Youth Team Star
Sep 11, 2019, 6:21 PM
I get the bit about a limited company but if I search for, say, Arsenal, there are quite a few that appear to be related to the football club but which one would you have to buy to own the club and its FA affiliation? That might be relatively easy to work out for a club like Arsenal but what about a club at step 4,5 or 6?
I could incorporate a club called W&H 2020 Ltd but that wouldn't mean I own the club. Accounting information on Companies House is not sufficient to work it out either. Equally a club can be owned by a company whose name is not related to the club itself.
You'd have to do due diligence as to what you were actually buying, and ideally make sure it was included in the buying agreement or contract.
You might simply agree a sale of the registration and assets of the club rather than the company that holds them (in fact it might conceivably be held by a sole proprietor or association rather than a company). Equally you might buy the company without some or all of the assets.
Probably different leagues have different rules about how club registrations and assets can be transferred between owners. Holding companies can and do change at every level, and it used to be reasonably commonplace for a bankrupt team to fold the holding company leaving creditors unpaid, form a new limited company and then transfer the assets over. But that gradually became to be seen as unfair competition with respect to teams that did live (slightly more) within their means, hence why there are sanctions against teams doing this now.
At the lowest levels I doubt many teams are actually incorporated - they'd probably be considered to be partnerships or more likely unincorporated associations whereby the 'principal officers' (e.g. manager and club secretary) are essentially trustees for any assets but are also liable for losses. Something that many of those involved don't appreciate.
Getting back to Companies House, only companies with turnover greater than a few million (can't remember the exact figure) have to publish detailed accounts. The rest can publish abbreviated accounts which don't really reveal much about their assets or ongoing viability. The bigger clubs may also have multiple companies to demarcate non-core parts of their business from the club itself, just in case some particular business venture goes belly up or even for tax reasons.
So I think the only answer is that you have to ask a lot of questions if you want to buy a club!
(This post was edited by knmeynell on Sep 11, 2019, 6:27 PM)