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ENIC’s end game and flirting with new owners

6 min read
by Jason Fleischer
Wannabe financial analyst Jason Fleischer looks at ENIC's reign at Spurs and tries to figure out their end game and what they have planned for Spurs.

When I grow up I want to be a financial analyst. That means I want to help investors decide which companies are rough gems and which are shinny turds. Given this and given the fact that Spurs recently published our 2013 financial results I decided to try and use my skills to figure out if Spurs are a good investment.

daniel_levyWhy would I do this you may ask? Well with all the talk about Levy, Lewis and profit over glory I thought to myself, “What do Lewis and Levy see in Spurs?” This led me to a second question, “What is the best kind of owner and chairman for a football club?”

So what do Lewis and Levy see in Spurs?

At first glance it’s certainly not the headline earnings. The club only made £1.5 Million pounds in the year ending 2013. The year before the club lost over £4 million pounds. Those are pretty bad numbers.

I wouldn’t invest in business worth as much as Spurs. Last year Forbes magazine valued Spurs at £332 Million. Where is that value coming from?

That value comes from the fact that Spurs is seen as prestige asset. A prestige asset is something a rich bloke buys in order to show everybody how rich he is. Levy and Lewis aren’t those blokes though. However, they clearly recognize that those blokes are out there. They are trying to build the club into truly prestige asset.

[linequote]The club only made £1.5 Million pounds in the year ending 2013. The year before the club lost over £4 million pounds. Those are pretty bad numbers[/linequote]

They recognize that in order to do that, they need a state of the art training ground and new stadium. These things take time to do, but they are fairly easy to build. They don’t rely on chance. As long as the club remains in the top flight then these pieces can be paid for the traditional businessman way. However, the sporting side, not nearly that simple as we all know.

In 15 odd years the ENIC partnership have gradually improved the clubs on the field fortune. There has yet been a black spot, Levy’s meddling in the sporting affairs of the club, especially in the area of hiring and firing of mangers. This sets off alarm bells for any investor. Micromanaging of this level is almost always destructive and can lead crisis. The infamous 2008 season springs to mind immediately.

So based on this what is ENIC’s end game? Where are they looking to make the profit?

Levy and Lewis, who is a famous financial gambler, think they can turn Spurs into regular top 4 finishers as well as make Spurs a major force in the money markets of Asia and North America. This will make Spurs an attractive asset to a potential new owner. This actually links to the reason that Spurs are always selling our best players. Keeping the books balanced keeps the cost of sporting progress down.

This ultimately adds to ENIC’s bottom line when they eventually sell. Additionally good financial health will also attract a new owner to get involved.

So that’s what Levy and Lewis want from us. In my opinion that is their agenda at the club and I think it explains the way they currently run the club. It also explains why they don’t really care about the fans very much. They see us as the club’s goodwill and ultimately the new owner will essentially be buying us.

That brings me to my 2nd question:

What is the best kind of owner?

All of us have an idea of the best possible ownership structure. Some yearn for an Everton like “people’s club” ownership structure. Everton seems to be a team that really values its fans. Even its Twitter feed is friendly and responsive, something Spurs can only dream off.

[linequote]Levy and Lewis think they can turn Spurs a major force in the money markets of Asia and North America[/linequote]

Additionally, Everton is club that has been stable, David Moyes managing there for 11 seasons. When Moyes was announced as United manger, chairman Bill Kenwright consulted fans and kept them in the loop during the search for Moyes successor.

This sounds like a dream to  Spurs fans until you remember they haven’t won silverware since 1995. Most Spurs fans would not put up with a trophy draught of that length. So maybe that’s not the correct model.

Maybe QPR has the answer. QPR is owned and chaired by Malaysian businessman Tony Fernades. He provides funds to his mangers and unlike Daniel Levy, often consults with the fans of his club. Unlike many other foreign owners he has embraced everything that English football is.

He loves the game and he understands the fan culture and tradition, but his time at QPR has been a disaster on the field. After sacking Neil Warnock QPR just managed to avoid the drop in their promotion season by a single point. The next season he was forced to sack manger Mark Hughes after very poor start to following campaign after spending big money in the summer. As things stand QPR don’t look a sure thing for promotion this season despite having an excellent squad.

