1978-79 | The self-implosion of Manchester City

nijinsky

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Yes, the documentary is striking. Swales swans around as if he owns the place (even though at that stage he doesn't - see below). Some of the sycophancy in the staged board meeting is off the charts. Meanwhile, when Book in that press conference is prodded by Swales to tell the assembled press that the chairman treated him and Malcolm fairly, he couldn't be more supine if here were starring in one of those terrorist videos where they force a hostage to endorse their demands.

Anyway, the above post makes a good point, and @Gary James has, both recently and further back, mentioned before the role of the other directors. This is something that I often neglect, such is the foam-at-the-mouth fury that afflicts me when I think of Swales and the way he ran our club. It's an issue well worth looking at, though.

We should note here that Swales didn't enjoy a majority shareholding until late 1984, when he and Stephen Boler subscribed for GBP 750K-worth of shares, after which they each held around 32% of the total number in issue. Boler was a friend of Swales and took no interest in the running of the club, simply acquiring his stake as a favour to his mate, so Swales had a de facto majority among the shareholders from this point.

So this gives rise to the question of how Swales stayed in post between 1979 and 1983 despite the series of calamities he inflicted on the club in this period (I can understand how people might have been satisfied with the club's progress and direction before 1979). If Swales owned relatively few shares at this time, who were the men who kept him in post? Few on here will be gripped by detail of machinations at shareholder level at Maine Road in the seventies, I appreciate, but I'll continue the post in case there's the odd contributor who might be interested.

(I should point out here that most of my City books with the detail on this aren't currently available to me here, so I'm relying on my memory and what I hope counts as informed speculation save to the limited extent I can factcheck online. Thus, I welcome well-sourced corrections if anyone has any).

I know Gary traces all this back to the failed takeover of 1970, in which Joe Smith and his backers acquired some shares but not a controlling interest. Nonetheless, we eventually ended up with Smith and his followers taking up directorships (the likes of Ian Niven, Simon Cussons, Michael Horwich and Chris Muir, the latter having left the board amid some acrimony but then returning later). IIRC, Smith wasn't around with any kind of profile in the later seventies, and I'm not sure what happened to him. However, the others did stay on the scene.

Swales famously joined as a 'peacemaker' between these new directors and the old guard. Nonetheless, it seems that it was the new men on the board who were much taken by Swales, while the more established boardroom figures were far less impressed. Anyone who's read Eric Alexander's autobiography knows the lack of belief in Swales on the part of his predecessor, as well, presumably, as the rest of the august Alexander family of City stalwarts.

One can only speculate what other established directors, such as club doctor Sidney Rose and John Humphreys of Umbro, thought. However, as far as I can tell (key words), the Alexanders' position at board level at some point ceased to be backed up by a major shareholding (Albert Alexander had a 28% block of shares in 1970). Frank Johnson also disappeared from the scene, and if he also disposed of his shareholding, then more than half of the club's equity changed hands in this period.

This, I think, allows us to identify one of the villains of the piece, because it's a matter of public record that the Greenalls brewery bought into the club during these years. We know that Greenalls, who remained a shareholder until 2001, had 13.9% of the shares immediately after the Lee takeover in 1994. Bearing in mind that this holding must have been substantially diluted in the Swales/Boler 1984 share issue, it could well have been in the range of 25% or more when first acquired, which would probably have been the largest single block of shares for the best part of a decade.

The sad thing was that Greenalls cared nothing for club affairs. Their interest was motivated solely by a desire to retain the right to sell their awful beer at the ground and at the social club. Thus, they backed the man in pole position, who happened to be Swales, and didn't rock the boat.

I suspect that Swales may also have picked up a fairly small individual holding in this period, and that if the likes of Niven, Cussons, Horwich and Muir (as well as Joe Smith, possibly, in the background), then it's likely that these fragments will, when combined with Greenalls, have meant that Swales could rely on almost half the shares being behind him.

Most of the rest of the shareholdings were hopelessly split into small units. Also remember that 15% of the shares were estimated in 1970 as 'missing' (mostly, I presume, very small blocks bought up by fans in the distant past and now forgotten). The passiveness of Greenalls and the holdings acquired by his fanboys would then have meant it was highly unlikely he could ever be defeated in a shareholders' meeting, and right here you have the most likely explanation for 'how he got away with it'.

