CAST meeting with Peter Storrie

CAST board members Heather McKinlay (Chair) and Heather Alderson (Vice Chair) recently met via Zoom with Peter Storrie, Charlton Athletic’s CEO. Tom Rubashow (CAFC Head of Communication) was also in attendance. The meeting notes have been agreed with the club.

The meeting came about after CAST wrote to Marc Spiegel copying Peter Storrie once Spiegel’s name was in the public domain concerning a potential acquisition of the club. Peter explained that it was not appropriate for Spiegel to meet with fans while legal and financial due diligence was underway but that he would share the discussion with him.

Heather M gave an introduction to CAST, outlining the mission to protect, preserve and promote CAFC for this and future generations and highlighting that CAST is one of the most active Supporters’ Trusts in the EFL. Heather A sits on the National Council of the FSA and attends structured dialogue meetings between the FSA & EFL. CAST gave evidence directly to Tracey Crouch’s panel for the Fan Led Review upon which the Government’s white paper on football reform is based. CAST is constituted democratically and independent of the football club. Our present focus is to keep our members and fans in general aware and informed of what is happening at the club. We seek to have a constructive and mutually beneficial relationship with the ownership of the club. Initially we thought this was going to be possible with Thomas Sandgaard but it has not turned out that way.

CAST thanked Peter for his swift response in agreeing to meet and acknowledged the importance of having a CEO in place with experience and knowledge of the English game. Supporters in general welcome signs of forward planning and investment such as Dean Holden’s contract and some player contract renewals as well as the strengthening of the management of the club.

Peter gave an overview of his background in football. He is a football fan first and foremost and was born 800 yards from Upton Park. It was his dream job to become the first ever managing director of West Ham, the club he supported. He held this role for most of the 1990s and built up the academy until having a disagreement with the chairman over sales of young players  Bringing through young players is core to his beliefs. He went on to work for Southend United then Notts County before joining Portsmouth on the recommendation of “one of my closest friends” Harry Redknapp under Milan Mandaric. This was initially a great time until latterly when Portsmouth faced ownership difficulties as Charlton has recently been going through: “Portsmouth had three different owners in six months…none of those people had any money”.

He has continued to be involved in football as a consultant working initially in Australia for Central Coast Mariners and now for Millonarios in Colombia and Padova in Italy as well as some involvement with Lens in France – these three all for the same owner, Joseph Oughourlian. He became involved with Charlton after receiving a phone call from Thomas Sandgaard whom he did not know until that point. Sandgaard said he had been recommended to him and was looking for someone to help out following the breakdown in other negotiations. They met up. Initially he was asked to take on the CEO role “for six few weeks but this has already gone into the end of May and who knows what will happen after that”. His role is to restructure the club, look at the forecasts for the year end and handle the due diligence. “Although I work for Thomas I have also been doing a lot for Marc with Thomas’ agreement to help him understand where the club is going forward.” He stressed the importance of realistic budgets and targets and steadying the day-to-day structure and management of the club.

CAFC is presently taking up most of his time. He met Marc Spiegel on the same day he first met Thomas Sandgaard. He works for Sandgaard and speaks with him every few days and is also in daily contact with Spiegel, who is very enthusiastic and keen to move things forward. He is assisting with the financial due diligence process which is being conducted by Deloittes and advised that legal due diligence is also underway. He said it is hard to put a timeline on these type of things, but there is impetus to get to an SPA (Sale and Purchase Agreement) as soon as possible. Once the SPA is finalised and agreed, applications can then be made to the EFL. Storrie has personally passed the EFL’s owners and directors test with respect to his position at Charlton. This took two days but it will take much longer for investors from outside of the country/English football.

Heather A probed on the proposition regarding investment in CAFC given the present financial state of the club and negative cashflow forecast. Peter admitted that the club was losing significant money and that this would likely continue next season. The squad needs further rebuilding over the summer. New players coming in will hopefully give fans more optimism.

The proposition for investors is “outside my domain and it will be up to Marc to explain that once he is in a position to do so”. There are no false promises/ rumours going out to supporters – “It is better these things are done in confidence.” Peter said that English football was attracting a lot of interest from the States and around the world. The priority has to be to get out of League One, with plans focussed on achieving at least a top six finish next season. The investors know that the club will likely make a loss this season and next.

Peter is in discussion with Dean Holden about player recruitment. He assisted Thomas in the signing of Holden on a three year contract, which Thomas was very keen to finalise. Holden has so far been working with an inherited squad so the summer will give him the chance to bring in more of his choice of players if he so desires. Peter acknowledged the importance of actions rather than words.

CAST asked about future plans regarding The Valley and training ground. Peter said these are “on the agenda” but that the number one priority was to take charge of the football club. He admitted that the balance sheet valuation of the assets was unrealistic but that the annual rental was realistic and was well negotiated. There have not been any direct discussions between Marc Spiegel and Roland Duchatelet or his representatives at this stage to Peter’s knowledge and is unlikely at this stage of the due diligence.