Obviously, if we are exploring ownership models we need to look at the steroid clubs Chelsea and City. These clubs have open-ended transfer budgets. They can buy and sell players as they please. They have won silverware and starred in Europe. To many fans this sounds like a dream.

However, there is a dark side to this, if a club is sold to a sugar daddy Russian or Arab, the club no longer belongs to fans. It is now a toy of its owner and none of us want our beloved club to be some fool’s plaything.

That brings me to Liverpool. American John Henry owns Liverpool. He is fairly hands off but does wade in on important issues like that of the transfer away of Luis Suarez. He has brought Liverpool stability and the club has clearly thrived under his ownership.

[linequote]ENIC will sell up soon. I do not doubt that. That has to their end game. They can’t make profit any other way[/linequote]

In a short time he has managed to restore Liverpool to the top 4 and make them serious league challengers. He has backed his manger, something Levy is often criticized for not doing.

Additionally and most importantly he respects the fans. This is reflected in his decision to expand Anfield rather than build a new ground because he does not want to loose the atmosphere at the Merseyside ground. That’s what makes him the ideal owner a mix between ambition and tradition.

ENIC will sell up soon. I do not doubt that. That has to their end game. They can’t make profit any other way. They will try and create value in anyway possible. It is our responsibility as fans to make sure they don’t ruin the club in the process.

Additionally when it comes time for new ownership we need to be united and make sure our new owner knows that Tottenham Hotspur belongs to us and we are allowing him to be our steward.

All views and opinions expressed in this article are the views and opinions of the writer and do not necessarily represent the views of The Fighting Cock. We offer a platform for fans to commit their views to text and voice their thoughts. Football is a passionate game and as long as the views stay within the parameters of what is acceptable, we encourage people to write, get involved and share their thoughts on the mighty Tottenham Hotspur.

Jason Fleischer

I’m a student studying PPE (Philosophy, Politics and Economics) at the University of Cape Town in South Africa. I have the only Townsend Shirt in the Southern Hemisphere (I think).

43 Comments

  1. Dan Mac
    03/04/2014 @ 3:47 pm

    Really good read, thanks for that.

  2. FatherJack
    03/04/2014 @ 3:48 pm

    ‘This sounds like a dream to a Spurs fan that is until you remember they haven’t won Silverware since 1995’

    Two league cups in 1999 and 2008 don’t count then.

    • 'Ang on
      03/04/2014 @ 3:55 pm

      Well, they don’t count for Everton, no.

    • Laughing Lilywhite
      03/04/2014 @ 3:56 pm

      Clearly he meant Everton haven’t won anything since ’95

    • Alan
      03/04/2014 @ 4:04 pm

      He meant the Everton situation sounds like a dream until you realise they haven’t won since ’95

      Not that Spurs haven’t won a trophy in that time

    • Niven Frey
      03/04/2014 @ 8:04 pm

      He was referring to Everton, not us.

    • J-Bonicus
      04/04/2014 @ 10:27 am

      He meant Everton haven’t won & paraded silverware since 1995. If you recall, we didn’t win anything in 1995!! Now then, I must write that this is, without doubt, the most insightful article I have had the pleasure to read in a very long time. I despise Levy and, as a knock on effect, Joe Lewis too. Year after year I pile in my circa one thousand pounds for a season ticket, only to be treated like a fool. After the debacle that is the 2013/14 season, they will expect me to cough up the same amount of hard earned, whilst being entirely unclear whether or not “Tactical Tiger Tim” will be, and I use this word in the very loosest sense, managing the team next season. Jol, Redknapp & AVB at least brought THFC back to a footing of being a Top 5 club after a couple of decades in the wilderness, attractive to top players, playing “Glory Football” and generally having something to cheer about (not so much under AVB, but you get my drift). Levy has done his very best, at every turn to bury and dismantle that feeling by selling our very best players to the clubs we are trying to match (Berbatov & Carrick to Man Utd for example). We are once again an also ran, as we were in the days of George Graham & Gerry Francis. I want, for my beloved THFC, a new stadium, a new manager and a new owner/ Chairman please.

