Fans react to Carrow Road sell-off idea
PUBLISHED: 10:55 08 January 2010 | UPDATED: 07:18 02 July 2010
Norwich City fans reacted with horror today to the suggestion that Carrow Road could be sold to clear the club's debts. The shock proposition, which is among a number of ideas to deal with a record £23m debt, would leave City as tenants paying £1m-plus each year for the privilege of using the historic ground.
Norwich City fans reacted with horror today to the suggestion that Carrow Road could be sold to clear the club's debts.
The shock proposition, which is among a number of ideas to deal with a record £23m debt, would leave City as tenants paying £1m-plus each year for the privilege of using the historic ground.
It was suggested by club chairman Alan Bowkett yesterday at a press conference to confirm the level of the club's debt.
But fans were not impressed.
Pete Chambers, of Norwich, said: “I'm disturbed but not massively surprised. It would be a very bad step. The ground has been one of our saving graces. Having it has kept various parties from pulling the plug numerous times.
“If you cash it in, it doesn't leave you much to play with. You're never going to be able to buy it back.
“We've already sold off a lot of the family silver in the surrounding area, and the final jewel in the crown sitting in the middle of it all is the ground.”
He added: “That square of grass is where decades of Norwich City history has been played out. I don't like the thought that it would be someone else's decision whether it was sold and we were moved on.
“The existing board have got to take some hard decisions based on the actions of their predecessors, but there must be a way out of this situation other than that.”
Matt Worley, of Norwich, said: “My instinct is that it's a bad idea. You immediately lose one of your main assets that gives you financial ballast. If they own it they can do what they like. I'd rather pay a bit more on my season ticket - I'd pay £100 more if it meant we kept the ground.”
Matt Ware, of Norwich, said: “The ground is by far our biggest asset and we'd be losing control of it. You can only do it once and if you get into trouble further down the line you have nothing to mortgage against. It seems a fairly desperate measure.
“Not owning their own ground is something Norwich fans have sneered at other clubs about. It's always been a source of pride to us. I don't think any club wants to be lodgers in their own ground.”
Mark Burrows, of Norwich, said: “I don't like the sound of it and it's not something I would be comfortable about. And is this a good time to be selling? I'd rather we went into administration and cleared our debts that way.”
Bowkett, who was joined at the press conference by City chief executive David McNally, said there would be a £2.9m hole in the finances in 2010/11 unless new money could be found.
He said: “It may be sensible to sell the ground, pay a low rent and pay off all the debts. I'm not saying I'm promoting it, but it's one of the options.
“If it came to owning Carrow Road and not having a football club or having a team and paying rent there's no choice.”
He said a likely buyer could be Axa, the insurance firm that handed the Canaries a £15m securitisation loan in 2002 to pay for the £7m Jarrold Stand and reschedule the debts.
City currently owe Axa £11.5m of that cash, which is being paid back annually. The club's accounts put the value of Carrow Road at £34.5m, raising the prospect that selling to Axa would clear all of the debts and give the board millions of pounds to spend.
However, City would be left as tenants at the ground they have owned since it was built, and would face annual rent charges of at least £1m.
Mr Bowkett said: “We would have to pay a yield of, say, 3.5-4pc in rent. That would be perhaps £1m a year in rent every year. But we currently pay more in that each year to Axa in repayments and interest.”
The chairman, who took over from Roger Munby following his resignation in the summer, said City's board had secured the “continued support” of Axa and the other major lender Lloyds Banking Group “until at least the end of the current season”.
But he could not be certain of continued support in 2010/11, despite negotiations being “ongoing”.
And he said a number of options were being considered to plug the potential £2.9m hole in the finances and to reduce the growing debt, including:
t New ownership, which he said was “very unlikely in the current financial climate”
t New money coming in from investors
t Issuing bonds, which could put the debt repayments on a longer-term repayment schedule and provide lower interest rates than the current 7.5pc being paid for the securitisation loan
t Making City a co-operative, owned by the fans - like Barcelona in Spain - or by a combination of the fans, local councils and local businesses
t Selling Carrow Road and leasing it back.
Mr Bowkett said: “The figures make grim reading, but we have taken the club by the scruff of the neck. Thankfully our lenders have been extremely supportive.”
He said accountants Deloittes had been appointed by the club to advise on attracting investment, while international property consultants King Sturge were on board to advise on “property matters”.
Club chairman David McNally, who sat alongside Mr Bowkett at the Carrow Road press conference, said: “The action that we have taken gives us breathing space to properly evaluate each opportunity. When we joined the club we didn't have much time to sort things out.”
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