Who Goes To Arsenal’s AGM – And Why?

The Arsenal Holdings AGM for this year takes place on Thursday October 17, 2013. It’s traditionally held on the third Thursday in October, and since the stadium move has been held in one of the Club Level eating and drinking areas.

As with all Public Limited Companies, Arsenal are obliged to hold an AGM and invite all shareholders, whether they have one share or (as in the case of Mr Kroenke) over 42,000 of them. Shareholders have a legal right to attend; anyone other than shareholders is there at the invitation of Arsenal.

The number of shareholders has dropped quite dramatically over the last few years, with the Uzbek and American billionaires buying shares from both small and large shareholders. Until Stan bought out most of the old Board in 2011, no one had ever owned a majority of Arsenal’s shares, ownership of the club had always been split between a number of different major shareholders as well as hundreds of smaller holdings. Even Henry Norris, the man who moved Arsenal to Islington, deliberately avoided holding a majority of shares, and the Hill-Woods and Bracewell-Smiths who succeeded him were happy to continue that arrangement.

Now, however, with over 97 per cent of the shares in the hands of just two men, the number of small shareholders has dropped to a few hundred. It’s likely that the number of attendees at AGMs would also have dropped from the 300-400 of a few years ago down to something in double figures, but for one extra factor: the Fanshare scheme.

Fanshare was set up by the AST to give Arsenal supporters the chance to own a part of their club at a time when a single share costs around £15,000, making it prohibitively expensive for most ordinary fans to have a stake. Fanshare has around 2,000 members and the scheme owns over 100 shares, making it the third biggest shareholder in Arsenal.

Fanshare is a separate legal entity to the AST, and contrary to what some people believe you are not automatically an AST member by being part of Fanshare. Because Fanshare offers the chance to buy shares it is governed by a lot of rules on offering investments for sale – for this reason it isn’t possible for it to be open to Arsenal fans outside of the UK. AST membership is open to any Arsenal fan anywhere in the world.

Regarding the AGM, for the past couple of years the club has allowed the 2000-odd Fanshare members to have 100 seats at the meeting. This was generous because to begin with Fanshare owned fewer than 100 shares. Since the last AGM the Fanshare total has gone over 100, so this year Arsenal are allowing 104 places, one for each share the scheme holds at the time of the meeting.

I’m not sure whether the club could claim, if they wanted to, that the Fanshare scheme is a single owner so only one person should attend to represent that shareholding, whatever size the holding is. However, I think the club perhaps recognise that with the number of shareholders outside Fanshare having shrunk dramatically, the floor would be pretty empty these days without them. It looks like a more vibrant community if at least a couple of hundred people turn up rather than a couple of dozen, where you can clearly hear every time someone clears his throat.

Any shareholder is entitled to send a representative, or proxy, instead of attending himself. Rather boringly, this is what Mr Usmanov does.

So aside from full shareholders (or their proxies) and Fanshare members, who else is in attendance?

Firstly the Board, who apart from Stan Kroenke now don’t own a single share between them. This non-ownership is unusual and in many ways not particularly desirable, though it’s not legally an issue.

Arsène Wenger also appears on the podium and gives a short speech to the assembled company. As I’ve said before, he can’t lose at these gatherings: when the team is doing well he gets the credit, and if it’s doing badly the Board will get more stick than he does. He’s always the most popular man on the podium.

The only other usual attendees are members of the press. There’s no obligation on Arsenal to let them in, but it’s good to be seen as open and friendly.

Don’t be fooled into thinking that the AGM is held as a benefit to supporters, though, or to provide engagement. It’s held for one reason only: as long as Arsenal is a PLC it must have an AGM for all shareholders. The reason other clubs don’t do the same is not because Arsenal is intrinsically more open to dialogue with fans, it’s because other clubs don’t tend to have the same legal obligations due to their different ownership structures.

And don’t forget the words of Arsenal’s longest serving director last year as he closed a meeting that as Chairman he was legally obliged to oversee and run in a professional manner: “Thank you for your interest in our affairs”. That’s “you” as in the supporters who make the club what it is, and “our” as in the Board who are there to serve.

