Great podcast, chaps. Thoroughly enjoyed it. Always been interested in this stuff and my greatest personal area of knowledge is the Francis Lee era; I was at a Manchester law firm as a junior solicitor and did some work back then both for the club and key individuals at the club. I was also involved in a fan initiative for a couple of years in the Joe Royle era that involved meeting board members a few times.
Hope you don't mind, but I jotted a few things down as I listened. No criticism implied whatsoever, as one could discuss these subjects for hours and you only had a short time. You both spoke authoritatively and knowledgeably, provoking a lot of thought among listeners. These were the points that chimed with me, so I hope you don’t mind me sharing them.
- Lee, when he bought into City in February 1994, took 29.9% of the shares (to avoid having to make an offer to all shareholders if he hit the 30% threshold), thus allowing him to make money available for transfers to help the team avoid relegation. In hindsight, he’d have probably been better off allowing the club to get relegated and go into administration, picking up 100% of the shares in the summer. But the way this deal was done, with a lot of the old Swales guard continuing to hang around, had a significant effect on what followed.
- Bernstein wasn't invited to the club by Wardle and Makin but by Franny, as Vice Chairman towards the end of 1994. The idea was for Bernstein to use his expertise and contacts to help the club prepare for a flotation and to ensure it was a success (lots of football clubs were advancing similar plans at the time). I believe that Bernstein and Lee didn't know one another but were brought together by a mutual City-supporting friend.
- After we got relegated in 1996, the financial state of the club was such that we were going to be in serious trouble if we didn't go up immediately - and it soon became clear that if we were to exit the second tier that season, it wouldn't be upwards. The club had several suitors who wanted to buy in, but chose instead a share issue that saw Stephen Boler increase his shareholding to 29.9%, and Makin and Wardle subscribe for shares (IIRC, they had about 12%, while Lee plus a couple of allies had around 19%). Bernstein, who was well known in the leisure wear sector, introduced the JD Sports pair. That was in December 1996.
- When things went wrong on and off the field, they insisted on having the right to appoint a board nominee, hence Dennis Tueart’s appointment as a Director in December 1997. He immediately promised to “rattle a few cages”, which he did. This was followed by Makin’s famous phone call to GMR after the defeat to Bury in February 1998, Frank Clark’s dismissal a few days later, and finally Lee’s resignation from the board (the other main shareholders in effect ousting him), with Bernstein taking the chair as a man for whom all factions had respect.
- Stephen Boler died at his game reserve in South Africa towards the end of 1998, by which time we were in the third tier. After promotion (in November 1999), Makin and Wardle converted their loans to shares and bought out Greenalls. In the same set of transactions, Sky bought their 9.9% holding. So this is when Makin and Wardle’s holding became the most significant bloc of shares at 29.9%. IIRC, Stephen’s son Mark Boler now had around 19% and Francis Lee around 7%. We actually had virtually zero debt at this stage, IIRC.
- I know Colin outlined all this with aplomb and that in the pod, you’re limited for time. I just think that when you see all the developments set out sequentially like this, it becomes even clearer how the enmities and factionalism came into being.
- I think you have to see the Keegan period in the context of his appointment. That came in the wake of relegation, and two years before we were to move to the new stadium. There was actually a strategy, one which Bernstein described as a calculated risk. The first stage was for Makin and Wardle to fund the club in the second tier to a level that would allow Keegan to have a real crack at winning promotion, which worked wonderfully well.
- Having won promotion, the plan was to secure serious investment from outside, which would pay the cost of fitting out the new stadium and give Keegan serious funds to buy new players after promotion. That should allow us to move to CoMS (where we had 13K extra seats to fill) with a team that played attractive football and looked destined for success.
- You can debate the wisdom of this, but IMO in 2001, there were at least some grounds to think that a top-flight Manchester City with the new stadium on the horizon might attract serious investment. Unfortunately, a year later, the arse had dropped out of the market and we were forced to go for securitisation deals instead.
