Rob DaviesSwansea City Supporters Trust have today announced, in accordance with a statement from Swansea City Football Club, that the legal action proposed against the sale of the club in 2016 will no longer go ahead.
It had long been a discussion point, with little in the way of communication around the legal action coming in recent times, that perhaps there would be a resolution and it appears that has now been reached.
The Supporters Trust agreed to follow its members overriding wishes to pursue legal action, with 81% voting in favour in 2019 but the decision to now reach a settlement with the American owners has come without a further vote – a decision that is likely to cause frustration (putting it mildly) amongst members.
In a detailed Trust statement, it confirmed that:
• 5% of the Trust’s remaining shares (approximately one-third of the shares retained post dilution) will be permanently protected against further dilution. They will become “Class A” shares and will be anti-dilutive and permanent, and cannot be sold. These will also have 5% voting rights in all decisions taken by the Club Board, both while the club is owned by the current majority owners and by any future owners. The Trust will also have 5% dividend rights in the event of dividends being paid by the club in the future.
• The Trust will have tag rights for its remaining expected circa 10% unprotected shares so that, as and when the current majority owners sell their controlling interest in the club, the Trust has the option to participate in such a sale of its remaining unprotected shares should it elect to do so.
• The Trust will also have a no-drag provision in place, so that the Trust is not obligated to sell its remaining unprotected shares as and when the current majority owners sell all or part of their shareholding in the club.
• The Trust will shortly receive a settlement payment of £0.5 million.
• In addition to the settlement payment and while the club is owned by the current majority owners, the Trust will receive a further payment of £0.5 million on promotion to the Premier League and a further £0.5 million for each season thereafter that the club is in the Premier League until an additional total of £1.5 million has been paid.
• If the club is promoted to the Premier League and the current majority owners sell their controlling interest in the club at any time during the club’s first season in the Premier League, then the Trust will receive one payment of £0.5 million as described above as well as a second payment of £0.75 million at the time of sale. For clarity, this means the Trust would receive a total of £1.25 million in this scenario.
• The Trust will be guaranteed on a permanent basis a Supporter Director on the Club Board who will continue to enjoy the same full rights and duties as other Club Board Directors. The Trust will also continue to be granted a Club Board observer (currently termed Associate Director) who will be invited to attend Club Board meetings and will also receive the same Board information as Directors of the Club.
• As part of the agreement the Trust will in future work alongside the Club to implement new initiatives aimed at encouraging more supporters to become Trust members.
In a big turnaround from its original stance to pursue legal action, Trust chair Dave Dalton said: “The Trust is pleased to have reached a resolution that is in the best interests of the Trust and football club and looks forward to a new chapter built on mutual support and co-operation.
“The Trust will shortly provide further clarifications about the agreement reached in a separate statement to its members. ”
There’s undoubtedly going to be a considerable amount of reaction to the news from all bases – we await to see what else comes out over the next days.
