Notts County FC. A proud football club with a long tradition of shifting up and down the leagues like a lift. Here at LCM we have a love / hate relationship with The Magpies. On one hand we have lots of friends who are ‘Pies’ including the fella who runs our local junk food caravan ‘Smash-in Skins’, and good friendships with the mascots Mr and Mrs Magpie. On the other hand we have the death threats and abuse that we received when our editor ran with his Notts County massacre a few weeks ago. Love and hate, so closely aligned.
So we’ll be prepared for another round of abuse after we run the following story. Here goes Pies, get those harshly worded emails ready.
It would appear that after receiving the thumbs up from the FA, Notts County may again be under the spotlight, bizarrely enough thanks to the world of Formula One.
The Formula One world have become very interested in QADBAK, the investment company in control of Notts County. It stems from from the investment company’s proposed take-over of the BMW Sauber Formula One team.
BMW are extremely keen to offload the team, which has lost its place on the grid for next season but has been expected to get it back before the start of next season because of other withdrawals from the competition.
Investigations have uncovered that the FIA have concerns that the main man behind Qadbak is the convicted British fraudster Russell King and that the myriad companies set up relating to Qadbak over the last few months are merely shell companies covering his tracks.
The thought is that the FIA are suspicious both of King’s motives and his financial backing. Therefore they are unwilling to allocate the grid slot to Sauber until they are convinced the money is there to guarantee the future of the team and its employees.
The knock on effects for County seems to be that the longer that time goes on the less likely it is that there will be the constant flow of Middle Eastern cash. The rumour currently bouncing round Formula One circles is that the BMW-Sauber deal will collapse because the FIA simply don’t believe that Qadbak has the money to be able to safeguard the future of the team. If they don’t have the money for that, do they have the money to support County?
The attitude to any questions directed at Meadow Lane as to who owns the club could be described as ‘aloof’ and perhaps a little arrogant. Their spokesman Peter Trembling has been extremely defensive of his ‘Middle Eastern’ investors and has been quoted as saying that ‘those who need to know, know’. He has described the owners of the club as “Middle East investors”; they eventually turned out to be based in Pakistan (not the Middle East Peter but hey ho). Trembling has in fact put down any queries or negativity towards the County takeover as sour grapes, as immense jealousy. Some County fans have leveled the same accusations at LCM (which in fairness has a slight degree of truth, if it was above board, transparent and clearly legit then we would be a little jealous).
Furthermore The Guardian reported recently that there are doubts as to the validity of the letter that promised £5m guaranteed funds that persuaded Notts County Supporters Trust to hand over control of the club for a nominal consideration of £1. That guarantee was produced in May of this year, and came from a company belonging to First London, another financial services firm.
A corporate law partner at Olswang has raised doubts about whether the clause could actually be enforced:
"The letter of guarantee is quite imprecise and confusing. It refers to the guarantee being able to be invoked if Munto does not make "investments" in Blenheim 1862 [the club's holding company that was majority owned by the supporters' trust] but it does not define when and how such investments must be made.
"In addition the breadth of the wording regarding 'settlement means' would imply that Blenheim 1862 would have to seek final legal judgment against Munto before it could secure funds from First London. This is unusual.
"Also the Guarantee is addressed to Blenheim 1862 and not to the shareholders of Blenheim 1862. There is no third party rights provision that would enable the shareholders of Blenheim 1862 to enforce the terms of the Guarantee."
(quotes from The Guardian)
The First London balance sheet showed assets of £180m as at 31 March two months before the letter had been written. However their latest accounts reveal that currently First London holds just £18,657 in cash and had only £1.3m available to it in undrawn borrowings. It is unclear what First London's equity assets include, but it enjoyed an impressive year to 31 March.
First London have said that the letter seen by fans to Blenheim 1862 was actually made by a Bahrain-domiciled subsidiary. This is sadly not made clear in the letter which does in fact sport a First London letterhead, complete with a London address and is signed by a director of the UK company.
As at 31 March, the only Bahrain-domiciled subsidiary of First London was recorded as dormant.
So these could yet be very concerning times for The Pies and their fans. Certainly Formula One does seem a little stricter on the individuals involved in the sport as demonstrated with their treatment of Flavio Briatore earlier in the year which resulted ultimately in his removal from QPR as well. Perhaps this latest development at Sauber-BMW will ultimately lead to heart break for County fans.