The Trust and the Club
The Supporters’ Trust’s long term aim has been for the club to have stable ownership with healthy, transparent finances leading to success on the pitch. When the Trust was first formed it’s objective was to raise money which would be invested in the club for the benefit of supporters, whilst also at the same time acquiring a significant shareholding that would enable it to have a meaningful influence on behalf of supporters in the way the club was run.
Since Hadley Property Group (HPG) took over control of the club in February 2014 the Trust’s objectives have evolved to include an ownership model that fully involves supporters (you can read the Trust’s objectives for 2014-2016 here).
Dulwich Hamlet FC Limited is a private company, which changed ownership in the mid-2000’s when the vast majority of its 300,000 shares were acquired by Nick McCormack. At the current time, Champion Hill Stadium and Dulwich Hamlet FC Ltd (DHFC Ltd) are separate legal entities.
Greendale Property Company Limited own the freehold of the Champion Hill Stadium and surrounding locale, and has an exclusive option, through its associated company Meadow Residential, to purchase the majority holding of the issued shares in DHFC Ltd (the legal entity that runs the football club) from the Football Club’s current owner, Nick McCormack.
When Hadley Property Group took over the running of the football club in 2015, they invested considerable time and money in clearing debts and trying to get the club back on an even keel. Hadley Property Group and DHST signed a Memorandum of Understanding (since revised when Meadow took over from Hadley) which set out a common understanding and commitments relating to the proposed redevelopment of Champion Hill.
If Meadow obtained planning permission for its proposed new development of the site, which included a new stadium and community facilities, they would also have committed to exercise the option to purchase the majority shareholding in DHFC Ltd and transfer ownership of the club to the Supporters’ Trust, debt free with a working capital to ensure the Club had a healthy and sustainable future.
Work of the Fan-ownership Sub-committee
The Trust has set up a fan-ownership sub-committee to engage with the owners of Champion Hill and fans to develop a model for the Club to be fully fan-owned in the future. The Club’s present position means that we are in a unique position to plan, consult and prepare for a managed transition to a fan owned club.
● In January 2015 we held an open “Ask the Experts” meeting with representatives from 4 fan-owned clubs to give fans an opportunity to ask questions of those who have a wealth of experience of both the transition to fan ownership and running a football club.
● We have established links with key personnel at fan owned clubs – Enfield, Portsmouth, Fisher, Wimbledon and Lewes – who have all been very supportive and generous with their knowledge and advice. We will continue to make use of these links for advice throughout the process.
● We have worked closely with Supporters’ Direct, particularly with James Mathie, in relation to all aspects of fan ownership. As well as advice and guidance on the process, they provide model documents for the transition to owning the club, carry out due diligence on the club prior to taking over, and provide training for board members in relation to running the club in the future.
● We held a series of meetings with Hadley focusing on the issues surrounding the progression to fan ownership. In April 2015 Hadley issued a public statement confirming their intention to hand the club over to the fans if their planning application is successful. Hadley also brought on board, Kevin Rye, formerly of Supporters Direct, as a consultant to deal with the fan ownership issue on their behalf, which we felt at the time was a very positive move. We also worked with Hadley on the production of a business plan for the new facility alongside their preferred leisure operators which formed part of the planning application for the new development.
● In October 2016, a change in the management structure of Hadley Property Group saw the proposed redevelopment of Champion Hill move to a new company called Meadow Residential, headed up by former Hadley CEO, Peter Bennison.
● We continued to work with Meadow on the proposed redevelopment in the same manner as we had done with Hadley. During this time, Meadow’s relationship with Southwark Council became strained and in January 2017, having grown frustrated at Southwark Council not determining the planning application, decided to refer the scheme to the Planning Inspectorate to make a decision. This took the decision on whether to approve the scheme out of the hands of Southwark Council. The hearing to determine the application was due to take place in December 2017, however Meadow (acting on behalf of DHFC Ltd) lost a case against Southwark Council to renew the lease on Greendale – a fundamental component of the whole application as the new ground would be built on this land – which triggered a series of actions resulting in the withdrawal of the planning application, any funding and managing payments of the Football Club
● As a result of the withdrawal of Meadow’s planning application and funding assistance, the future of the Club is very uncertain and with the agreement over the majority shareholding still in place and held by Greendale Property Company (Meadow), there is no prospect of fan ownership at present. It is however, now the volunteers and fans of the Club who are having to pick up the pieces from this situation and try and keep the Club going. We are hopeful that if Meadow choose to sell the land to a new company and relinquish their hold over the majority shareholding, that the Trust are able to at least seek fan representation on any new Board formed.
What is Fan-Ownership?
Supporters Direct defines community ownership as a model where 50% +1 of voting rights are owned or controlled by a democratic entity with open membership, for instance a supporters’ trust. There are two models :
● Community Interest Company (CIC) which can be set up as a Company Limited by Shares, a Plc, or a Company Limited by Guarantee but which has articles which put community purposes at its heart. It has limits on dividends to shareholders, currently 20%, but has a principle of one share-one vote which allows an individual or group of people to have overall control. The shares can be bought and sold, as with any company, and this model is usually employed where large capital sums need to be raised at the outset, either to buy out an existing owner, or build a new ground, for example Portsmouth FC and AFC Wimbledon.
● Community Benefit Society (CBS) This is the model recommended by Supporters Direct, the advantage over a CIC being that the model ensures control remains in a democratic structure. There is one member-one vote so no matter how many shares a member buys they only have one vote. Further the shares are non-speculative in that they cannot be traded or increase in value, and interest payable on the shares is strictly limited and can only be paid from a trading surplus. Likewise the withdrawal of shares can be limited so that only a certain amount can be withdrawn in any one year and can only be paid from a trading surplus.
The CBS model ensures the club is run sustainably and democratic control is retained. It enables the maximum profit to be ploughed back into the club and prevents the shares being used as a vehicle for profit. Given the value of the Champion Hill ground itself and the recent history of property speculation around the Club, protecting the Club from this in the future is one of the Trust’s main aims. Hadley and then Meadow’s plan was to hand the Club over as a sustainable operation with a business plan in place, without the need for large capital sums to be raised.
For these reasons the Trust is working towards the Club becoming a CBS which is 100% owned by DHFC Ltd.