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Golden Share is a powerful weapon to deter vultures

CFU viewpoint - Mark Stuart-Wood

I attended Cambridge United�s AGM on Monday.

A fairly dour affair in general, it was noticeable, in my view, for the unseemly haste in which official business was run though, the lack of preparation by both some shareholders and current directors for the Q&A session which followed, and a voting process for director re-election that would have had old-time Communists weeping with joy.

Enough negativity and criticism, how about explaining � in detail for once and for all � how the CFU-supported concept of a Golden Share could work to protect important elements of the club structure from the sort of predatory vultures currently circling Chester City and Notts County?

The Golden Share is a nominal share, which would be held, in United�s case, by the supporters� trust. It has the ability to outvote all other shares and shareholders in certain tightly-specified circumstances.

In the case of the football club it would be the intention to ring fence the ground, whether owned or leased, and prevent any further sale which could endanger the club�s existence.

Another example would be to protect the potential dissolution of the club�s excellent youth development scheme which, under director of football, Jez George, is producing a crop of players for the first team as well as currently topping the Ridgeon�s League in an outstanding season.

The purpose of this share gives the holder the right of a decisive vote, effectively having a power of veto over all other shares at a shareholders meeting.

It would need to be implemented via amended clauses in the company�s Articles of Association, and should be designed, with shareholder approval, to:

- Prevent any single stake building above a specified percentage ownership level.

- To give the Golden Share holder veto powers over any major corporate action.

This could include the sale of a major asset (the ground or lease) or a subsidiary (youth development) or of the company (football club) as a whole.

If anyone wishes to question the necessity of having such an instrument available to the Fans Trust, let�s just look at another United, in Manchester.

It could have been said that a Golden Share would have prevented the Glazer cavalry from coming in and purchasing the club.

It would also have prevented a once richly-profitable � a rare achievement in modern football! � organisation from having to sell Cristiano Ronaldo in order to turn a profit this past year.

Without the sale of Ronaldo, Manchester United would have made a loss of £31.8 million � an immense figure when compared with the operating losses at Cambridge. But bearing in mind how these losses came about, the comparison is wholly relevant.

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