As with all PLCs, individual Directors on the Board are elected for a three year term, then must seek re-election. This year Stan Kroenke is up for re-election. Obviously Stan has enough votes on his own to re-elect himself and anyone else he chooses, but it might be an interesting meeting if no one else puts their hand up in favour of this motion. Stan better make sure he’s paying attention and raises his hand at the right time, just in case.

I’ll be tweeting live from the AGM on Thursday, so follow for updates: @AngryOfN5

21 thoughts on “Who Goes To Arsenal’s AGM – And Why?

  1. The AST have managed to embarrass Arsenal FC and the vast majority of real fans.

    Fans who actually care about the club and not promoting themselves and self interested attention seeking tabloid declaratrions of faux outrage.

    Payton is a vile self serving non entitiy and this blog is seems to be the cyberspace incasrnation of said arsehole.

    No wonder its dying on its arse.

    • I hold no candle for the AST, but exactly who do YOU represent Sid?
      Which supporter group, on behalf of what number of shares, and by whom and how many were you elected that you make the claims you do?
      How many of your little co-evangelists blog and commentate on your site?
      It’s time all the little holier-than-thou types took a step back.
      No, you aren’t “better” or “real” fans. Most of the time you’re just a bunch of fascist wannabees who can’t see or understand alternative viewpoints..

    • Who are ‘the vast majority of Arsenal fans’ then? Where are they? What do they believe? How do you know they believe the same as you? What constitutes ’embarrassing Arsenal’?
      As for this blog ‘dying on its arse’, where is your evidence for that?

    • Sid,

      I’m surprised you’ve managed to visit a well constructed website with independent thought, rather than the perma-dross churned out by Sir Anthony Attwood. What a Sir Anthony he is, as are you

      Go on back to the self righteous cess pit that is Untold. toodle pip.

  2. “…The number of shareholders has dropped quite dramatically over the last few years, with the Uzbek and American billionaires buying shares from both small and large shareholders. Until Stan bought out most of the old Board in 2011, no one had ever owned a majority of Arsenal’s shares, ownership of the club had always been split between a number of different major shareholders as well as hundreds of smaller holdings. Even Henry Norris, the man who moved Arsenal to Islington, deliberately avoided holding a majority of shares, and the Hill-Woods and Bracewell-Smiths who succeeded him were happy to continue that arrangement…”

    This text in article implies that the majority ownership is a power grab concocted by the current majority owner, Stan Kroenke. And that the previous owners were completely passive in this respect. Which is wrong.

    Let’s just make sure we all know the underlying FACTS here, which are that the much lauded “Hill-Woods and Bracewell-Smiths”, along with Fisman, were in fact the ones who VOLUNTARILY all tied themselves into a legal lock-in agreement in which they all aimed sell out to the same buyer at the same time…..in order to maximise their gains on Arsenal shares that had been priceless family heirlooms. And they even booted Dein off the board, when he appeared to be breaking ranks – which he in fact did, in the end.

    In short the current situation of majority ownership was in fact DESIRED and CREATED by the would-be sainted “Hill-Woods and Bracewell-Smiths”…..all for their own personal enrichment.

    There is no Abominable American Bogeyman who stomped over here to destroy tradition – just an ownership concentration created by the previous owners, for their own benefit – and knowingly to to the detriment of the fans’ interests.

    Yes some people seem to suggest these saints walked on water, butter wouldnt melt in their mouths and everything was pie in the sky when the jolly good old crowd were in charge. Right….

    • You don’t give it a rest, do you? I’m not claiming, and never have, that everyone who ever had shares in Arsenal pre-Kroenke and Usmanov was a saint, but the fact is that for two generations after Norris departed, the Board was happy to maintain a plurality of ownership, because they thought that was best. They had the perks of running a top football club, but they weren’t making money from it. It is only in the last 25 years that the possibility of making money has even arisen, and for various reasons the Board members since then have cashed in. Everyone knows that. No one is trying to hide it.
      The difference between 10 years ago and now is that 10 years ago one person did not on his own decide the fate of Arsenal. So for that reason alone the situation is now worse for the club (ie for supporters) than it was, whether the one person is Kroenke, Usmanov or Father Christmas.