When asked, he stated that he was not aware of the detail regarding future source of funding, whether Spiegel was acting with other investors and whether or not Sandgaard will retain any form of stake. Marc is the main lead as far as he knows, but Peter is not part of these discussions. He said that such matters would become clear on conclusion of a deal.

CAST outlined the background to the development of the Addicks’ Charter. Peter had read it and sent it to Marc Spiegel who felt it was generally aligned with his thoughts. In terms of football management, Peter, Dean, Steve [Gallen] and Ron [Dangerfield] work together and hold weekly meetings.

Peter said he was also presently dipping in and out of the government’s white paper on football reform. When he went through the shenanigans at Portsmouth he proposed that new owners should demonstrate proof of funds via an ESCROW account but this was not taken further. He foresaw an “interesting few months” in regards to the implementation with the differing perspectives of the EFL and the Premier League. He thought Charlton should support it but that was his opinion only and he is not the owner. The EFL will want unanimous backing from its clubs. CAST believe the white paper should form a key part of due diligence in terms of future significant changes in the legislative landscape for football and hoped that it would be something that Spiegel or any future owner of the club would embrace.

Peter stressed that he is "an open person" and invites engagement from fans. He did wish to emphasize that Thomas Sandgaard has put significant sums of money into the club and, as he understands, saved the club from Administration a couple of years ago. Equally he recognised that Charlton is a sleeping giant, as are several clubs in League One, and the club needs to get back to the Championship and consolidate its position there. CAST agreed that the club is at its best when it pulls together.

CAST raised the subject of the forthcoming Fans’ Forum (Thu 23rd March) and asked if Thomas Sandgaard was due to attend. Peter said he would check this. He will be there as CEO of the football club and will answer questions as openly as he is able to do so.

CAST asked what would happen if this takeover fell through – were there plans and budgets in that scenario? Peter felt progress was positive and unlikely to fall through but this was not a matter for him, but that the target was a top six position in any case, with different scenarios for player budgets. CAST asked about Thomas Sandgaard’s breakeven strategy. Peter highlighted that the Academy investment at Charlton was high for a League One club and said he felt that the only way to breakeven in League One was to sell players, but that would then be detrimental to promotion prospects.

We asked about the launch of season ticket sales. The club are presently working on the detail and the launch is likely to take place within the next few weeks. CAST raised concerns about fans’ apathy and disengagement which could lead to a large drop in season ticket numbers and stressed the importance of pricing given the impact of the cost of living on fans. The club highlighted that they too are facing cost challenges with the uplift in the minimum wage and energy costs but equally appreciate the issues for fans. All agreed that there will be a need to build positive momentum and that to a great extent this will come from optimism regarding on the pitch as well as stability and security off it.

Post Meeting Thoughts

CAST welcomed the openness of the meeting with Peter Storrie in his role as acting CEO. We found him to be much more realistic about the challenges of running a League 1 football club than Thomas Sandgaard, who of course thinks it's easy. We hope that Peter's knowledge will bring a bit of calmness and stability to the day to day operations.

It was news to us and, and no doubt to others, that Peter had passed the EFL Owners' and Directors' Test. In practice that means that he can act on behalf of the club without fear of EFL sanctions around eligibility. Supporters will remember that the club was sanctioned during the ESI period due the failure to pass various EFL tests.

It was also encouraging to hear from Peter that Marc Spiegel sees the Addicks' Charter as 'generally aligned with his thoughts' and we look forward to discussing this further with him if his investment  / takeover goes ahead.

We understand restrictions on sharing information while due diligence is taking place. It seems clear that the current potential investors have no experience in EFL League One. We tried hard but gleaned nothing from the meeting to allay our concerns that there might be a lack of transparency around the proposition being made to investors which would enable the club to progress both on and off the field. The club is loss-making, it is in debt, and future cash flows are more likely to go down rather than up in the short to medium term. Without The Valley & Sparrows Lane, the club has few assets worth speaking of beyond a few players. Given what we have been through repeatedly since before the sale to Roland Duchatelet, we will continue to push hard for answers about the structure of the deal, the investors themselves, their source of funding and their motivations.

More immediately, we are concerned about the approach to season ticket pricing. Whilst we appreciate some costs have gone up, and forgive us for borrowing the language of Katrien Meire, only very strong businesses can pass cost increases on to their 'customers' without seeing a reduction in sales.  If incoming investors are serious about making Charlton a success, making sure we definitely finish top 6 next season, now is the time to invest in rather than squeeze the 12th man & woman. The draft Addicks' Charter says Charlton fans expect 'It is affordable for fans to watch & attend matches'. Surely it would be better to freeze or reduce prices in order to fill more seats, rather than increase prices and hope that the fewer fans coming each week can nevertheless sing at the top of their voices to make Valley Floyd Road reverberate around the stands?


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