As he is English and the previous regime at Newcastle were widely despised, there have been no tirades of abuse being hurled at Mike Ashley during his takeover of the Geordies. There have been no blog posts or mainstream media articles questioning how the man established his wealth and there has been a complete absence of the xenophobic and, occasionally, anti-semitic histrionics that have welcomed some of members of the new group of hyper club owners. Obviously a dodgy Englishman is preferable to a dodgy anyone else.
Ashley has achieved his primary aims of getting Hall and Shepherd to part with their private cash cow and taking the club private. The rush to privatise at all the takeover clubs has been indecent. Private ownership massively reduces the number of eyes who have access to key business data. A further benefit is that there is no risk of a hostile takeover or of ownership being diluted by bothersome shareholders. So, even though full declarations must still be made to the relevant regulatory authorities, the possibility of significantly doctoring such information on a proprietary level is the paramount factor here. Furthermore, privately controlled operations are far more likely to select even more corrupt methods like the utilisation of Offshore Financial Centres (OFCs) to squirrel away illicit earnings. There is an added advantage here that a private company does not have to work alongside accounting firms to develop OFCs strategies as the route to corruption does not require the continual monitoring of accounting and financial loopholes.
Since gaining private control just a week ago, it has all gone spectacularly pear shaped for the new owner. Firstly, St James Park was raided by the City of London police. Relating to the Quest bungs inquiry and, in particular, the role of Graeme Souness in the signing of Jean-Alain Boumsong (see: http://footballisfixed.blogspot.com/2007/07/enter-fall-guys.html), this raid, although related to a prior regime, was not an encouraging backcloth to the occasion of Ashley's takeover. No doubt the issue will run and run although the fact that the police activities disappeared from the mainstream media within 24 hours is suggestive that we may struggle to find the full machinations of the ensuing investigations.
Injuries to Joey Barton and the continuing travails of Michael Owen have hardly managed to lift the gloom. Owen is a hot potato and a wise club would be wanting freedom asap but his continuing injury campaign reduces his input to merely that of a fixed overhead. Although this scenario is actually preferable to the little man being fit, Owen's financial presence still weighs on cashflow. Still, at least they have signed Mark Viduka... Allardyce has finally decided to go public about the lack of transfer funds and is now looking to sell Kieran Dyer to raise the cash for new players. Allardyce added: "the changeover has been the biggest problem we've had"; together with a more illuminating "it's Chris Mort [the new Ashley chairman] I deal with now in the main but he hasn't had that much experience in football terms".
Yesterday, it all reached a climax as Ashley had his first hissy fit day at the club. The shares of Sports Direct, Mike Ashley's business empire, lost a quarter of their value in five hours on Tuesday as a result of an "enormous" profit warning - the share price has now fallen to half the value they commanded when Ashley floated the company just five months ago. This plummeting price has been caused by the amateurish mismanagement by Ashley and his team.
In the five months since Sports Direct listed it has parted with its public relations advisers and chairman amid rancorous disagreements on communication strategy. Meetings with the City have been cancelled; calls have been left unanswered and unreturned. Even analysts belonging to the syndicate of banks who sold shares at the IPO have quickly lost enthusiasm only months after investors bought the stock, partly on their then-upbeat research. Following his presentation to City analysts, Ashley's performance was variously described as "farcical" and "a shambles". Mal Patel, analyst at Merrill Lynch, which brought Sports Direct to market in February, told clients “things to date have been much worse than our worst fears”.
Ashley's stomach churning self-deprecating humour when explaining his disastrous performance to the powerful City analysts obviously took it out of him as, just hours later, he was sacking Freddie Shepherd. Now, nobody can feel sorry at Shepherd's departure. He leaves with a fat wallet and he'll, no doubt, seek out some other project to abuse financially. The most revealing aspect of the sacking was Ashley's kneejerk responsiveness to a week of bad news - he was looking for a cat to kick and Shepherd was that fat cat.
Equally important to Newcastle fans should be the charges of mismanagement that have been thrown at Ashley following the Sports Direct debacle. Everybody close to the operation has lost faith in the man and even Ashley himself admitted: "we couldn't do any worse kind of thing - I think that would be my report card".
Poor management style, no strategy, financially inept, kneejerk decision-making, inappropriate merger and acquisition schedule, an inability to perceive the big picture are exactly the deficient attributes that should be most worrying to Toon fans.
In the wise words of Paul Gascoigne "I never predict anything and I never will" but, despite this proviso, we would like to suggest that there may well be chaotic times ahead.
© Football Is Fixed/Dietrological
