’s absolute horseshit.  For a start the company doesn’t have a market cap as it’s not listed.

EDIT - sorry BlameMe, this isn’t aimed at you.  But that statement is one of the worst examples of a word salad I’ve seen in a while, and the more I read it the more I think it’s trying for deliberate obfuscation.  Had they said “it’s costly in fees and time consuming to issue new shares”, I would appreciate the sentiment.

The note above from our erstwhile board rep Is a very good one.  There is no cap until nearly 50%.  Every £ that FSS puts into the club adds value, and therefore we are adding value to the shares owned by others.  If you put into a shareholders group, you expect shares in return.  Otherwise, I’ll just buy £30 of 50/50 tickets every other week and at least get something back (maybe!).

Issuing shares is a process that’s awkward, so I would see the company doing so in a large tranche and then allotting them maybe once a year, with the option for other shareholders to do so at the same time to stand their corner.  Not just sit back and do f**k all and let the little guy come up with the cash.

Edited September 11, 2023 by Disco Duck

[AJ1981]

35 minutes ago, Van_damage said:

Said it before but I believe the new board have done some great things to help progress the club on and off the field.
 

Gary Deans and co they are not but that doesn’t mean to say that we shouldn’t be open to discussing anything we think is wrong. The new board are much more open to conversation but if no solution can be sought then sometimes the only way to right a wrong is to get it out in the open. At least that way it can be debated and the result is determined by the many and not the few.

 

Actually i wasn't talking about the board as folk, it was about the FSS owning 25% of the club plus the 9% small shareholders and we're driving the bus now, not people hand picked by a few.

Pie and Bovril ain't debate dude, it's an echo chamber dominated by the few.. 

[Guest]

3 hours ago, AJ1981 said:

Actually i wasn't talking about the board as folk, it was about the FSS owning 25% of the club plus the 9% small shareholders and we're driving the bus now, not people hand picked by a few.

Pie and Bovril ain't debate dude, it's an echo chamber dominated by the few.. 

That could be true but the same can be said with all social media. 

Char on the FSS said we would ‘welcome any kind of feedback on social media forums’.

This is one type of area to at least put things up for discussion.  

The key point you find about football clubs is noone wants to discuss issues about governance while the team is doing well, that doesn’t mean to say that these issues won’t cause more harm in the future if unresolved. So you may well be correct that it seems like an echo chamber speaking about such things compared to what formations to play or others, but at least it gives an opportunity to get it out in the open, for posterities sake at the very least. 

 

Edited September 11, 2023 by Van_damage

[Guest]

48 minutes ago, Disco Duck said:

That’s absolute horseshit.  For a start the company doesn’t have a market cap as it’s not listed.

EDIT - sorry BlameMe, this isn’t aimed at you.  But that statement is one of the worst examples of a word salad I’ve seen in a while, and the more I read it the more I think it’s trying for deliberate obfuscation.  Had they said “it’s costly in fees and time consuming to issue new shares”, I would appreciate the sentiment.

The note above from our erstwhile board rep Is a very good one.  There is no cap until nearly 50%.  Every £ that FSS puts into the club adds value, and therefore we are adding value to the shares owned by others.  If you put into a shareholders group, you expect shares in return.  Otherwise, I’ll just buy £30 of 50/50 tickets every other week and at least get something back (maybe!).

Issuing shares is a process that’s awkward, so I would see the company doing so in a large tranche and then allotting them maybe once a year, with the option for other shareholders to do so at the same time to stand their corner.  Not just sit back and do f**k all and let the little guy come up with the cash.

I don’t quite understand it too. The remaining shares were left for fresh investment but if only £24k left and to save any fuss then why not issue 1m more shares with at least 25% ringfenced for the FSS? That way the FSS could maintain and continue to up its shareholding and there would be more shares available should any small, medium or large shareholder be interested in purchasing shares. 

Also please correct me if I’m wrong but for the value of the club, I didn’t think it mattered about the amount of shares issued but the cost of them?

Technically the cost of all the shares added together gives the club a value of around £2.3m. With 5,250,000 shares allotted someone looking for a 50% stake would require another 5,250,000 shares to be issued. The money that will require will depend on the cost of those shares, so it’s not the amount of shares that matter but their value?(or am I missing something?)

[Disco Duck]

11 minutes ago, Van_damage said:

I don’t quite understand it too. The remaining shares were left for fresh investment but if only £24k left and to save any fuss then why not issue 1m more shares with at least 25% ringfenced for the FSS? That way the FSS could maintain and continue to up its shareholding and there would be more shares available should any small, medium or large shareholder be interested in purchasing shares. 