There will have been no incentive for the pro-Swales board group to oust him if they wanted to keep their own positions. None of them was himself a credible figure for the chair, and since they were identified as Swales acolytes, any dominant incomer gaining a major stake in the club would surely have swept them aside with disdain.

And this is how we saw the responsibilities of the two most business-savvy directors in the late 1970s usurped by Swales. As I noted in an earlier post on this thread, the Nationwide booklet for the 1977/8 TV show referred to two directors in particular who, while not major shareholders, were independently successful businessmen bringing enviable skills and expertise to the City boardroom. By 1979, Swales had taken over the roles filled by both men.

John Humphreys, then the MD of Umbro, was cited as the "finance director". It wasn't the fault of Swales or the other directors that Humphreys died at the age of only 50 in February 1979 (after Allison's return, but before the real financial madness began) - but it was their fault that they never thought to recruit a similarly skilled specialist in his stead. And Robert Harris, another director, was chairman of Great Universal Stores. Nationwide asserted that he was "known as a fierce negotiator" and a noted financial strategist. He quit because Team Swales kept ignoring his advice.

Let's just think about this for a minute. Humphreys was a finance man from what was Britain's leading supplier of sports kits who'd had the nous and skill to negotiate with every federation represented at the 1966 and 1974 World Cups to ensure that each of the 16 teams at both events wore his company's kits. Harris was a nationally renowned operator who was chairing a major public company. These guys were running our finances. And then, instead, these matters were decided by a TV salesman from Altrincham, egged on into ruinous folly by a publican from Marple. It makes you weep.

Anyway, there you have it. The story of how City were shafted for years by having major shareholders who didn't care, an egotistical chairman on the make, and a bunch of spineless toadies who were clinging to their directors' privileges in his wake, too weak-willed and cowardly to stand up for the right thing. It's a good job we're decent these days, or else writing this stuff would make me want to go and slash my wrists
What a fantastic account of what went on at that time. It really takes you back 50 years with a stupefying reverie
Thanks for taking the time to share it with us. And the other posters for their own contribution to keeping the sometimes mind boggling history of our club alive.
 

Denis Law's Back Heel

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This thread is incredibly interesting and quite painful reading as I remember being a City fan from the late 60's and remembering all the pain that we went through.

Bearing that in mind, let nobody ever, ever forget that banner draped over the shitford end for all those years ;o)
 

spiny

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958
I was around pre Swales and it is good to read other peoples knowledge of what went on under this self promoting apology of a chairman who all but ruined City. Fit and proper ownership? Pah!!

That Greenhalls played a bigger role came as a surprise. It could not have made business sense if it was about selling their ales. (anyone remember their Grunhalle lager - totally forgetable?) Were we financially sponsoring them?

I had assumed they were like Cussons. Hard to see how a soap company benefitted from links to City.

Boler certainly had no interest in City but supported Swales.

I could understand the motivations of the minor directors but never what the above got out of it? All were local to the North West. Once Humphreys of Umbro went so did all prudent financial control. We started to rapidly decline after 1979 when he died.

If anyone knows anything more, I for one would love to hear.
 

Didsbury Dave

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34,386
Yes, the documentary is striking. Swales swans around as if he owns the place (even though at that stage he doesn't - see below). Some of the sycophancy in the staged board meeting is off the charts. Meanwhile, when Book in that press conference is prodded by Swales to tell the assembled press that the chairman treated him and Malcolm fairly, he couldn't be more supine if here were starring in one of those terrorist videos where they force a hostage to endorse their demands.

Anyway, the above post makes a good point, and @Gary James has, both recently and further back, mentioned before the role of the other directors. This is something that I often neglect, such is the foam-at-the-mouth fury that afflicts me when I think of Swales and the way he ran our club. It's an issue well worth looking at, though.

We should note here that Swales didn't enjoy a majority shareholding until late 1984, when he and Stephen Boler subscribed for GBP 750K-worth of shares, after which they each held around 32% of the total number in issue. Boler was a friend of Swales and took no interest in the running of the club, simply acquiring his stake as a favour to his mate, so Swales had a de facto majority among the shareholders from this point.

So this gives rise to the question of how Swales stayed in post between 1979 and 1983 despite the series of calamities he inflicted on the club in this period (I can understand how people might have been satisfied with the club's progress and direction before 1979). If Swales owned relatively few shares at this time, who were the men who kept him in post? Few on here will be gripped by detail of machinations at shareholder level at Maine Road in the seventies, I appreciate, but I'll continue the post in case there's the odd contributor who might be interested.

