American billionaire Stan Kroenke is set to take full control of Arsenal after minority shareholder Alisher Usmanov accepted a buyout offer of his 30 percent stake.
The deal, which values the club at £1.8 billion, ends a long battle between the two billionaires for control of Arsenal.
A statement from Kroenke Sports & Entertainment said it has “received an irrevocable undertaking from (Usmanov’s) Red and White Securities to accept the offer.”
A source close to Usmanov confirmed to ESPN FC that the Russian has agreed to sell his stake.
Kroenke currently holds just over 67 percent of shares.
“We at KSE are moving forward with this offer leading to 100 percent ownership of the club,” Kroenke said in the statement. “We appreciate Mr. Usmanov’s dedication to the Arsenal Football Club and the storied ethos and history the club represents.”
Arsenal’s majority shareholder, Stan Kroenke, had bid almost £525m to buy out Alisher Usmanov, the second-largest shareholder who has tried several times to wrest control of the club. Only last May the American resisted Usmanov’s latest attempt at a takeover, and within the past couple of weeks this slow-burning struggle for full control took a twist as Kroenke offered £28,000 per share for the Russian’s stake.
Kroenke owns 67% of Arsenal; Usmanov has a 30.4% stake. The remaining shares belong to minority shareholders, many of whom have preserved a small holding for decades, even passing down the generations. Having two main investors who do not have a working relationship, despite having been on the scene for the past 10 years and who appear to hold one another in low regard, is not a healthy situation. Usmanov has never been able to secure a seat on the board or influence any decisions and both men know this will continue with the current awkwardly cut pieces of the Arsenal cake.
Both parties have tried to force a change. If Kroenke succeeds in his attempt to buy out Usmanov, initially reported by the website Arseblog, it would take his percentage to 97%. It would put him in a position to squeeze out the minority shareholders and presents the risk Arsenal would become a privately owned business.
The consequences of that are troubling for the 130-year-old club. As well as removing any requirement for the publication of accounts or an AGM, the option of registering the business in the United States, to be based under Kroenke’s KSE umbrella in Delaware, would open up. There would also be no internal barriers to using Arsenal as leverage in deals as the Glazer family did with Manchester United.
These board-level manoeuvrings have been watched with interest by a consortium of longstanding Arsenal supporters who found heavyweight financial backing and tried to throw their hat into the ring three times during the past year. They made two inquiries to Kroenke at a valuation of £2bn for the club – £32,000 per share – and made a third attempt at a breakthrough in June via an olive branch idea to buy out Usmanov but that was dependent on a seat on the board and collaboration with Kroenke to create a more unified environment around the club. The Missouri-born entrepreneur turned down all three presentations.
A spokesman for the consortium, which has been in communication with Kroenke and Usmanov for close to a year, expressed concerns about the situation. “We are owned 97% by two very wealthy individuals but it is a disappointment that they have never managed to get together and see eye to eye to move the club forward. The benefit of their wealth and experience could have been felt in unison but Arsenal has not been able to gain from it.”