Brisbane Roar’s ownership is “in the balance” according to FFA chief executive David Gallop, and today the Bakrie Group may finally find themselves stripped of their A-League license. Yet even though FFA’s intervention would bring a welcome end to the farce in Queensland, it could pose problems for future investment.
The Roar’s dramas have been well documented in mainstream media, especially through AAP journalist Vince Rugari.
In short, the club’s owners have failed to pay player and staff wages twice within three months amid a well documented fall from billionaire status to sinking ship with a reported $9 million debt.
There have been accusations of financial mismanagement thrown between the Bakrie Group and former Roar managing director Sean Dobson, further muddying waters that will likely never become clear.
Bakrie Group chairman Chris Fong has been promising fans and FFA that a sale is imminent, ever since a premature statement back in July announced that a price had been agreed with a third party.
It is now almost two months since that release, and FFA have finally issued a hardened response ahead of showdown talks today with Bakrie Group officials.
“The choice is very clear. If the Bakrie Group wants to stay in the A-League, the debts need to be addressed immediately, wages need to be paid to staff and stability restored,” Gallop said.
“We are very confident that, if necessary, we can stabilise the club, find a new investor and create a bright future for the club.
“But the current uncertainty is damaging the club and we are no longer in a position to tolerate the situation.”
Unless the Bakrie Group stumps forth a guaranteed cash injection by today or provide reasonable proof that a sale is close, it appears FFA are no longer willing to hand out second chances.
A backflip from the Bakrie Group would be no surprise if they can find parachute funds to keep the Roar on life support – they value the club at $10 million and will understandably not give that up easily.
However, FFA could still attempt to strip the license, and then likely build on the Bakrie Group’s existing negotiations with third parties to finalise a sale.
Sound familiar?
FFA are still reportedly thrashing out a deal with Dundee United chairman Stephen Thompson for the ownership of the Newcastle Jets. Former embattled owner Nathan Tinkler first sounded out Thompson earlier in the year but was forced to relinquish the Jets license after placing the club into voluntary administration.
FFA are on target to profit from one owner’s financial empire crumbling, albeit having to step in and take control of operations momentarily, and look set to do the same with another.
There is no question that both Tinkler and the Bakrie Group must cop the blame for poor governance, yet FFA have questions to answer of their own structures and practices.
Welcoming millionaire or billionaire investors with open arms and pocketing a neat license fee is a breeze. Conducting due diligence on said investors and putting in frameworks for financial sustainability is a lot harder.
Australian football ownership is not an investment at the moment. It is a charity. Owners are unlikely to see returns on their investment for years if not decades. The collective losses between A-League owners over 10 years has been reported as between $100 and $200 million.
Prior to the 2014-15 season Gallop boldly claimed that half of the 10 A-League clubs would break even or make a profit, so he clearly believes it is possible for the league to become sustainable in the near future.
Yet only Melbourne Victory made a profit, of about $1 million, and Adelaide United and Western Sydney Wanderers were the only two teams to break even. The total losses in the league from 2014-15 are thought to be $10 million, with about $2 million attributed to the Roar.
One wonders whether Gallop thought the Roar were set to break even, or at least which other two clubs he had in mind. Why were Gallop’s expectations not met? It is FFA’s job to investigate, assess and produce solutions in partnership with A-League owners.
Poor business management is not exclusive to the A-League, the NRL are currently propping up three clubs, and Australian businesses in general struggle at times in the current financial climate. Yet more has to be done to identify new, reliable owners, and also to appease them. It makes sense for FFA; they cannot continue to run A-League clubs forever.
Foreign investors are unlikely to be convinced to enter A-League ownership when they see the track record of failed ventures and the ability of FFA to strip away licenses when they fall into trouble.
That a club which has won three grand finals and two premierships can fail to break even with average crowds hovering around 15,000 is worrying, especially with the salary cap covered.
The A-League has had many winners over the first 10 years of existence – the fans, the FFA, the Socceroos, the players, the coaches, the sponsors and the broadcasters – yet there has been one distinct loser – the owners.
Improved communication and increased collaboration with owners has to happen. Loosening sponsorship restrictions – the NCIP for one – and giving clubs increased control over promotions – the generic club websites come to mind – would be a start.
A-League owners have expressed displeasure previously, and if not for Clive Palmer’s erratic nature there could once have been significant pressure placed on FFA to introduce change. Unfortunately the philanthropists get forgotten by the general football fan, much like philanthropists in the rest of the world.
A-League supporters are transfixed on the next broadcast deal and the supposedly inevitable two-team expansion, but the real concern should be directed towards how FFA can assist clubs to break even.
A further cash injection through TV money would help, but so too would the identification of reliable investors, through detailed assessment, and continued collaboration with owners to find better solutions.
Otherwise FFA may see the next bumper broadcast deal scuppered due to the collapse of one or two existing clubs.