  3. 'Ang on
    03/04/2014 @ 3:54 pm

    I studied at Stellenbosch for a bit, so I know it isn’t always easy keeping up with the Premier League while in South Africa. I would take issue with you though in that you seem a little to envious of John Henry and a little too quick to discard ENIC.

    John Henry isn’t redeveloping Anfield instead of building somewhere new just because he’s a nice guy. He’s taking the cheapest route. Anfield is already bigger than White Hart Lane so there is less to be gained from Liverpool tearing their stadium down and starting again. Make no mistake, if he was our chairman he’d not be saying that White Hart Lane should just be redeveloped.

    And as for ENIC – as you well say, everything they do is about maximising the club’s value. Levy is a shrewd businessman, not some numpty who has just got lucky 15 seasons in a row. You describe Levy’s meddling as a black spot, but actually he has taken the steps needed to keep Spurs in contention.

    What kind of owners do we want? I’d take intelligence, commitment and cash – and ENIC tick all three.

    • Laughing Lilywhite
      03/04/2014 @ 4:05 pm

      Strange how even Labour think running the country when in opposition is dead easy? but when in power they’ll happily cock it up and leave other’s to clean up the mess, mind you, that’s the benefit of hindsight I guess-mine would be that Abramovic offered to buy them out before purchasing CFC, this when a new stadium and so on were not even mentioned, but they wouldn’t sell-ENIC instead Invested heavily in the clubs future and used the Bale money and a bit more on new players when they could’ve said that money would go towards the stadium-you’re saying in essence ENIC are speculating to accumulate, but without anything other than guesswork to back up your claim? Then again, if you repeat post this each season, then you’ll be right at some stage!

      • Spurgatso
        03/04/2014 @ 6:27 pm

        Correct on every point,I’m interested to see if Hm Goverment seize Abramovichs assets,Im talking money right,thats going to throw a spanner in Chelski’s works.

      • OfftheShelf
        03/04/2014 @ 9:07 pm

        Change Labour to politicians and then blame the true culprits of this recession the (W)bankers who bankroll the Tories. I know the truth through association with Lehman Bros. As for the article it gives a different perspective on ENIC. I always believed they would always do what was best for Spurs as it would increase the value of their investment. A permanent nearly club is not what they want but I believe they are not willing to pay the players wages that would take the Spurs to the next level.

        • Laughing Lilywhite
          04/04/2014 @ 12:06 am

          Look at the top four places since the inception of the PL in 1992, then tell me ENIC have been bad for the club!-use the evidence of your own eyes as you’ll see how far above our weight we’ve been punching recently and still the moaners moan and whingers whine- Where exactly is this additional money to pay these players coming from?

          • OfftheShelf
            04/04/2014 @ 10:55 am

            I have no insight of ENIC’s intentions as to. Expenditure with Spurs but I do know that investors/wealthy men will buy an Everton etcetera and build that club up as there is no real advantage in paying a premium for Spurs when they can be easily caught.

    • Nick
      03/04/2014 @ 4:06 pm

      Also, Liverpool under John Henry has not “built” that much! The first two seasons were pretty forgettable (8th and 7th), and now in the third season they have really only had the league on the agenda… They have basically only had to build a squad able to play one game a week, and outside their starting eleven the squad is not that strong!
      Lets see much Henry is willing to spend next season when they play a little more than 38 meaningful games…

    • Niven Frey
      03/04/2014 @ 8:09 pm

      Good points apart from the most important one, and that is the success of a club, sporting and financial, ultimately emanates from the pitch. Forgive the puns but too many open goals missed, and too many own goals scored by Levy and Enic. I could make a list but I would run out of space!!!!!!!!!!!!

