West Ham are in purgatory as they come to terms with relegation from the Premier League, the financial realities of the Championship and an interregnum in the boardroom.
Last week’s good news, most but not all fans agree, was that Nuno Espirito Santo is staying to lead the Hammers into their first campaign in the second tier in 16 years.
Higher up, the picture is decidedly more turbulent. Karren Brady is gone and Karim Virani’s appointment as CEO, as far as we’re aware, remains an interim solution.
Some have interpreted the news that Nuno is still here as indicative of the direction of travel in the club’s top brass, namely that Daniel Kretinsky’s influence is growing. He is said to be more keen on the manager than David Sullivan. See also: the club’s apparent decision to pursue a director of football to work alongside Nuno – a role of which Sullivan is sceptical but in which Kretinsky sees more value.
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The Czech’s 1890s Holdings owns 27 per cent of the club, while Sullivan’s shareholding is 39 per cent.
Recently, it has been reported that Kretinsky is exploring the possibility of increasing his stake to match Sullivan. And given that the 50-year-old is famed for his penchant for buying distressed assets on the cheap, a West Ham whose enterprise value has likely just halved overnight would seem to fit the bill.
If he was to up his stake, he would either need the board to issue new shares, which would dilute other shareholders, or purchase shares from one of his peers. Vanessa Gold, whose most recent stance is that she is looking to sell about 10 per cent of her 25 per cent stake, looks the most realistic option, but there would likely need to be some horse trading beyond that equity alone in order to get to the 40 per cent mark.
“There is a case for Kretinsky buying Gold’s shares, but that doesn’t do anything for the club because the money would go straight to her,” says University of Liverpool football finance lecturer Kieran Maguire, speaking exclusively to Hammers News.
In the meantime, West Ham need money to pay the bills. They have plenty of saleable assets, not least the likes of Matheus Fernandes, Jarrod Bowen, Crysencio Summerville, whom the club have appraised at £80m, £50m and £35m-plus respectively.
But the Irons do not want to be negotiating from a position of weakness any more than is necessary, and that means that external finance might be needed in the meantime, says Maguire.
“Reading the annual report, there was an admission that some form of funding will have to come over the course over the summer. Whether that is purely player sales or another form of external investment, we’ll have to wait and see.
“The Rights and Media Funding issue is a further complication. The lender there is supposed to be a West Ham, so we’ll have to wait and see if he asks for his money back on behalf of his lending emporium. The interest rates there will be interesting.”
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