      • Concentrated ownership in an of itself is not good or bad. Its just what it is. The difference in Arsenal between now and 10 years ago is that Dein, Fisman and co decided to give up the fight against Abramovic and cash in. Since then Abramovic has been joined by the Abu Dhabi Crew. Its not more complicated than that. And would be no dfferent if Dein and Fisman had not cashed in – which they did.

  3. Imagine what it was like in the 1890s. 1500 shareholders, the vast majority with just 1 share, only one with more than 25 shares. All wanting to have their say but not wanting to be a director

  4. im a shareholder, proud of it, as well as the creator of the phrase ‘arsene knows’ it was my banner at white hart lane in 2004, i go home & away and care too much about arsenal really but anyway… my point is that we have nobody who knows anything about arsenal or football on our board and kronky has not said or done anything at all!, arsene runs arsenal and for now faith has been restored with or new ozil bergkamp, flamini, new ramsey and er top of the league on merit but what about when he goes? if he became a director then that could work but im very worried about kronky, he seems vile, and has no vision but fizman sold us all out, usmanov wants to invest 500m into the club i know this for a fact but kronky wont sell, its an odd situation, we have arsene for now maybe the best manager of all time, even if you dont like him for whatever reason before ozil over the last 10 years our spending was the lowest of every premier club and still top 4 & CL, we are stuck with kronky it seems with his stupid son forevermore, its going to be interesting & scary with kronky but no arsene!

  5. Not deliberately meaning to be picky here, as I’m genuinely not sure about this.

    As far as I know, the AST (Fanshare now really), own 3 shares directly for its members,

    I thought a lot of AST members are individual shareholders in their own right, and hold them privately. Its a small but rather serious distinction.

    It could be that the club have offered multiple seats to represent the fanshare collective, or the 100 seats represent shareholders that would be entitled to attend anyway, but do so under the AST umbrella. Or a mix of both.

    I have to admit, that after doing a bit more research at this point, that things might even be more complicated than that. It seems that the fanshare scheme is being rewarded for its equity by the board in some way — given seats equivalent to the shares they could buy if there were any to buy. Even then I’m not sure and would love to see it explained by someone in the know.

    Not even sure about votes at the AGM, whether the board have given them actual votes (1/fanshare), or whether they get to decide how the scheme’s actual shares are voted. The former is unlikely as it sets a dangerous long-term precedent, as Fanshare is likely to keep growing, and dilute everyone else’s control. (Of course if that is the idea or no one has realized the long-term ramifications, it might eventually change the club’s whole structure).

    • As I said in the post, the AST and Fanshare are legally and operationally separate. The AST owns 3 shares which are held in trust for all AST members. Fanshare owns 104 shares, which it has bought from other small shareholders who preferred to sell to supporters rather than to Usmanov.
      There’s no question of anyone being “given seats equivalent to the shares they could buy if there were any to buy” – they’ve bought them!

      • In case you are still monitoring this one (so annoying when the real world drags you away from the important stuff for a couple of days 🙂 ). I know that the AST and fanshare are separate, but thought they were functionally the same thing until the financial implications of the growth of fanshare required them to reconstitute it as a separate entity.

        The misconception at the center of my post was that with all the theatre over every share acquired by the two power major blocks, you (OK I), forget that they have to follow different rules, and the Fanshare easily could have quietly pulled 100+ shares together. The money was never an issue, I have no problem seeing them assembling a couple of million quid over the last couple of years.

        From the mistaken starting point that there was no way that Fanshare could assemble their shareholding without huge publicity, the rest of the post spirals into some forlorn hope that the Fanshare could be developing into a new form of direct investment by the fans into the club.

