Arsenal's Shareholders

The split among Arsenal's main shareholders has widened after Alisher Usmanov cast doubt on the club's ability to provide enough money for the team to challenge for honours. It was no surprise when the Arsenal board rejected the Uzbek-born Russian billionaire's plan to provide fresh funds for transfers as well as reducing the club's debt by issuing new shares. Arsenal's shortage of money is in part a legacy of building the Emirates Stadium which cost about £440m. They borrowed £260m with the rest coming from sponsors and other contracts that were structured with most of the money being received early in the deals, leaving little coming in now. In addition, the club's redevelopment of Highbury into flats has run into problems with the downturn in the property market and they must re-negotiate a £133m loan by April.

The share proposal was turned down because it would generate a one-off sum that might only allow them to sign a couple of players in an inflated transfer market. The club also believes that it can cope with its debt repayments. Moreover, the plan would require existing shareholders to take up their full allocation of new shares or face their stake being diluted when the process is completed. In the case of Stan Kroenke, the largest shareholder, it would have required the American to spend £20 million had they issued £70 million of shares. Usmanov has few options. He could call an extraordinary general meeting to challenge the board, but that would not get him very far. His long-term strategy may be to angle for support from the fans. There is a risk that Arsenal could end up the perpetual No.4 among the big four teams.