  4. JOHNNY
    03/04/2014 @ 4:18 pm

    A GREAT READ WAY WAY ABOVE MY HEAD BUT I AM A STAUNCH SPURS DIE HARD FROM 1960 I WOULD LOVE TO SEE A NEW OWNER WITH ENDLESS POTS OF MONEY TO SEND SPURS TO THE HEIGHTS THE SPURS FAN DESERVE AND LONGS FOR , IF HE WAS INTERESTED IN SOCCER OR JUST TO CHALLENGE THE OIL SHIEKS THE RUSSIAN BILLIONAIRES AND THE LIKES BILL GATES WOULD BE MY MAN THE CHELSEA`S AND CITY`S WOULD NOT SCARE HIM , HE WOULD HAVE TO BE NOT INTERESTED IN MAKING HUGH AMOUNTS OF PROFIT UNTIL THE TIME WAS RIGHT AND SPURS WERE BETTER OFF THAN THE BIG RED ONE THE OIL SHIEK AND THE REST IN BUYING AND PAYING THEIR WAGES SO BILL COME ON DOWN TO WHITE HART LANE OR ANYONE WHO IS RICHER MONEY DOES MAKE A TEAM NO MATTER WHAT THE SO CALLED EXPERTS MAY SAY .

    • arlombardi
      03/04/2014 @ 4:30 pm

      Look left. Locate caps lock button. Extend finger. Aim above it and press down.

    • spurian
      03/04/2014 @ 5:12 pm

      my eyes started to blead so i stopped reading your comment half way through

  5. Keano
    03/04/2014 @ 4:34 pm

    I would love owners that invest in the team in January, and realizes that all transfer business cannot possibly be done in the summer.

  6. Bazza
    03/04/2014 @ 4:50 pm

    There does seem to be a lot of contempt around for ENIC. To my mind if they were after a quick profit then their was never a better time to sell than when we qualified for the CL. I don’t go along with hating Levy and ENIC each year we end up out of the top four theory, and I don’t really think most fans do either. As a club we have seen steady improvement year on year, starting with stopping us from going bust and doing a Leeds up until now where Spurs are one of the strongest clubs in world football (financially speaking) without CL money. When we have hit trouble along the way Levy has acted, mostly correctly IMO, but with one or two questionable decscitions, namely Martin Jol, and AVB. so I think he’s entitled to carry on being supported by the majority of fans although will always have to put up with wannabe’s that think they talk a good game but are clearly not good enough to earn a living doing it. 6th richest club averaging a top 5 spot is not a badly managed club. We are unfortunately in a league that can only have 4 teams at the top table so even though more than half the clubs profiting from CL cash wouldn’t be safe from relegation in the premiership we will always be struggling to break that glass ceiling. So how about supporting the club and giving ENIC a bit of credit for not cashing in rather than eternally accusing them so that one day you might be right.

    • Hamish
      04/04/2014 @ 10:32 am

      Top read. Thanks for expressing what so many of us felt reading the “analysis” above. To add – Sherwood has mentioned already in interviews how much Levy really cares for Spurs. It won’t stop people trying to fill the internet with rather badly though-out, mean spirited nonsense.

  7. Eric
    03/04/2014 @ 5:27 pm

    A Good read. Thanks.

  8. graham
    03/04/2014 @ 5:59 pm

    It doesn’t sound like you heard the rumour that Daniel levy brought the club himself under mr Lewis umbrella for tax reasons. And he is a life long spurs fan. Also a 4.5 mill loss and 1.5 mill profit on the back of building a state of the art training ground is good business. Youre article makes no sense just nonsense

  9. Spurgatso
    03/04/2014 @ 6:30 pm

    Stick with ENIC, theres an awful lot worse.Vincent Tan anyone?

  10. Nanty
    03/04/2014 @ 9:08 pm

    What about community and fan ownership models like in Germany?

    I think we’ll start seeing that in the “recovery phase” of English football, when all the oligarchs, Middle East royals and other billionaires have moved on to other projects, leaving English clubs and the leagues in the shit.

  11. anon
    03/04/2014 @ 11:23 pm

    Thank you for a fascinating load of dribble that you wank about at home! Have you ever done a business deal??

    Its simple everything in this world has a price! Liverpools owners are currently negotiating with a an Asian group who I could give the names but won’t for a price in the region of £500m but it makes a massive difference what country these deals are done in so that’s why it hasn’t happened

    As a spurs fan in this industry you should know the Levy and Lewis will do a deal at £800m but there are no takers at this point in time!! Ask me about another club they all have a price, its called business!!

