{"id":79142,"date":"2023-04-13T07:00:19","date_gmt":"2023-04-13T06:00:19","guid":{"rendered":"https:\/\/jackarmy.net\/wp67\/?p=79142"},"modified":"2023-04-12T20:13:55","modified_gmt":"2023-04-12T19:13:55","slug":"as-the-shareholding-is-diluted-more-the-question-is-why","status":"publish","type":"post","link":"https:\/\/jackarmy.net\/wp67\/2023\/04\/13\/as-the-shareholding-is-diluted-more-the-question-is-why\/","title":{"rendered":"As the shareholding is diluted more, the question is why?"},"content":{"rendered":"<p>Yesterday&#8217;s announcement of &#8220;investment will help fund ongoing running costs within the club and avoid more debt on the club\u2019s balance sheet&#8221; will be applauded by many and a sign of further intent from the owners but the reality could be very different &#8211; is the club heading towards a \u00a330m sale?<\/p>\n<p>This is the fourth share issue in the club in the past five months and takes the majority shareholding of Swansea LLC up to 82% ownership of the football club.\u00a0 \u00a0As a direct result &#8211; and the one of interest to the fans &#8211; is that the Trust shareholding has now been diluted to 11.5% total shareholding, of which 2.7% is the Class A shares that twelve months back made up 5% shareholding in the club.<\/p>\n<div class=\"getty aligncenter\"><a id='p_nxPPQ3RTB6nIYxPhw3IA' class='gie-single' href='http:\/\/www.gettyimages.com\/detail\/664905438' target='_blank' style='color:#a7a7a7;text-decoration:none;font-weight:normal !important;border:none;display:inline-block;'>Embed from Getty Images<\/a><script>window.gie=window.gie||function(c){(gie.q=gie.q||[]).push(c)};gie(function(){gie.widgets.load({id:'p_nxPPQ3RTB6nIYxPhw3IA',sig:'DtZZL4t5UQcuYfoY-d8q3tHFjZC92du6x0tNrFSc9Sk=',w:'594px',h:'389px',items:'664905438',caption: false ,tld:'com',is360: false })});<\/script><script src='\/\/embed-cdn.gettyimages.com\/widgets.js' charset='utf-8' async><\/script><\/div>\n<p>It is fair to point out that that 2.7% shareholding does hold 5% of the voting rights of the club but as a shareholding it is diluted in line with Class B shares every time there is a further share issue.<\/p>\n<p>There has been some strong rumours around Swansea for some time that the club has been touted about for sale and of course more recent rumours has suggested that Nigel Morris is about to be confirmed, as a minimum, as an investor in the club.<\/p>\n<p>Yesterday&#8217;s announcement added to those suggestions with further rumours that this was merely just a further step designed to ready the club for a sale to Morris with the majority owner stake now valued at a touch under \u00a325m based on current valuations of the club.<\/p>\n<p>There is, of course, nothing that we like more than a conspiracy theory when it comes to investment into the club but it does appear that we are coming further and further away from the fan owned model that we craved and valued for so many years.<\/p>\n<p>It is also possible that the money was needed to prop up the club finances which should be ringing many alarm bells with the fan representation on the board that we continue to hemorrhage money on a regular basis which would certainly account for our complete inactivity in the January window. Either way it shouldn&#8217;t just be applauded without a question as to what is happening in front of us &#8211; the club is either in a very precarious position or there is preparation for a sale.<\/p>\n<div class=\"getty aligncenter\"><a id='rovBN-02Ry94twSTa6Ah2w' class='gie-single' href='http:\/\/www.gettyimages.com\/detail\/1244170989' target='_blank' style='color:#a7a7a7;text-decoration:none;font-weight:normal !important;border:none;display:inline-block;'>Embed from Getty Images<\/a><script>window.gie=window.gie||function(c){(gie.q=gie.q||[]).push(c)};gie(function(){gie.widgets.load({id:'rovBN-02Ry94twSTa6Ah2w',sig:'Q8ouKgXH0PQXVj3BBQrhz3yy8nTDM8bvV0ai77-hJPs=',w:'594px',h:'396px',items:'1244170989',caption: false ,tld:'com',is360: false })});<\/script><script src='\/\/embed-cdn.gettyimages.com\/widgets.js' charset='utf-8' async><\/script><\/div>\n<p><strong>When &#8220;Non Dilution&#8221; is actually dilution<\/strong><\/p>\n<p>Yesterday&#8217;s Trust statement that accompanied the injection read &#8220;With the subsequent investments made in the club, the Trust\u2019s Class A permanently non-dilutable shareholding remains at 5% of course, while our Class B shareholding has been diluted to about half the level at the time of settling the legal dispute. This dilution over time was a known reality at the time of settlement as the Trust simply does not have the financial resources to avoid dilution of B Class Shares by matching new investment monies coming into the club.