Leeds United: Dylan’s astonished by LLP development

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From a meeting involving 15 fans three months ago to the launch of a plan to buy shares in the club today, Leeds Fans LLP has come a long way in 100 days as Dylan Thwaites tells the YEP’s Phil Hay.

It began as a small gathering of like-minded Leeds United fans, all of them keen on the concept of supporter-led investment at Elland Road. Three months on, the launch of a plan to buy shares in the club will invite United’s fanbase to join the movement en masse.

Tomorrow marks exactly 100 days since a meeting in late December prompted the creation of Leeds Fans LLP, a group which hopes to bring a minority stake in United under the control of the club’s support.

The body will unveil the first part of its scheme tomorrow morning with the stated aim of raising between £5m and £10m through financial commitments from fans.

The investment plan was effectively given the go-ahead last week when the Financial Conduct Authority (FCA) cleared and registered it. For the past three months a network of more than 100 fans – all of them offering assistance for free – have provided legal, financial and other specialist help needed to convert the initial idea into a viable project. Its credibility now rests on the interest and take-up among Leeds’ wider support.

Dylan Thwaites, the entrepreneur who has fronted Leeds Fans LLP since its formation, said he was “astonished” that the scheme was already in place and ready to begin gathering funds. “To be in this position after 100 days is pretty incredible,” he said. “Those of us who were there at the start, and there were 15 at the first meeting, took this on knowing full well that there was a high likelihood of failure early on and a possibility of problems at every turn.

“In your naivety you start by thinking you’ll just set up a website and ask supporters to donate money. Then you look into the numerous implications – security, legal matters, issues of FCA compliance – and the amount of work needed to make the scheme secure, to give it integrity, is massive.

“Every time we’ve hit a hurdle, someone somewhere has helped us to clear it. We’ve been diligent and we’ve done things properly because we didn’t want to launch a half-baked scheme. The idea of supporter investment has been serious from the start.”

The details of the plan will be revealed at a press conference in Leeds tomorrow. Initially, Leeds Fans LLP talked of selling 100,000 stakes at a cost of £100 each, with every stake carrying one vote and individual fans limited to a maximum purchase of 1,000 stakes. The intention, Thwaites told the YEP in January, was to avoid a situation where “one supporter puts in £5m and controls everything.” The group still needs that sort of sum to have a chance of buying a meaningful share in United.

The plan as it stands now is different and more complex but still based on the same principles of inclusion and mass participation. Thwaites said Leeds Fans LLP would use “three vehicles – in other words, three means of selling stakes in the organisation – to target different sections of United’s support. The first of those three vehicles will be unveiled tomorrow and the other two at a later date.

Leeds Fans LLP is employing the same legal firm, DWF, which assisted a highly successful community share issue scheme launched by FC United of Manchester in 2010. The club set out with the intention of raising £750,000 but ultimately amassed around £2m. Thwaites argues that the size and the reach of Leeds’ support should allow Leeds Fans LLP to exceed that figure.

“When I see what we’ve done in three short months, it makes me think that our targets are achievable,” he said. “I definitely think the interest is out there.”

These are, nevertheless, the opening exchanges of a long and unpredictable game. At the outset Leeds Fans LLP targeted the minority stake in United controlled by Gulf Finance House, describing the Bahraini bank’s involvement at Elland Road as “toxic”.

The group is yet to engage GFH about a possible sale of its shares and it has not spoken directly to Massimo Cellino, Leeds’ disqualified owner, about his own enthusiasm for supporter involvement at boardroom level. Thwaites, however, has met more than once with club chairman Andrew Umbers and was among Umbers’ guests for a 2-1 win over Ipswich Town last month.

There is confusion too about precisely how many shares GFH has to sell. Following its sale of Leeds to Cellino last April, the bank was said to have retained control of a 25 per cent stake in Leeds. A revised ownership statement published by United on their official website last Friday implies that GFH’s shareholding in Leeds United Football Club Ltd is actually lower than three per cent.

The two parties expect to return to a 75-25 per cent split in the near future but the division of equity at Elland Road has been fluid and unclear ever since Cellino began trying to renegotiate the original share purchase agreement (SPA) signed when he first bought the club from GFH. Leeds Fans LLP want GFH’s 25 per cent stake, if indeed the bank owns that much.

“The picture’s not exactly clear,” Thwaites admitted. “But our attitude has always been that before we approached Cellino, GFH or anyone else, we needed our scheme to be off the ground and running.

“Money in the bank would show the direction we’re going in and also show that we’re serious. The fact that I was in the directors’ box with Andrew Umbers proves that we’re not enemies and for us to have a minority stake in Leeds United, we obviously need to have a good relationship with the majority shareholder. We’re very aware of that. We’ve got two jobs: firstly to raise money and then to convince the existing shareholders of the value of having fans involved in the ownership of the club. I really don’t think the second part of that should be difficult.”