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Reflections On the Change of Ownership at Ipswich
Written by PhilR on Friday, 14th May 2021 15:12

I am in my late 50s and have supported the club for as long as I can remember.

I was concerned to read comments on TWTD from a contributor recently referring to one of our new investors as an ‘offshore debt peddlar’, and it has prompted me to set out some thoughts of my own about the recent takeover at the club.

It may not have been intentional, but there is an unpleasant implication in ‘offshore’ - our investors do not come from a tax haven and I would struggle to think of a source of funds more upright than an Arizona State pension fund. I don’t know how the purchase of the club was structured, but I would expect that some or much of the investment was introduced as some form of subordinated debt.

I expect in reality the form of investment makes little difference. Most of Marcus Evans’s investment over the years was in this form – and a simple lesson from that scenario reminds us that, from the club’s perspective, this sort of debt does not behave like, for example, bank debt, and its value only really relates to the value of the business as a whole (how much of it did Marcus Evans get back?);

I don’t expect the Arizona pension fund are likely to see any repayments of any such debt from the business while the club is in League One, probably not if it gets to the Championship, I guess maybe if it reaches the Premier League… in which case frankly I wouldn’t mind too much.

The Arizona pension fund, via ORG, has provided funds for the acquisition of the club. The more interesting questions for me are what funds are also available to invest in the club now – into the infrastructure, people, ground, management, team – what might be their appetite for more investment in the future, and whether there are any other sources of funds in the background.

We would have the same questions for any acquiror. But there would be little point in buying the club without a plan and funding for investment, so I think we can safely assume that there is at least a decent scenario in place for the future. These do come across as sophisticated investors with good track records in sport investment.

The fact is that a few months ago we were stuck with an owner who had run out of appetite to invest in the club, beyond what had to be provided every year just to keep it afloat. That was a very poor scenario with only one likely outcome, which had been playing out on the pitch over the last few seasons.

The new position must be hugely preferable to that. I am just glad Evans found someone who had the desire to take the club on as the new owners have, and who made it financially feasible for him to sell.

From what I have seen and heard, the investors and new leadership come over well. I am glad to see that they clearly arrived with a plan, with people they had lined up to run the club. These look like good quality individuals who have management and leadership experience and know English football; they are what Evans lacked all those years ago when he took the hasty and (to me) extraordinary decision to remove Jim Magilton and bring in Roy Keane as manager.

As the Americans have repeated, the club needs all the right building blocks to succeed, and there seems to be systematic rebuilding going on at our club.

My biggest concern is about if and when things go wrong. I struggle to believe Marcus Evans could ever have stomached presiding over the demise of an old English footballing institution like Ipswich Town or would have wanted the name of his business to be associated with such a public failure. I am not convinced the same could be said for ORG and the Arizona pension fund representatives, sat thousands of miles away and very largely with no direct involvement.

But we will see how this pans out and I am optimistic. I think fans are right to express concerns about the outcome of Paul Cook’s first few weeks in charge on the pitch, but I am inclined to give him the benefit of the doubt – changes of management and leadership are never easy, let alone when combined with a change of ownership. I hope that the changes will have been healthy for the club and will reset things in a failing squad.

I think we should be grateful for the arrival of ambitious new owners and management, should throw ourselves as fans wholeheartedly behind them, and behind Cook and the players, and we should look forward to a period of great opportunity for the club we love.

I will also be trying to bear in mind that wholesale change can be hugely challenging, that success in League One football is not easy, and that I may need a healthy helping of patience along the way.




