Burnley chairman Alan Pace explains ALK Capital's offer to buy fans' shares in more detail

Burnley chairman Alan Pace has explained the whys and wherefores of ALK Capital's offer to buy fans' shares in the club.

Tuesday, 5th October 2021, 2:27 pm
Alan Pace

Shareholders who did not have an option to sell during the initial takeover of the club by ALK Capital’s investment arm Velocity Sports Partners in late December, have now received an offer, and will have 21 days to respond, with no obligation to sell.

The offer to supporters is £1,699 per share, split between £849-50 cash and the same in club credit, which can be spent on ticketing, hospitality, merchandise, or food and drink at Turf Moor.

Some shareholders have questioned whether or not the deal was the same offered to the majority shareholders - the 84% stake which ALK purchased - and Pace explained: "That is correct, we thought this was the best way we could accommodate the requests being made.

"I understand it is different, but I do believe we've found the balance, you can spend the 50% in a number of ways here, season tickets, hospitality...your money doesn't expire if you don't buy a season ticket this year, it doesn't disappear.

"We felt it was a good way to be aligned both the cash side and incentivising some fans if they wanted to take some cash off the table, as well as staying connected to the club.

"We could have just done this as making the ability to sell your shares in a third party mechanism and just taken whatever the market tells you - and that will still become available.

"There is no force here, it is just an option, we thought this was fair and the best way to approach it both for us and the stakeholders."

With the initial takeover funded by some of ALK's own money, a loan from MSD Capital, and some from own bank, how will the share purchase be made if all 6% of the minority shareholders take up the offer?

Pace said, succinctly: "That will come from our capital outside the club."

He feels the time is right to make the offer, having had a number of requests from shareholders since the takeover, but with Pace having had to get his feet under the table, complete the second half of last season, plan and execute the transfer window, and secure Sean Dyche on a new contract.

He said: "Let's be clear, we're not trying to buy the remaining shares, I'd be very comfortable if no-one wanted to sell.

"All we're doing is making available to them the opportunity that if they would like to sell, we would be a buyer for them at this particular moment.

"I took a lot of note from folks who had reached out to us during and after the takeover, but we obviously bought from the majority owners and we couldn't necessarily do anything for the minority shareholders when we took over.

"We've made it through last season and the transfer window, and just from a timing perspective, this was the right time.

"I don't think that will surprise anyone, we've also got a coach's contract in place.

"We're in a position now where we feel very comfortable making the offer, and if people would like to leave, this is a mechanism that means they can.

"There will be another mechanism available going forward if people don't want to do it now, but we have heard the feedback loud and clear, and people felt they weren't given the opportunity, so this is the opportunity.

"There will be further opportunities moving forward, just not necessarily orchestrated or conducted by ourselves - there will be a third party mechanism, an exchange if you will, available after this is done, so people who want to buy or sell shares will be able to do so, but it won't be us doing the purchasing, it will be among themselves or other investors."

Pace reiterates that there is no requirement to sell, and asked if all 6% wanted to move their shares on, he smiled: "It would probably worry me why everyone wanted out! I would think what we have done has been beneficial, and people would want to be a part of it with us, but other people, financially or for other reasons, will be interested.

"We needed to do something, and this felt like the right thing at the right time.

"I would prefer they didn't, but a number will want to for a liquidity perspective, they've owned the shares a long time and may or may not see the shares as an investment they wanted it to be.

"It feels like original purchases were historical, so there may not be the same ties, and they probably also don't see the benefit long term of being involved, that they may once have seen.

"So I wouldn't be surprised if a number do want to sell, but I don't know that I expect or encourage them one way or another."