<\/p>\n<p>&#8220;Today\u2019s changes in no way affect the Trust\u2019s ongoing involvement and influence in the club, and our position as a Board member of the club that is permanently protected through our permanent non-dilutable A Class shareholding. We continue to engage at all levels and the dilution has no material impact on that or the work that we are doing. &#8221;<\/p>\n<div class=\"getty aligncenter\"><a id='w8iQKKbWRwhsLdntB9cnCQ' class='gie-single' href='http:\/\/www.gettyimages.com\/detail\/1250356247' target='_blank' style='color:#a7a7a7;text-decoration:none;font-weight:normal !important;border:none;display:inline-block;'>Embed from Getty Images<\/a><script>window.gie=window.gie||function(c){(gie.q=gie.q||[]).push(c)};gie(function(){gie.widgets.load({id:'w8iQKKbWRwhsLdntB9cnCQ',sig:'qCHdfYz9NPAoYzCZIH4q_77JU9m5C8MuLfzRfpV6ryw=',w:'594px',h:'396px',items:'1250356247',caption: false ,tld:'com',is360: false })});<\/script><script src='\/\/embed-cdn.gettyimages.com\/widgets.js' charset='utf-8' async><\/script><\/div>\n<p>Non-dilution is a very misleading statement given that the Class A shareholding is 47,500 shares.\u00a0 \u00a0By default the percentage of the club this relates to has been diluted to 2.7% although the voting rights of that shareholding remains unaffected.<\/p>\n<p>It is therefore factually incorrect to state that the 5% class A shares cannot be diluted as they can, and they already have been.\u00a0 The Memorandum and Articles of the ownership state this and it would also be correct that should there ever be a dividend payment then the dilution would impact that as well.\u00a0 \u00a0 The Class A shares do retain &#8211; as mentioned above &#8211; the rights of a 5% shareholder but this does not include dividends or a guaranteed 5% ownership.<\/p>\n<p><strong>So what next?<\/strong><\/p>\n<p>It genuinely is difficult to predict the next step although the rumour of Morris will not be without substance.\u00a0 \u00a0It seems inevitable that he will be playing a part in the club going forward and the smart suggestion is that he will be involved in the club at some point in the near future with strong suggestions being that his involvement will be by acquiring the shareholding of Swansea Football LLC which would, in turn, have no impact on the other shareholdings within the club.<\/p>\n<p>When and how this happens remains to be seen but it is certainly the case that there was more to yesterday&#8217;s announcement than initially met the eye.<\/p>\n<p>We think!<\/p>\n<div class=\"getty aligncenter\"><a id='H1lilfQXTHltQnE2tEZ7HA' class='gie-single' href='http:\/\/www.gettyimages.com\/detail\/1250861374' target='_blank' style='color:#a7a7a7;text-decoration:none;font-weight:normal !important;border:none;display:inline-block;'>Embed from Getty Images<\/a><script>window.gie=window.gie||function(c){(gie.q=gie.q||[]).push(c)};gie(function(){gie.widgets.load({id:'H1lilfQXTHltQnE2tEZ7HA',sig:'TbACgnIK4Dj40ajM0TkaKdpfQ0oPZPD3LmPIL-MkBxE=',w:'594px',h:'396px',items:'1250861374',caption: false ,tld:'com',is360: false })});<\/script><script src='\/\/embed-cdn.gettyimages.com\/widgets.js' charset='utf-8' async><\/script><\/div>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Yesterday&#8217;s announcement of &#8220;investment will help fund ongoing running costs within the club and avoid more debt on the club\u2019s balance sheet&#8221; will be applauded by many and a sign of further intent from the owners but the reality could be very different &#8211; is the club heading towards a \u00a330m sale? This is the [&hellip;]<\/p>\n","protected":false},"author":452,"featured_media":75902,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"cybocfi_hide_featured_image":"","footnotes":""},"categories":[293,49,203],"tags":[767,766,575,665],"class_list":["post-79142","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-first-team","category-news","category-opinion","tag-jake-silverstein","tag-jason-levien","tag-steve-kaplan","tag-the-2022-23-season"],"_links":{"self":[{"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/posts\/79142","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/users\/452"}],"replies":[{"embeddable":true,"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/comments?post=79142"}],"version-history":[{"count":0,"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/posts\/79142\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/media\/75902"}],"wp:attachment":[{"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/media?parent=79142"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/categories?post=79142"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jackarmy.net\/wp67\/wp-json\/wp\/v2\/tags?post=79142"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}