Kroenke set to buyout Usmanov in £1.8 billion Arsenal deal

Arsenal
striker Pierre-Emerick Aubameyang.

REUTERS/Darren
Staples

• Stan Kroenke, who owns 67% of Arsenal FC, has made an
  offer to buy the remainder of the club.
• The deal values Arsenal, one of Britain’s top soccer
  clubs, at £1.8 billion ($2.33 billion).
• Arsenal’s second-biggest shareholder, Russian
  billionaire Alisher Usmanov, has reportedly agreed to the deal,
  meaning the takeover should go through easily.
• The Arsenal Supports Trust are concerned that taking
  the club private will “neuter [fans’] voice and
  involvement.”

LONDON — Arsenal shareholder Stan Kroenke is set to take full
control of the North London football club as part of a deal
valuing the team at £1.8 billion.

Kroenke currently owns just over 67% of Arsenal FC and on Tuesday
KSE, his Delaware-based holding company, announced an all-cash
offer to buy all the shares in the club it doesn’t already own.
The company is offering £29,419.64 ($38,116.50) in cash for each
share, valuing the entire club at £1.8 billion.

KSE said it has received “irrevocable undertaking” to buy out
Arsenal’s second-biggest investor, Russian-Uzbek billionaire
Alisher Usmanov. Usmanov owns just over 30% of the club through
his vehicle Red and White Holdings.

Kroenke has been battling Usmanov for control of Arsenal for over
a year. Usmanov made a £1 billion ($1.3 billion) bid to buy the
American businessman’s stake in the club in May 2017, an offer
that was rejected.

Usmanov’s large ownership stake means that if he agrees to the
terms set out on Tuesday, Kroenke’s takeover bid becomes binding
and he can force non-compliant shareholders to sell up.

Stan Kroenke.
Steve
Dykes/Getty

KSE said in its offer that the takeover will “result in the
opening of a new chapter in the history of the Club” and said
that: “KSE believes moving to private ownership will bring the
benefits of a single owner better able to move quickly in
furtherance of the Club’s strategy and ambitions. KSE is a
committed, long-term owner of the Club.”

Kroenke said in a statement: “We at KSE are moving forward with
this Offer leading to 100% ownership of the Club. We appreciate
Mr Usmanov’s dedication to the Arsenal Football Club and the
storied ethos and history the Club represents.”

The Arsenal Supports Trust, which represents over 1,000 fans of
the club,
said in a statement on Tuesday morning that the deal “will
see the end of supporters owning shares in Arsenal and their role
upholding custodianship values.”

“The most dreadful part of this announcement is the news that
Kroenke plans to forcibly purchase the shares held by Arsenal
fans,” the Trust said. “Many of these fans are AST members and
hold their shares not for value but as custodians who care for
the future of the club. Kroenke’s actions will neuter their voice
and involvement. It is in effect legalised theft to remove
shareholder scrutiny on how Arsenal is managed.”

Kroenke, who
is worth an estimated $8.3 billion according to Forbes, made
money in real estate before becoming a sports mogul in the US. He
owns NFL team the Los Angeles Rams and NBA team the Denver
Nuggets, among others. He began building his stake in Arsenal in
2007 after buying a 9.9% holding from ITV.

Arsenal last year parted ways with Arsene Wenger, who had managed
the club for over 20 years after they finished the season 6th in
the Permier League, their worst position since 1992. Unai Emery,
the former manager of Paris Saint-Germain, was appointed in his
place.

Deutsche Bank is advising KSE on the takeover deal.