Also please correct me if I’m wrong but for the value of the club, I didn’t think it mattered about the amount of shares issued but the cost of them?

Technically the cost of all the shares added together gives the club a value of around £2.3m. With 5,250,000 shares allotted someone looking for a 50% stake would require another 5,250,000 shares to be issued. The money that will require will depend on the cost of those shares, so it’s not the amount of shares that matter but their value?(or am I missing something?)

Correct.  If the club issues 100% more shares  but doesn’t get any cash in, the value of all shares is diluted by 50%.   If it issues them at the right value, it issues (say) £1 of value for £1 received in cash, notionally increasing the club by that value.  

but I think the relevant bit here, is if the club allotted another £250,000 in shares to FSS, the shareholding % of the other non-FSS shareholders declines, and I don’t think they want that.  

Worth noting that the value of a football club is pretty much entirely theoretical until someone is willing to buy it.  There’s no dividend stream attributable most clubs.

Edited September 11, 2023 by Disco Duck

[Guest]

15 minutes ago, Disco Duck said:

Correct.  If the club issues 100% more shares  but doesn’t get any cash in, the value of all shares is diluted by 50%.   If it issues them at the right value, it issues (say) £1 of value for £1 received in cash, notionally increasing the club by that value.  

but I think the relevant bit here, is if the club allotted another £250,000 in shares to FSS, the shareholding % of the other non-FSS shareholders declines, and I don’t think they want that.  

Worth noting that the value of a football club is pretty much entirely theoretical until someone is willing to buy it.  There’s no dividend stream attributable most clubs.

This is why I start to wonder why we’re so tied to the 3 stool model. Other fan organisations have went on to have full control of their club but the way it is now setup means that the FSS will presumably be the only leg to continually feed in money for nothing in return yet will have no greater say for it whereas the Rawlins will maintain their 15% as will everyone else. 

Again please correct me if I’m wrong but if the FSS was to continue to amass more shares then the opportunity for outside investment will still be there if it was ever required.

At least if the FSS had a large percent of the shares then it could agree to sell them and put the money back in to the club rather than issuing more shares? 

[Disco Duck]

2 minutes ago, Van_damage said:

This is why I start to wonder why we’re so tied to the 3 stool model. Other fan organisations have went on to have full control of their club but the way it is now setup means that the FSS will presumably be the only leg to continually feed in money for nothing in return yet will have no greater say for it whereas the Rawlins will maintain their 15% as will everyone else. 

Again please correct me if I’m wrong but if the FSS was to continue to amass more shares then the opportunity for outside investment will still be there if it was ever required.

At least if the FSS had a large percent of the shares then it could agree to sell them and put the money back in to the club rather than issuing more shares? 

Yeah I agree.   Nothing stops investment, but lets FFS have a say.  That’s the point.

If FSS continues to put in money but gets nothing in return, it’s completely imbalanced - but we now have a loan to repay, so I think the club is banking on FSS having an obligation there so not wanting to rock the boat too much.

If I were in charge of the club, I’d ask for what theyre asking for - free cash from the ever loving supporters.  Instead of putting the gate fee up, they're at least getting cash from those that fee they can afford it!

[Forever_Blue_]

23 minutes ago, Disco Duck said:

Yeah I agree.   Nothing stops investment, but lets FFS have a say.  That’s the point.

If FSS continues to put in money but gets nothing in return, it’s completely imbalanced - but we now have a loan to repay, so I think the club is banking on FSS having an obligation there so not wanting to rock the boat too much.

If I were in charge of the club, I’d ask for what theyre asking for - free cash from the ever loving supporters.  Instead of putting the gate fee up, they're at least getting cash from those that fee they can afford it!

Surely we're getting something in return? Maybe it's not tangible, but influencing how our money is spent (academy would be my preference and a real legacy for the FSS if we can get it back to where it was), two seats on the board, the ability to veto the next Mark Campbell, and hopefully seeing the club get back to where we belong, with our backing helping to deliver that.. 

Edited September 11, 2023 by Forever_Blue_
Typo

[Disco Duck]

6 minutes ago, Forever_Blue_ said:

Surely we're getting something in return? Maybe it's not tangible, but influencing how our money is spent (academy would be my preference and a real legacy for the FSS if we can get it back to where it was), two seats on the board, the ability to veto the next Mark Campbell, and hopefully seeing the club get back to where we belong, with our backing helping to deliver that.. 

can’t argue with any of that, but if we continue to put cash in we should continue to get more influence, no?  Or should we be insisting others match our funding (so everyone’s equity interest remains proportionate) and the club gets even more money?

Perhaps more tellingly, give me a good reason why we SHOULDNT get more equity for injecting funds continuously.

Edited September 11, 2023 by Disco Duck