- We managed to sign Schmeichel, Distin, Foe and Anelka in the summer after promotion, so we’d acquired a pretty decent spine of a team, making sure we had no relegation worries (and, indeed, we finished in the top half despite a poor end to the campaign as we played the unfit Fowler week after week). The question was where we went after that, and that’s the point at which the board started to become divided over strategy.
- I think we made a grave error by not reining ourselves in during the transfer windows of January 2003 and summer 2003 as Bernstein had wanted, but I acknowledge that such a course would have entailed Keegan leaving. I believe he did tender his resignation after the Fowler deal first collapsed – the day before the game at Newcastle where Shearer scored after about ten seconds – and took a lot of talking round. But I think Keegan is fundamentally right that if you want a manager for consolidation, it isn’t him. And I can kind of see why other directors were kind of reluctant to see him walk, just before the big stadium move
- In effect, the message of Keegan’s departure to both our fans and the wider world was that Manchester City’s ambitious plans were a thing of the past. The feel-good factor around the club would have been seriously punctured. As I say, I think we should have bitten the bullet, but I don’t believe it was an easy or palatable choice
- I think it’s worth noting that, as Colin said, we proved unable to control costs when we moved to CoMS. The figures are instructive; they’re from memory, but I don’t think I’m too far out. IIRC, we turned over around GBP 49 million in the last Maine Road season and GBP 62 million in the first year at CoMS. But at CoMS we had an extra GBP 10 million of non-wage expenses (as well as spiralling wages), which largely negated the rise in our income.
- In addition, the costs of fitting out the stadium proved far greater than we’d estimated. The board’s public estimate when we started this work after the Commonwealth Games was GBP 12 million, and eyebrows were raised at a supporters’ meeting in London in January 2003 where Bernstein offered a revised figure of GBP 20 million. As it turned out, I believe the final figure comfortably exceeded GBP 30 million. The result was that the initial GBP 30 million securitisation deal we did with Bear Stearns had to be supplemented by a further similar transaction worth GBP 14 million. But Bear Stearns declined to do that deal and we concluded it with an obscure Portuguese lender on worse terms.
- This bears out what Stefan was saying, but again, I think the detail helps to underscore his point. The first time I, looking from outside, realised that we were in truly dire straits was in February 2004, when the half-year figures came out. I remember writing a particularly gloomy review on the old Talkin’ City board (rather a niche forum, but one or two on here, including Colin, will recall it). There was a constituency of optimists who took issue, but I think hindsight proves me right.
- You talked about the mood in the 2005/6 season under Pearce. My memory is that it was fairly upbeat for a lot of the campaign. We started well and were in fourth place in November before a trip to Fulham, with Cole and Vassell combining well as our front pair. It was really when Cole got injured for the last 3 months of the season that things went wrong. We lost at home in the Cup quarter final to West Ham and lost 8 of the last 9 games to finish in the lower reaches; it was really fairly late in the campaign that the dejection really set it.
- On potentially sacking the manager in March 2007, I have no idea what they might have had up their sleeve. But just to note that Dennis Tueart’s autobiography suggested the board had considered firing Pearce and recruiting a short-term replacement to the summer. The three candidates? Graeme Souness, Lawrie Sanchez and Bryan Robson. I wish that were a joke, but it isn’t. If I’d been involved in drawing up that shortlist, I wouldn’t admit it to anyone, ever.
- I tend to agree with Stefan that the club had to go for Thaksin in the spring/summer of 2007. David Conn wrote a piece along the lines you’d expect and I responded on another forum. As is my wont, I struggled to keep it below 2,000 words, but it was copied and pasted in other places as well. Someone said it was too long to read and asked for a summary, to which someone else responded: “Yeah, he’s dodgy, but fuck it, let’s go for it.” It was a pretty fair distillation.
Really looking forward to the next podcast.