(I should point out here that most of my City books with the detail on this aren't currently available to me here, so I'm relying on my memory and what I hope counts as informed speculation save to the limited extent I can factcheck online. Thus, I welcome well-sourced corrections if anyone has any).

I know Gary traces all this back to the failed takeover of 1970, in which Joe Smith and his backers acquired some shares but not a controlling interest. Nonetheless, we eventually ended up with Smith and his followers taking up directorships (the likes of Ian Niven, Simon Cussons, Michael Horwich and Chris Muir, the latter having left the board amid some acrimony but then returning later). IIRC, Smith wasn't around with any kind of profile in the later seventies, and I'm not sure what happened to him. However, the others did stay on the scene.

Swales famously joined as a 'peacemaker' between these new directors and the old guard. Nonetheless, it seems that it was the new men on the board who were much taken by Swales, while the more established boardroom figures were far less impressed. Anyone who's read Eric Alexander's autobiography knows the lack of belief in Swales on the part of his predecessor, as well, presumably, as the rest of the august Alexander family of City stalwarts.

One can only speculate what other established directors, such as club doctor Sidney Rose and John Humphreys of Umbro, thought. However, as far as I can tell (key words), the Alexanders' position at board level at some point ceased to be backed up by a major shareholding (Albert Alexander had a 28% block of shares in 1970). Frank Johnson also disappeared from the scene, and if he also disposed of his shareholding, then more than half of the club's equity changed hands in this period.

This, I think, allows us to identify one of the villains of the piece, because it's a matter of public record that the Greenalls brewery bought into the club during these years. We know that Greenalls, who remained a shareholder until 2001, had 13.9% of the shares immediately after the Lee takeover in 1994. Bearing in mind that this holding must have been substantially diluted in the Swales/Boler 1984 share issue, it could well have been in the range of 25% or more when first acquired, which would probably have been the largest single block of shares for the best part of a decade.

The sad thing was that Greenalls cared nothing for club affairs. Their interest was motivated solely by a desire to retain the right to sell their awful beer at the ground and at the social club. Thus, they backed the man in pole position, who happened to be Swales, and didn't rock the boat.

I suspect that Swales may also have picked up a fairly small individual holding in this period, and that if the likes of Niven, Cussons, Horwich and Muir (as well as Joe Smith, possibly, in the background), then it's likely that these fragments will, when combined with Greenalls, have meant that Swales could rely on almost half the shares being behind him.

Most of the rest of the shareholdings were hopelessly split into small units. Also remember that 15% of the shares were estimated in 1970 as 'missing' (mostly, I presume, very small blocks bought up by fans in the distant past and now forgotten). The passiveness of Greenalls and the holdings acquired by his fanboys would then have meant it was highly unlikely he could ever be defeated in a shareholders' meeting, and right here you have the most likely explanation for 'how he got away with it'.

There will have been no incentive for the pro-Swales board group to oust him if they wanted to keep their own positions. None of them was himself a credible figure for the chair, and since they were identified as Swales acolytes, any dominant incomer gaining a major stake in the club would surely have swept them aside with disdain.

And this is how we saw the responsibilities of the two most business-savvy directors in the late 1970s usurped by Swales. As I noted in an earlier post on this thread, the Nationwide booklet for the 1977/8 TV show referred to two directors in particular who, while not major shareholders, were independently successful businessmen bringing enviable skills and expertise to the City boardroom. By 1979, Swales had taken over the roles filled by both men.

John Humphreys, then the MD of Umbro, was cited as the "finance director". It wasn't the fault of Swales or the other directors that Humphreys died at the age of only 50 in February 1979 (after Allison's return, but before the real financial madness began) - but it was their fault that they never thought to recruit a similarly skilled specialist in his stead. And Robert Harris, another director, was chairman of Great Universal Stores. Nationwide asserted that he was "known as a fierce negotiator" and a noted financial strategist. He quit because Team Swales kept ignoring his advice.

Let's just think about this for a minute. Humphreys was a finance man from what was Britain's leading supplier of sports kits who'd had the nous and skill to negotiate with every federation represented at the 1966 and 1974 World Cups to ensure that each of the 16 teams at both events wore his company's kits. Harris was a nationally renowned operator who was chairing a major public company. These guys were running our finances. And then, instead, these matters were decided by a TV salesman from Altrincham, egged on into ruinous folly by a publican from Marple. It makes you weep.

