Who is Alisher Usmanov?

He’s a billionaire from Uzbekistan in the former Soviet Union, though often referred to as Russian, who owns half of Red And White Holdings, along with his partner Farhad Moshiri (whose Wikpedia entry is sadly out of date).

How rich is Usmanov?

Very rich. Estimates of his wealth vary, but it seems to be comfortably over $10 billion. The Forbes list in 2012 has him as 28th richest person in the world.

Has Usmanov always been an Arsenal supporter?

He claims to have been a supporter for some years, though there’s no evidence of any particular allegiance for any length of time.

Does Usmanov go to Arsenal matches?

He certainly goes to some, but as I’m not there with my binoculars every week I can’t say exactly how many. But he’s got two executive boxes knocked together into one ‘superbox’, so he has the world’s most expensive season ticket.

Why does Usmanov want to buy Arsenal shares?

He says because he’s a fan and wants the best for the club. He believes Arsenal is underfunded and would like to put more money in.

Why doesn’t he put money into Arsenal now, then?

He’s offered to put in an equivalent amount (in terms of share percentages owned) to majority shareholder Stan Kroenke by way of a rights issue. Mr Kroenke feels this is unnecessary.

Would he put in more if he was sole owner?

He’s indicated that he would, but as we know from the world of politics it’s easy to make promises when you are in opposition, and often the tune changes when you get into power. FFP rules will also make this more difficult, though I’m sure clever owners will find a way round it, with advantageous sponsorship deals and so on (eg £400m Etihad Stadium sponsorship). It would also be possible to repay the stadium debt early, which would be within FFP rules and free up approximately £17m of repayment and interest charges each year. The current Board has said there is no need to do this, given the manageable nature of the debt.

What other reason could he have for wanting to own Arsenal?

Three really: one – he wants a new toy, in the manner of Roman Abramovich, something to play with; two – he thinks it will enhance his status to own a major and world famous football club; or three – he thinks he can make money from it.

Can Usmanov make money from Arsenal?

In the long run, probably. Global media rights are growing in value. Stan Kroenke probably thinks the same thing.

How many shares has Usmanov got?

For the latest position, look here on Arsenal.com. Arsenal update this figure every couple of weeks. Mind you, that isn’t necessarily the full story, so read the information on my blog entry here, which explains more about exact numbers of shares and the reporting thereof.

Why does Usmanov’s share position get announced on Arsenal.com?

Premier League rules and stock market rules both apply. Any director who buys or sells a share has to put out an official announcement immediately. This applies to Mr Kroenke at present, but not Mr Usmanov. Non-director shareholders have to announce whenever they go over a whole percentage threshold. So there are announcements on the Plus Markets website for Mr Usmanov reaching 29%, 28%, etc. The Premier League rules are ambiguous, but say that all shareholdings over 10% have to be announced. They’re not clear on whether every share needs to be announced above 10% for non-directors, but Arsenal announce changes in Usmanov’s shareholding every couple of weeks.

How many Arsenal shares is Usmanov buying?

Seemingly as many as he can get hold of. Though as he’s now bought most of the ones other shareholders are willing to sell, it’s getting more difficult for him.

Where is Usmanov buying Arsenal shares from?

There are still a few hundred Arsenal shareholders, though a lot of these now have only one share and are fans who don’t want to sell. Some shareholders have blocks of four or eight shares, and may sell all but one, so as to retain an interest but make some money as well.

Has Usmanov inflated the Arsenal share price with his purchases?

Yes and no. The price is a lot higher than it was a couple of years ago, but it’s not excessive when you look at turnover and consider marketing potential. Football is big business these days and Arsenal are in good shape to take advantage. So although Usmanov’s desire for shares has pushed prices higher, there is actually business justification for it too.

How many Arsenal shares are there?

62,219 – so 30% of that is 18,666.

Why does Usmanov want to get to 30% of Arsenal shares?

In summary, the Premier League treat a 30% shareholder as an owner, and don’t differentiate between situations where the 30% shareholder is the biggest shareholder, and where there is another majority shareholder as there is with Arsenal. So Usmanov hopes that when he gets to 30% the Premier League will give him all the rights and privileges of an owner, despite the fact that Arsenal already has a majority owner. See my blog entry here for more details.

Will Usmanov having 30% of shares give him a seat on the Arsenal Board?

No. Directors are appointed by a majority of shareholders, and Stan Kroenke has a majority. So Usmanov will only become a director if Kroenke decides he should.

Does Usmanov have to make a bid for Arsenal when he gets 30% of shares?

My previous blog on this said he doesn’t and in practice he won’t have to, but for the record the Takeover Code says this:

The [Takeover] Panel will consider waiving the requirement for a general offer . . . where:

(a) holders of shares carrying 50% or more of the voting rights state in writing that they would not accept such an offer; or

(b) shares carrying 50% or more of the voting rights are already held by one other person.

Obviously Mr Kroenke has more than 50%, and gives every indication that he has no intention of selling. So the Takeover Panel are not going to insist that Usmanov makes a bid when he reaches 30%.

Can Usmanov make a bid for Arsenal anyway?

He can make a bid anytime he wants to. It seems likely that a bid would happen in the close season, so he can’t be accused of derailing the team’s season. The close season is fast approaching . . .

If Usmanov makes a bid for Arsenal, what price will he have to pay?

The general rule is that a bidder must offer the highest price he has paid for a share in the 12 months preceding a bid. However, there are plenty of reasons for exceptions. The Takeover code lists the following:

Circumstances which the Panel might take into account when considering an

adjustment of the highest price include:

(a) the size and timing of the relevant acquisitions;

(b) the attitude of the board of the offeree company;

(c) whether interests in shares had been acquired at high prices from

directors or other persons closely connected with the offeror or the offeree

company;

(d) the number of shares in which interests have been acquired in the

preceding 12 months;

(e) if an offer is required in order to enable a company in serious financial

difficulty to be rescued;

(f) if an offer is required in the circumstances set out in Note 12 on Rule 9.1;

and

(g) if an offer is required in the circumstances set out in Rule 37.1.

The price payable in the circumstances set out above will be the price that is

fair and reasonable taking into account all the factors that are relevant to the

circumstances.

Basically there is plenty of scope for the Takeover Panel to make any decision they like.

What price has Usmanov been paying for shares?

I’m told he has not paid over £14,000 for a share, in case he is made to pay his highest price. However, at least 78 shares have been sold at higher than £14,000 each, so someone else is buying them if it isn’t Usmanov. It can’t be Kroenke, because he is obliged to announce every time he buys a share.

When will the battle for ownership of Arsenal between Kroenke and Usmanov be resolved?

It seems quite likely that Usmanov will reach his 30% target this summer. The next step will be to see what attitude Kroenke and then the Premier League take to that event occurring. After that, developments will depend on whether any additional access Usmanov has to Arsenal’s information allows him to pressure Kroenke into selling up or accepting Usmanov into the fold. Usmanov seems determined to keep pushing and is getting closer to his target. The status quo won’t last forever.

For more updates, follow me on Twitter: @AngryOfN5

If you have any more questions, or think I’ve left information out or not been clear, please add a comment or tell me on Twitter.