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ElephantintheRoom added 09:58 - May 15
Interesting. I admire your optimism. I coined the phrase 'offshore debt peddlar to sum up what the new owners were in a Toryesque 3 word slogan. In effect Town have become Manchester United Lite - a franchise funded by debt - but with a distinctly third division whiff, rather than a Superbowl winnng franchise. The purchase is funded by people looking for a return based in Ohio, taking money from an pension fund based in Arizona, fronted by people with other second rate clubs to sort out looking for a buck, using on-the-spot chancers looking for a buck that have relocated Bristol City to Ipswich. It could succeed - but why should it? Perhaps forty clubs think they belong in the Premier League. I'll grant you promotion out of the third division wrecked by Covid ought to be a strong possibility next season - but then? I have no idea what was in the powerpoint presentation that persuaded the pension fund to take a punt - but presumably it was the £100 million on offer for one season in the Prem - even taking a ten year view that is a tasty financial mirage that whetted Evans' whistle for a decade.. You may throw yourself wholeheartedly behind the new owners - but excuse me if I don't. Honeyed words and right-on phrases from Phoenix are one thing - but they are here for money based on a business plan which is perhaps moe in depth than Evans' back of a fag packet five year plan - but still has to collide with reality at some point. When does the hgh interest loan have to be repaid? And how - answer more debt. It will require more than patience. It requires more than a modicum of good fortune. And ultimately is completely unsustainable - because you cant take vast sums of money out of a small town football club - except on a powerpoint presentation .
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hyperbrit added 00:35 - May 16
....the choice was simple more of the same or this!!
2

RegencyBlue added 16:04 - May 16
You either do something or you do nothing!

Doing nothing in this situation meant Evans continuing to ruin this club. Who knows what the new ownership will bring, hopefully it will work but there is always the prospect it will not. There lies the difference though because under Evans we were definitely heading for the fourth Division and maybe worse.

At least there is some hope now, where there was non before!
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Realist added 11:47 - May 18
RegencyBlue - Your contention that ITFC was heading for the 4th Division doesn't bear scrutiny. In fact, at the time of Lambert's replacement, the club was on course for the playoffs with a 50% win record for the season thus far. Unfortunately, since Cook's tenure, we have managed relegation form with a miserable win record of 25%. Under our real estate expert new owners, should we fail to provide a profit in quick time we will be heading for administration and worse when their funding ceases.

0

RegencyBlue added 09:15 - May 19
Realist.

Are you Evans in disguise?

You have been watching the last 14 years haven’t you? Relentless long term decline because of the ticket touts inability to run a football club. No doubt you were also one of the Evans fanboys who didn’t think we would end up in the Third Division!
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Realist added 14:19 - May 24
RegencyBlue

Do you have your head in the sand regarding our "new owners"?

The decline of ITFC started long before Evans came along and probably started with us going into administration around 2003, a good 5/6 years before Evans came on board.. Evans had a go at investing in the club early in his tenure but to no avail. Howver, but for his willingness to cover our annual losses over the next 12 years we would have gone back into administration many years ago.
No doubt you are a fanboy of our much touted "new owners" the 3 lions who own 4.38% of ITFC between them. Exactly the same amount that Evans still owns all by himself.
The actual majority owner (more than 75%) of ITFC is ORG Az Secondary Opportunity Fund, a fund that has been set up to maximise a profit from real estate.
Co-owner Mark Detmer (with 1/3 of 4.38%) is a real estate expert who in an interview in the Ipswich Star today says that:
“My professional career is centred around industrial real estate and making markets," he explains, when pushed on his area of expertise.
When you make a market you absolutely represent the best interests of the parties you represent in negotiations."
With his tiny 1.46% of ITFC I guess he will be representing the best interests of the party that he represents. That would be ORG Az Secondary Opportunity Fund, the real estate fund and real owner.
Have you wondered why these 3 lions who own a paltry 1.46% of ITFC each always fail to correct journalists when they are described as "co-owners"? Technically they are co-owners, but they are just mouthpieces of ORG Az who actually call the tune.

Can you not see the dissonance between so-called "new owners" who are going to do wonders for ITFC, a football club, and the fact that the main protagonists are mostly from "real estate" backgrounds?