Anyway, there you have it. The story of how City were shafted for years by having major shareholders who didn't care, an egotistical chairman on the make, and a bunch of spineless toadies who were clinging to their directors' privileges in his wake, too weak-willed and cowardly to stand up for the right thing. It's a good job we're decent these days, or else writing this stuff would make me want to go and slash my wrists.
Oh God, it's even worse that I thought.

Did I read this correctly? Did we have NO Financial Director in the years following 1979? That has just rung a bell with me. Was it the Lee takeover or was it when Bernstein took over when someone (Alistair Mackintosh?) commented that they were astounded that the club had no FD.

Did we go 15-20 years without an FD?!?!?!?
 

petrusha

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Oh God, it's even worse that I thought.

Did I read this correctly? Did we have NO Financial Director in the years following 1979? That has just rung a bell with me. Was it the Lee takeover or was it when Bernstein took over when someone (Alistair Mackintosh?) commented that they were astounded that the club had no FD.

Did we go 15-20 years without an FD?!?!?!?

Swales in effect took over the role after Humphreys died an AFAIK never relinquished it until he left early in 1994. Under Lee, from memory Bernstein joined the board and we recruited someone below board level to handle day-to-day stuff under his supervision where needed. Football was long an astonishingly amateurish industry, still is to a degree. People would be surprised.
 

spiny

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The stars definitely aligned for us to have a fantastic chance of landing Clough in October 1973, had we chosen to pursue him. I've checked the dates in the past and Johnny Hart, who'd stepped into the job when Allison left for Palace seven months earlier, went on sick leave after Clough had left Derby but before he agreed to take the job at Brighton at the start of November. We were reported at the time as having held talks with him, but they came to nothing.

It's hard not to think that he'd definitely have taken our job if offered it, given that he was prepared to drop to a Third Division club in the south (he was quite open about loathing the south of England). This was just after Swales had stepped up and become chairman, and it's impossible to imagine Swales favouring the recruitment of Clough. However, it's possible that the board as a whole were put off him because of his open warfare with the Derby directors, which had at that stage damaged his reputation to some degree.

IIRC, @Gary James has posted in the past that Clough was interested in the City job in October 1980, as well (Gary will no doubt correct that if I'm wrong). Had we made a serious move for Clough, I'm not sure how likely he would have been to do what John Bond did and leave his current job for us.

He was also linked in the press with our job after we went down in 1983. I had the impression with that one that he might have been reminding Forest of his value with a view to attracting an offer of an improved contract, but I don't know for sure.

This fits in with Swales as Chairman of the FA England selectors that saw the appointment of Revie over Clough as England manager. Revie later walked out. Brian Cloughs comment is consistent with the narrative in Petrusha's above post, particularly I quote "This was just after Swales had stepped up and become chairman, and it's impossible to imagine Swales favouring the recruitment of Clough."

Clough said: "I'm sure the England selectors thought if they took me on and gave me the job, I'd want to run the show. They were shrewd, because that's exactly what I would have done."
 

StillBluessinceHydeRoad

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Am I right in thinking that by the mid-80s more shares were held in trust/proxy for the families of dead men than by the living and that these "shareholders" always backed Swales?
 

petrusha

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Am I right in thinking that by the mid-80s more shares were held in trust/proxy for the families of dead men than by the living and that these "shareholders" always backed Swales?

This isn't one I personally remember hearing but that doesn't mean it's untrue. If it was true, it stopped being so when Boler bought into the club, as from then on he and Swales owned nearly two-thirds of the shares between them.
 

StillBluessinceHydeRoad

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This isn't one I personally remember hearing but that doesn't mean it's untrue. If it was true, it stopped being so when Boler bought into the club, as from then on he and Swales owned nearly two-thirds of the shares between them.
Thanks. I can't remember where I heard this and so can't evaluate the source and it may be that it was a dig at City as the chaos at the club made any story of lunacy and any explanation of it credible. The more barmy the story the more credible! A decade dominated by vain megalomaniacs and toadies who couldn't even tell them how mad they were!
 

petrusha

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Thanks. I can't remember where I heard this and so can't evaluate the source and it may be that it was a dig at City as the chaos at the club made any story of lunacy and any explanation of it credible. The more barmy the story the more credible! A decade dominated by vain megalomaniacs and toadies who couldn't even tell them how mad they were!

Yes, that's spot on. Almost nothing in this period at City is too crazy to be definitely untrue!
 

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