    • Fashy
      04/04/2014 @ 12:24 am

      It must be great being privy to see the intimate thinking of these owners, or you just talk a load of shit to try and sound big and clever.

  12. rich
    04/04/2014 @ 4:06 am

    The crazy thing is that me and my mates had this exact discssion and had very similar conclusions ourselves. The strange part is, none of us ever wanted to be a financial analyst. Infact we are all stupid and work as postmen and rubbish men.

    Great minds think alike!

  13. matt
    04/04/2014 @ 4:32 am

    A good article and I think a pretty coherent and accurate assessment of the strategic game plan of the Lewis/Levy ownership/managerial axis. The key player in this strategy is Joe Lewis, not Daniel Levy, although Levy is the front man for ENIC and the one who takes all the flak.

    Joe Lewis is a financial speculator, pure and simple and although he reportedly watches all the games, he is evidently not primarily motivated by glory and accomplishment on the pitch, but by the bottom line off it! Lewis is not an Abramovich (who is a genuine lover of football) and has proven conclusively that he is not willing to bankroll the club from his own, close to 3 million, GBP fortune. Hence he is in it primarily for the money and any glory and achievement that is accomplished on the playing field is a secondary consideration.

    The truth is we are the 6th wealthiest club, with the 6th largest payroll in the EPL and this has been the case for the past 5 seasons, accordingly we have actually been punching slightly above out weight for these past 5 years. As Levy’s placatory statement this week re-emphasizes, the building of the new stadium is the crucial element in the game plan to elevate us into genuine top 4 contention on an on-going basis.

    Once this final piece of the strategy has been accomplished then I believe ENIC will ultimately sell the club, to a wealthy foreign owner a la Sheik Mansour, at which point Lewis’s financial game plan will have been realised.

    • Peter
      04/04/2014 @ 10:34 am

      “Lewis is not an Abramovich (who is a genuine lover of football) and has proven conclusively that he is not willing to bankroll the club from his own, close to 3 million, GBP fortune”, I understand that Lewis is actually a massive Spurs fan that he watches every game, in addition to literally just putting in 40 million quid in return for shares (the latest such). As an aside, Lewis spends huge amounts of money on sport, namely several golf courses that he uses to donate larges sums to charity as well as http://en.wikipedia.org/wiki/Lake_Nona_Medical_City

  14. Chris
    04/04/2014 @ 7:25 am

    If you really want to be a financial analyst, learn to spell “shiny”; especially when you try to use it in your starting pitch and attempt to convince us you know what you’re talking about.

    • 'Ang on
      04/04/2014 @ 8:36 am

      A typo? He must be an idiot! Quick, ignore every point he makes and instead focus on a word that was typed incorrectly – that’s certain to be worthwhile for everyone involved!

  15. simples
    04/04/2014 @ 7:31 am

    Would you buy Spurs for £300m then build a £400m stadium before even investing in player staff, or would you buy a club that already have an upgraded large ground like Newcastle or Sunderland? hell, even West Ham when they get the olympic stadium built.

    Any new owner would be looking at needing £1,000 million by the time they purchase the club, build the stadium, invest in the first team & smash the wage structure.

    There is value in our club at present, we are caught between a rock and a hard place.

  16. patnevin
    04/04/2014 @ 8:30 am

    If Enic are the big bad wolf of your story, they’re playing it pantomime style. Even if the end game is to sell for a profit they’ve gone about it in a decent way. Tottenham are in great shape! Other than the few clubs owned by foreign billionairs…and arsenal, we sit in an enviable position. People forget we were close to folding in the not too distant past. While all the others were enjoying the new found wealth of the premiership money we were staving off closure and because of that have been playing catch up ever since. If you could go back in time to the start of the Premier league and have Tottenham on an equal footing with the rest, I think you’d be looking at a different club. If or more likely when UEFA get rid of the Europa league and turn the CL into a monster, we’ll finally have the chance to catch up properly. Other than that it’ll only happen via a Chelsea or Man City type owner. ENIC? Best we could have hoped for and i’m happy for them to remain.