Just be careful of going overboard with the love for the new "owners" and wait to see where we are in 3 years time.
3

blues1 added 12:01 - May 25
Realist. You are anything but a realist. Lam wet had a 50% win rate? What planet are you on? And get ur figures right before posting rubbish. Mark Detmer, just like the other 3 new owners, and even Evan's, has 5% of the club. Not 1.46%. They are all part of the whole organisation who own between them 87.5% of the club.. And are a trio who have had success at Phoenix rising already. So stop talking bull and get behind them. Or just go and support someone else. This club doesnt need ur kind of negativity anymore. It's time to look forwards, not backwards to what's happened in the past15+ years.
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Realist added 14:51 - May 25
Blues1. You really shouldn't comment on things you cannot understand. If you could read I said "In fact, at the time of Lambert's replacement, the club was on course for the playoffs with a 50% win record for the season thus far."
Note the words "for the season so thus far".
To make clearer for you, Lambert was manager for 30 games this season and 15 were won. Ergo 50% win rate for the season.
Again you obviously do not understand percentages. The 3 lions have 5% of Gamechanger between them.
Gamechanger has 87.5% of ITFC so the 3 lions have 5% of 87.5% which = 4.38% between them. 4.38% divided by 3 = 1.46% .
Hence, they have 1.46% each.
Marcus Evans continues to hold 5% of Gamechanger so owns 4.3% of ITFC. Exactly the same as the 3 lions hold collectively.
The largest holder of Gamechanger and hence ITFC is ORG Az Secondary Opportunity LP who holds over 75% of Gamechanger.
The 3 lions are not part of ORG Az Secondary Opportunity Fund as it is an independent real estate fund owned by ORG Portfolio Management LLC who manages money on behalf of the Arizona Public Safety Personnel Retirement Scheme.
Perhaps you should get your figures right before posting rubbish.
The 3 lions have had some success at Phoenix Rising but at a club that is English National League at best and attracts gates of around 6,500. It is also the 3rd division in the US below the MLS and NASL.
As the MLS is the league where European and S American stars retire to for a last payday it is probably best not to quote a team another 2 tiers below this as a great success.
Here are a couple of web pages that may help you with your figures:
https://privatefunddata.com/private-funds/org-az-secondary-opportunity-fund-lp/

https://s3.eu-west-2.amazonaws.com/document-api-images-live.ch.gov.uk/docs/lTgK3

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PhilR added 23:30 - May 28
Realist. No doubt your percentages are correct, and yes technically ORG controls a large majority stake on behalf of APSPRS.
But who is going to call the shots? No doubt ORG will have a watching brief, and they have a representative on the Board for that purpose, but I don't expect they will have any input into how the club is run. A management structure has been put in place at the club for that purpose with people who understand English football.
I suspect in reality the investment in ITFC represents a small proportion of funds managed by ORG on behalf of APSPRS, and a minuscule proportion of APSPRS funds overall.
If I had to guess, that may make it likely funds very material to our club could be available to follow the investment, and who knows but it may mean as investors they are less likely to act precipitately if things don't go well.
The trio of other investors may have only around 1.5% of the equity, but I expect that represents a valuable investment for them personally, and they will be highly motivated to succeed, which is why ORG has put them there. They have experience and success in football in the US, which could help, but again I doubt they will have much influence on how things are run in the UK beyond their areas of expertise.
As I said, I have concerns about how these investors may act if things go wrong, and questions about resources to invest, but In the absence of a sugar daddy with limitless funds and infinite appetite to spend them, I am glad they turned up and got rid of Evans.
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BettyBlue added 07:39 - Jun 17
Mark Ashton will look after himself and when he's milked as much money from the club and owners and he's completely ruined the club he will walk just as he has done at wolves, oxford and bristol city.

yes there is a lot worse than marcus evans, hard to believe but we've found someone.
1

Crinkle59 added 22:41 - Jul 5
Just a thought on the new set up............... Bobby Robson ran it ALL Virtually on his own.
Some of it could be considered jobs for the boys .How football has changed!
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