What is going on?? Rothermans Guide to the Takeover yo-yo

Last updated : 21 June 2004 By Bigrich.....

As Stephen Gerrard cracked home England's third on Thursday, only Scotsmen, Swiss nationals living in the UK and Rotherham United fans could be found staring glumly at their television screens. While the vast majority of the country cheered Rooney and his team-mates on two three Euro 2004, most Millers contemplated the same melancholy questions – why us? What have we done to deserve being kicked in the teeth once again? And, most importantly, what exactly was going on?

The answer to the first two questions is anyone’s guess – personally, I blame Sheffield Wednesday, but then I blame them for most things that go wrong in the world – but we can at least try to answer the third question. Which, in turn, might help to answer a fourth – what happens next?

So – here it is, your cut out and keep guide to events at Millmoor. Let’s start with the key question of everyone’s lips on Thursday:

Huh? The takeover’s off? I thought Freeman and Booth had agreed a deal…

So did we all, including, judging from his Radio Sheffield interview, Neil Freeman. However, the deal that Freeman and Booth “shook hands on” wasn’t actually legally binding.

All they’d done was agree heads of terms, which is a document that sets out what it is that is being bought and sold, but doesn’t actually commit anyone to anything. It’s a bit like having an offer accepted on a house – it means that both sides have a deal that they’re happy with but there isn’t a binding contract yet.

Yes, I know, but Freeman said he would be in charge by the Friday after they agreed on the Wednesday. How could it all go wrong?

Good question – and it’s a hard one to answer for certain, because neither Booth nor Freeman have made it entirely clear.

However, we do know that after Booth and Freeman shook hands, the club

Shooks Hands??
instructed lawyers (DLA in Sheffield) to draft the binding contract that would finalise the deal. To be honest, it was always unlikely that that could be done in two days – it’s an expensive and complicated process – so there wasn’t anything particularly alarming when the deal wasn’t done by the start of the next week.

However, the alarm bells did start ringing during Freeman’s fairly inarticulate performance on Radio Sheffield, when he said that there was an issue about “a bit of land”. That should have been covered in the heads of terms - any arguments, by then, should have been about the mechanism for doing the deal, not what was included and what was not. Those 30 seconds of interview showed that there was trouble afoot.

Ah yes, the “bit of land” – what is all that about?

Well, to be honest, we don’t know for sure, but from what Freeman has said during and after his Radio Sheffield interview, it seems like the land in question is some or all of the car park behind the main stand. As Carl Luckock pointed out in his Radio Sheffield last year, that land isn’t owned by the club, but by Mr Booth (either personally or through another of his companies). The reason why it’s important is fairly obvious – it’s going to be tough to build a new main stand on land that the club doesn’t own.

Now, if you believe Mr Freeman, that land was in the heads of terms that he shook hands on with Booth, but disappeared from the deal when the legal contracts were drawn up. Booth hasn’t confirmed or denied this.

But didn’t Lucock say that Booth had given that land to the club when he and Henson appeared on Radio Sheffield?

"Booth has donated the land" Lucock

He certainly seemed to say that – citing it as an example of how much Mr Booth contributed to the club. It’s all very confusing.

Freeman’s story sounds odd. If he sells the club, Booth hasn’t got any use for the land either and it can’t be worth much on its own. So why would he take it out of the deal?

It’s hard to say for certain. It could be that the land was never on offer from Booth and Freeman misunderstood what he’d agreed. It could be that Booth, after shaking on the deal, had second thoughts. After all, if the new stand were to get the go ahead but the only thing stopping it from happening was that the club didn’t own that bit of land, suddenly its value would increase. It would become what developers call a “ransom strip” – a bit like when you own all but one of a set of properties in Monopoly: you always end up paying more than the face value to whoever it is who owns it because you need it complete your set. It’s possible that Booth might have thought that, by keeping that land for now, he might end up getting, in the end, something like the £5,000,000 he originally wanted for the club.

Wasn’t this "bit of land" and whether it was being sold or not the reason why the Ron Hull takeover collapsed?

So some people said, but nothing official ever came out other than the rather vague statement that that deal wasn’t in the best interests of the club, so we just don’t know.

But this is definitely what caused these talks to stall?

Not according to the club, which says that the talks have stopped because Freeman didn’t provide evidence that he had the money and didn’t put down a deposit like he was supposed to.

So, it’s Freeman’s fault?

He says not and insists it’s all to do with this “bit of land”. Suprisingly, neither side reckons that the collapse of the deal is their fault...

MY Fault????

Probably, the truth is somewhere in between. There probably was a deadline by which Freeman had to put up a deposit and Freeman probably didn’t meet it.

If you asked him, though, Freeman would say that he wasn’t giving any deposit to Booth until the land issue was sorted. You could see it as being like buying a car and being asked to put a deposit down before the garage had said for definite whether they were including the engine in the price: you’d be unlikely to part with your cash until they’d said for certain that there was an engine in the car.

Of course, Freeman may simply not have any money. You have to say, though, that it’s surprising that the deal got this far without someone spotting this.

This sounds like stalemate. Is there any hope that the takeover could still go through?

It looks pretty dead in the water, it must be said.

However, you have to wonder how much Booth and his family want a football club’s losses to underwrite for another season. It’s not like there looks like being a lot of income from ticket sales or TV rights, so you can’t see there being much profit for them to take from the business.

Plus, it costs a lot of money to get to the stage that Freeman and Booth have reached (lawyers and accountants aren’t cheap) and neither of them made money by simply chucking cash away.

Finally, if you believe the club’s press release, there are other interested parties – who knows, there might be a whole new buyer lined up next week.

So what’s going to happen?

The Million Dollar question! It’s hard to imagine any other potential purchasers are particularly encouraged by how Freeman’s deal has panned out, so it’s a fair bet that Freeman remains the only realistic show in town.

It all smells a bit like brinksmanship. Remember when Booth departed on holiday? According to Freeman, his parting words were “just give me £4m”. It might just be that this is Booth’s last attempt to squeeze another £400,000 out of the deal, just like when Freeman pulled the plug on talks.

If so, expect a flurry of stories about the “midlands consortium” at the start of next week and lots of comments how much more the club would like to sell to a local buyer. Then, it’s up to Freeman: will he shrug his shoulders and shove in another wedge of cash just to get the deal done? Does he have the money to do it? Or will he simply give up, like Ron Hull before him?

Oi!! I ask the questions. It sounds like another depressing week?

Yep, and you’d imagine it would be followed by some depressing years if the deal doesn’t go through. It’s hard to see the present squad doing anything but struggle, because there simply aren’t enough players to see us through the season (especially without Macca until Christmas). Plus, you’d imagine that Ronnie will be off at the first opportunity and it’s a fair bet that he might take Barker, Hoskins, Sedgy and Pollit with him (after all, £250,000 would buy you any of those from the current board). And then, with a ground that’s inferior to most clubs in the league, it’s hard to see anything other than a return to bouncing between the bottom two divisions, mediocre manager succeeding mediocre manager, crowds dwindling down to 3,000 and a bitter memory remaining of that brilliant week when it looked like there was a chance that, just for once, Rotherham United might actually be looking up rather than down.