        I’m kind of sad I’m wrong, because it sets a low ceiling to what the fanshare can achieve in the long term. One upside is that most of the shareholders who wanted to sell to the main power blocks have probably done so already. With Kroenke already having what he wants and Usmanov having just made his symbolic gesture, perhaps the pressure from them on people to sell may lessen.

        Starting with the (reasonable?) assumption that the major players are not selling up anytime soon, it means that fanshare are buying from the remaining pool of 2000 or so shares. I agree that a lot have (and will) come from the shareholders who have held on until they could find what they saw as an ethical buyer.

        You also have to hope that they are trying to track down the 300 odd AWOL shares, and hopefully either can give the descendant of an Arsenal fan a nice windfall, or bring them back into the fold. After that, there are a hard core who will (rightly) hold onto their shares no matter what. It means that fanshare will cap out at well under 2000 shares.

        What was underpinning my original post was the idea that the Fanshare has money, but there are no shares to buy, and what happens then? Clearly that isn’t true now as I’d thought; but will be soon.

        So, When? I think it is a reasonable assumption that participation in fanshare will grow over time, and that they cannot acquire close to all the remaining shares. 5 years? 10?

        I still think Fanshare is a wonderful idea, even if just gives fans a sense of belonging they’ve lost in the last few years, and holding even a small part of the club in trust. I was just hoping it could be evolving into much more than that.

      • Fanshare can basically grow as long as Stan Kroenke lets it. That’s the main reason why the AST in particular, but the other supporter groups too, want dialogue directly with the owner. He is the only one who can authorise new shares being issued, and given he’s got almost 67% it won’t matter a jot to him. Alternatively he could sell Fanshare a few of his, again without affecting in any way his control. The disadvantage of that option is that he gets the money rather than the club getting it, but it’s still better than Fanshare stagnating.
        Option 3 is for Usmanov to sell Fanshare a few of his, but so far he’s shown no inclination to do that. However, at least he’s stopped actively hoovering up every spare share so that the diminishing pool of small shareholders aren’t being further diminished. Obviously he announced the purchase of 6 on Thursday, but I assume that was a one-off to go past 30%. He’s got no reason to keep buying in dribs and drabs, he needs Kroenke to sell to him for anything to change.

        The idea of Fanshare is to give supporters a stake and a real sense of belonging, not to make a takeover bid.

  6. Pingback: AGM like a walk in the Park | Arseblog … an Arsenal blog

  7. I think it’s a safe assumption that the majority of fans are too apathetic to join a trust/association.

    There are other who, like me, believe that the 4 existing groups would FAR better serve the interests of arsenal fans if they banded together. They would have one unified voice which would carry more weight – and i imagine they would find it considerably easier to attract new members (which would in turn lend further weight to their voice). I imagine the club would find it easier to liaise with one group than four.

    The imagine the stumbling block would be a 75% reduction in stakeholders and free days out however. I appreciate there are a lot of people who do a lot of good work with the best intentions but alot of that is undone by the people who they put in front of cameras who more often that not, seem more interested in developing their own profile and career off the back of arsenal.

    I think they would be much better served in sticking to bread & butter issues which affect fans on a day to day basis – ticketing, membership, matchday experience etc. Although i doubt that would get Tim Payton on Sky Sports news.

  8. If I had to pick out one issue negatively affecting the club currently, I would not point to the ownership, or the manager or even the team.

    My own personal ire would be directed at the fan base.

    People support clubs, because of the sense of family and community it engenders. There needs to exist a cherished sense of wonderment and passion about the club. The way you hold ranks, defend the players to the hilt, and always believe this is going to be our year.

    At Arsenal, this has been contaminated by isolated groups of cynical, angry individuals who feel perfectly entitled to publicly undermine our young footballers. These are the people who are setting the tone of the debate, unfortunately.

    Instead of buying a few more shares, I would welcome a more active initiative from fan groups to improve the matchday experience and bring back the love for the club amongst the fans.

    That to me is what is required more than ever.

    You can change managers, owners and players, but the fans remain.

  9. Pingback: 股东大会揭开帷幕,联赛欧冠重燃烽火 ‹ Arseblog阿森纳博客

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