Beny Iniesta
Guest
There's a phrase for it - it's called 'moral hazard'. You (the FFA) do the right thing by taking the license off a bankrupt club and selling it again pretty soon people realise there's no point acquiring an A-League license in the first place unless you are sure you can make a profit. If you can't make a profit, eventually you will be bled dry and as Mr. Football says, prospective buyers will wait for you to be booted out by the FFA before buying the license. So you realise that unless you can make a profit, you will lose whatever you pay in the first place plus whatever losses you sustain operating the club!! Remind me again how many A-League clubs are profitable? Reading the article - I believe it's one. Melbourne Victory. Given that, Melbourne Victory is one of the few clubs that could be sold by the present owners - they have no reason to sell though.
Beny Iniesta
Guest
(and one that bastardises a European national song Are you talking about the Brisbane Lions/ French national anthem? Certainly hasn't been sung much for the last decade!
j binnie
Guest
Bob -Strong opinions indeed. How your "old NSL pals" can compare what is happening in the HAL to what happened in the NSL over a period of 28 years is almost beyond comprehension.and to be honest casts a shadow over the rest of your comment for the blunt truth is there is no comparison to be made in both occurrences. While your criticism of the FFA in it's handling of the Roar financial situation may be warranted it has to be remembered that the FFA have already had the experience of reviving the Roar, and with the Jets,and to a lesser extent the disposal of WSW and continuing dubiety about CCM it could be said they had perhaps a little more "on their plate" than they could handle at one time.To try and resurrect the old furphy about Vic. v NSW, v QLD into this discussion is not up to your usual level of debate. The blunt truth is that the HAL has reached a level of investment that almost forbids "local football" as you term it from participating in a full time professional league so localised football bodies will tend to stay well clear of the shenanigans going on. The leadership of the FFA also comes under your umbrella of criticism but don't ever forget that same man is the guy who,only 12 years ago, was approached "cap in hand" by officialdom and pleaded with to resurrect the game which your NSL pals will tell you was deep into it's "death throes".Have you ever wondered what would have happened if he had refused??? The man is getting on,no doubt and whether he will "engineer" his successor,remains to be seen but it is highly unlikely that he will walk away from what he has created as he did in 1984 when he first recognised the integral flaws in the NSL management system, and "cut his losses" by staying away for 20 years.Cheers jb
j binnie
Guest
Waz - If you are interested when the Broncos first moved to ANZ in 1993 they actually lifted their season average crowd from around 22,000 to 43,000 this average gradually falling away to an average of 24,000 over the 10 years they played there. Since moving back to the revamped Suncorp their average for season 2003 lifted by around 4000 to 28000 and has flucuated between that figure and a 34,000 average in the following 12 years. So there is little doubt the faciliry can handle crowds greatly in excess of the 15,000 the Roar have had. While investigating these figures I found out that the running track has been ripped up in 2001 for the Goodwill games but whether they increased the grassed area in size I do not know although it does say Brisbane Olympic did play an FFA Cup match recently so ,politics aside, it could be that the original error has been rectified and the grassed area has now been increased to accomodate international (FIFA) standards. Cheers jb.
Cugel
Roar Rookie
The SL GF drew 58,912 to QEII, with five other crowds of 50K. The Broncos averaged 43K in 1992, but only 20k by 2002. Most anecdotes related a distinct dislike of the ground.
Bob
Guest
Some good stuff there, particularly Rogic back from injury and back on form. Sadly there is no "lifting the mood" if you're in Brisbane. The entire situation is a shambles and casual fans have written Roar off for next season, the Bakries may stay which would result in many (even most) active fans staying away, home attendances could plumet to 5k or less if the Bakries hang around. The financial crisis has gone on since early May, that's 4 months now, the on-field crisis has gone on since November (that's 10 months now). Put simply, how much patience can anyone expect football fans to have? And if reports are to be believed, Gallop and the FFA were aware BRFC were behind in payments 12 months ago - the Bakries have been in breach of licence for over a year and yet Gallop and the FFA did nothing - and during that time the crisis at Jets erupted, the license was revoked, the club restructured and seemingly resold. The best they have done for BRFC is a "frank discussion" this past Friday. The view now is the FFA chose to save a NSWs club over a QLD club and the knives are now out for gallop. The seeds of the same bitter political infighting that undid the NSL have been sown, QLD Football will not allow itself to be "harmonised" under the FFA as a single entity because no one trusts them up here (never have, now it seems never will) and Lowys son as a successor must now be opposed no matter what the cost it seems. At the end of season 10 on the dawn of season 11 who would have thought the knives would be out for Lowey and Gallop? Talking to old NSL mates at the weekend over a beer the consensus was "surprised it took this long. Let battle commence". We are back where we started here in QLD - and the anger directed at the FFA will shortly turn to action and niether BRFC or football generally will benefit. How's that for lifting the mood :(
Brick Tamland of the pants party
Guest
Loungo provided the cross for QPR's win overnight as well. Always thought Leckie was abit one footed but that's a hell of a goal on his left foot. Rogic just keeps impressing for Celtic and props to Deila the manager for giving him a run in the starting 11, i don't think there will be any stopping him now barring injury. I think Bangladesh are in for abit of a hard time on Thursday.
