'Show us the money Sisu', says John Mutton over Ricoh talksCOVENTRY council leader John Mutton has issued a public appeal for Sky Blues owners Sisu to “show us the colour of your money” in Ricoh stadium part-ownership talks.
He said further lengthy talks at the Council House yesterday were “positive” – but added any deal was a long way off, given huge potential “show-stoppers”.
It is despite the Sky Blues’ hopes a deal can be struck soon, which might enable the deficit-hit club’s accounts to be signed off, the Football League’s player transfer embargo to be lifted, and a clear business plan for next season starting in August, following relegation to Division One.
The talks came as the Alan Edward Higgs Charity publicly expressed its desire to sell its half stake in Arena Coventry Limited, in which Coventry City Council holds the other 50 per cent of shares.
But any agreement between the Higgs charity and Sisu would need to be approved by the council, which owns the freehold to the stadium and land around it.
Coun Mutton told the Telegraph Sisu were a long way off offering a deal to satisfy the council’s requirements of investment in the football club and Ricoh, and the development of surrounding land for job creation – which was all “inextricably linked”.
Yesterday’s two-and-a-half hour talks took place between council representatives Coun Mutton, deputy council leader George Duggins, chief executive Martin Reeves and finance director Chris West; Sisu’s Joy Seppala and an unnamed events management company she brought to the table for the first time; Sky Blues’ chief executive Tim Fisher and Paul Barber; and Higgs charity’s Peter Knatchbull-Hugessen and Paul Harris.
Coun Mutton said: “There are huge obstacles to the way forward and there are some potential show-stoppers, which are not necessarily in the council’s control.
“We will want to make certain any additional revenue that may be generated through the Ricoh Arena primarily goes into the football club, not to pay off Sisu’s investors. We want to see some investment in the football club.
“I don’t think we’re that much closer to putting a package together that’s in everybody’s interests. There is a lot of work to be done.”
He said another potential showstopper was “whether Sisu and the Higgs charity could come to an agreement over price”.
Coun Mutton continued: “We’ve re-iterated the potential show-stoppers and asked questions.
“We’re saying if, and it’s a big ‘if’, they do become part owners this would be the only way they could go forward, because there is nowhere near sufficient profit from the Ricoh Arena to bail out the losses of the football club.”
Asked about talks over investment in hotels and leisure facilites to regenerate land around the stadium – to create jobs and in the longer term support the Ricoh and football club’s finances – he said: “I would want to see the colour of their money.
“There was talk of a deal being incremental. I said I want back-to-back contracts – they can’t buy into the Ricoh on the promise something in the future would be done. We need to protect taxpayers’ property and money.
“Sisu say they recognise the importance of having hotels built, and that the figures they have put together, which they didn’t disclose to us, include an amount for building hotels.
“The implications of what they’re saying leads me to believe finance is available. How much remains to be seen.
“If they want to buy out existing loans (a £15million mortgage is owed to Yorkshire Bank), and the Higgs charity shares (previously estimated at £10million based on a formula) there needs to be finance available, as well as for the football club and regeneration.”
He added: “While I’ve seen a number of options I haven’t seen a firm business case which shows adequate levels of resources will go into the football club to be competitive next season.”
The football club is losing millions a year, and has lost half its income automatically by this year’s relegation to English football’s third tier, including in lost TV revenue.
Of the new presence in talks of a major events management company, Coun Mutton said Sisu and the council were “looking at bringing in additional expertise to maximise returns for the Ricoh Arena.”
He added: “They’d be helping to run the Ricoh Arena, and bring other events in, including concerts.”
As reported in the Telegraph this week, Coun Mutton expressed concern about ongoing low profits for the Ricoh – expected by some to be around £1million this year – in the absence of hotels around the stadium to support more conference bookings.
Ricoh chief executive Daniel Gidney hit back in yesterday’s paper by pointing to expected higher ACL profits than last year’s £470,000, £5million in new investment including extra hotel beds later this year, and attracting the Olympics, rock giants Coldplay and the 2015 Rugby World Cup.