  17. Eoin
    04/04/2014 @ 9:08 am

    Enjoyed that a lot, very well written.
    I am a fan of ENIC and Levy and think you have slightly sold them short to be completely honest, but i do agree with most of what yuo have said about their end game, which is perfectly fine in my opinion.
    Nice article

  18. Park Lane Spurs
    04/04/2014 @ 10:01 am

    Nice article.. but I really don’t see why everyone is all of a sudden got this big Liverpool love in.. they have had a lucky season. They have not won anything yet, they have a very thin squad and have been very lucky with injuries and no european football to play. There was no master stroke about keeping Swarez, he even put in a transfer request for FFS, it was a simple fact that the Galacticos had there sights on Neymar and Bale, so he was not in the frame for really serious offers… if Bayern, PSG, Barca or Madrid come in for him with a serious offer, 80milliion plus, £250,000 a week wages they simply won’t be able to keep him. Not because they need the money, but because he will want to leave and who can afford to take a gamble of that magnitude on a player who has had his head turned. Next year they will need to majorly invest in there squad to be able to cope and if they get a few key injuries, like we have had this season, they will struggle next year.

  19. Peter
    04/04/2014 @ 10:26 am

    Some rubbish is being said here, it’s all assumption. First of all money is being earned by ENIC through dividend payments (about 4 million in 2008 and 2007 for instance when a PLC although these have ceased recently), Levy earning something like 2 million a year (paid to ENIC as a fee) and the massive property development that is the NDP. They have just transferred a huge amount of non-stadium related NDP sites to an ENIC owned tax free shell property company. So over the period ENIC have paid themselves a not insubstantial amount of money and now have a property company that owns 150-200+ million worth of the NDP. They paid Sugar 22 million for half his stake in 2000 then the remainder for 27 million in 2007, they have increased their shareholding since with further payments in exchange for shares. They have comfortably made back what they paid Sugar already and the rest is balance sheet earnings for them

    BTW Everton aren’t owned by ‘the people’, they are owned by the shareholders who suck money out of them and are 100 million in debt.

  20. Brian
    04/04/2014 @ 10:58 am

    Cheers for the article however in my opinion I haven’t read anything I would consider an insight. The views you hold have often been debated by many Spurs fans across all trades and educations depending on what your personal feelings are towards Levy & Lewis. I was also disappointed that your choice of ideal owner was American John Henry, what Liverpool are doing at the moment is amazing but the true test of his ownership will come after this season because that’s when a good owner and great manager develop, two poor seasons by Liverpool’s standards before this one cannot be so simply pushed aside just because this season they have surpassed expectations. My guess and it is obviously a guess is that Lewis will look to sell at the right price and time because that is what he does and has previous form with at other businesses in his portfolio, but who comes in after is anyones guess but as long as the club improves or actually starts winning things we the fans will be happy regardless of whether its a plaything for a Richy Rich or not and to believe otherwise is foolish, and if you disagree go and see all the protests outside ChelsKi and City….. oh you cant because they are all happily drinking in a pub to their dominance in the top 4

  21. Blind Faith
    04/04/2014 @ 3:33 pm

    Appoint a young(ish) manager, (Laudrup, Poyet) with Premier League experience and not a continental mercenary who would probably grab the money and run in a couple of years, then give them time! Tim is proving to be a poor mans “Arry”. If Mr Levy could actually show some bottle and stick with whoever he appoints we may just get somewhere. If not he will get abuse anyway

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  23. oldyid
    05/04/2014 @ 12:49 pm

    without the clubs with mega rich sugar daddys who could leave their own clubs in fanancial melt down when they get fed up and leave, who is actually above us, the gooners , Liverpool and Everton, Everton and Liverpool would both struggle playing the extra european games, so in reality ENIC and Levy have done a pretty good job with spurs, without leaving us in a massive debt, think back when Maxwell was thinking of purchasing spurs, Sugar came in and stabilised the club, and rightly so put a wage cap in place.
    True fans would not want to risk the clubs future for a short lived golden patch just look at Leeds and Pompey was it really worth it.
    COYS

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