Fussball ist unser leben
Roar Guru
Just to lift the mood a bit. A couple of cracking goals from Aussies overnight. Matthew Leckie scored the winner for Ingolstadt in Bundesliga & Tommy Rogic finally embarrassed Scottish defenders like he used to embarrass ALeague defenders. Leckie's goal: http://www.youtube.com/watch?v=HPRCHOM1Ycs Tommy's goal: http://www.youtube.com/watch?v=oM7rOEdSn9U
Waz
Guest
Fuss - here's a link to a story on the NRLs rental of Robina stadium on the Gold Coast where the titans are paying up to $300k/game to hire the stadium. This is owned by the same organisation that controls suncorp so it seems unlikely Roar are getting a significantly better deal: http://www.goldcoastbulletin.com.au/sport/nrl/gold-coast-titans-to-push-for-better-stadium-agreement-saying-they-are-bleeding-money/story-fnj9yd9w-1226995933238 The whole thing is again shrouded in "confidentiality agreements" but based in this story we seem to have a hire fee comprising the following: stadium hire fee + traffic management fee + transport fee + staffing fee + cleaning fee + a variable fee that rises "exponentially" with game day attendance which for the titans can reach $300k. I again think the $50k/game hire fee quoted in that article is inaccurate based on this and all the other evidence! Frustratingly though - you and I should not need to be debating this, as public infrastructure the facts should be published.
Waz
Guest
jb/lionheart - if the broncos used it for ten years it would suggest that the location is not a big problem for Brisbane fans. Reconfigure the venue and maybe ...
JR Salazar
Guest
Shared to tumblr. Thanks!
JR Salazar
Guest
So THAT'S why Besart is playing for Victory these days...
j binnie
Guest
Lionheart - Further investigation shows that Broncos used ANZ Stadium (as it was known then) for 10 years from 1992 to 2002 and the largest crowd to watch a game there was 43,000. Cheers jb
j binnie
Guest
Lionheart -Yes the Broncos were forced to use the stadium when Lang Park was being redeveloped but artificial grass had to be used on the corners in order that the minimum pitch size be attained.I attended Broncos games there and remember quite distinctly the reports of the Broncos wingers complaining bitterly about "grass burn" so much so they were advised to wear ladies nylon pantyhose in order to safeguard their legs when diving across for a try. Your 70,000 crowds are a bit tongue in the cheek, for the opening ceremony, which was a sell out, (it was an all ticket affair), and if you Google the openeing day at 1982 Comm.Games you will see the crowd was just a touch over 61,000.Cheers jb ps So you understand ,the running track being an oval actually cut down the pitch at the extreme corners of the grass area and it was these 'triangles" of imitation grass that were added so the international pitch sizes could be attained.Imitation grass back then in the early 80's was not of the standard of the materials used today. Cheers jb
Lionheart
Guest
Is this the same stadium the Broncos used for a season or two some years back? Maybe when Suncorp was redeveloped, and I seem to recall a dispute between the two over stadium costs. They had a few games with crowdsof 70k, thereabouts, from memory. How? Don't know. ACDC also held a concert there a few years ago, and have one coming up. I read that the tour managers were disappointed they couldn't get Suncorp because of the bigger numbers. Apparently the booking was made before the Qld gov changed their rule on the number of concerts there. It's all very confusing, but Suncorp is certainly full on with services, no matter the crowd size.
j binnie
Guest
Bob - the stadium was built as an "athletics" stadium in such a manner as to have the start and finish line of any "lap race" the 400,800, and 1500 metres right in front of the "royal box". What was not realised that that "oval" cuts down the size of the central grassed area as being only of use for the high-jump,discus,javelin and other "field" sports. As you say it would not be hard to re -configure but after 30 years?????? I don't think that is going to happen ,do you?????jb
Waz
Guest
It's always the case not having the link when you need it fuss, it's not an academic exercise so we can all be forgiven.
Waz
Guest
Personally I think the "this model is better than that model" arguement misses the point - I pointed out above that Roar in the last six seasons have now had both models in place. Both failed. So it is not the model that drives a more prudent business model. So let's dispense with the model arguement - Roar have categorically proved both can fail
Fussball ist unser leben
Roar Guru
@Bob They're not my figures. The figures were published in a mainstream newspaper (either The Age, or Herald Sun). Don't know why I didn't keep the link to the article. As far as I know, no club at the time refuted the data & asked the newspaper to issue an amendment, so we can assume the data was accurate in 2012. Here is a screenshot of the information: http://i1162.photobucket.com/albums/q535/FussballIUL/Stadium%20deals_2012_HAL_zpsikrevrdl.jpg
Bob
Guest
Not the set-up, just the qualification criteria and then quarterly oversight on compliance with the licensed conditions.