Football Observer

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Guardian
Lord Ashcroft offers to repay Russos to keep Watford out of administration• Former chairman answers Graham Taylor criticisms
• Club hopes rights issue will raise £7.5m
Matt Scott guardian.co.uk, Friday 18 December 2009

Lord Ashcroft, Watford's majority shareholder, has offered to repay the Russos' £4.88m loans into the Championship club in an effort to avert administration.

The Vicarage Road board is awaiting legal confirmation after receiving acceptance in principle from the club's former chairman Jimmy Russo.

Once the transaction is complete Watford will proceed with a rights issue that is aimed at providing £7.5m in working capital for the club. That sum, raised from shareholders in an exercise that will be underwritten by Ashcroft, would cover the £5.5m that is required before June 2010 to keep the club afloat, while also providing a useful financial cushion.

Russo confirmed that he would accept Ashcroft's deal. "Definitely, not a problem," he told Radio 5 Live. "The sad thing is this could have all been resolved without all the pain that's gone on over the last week or so.

"We've been asking him [Lord Ashcroft] to come to the table virtually every week. But now that he's prepared to pay my debt, that's great. It's good for the club. I'm absolutely delighted. But ... why leave things to the last second?"

Russo confirmed that his threat to take the club into administration was more than mere posturing, although he would have done so reluctantly.

"When you make an announcement that you are going to put the club into administration, you've got to go through with it," he said. "Was it something I wanted to do? No, never. It's something they should have taken into account when they decided my presence was not wanted on the board, despite all the good things that we'd done for the club."

He added: "I'm relieved that this has been sorted out and disappointed that it's taken so long."

Russo also mounted a robust defence of his position after the interim Watford chairman, Graham Taylor, branded him a "bad man" earlier today for allowing the club to come to the brink.

"I thought that was a disgraceful comment," Russo said. "He should have been more selective with his words. How can somebody who has rescued the club four times, have a contribution of £9m in the club, never been paid a penny ... become a bad man? I think Graham should apologise for that comment. I think that was totally out of order and I don't think I deserved that. He should really look at that again and pick up the phone, if he's big enough."

Watford confirmed the £7.5m rights issue is going ahead. "The feeling inside the club tonight is one of huge relief," a Watford spokesman said. "The right decisions have been made by both parties for the future of the football club." Guardian


Watford Observer
Jimmy Russo and Lord Michael Ashcroft reach Hornets agreement
Friday 18th December 2009

By Anthony Matthews »

Watford fans can breathe a huge sigh of relief tonight after their club was saved from administration.

Former chairman Jimmy Russo has accepted an offer from major shareholder Lord Michael Ashcroft to repay the £4.88m lent to the Hornets.

Russo who, along with his brother Vince and close business associate Robin Williams resigned at Tuesday's annual meeting, had threatened to put Watford into administration after rejecting the terms of a £7.5m right issue proposed by Lord Ashcroft's Fordwat company yesterday.

But a deal has now been done and Russo told BBC Radio 5 Live tonight: "I'm relieved to have all this sorted out but it's disappointing it has taken so long.

"It has rescued the club and it is good for the club and I'm delighted. I didn't want to put them into administration.

"I wish the football club all the best and they have got a good future."

Despite this positive development Russo hit back at interim chairman Graham Taylor for labelling him a "bad man" following this week's events.

"I thought that was a disgraceful comment," his predecessor reportedly said. "He should have been more selective with his words.

"How can somebody who has rescued the club four times, have a contribution of £9m in the club, never been paid a penny ... become a bad man?

"I think Graham should apologise for that comment. I think that was totally out of order, and I don't think I deserved that.

"He should really look at that again and pick up the phone - if he's big enough."

Watford Observer


EARLIER TODAY

Watford Observer

Watford Supporters' Trust chairman gives his views on Watford FC crisis
11:19am Friday 18th December 2009

By Frank Smith »

Following Tuesday's dramatic AGM, Watford Supporters' Trust chairman Graham Sterry released this statement on Thursday morning with his own views on the current situation:

'I attended the AGM of Watford Leisure etc in my capacity as Chairman of Watford Supporters Trust. Since the AGM, the Supporters Trust has not been able to meet to formulate its views and there will undoubtedly be differing views and interpretations of events – some informed by having been there and through experience. Some not.

My own interpretation of events is that the 3 directors representing the interests of Valley Grown Salads (Vince and Jimmy Russo and their nominee director Robin Williams) resigned because it was clear to them that they would inevitably be voted off the Board. A major shareholder had ensured that voting be on the basis of shareholdings of those voting. That is normal practice in a formal poll. Since the Russos between them own less than 30% of shares and the counter parties own in excess of 50% of shares, there could be only one result. The VGS directors resigned rather than be voted off the Board.

However, at the same time, they demanded the immediate repayment of loans made to the Club by VGS. That immediately would force the Club into administration since it would be unable to meet its commitments. Were that to happen, the Club would immediately be docked 10 points by the Football League.

Most of the clubs in the Championship have levels of indebtedness markedly greater than ours at Watford. In saying that, I am not making light of the loans that the Russo’s have had to make to Watford; nor of the efforts that they have made to make the Club successful. But I am astounded and disappointed that anyone with the best interests of the Club at heart would take such action. It is that single act of demanding immediate repayment of the loans that forces us into administration.

Jimmy Russo was understandably emotional when he resigned. He stated, quite rightly, that he had tried to keep the Club afloat since he had taken over as Chairman. During that time, the other major shareholders (Lord Ashcroft and Graham Simpson) had not invested any new money into the club. VGS had been forced to make loans to keep the Club going. The last £1million would have run out before Christmas. In previous statements Jimmy had stated that following that he would be forced to place the Club into administration unless the other major shareholders made money available. He told the meeting that despite his phone calls, Fordwat representatives had not spoken to him. He further stated that they, VGS, had the funds and would invest, but only if VGS could acquire the Club from Lord Ashcroft and Simpson, on their terms. VGS had made a proposal to acquire their interest, but had had no response at all.

During the course of the continued AGM, and after the VGS directors had all left the meeting, it was made clear that proposals had been received by VGS and also proposals presented by Lord Ashcroft and Simpson. The Board had resolved that both of these proposals would be evaluated urgently by a sub-group of the Board comprising the independent directors, including Stuart Timperley and Graham Taylor. That evaluation was incomplete. It was obvious that the independent directors were frustrated that VGS directors had resigned and pulled the administration trigger before the independent directors had been allowed to complete evaluation.

That makes it very clear that this is all about the outright ownership of the Club. We have two groups of people who have invested in the past – one for many years - both claiming to have the funds and, crucially, the desire to continue funding the Club. We should be comfortable but for their inability to work together. Instead we are being pitch forked into administration as a device to wrest control of the Club. The Supporters Trust can only regret and abhor such destructive behaviour. We should not be facing administration.

Just to finish off, with Graham Taylor as Acting-Chairman for the meeting, the AGM continued with voting on the Resolutions before the meeting. In particular these included the election or otherwise of the Board of Watford Leisure. Graham Taylor, Stuart Timperley, David Jansen and Julian Winter were re-elected. We shall continue to support them fully in their efforts for our Club. They are going to need it, and we need them to be successful.'

Watford Observer