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Coventry City head for Northampton: just how did it come to this?
Relegated to League One, penniless and now homeless, the Sky Blues are preparing for their first 'home' game at Sixfields
A group of Coventry City fans make their feelings clear about the club's owners, Sisu. Photograph: Adam Fradgley/Action Images
James Riach View all 2 comments
Coventry City will play their first home match of the season on Sunday in Northampton, 34 miles away from the Ricoh Arena, which was built only eight years ago. Supporters who have seen their club torn apart by bitter and petty disputes in recent years use epithets such as embarrassing, laughable and shambolic to describe their current plight. They are right: Rome is burning and plenty of people are fiddling.
The Sky Blues' sorry demise is a depressing tale of hedge funds, stadium revenue and complex company law. Some would argue it is the epitome of everything wrong with the modern game, where the fan is an afterthought behind profit, assets and stakeholders. Either way, it is perhaps the most disheartening of all downfalls in recent times because personal vendettas and rancorous relationships rather than overspending have left the situation at an alarming impasse, with a modern, state-of-the-art stadium facing the possibility of not staging a professional match for at least three years.
When contacted by the Guardian this week, the Coventry City ticket office claimed their phone lines had been "extremely busy" with requests for Sunday's game against Bristol City at Northampton Town's Sixfields Stadium. However, the figures paint a different picture. As of Friday morning the Sky Blues had sold only 491 season tickets for the current campaign, with a "guaranteed attendance" of just 1,200 for their opening home match in League One this season, of which 400 are for Bristol City fans.
The Sky Blue Trust has been vociferous in its protests against the groundshare. It organised a 5,000-strong march through the city, while blue ribbons have been put up around Coventry and will only be taken down when the club returns.
"Going to Northampton is just one nail in the coffin of this club," said the trust spokesman, Jan Mokrzycki. "Once fans stop going it is very hard to get them back and I think the club has been shocked by the vehemence of the opposition to the move."
Arena Coventry Limited, made up by Coventry city council and the Higgs Charity, is the company that owns the Ricoh Arena, which the club moved to in 2006 after leaving Highfield Road where they played in the Premier League up until 2001. The club were £50m in debt during the botched move to the Ricoh and could not afford a stake in the stadium, signing a deal as tenants that committed them to paying £1.3m in annual rent.
Sisu took control of the club in 2007 and relations with ACL have deteriorated since then, with the Mayfair-based hedge fund refusing to pay the high rent in April last year. There have been offers from ACL to reduce the rent – down to £400,000 per annum and even to £150,000 – in an attempt to salvage the situation, but the club has rejected them and claims that it deserves access to the matchday revenue at the stadium as a matter of urgency due to new financial fair play rules, which as a tenant it is not currently entitled to.
However, Mr Justice Males ruled in the high court this week – when an application from Sisu, that accused the council of acting unlawfully when buying out ACL's £14m mortgage debt in January, was thrown out – that the club "had caused rent to be withheld as a means of exerting pressure in their commercial negotiations", calling into question Sisu's intentions when refusing to pay for use of the Ricoh.
Last week part of the club, Coventry City Football Club Limited, was facing liquidation after it entered administration last season. A company voluntary arrangement was rejected by ACL, a creditor, meaning the club was docked 10 points by the Football League for a second successive season.
The administrator, Paul Appleton, appointed by Sisu when CCFC Ltd entered administration in March, selected Otium Entertainment Limited as the preferred bidder to take over the club during the process, although there was also a bid from the American multi-millionaire businessman Preston Haskell IV, introduced to the club by the former vice-chairman Gary Hoffman, a lifelong Sky Blues fan. Otium was founded by three former Coventry City directors who all have connections to Sisu, which is headed by Joy Seppala, meaning the club is effectively being run by the same personnel.
The chief executive, Tim Fisher, a banker specialising in financially distressed companies who was appointed in December 2011, agreed a deal with Northampton to stage Coventry's home matches at Sixfields for three years, potentially five, during which time the club claims it will build a new stadium in the Coventry area.
The club has agreed a £1m bond with the Football League with assurances that it will return to Coventry and says it is assessing a site at the Brandon speedway stadium and another in the south west of the city. However, the League chairman, Greg Clarke, admits he "does not know" if they will really build a new ground.
Asked whether he believed the club would build a new stadium, Clarke said: "I don't know, they haven't told me whether they will or not. Everybody is posturing to get a deal, people say things to create impressions. Unreasonable things are happening. We have no power over the stadium owners or the club to tell them how to run their businesses. At some point there will have to be a compromise.
"I can understand why the Coventry fans are outraged. If I was a fan I would be incandescent. But what would have happened if we had refused them permission to share grounds and they could not afford to play?"
The League has been criticised for its role in the saga. The Sky Blue Trust has labelled the organisation "toothless" while Hoffman, head of the Football Foundation charity that works alongside the Football Association, the Premier League and the government, implored it to do more.
Hoffman said: "I think the FA should ask whether the Football League is acting within its rules, because I'm not sure that it is. I'm not happy about the way the football authorities have dealt with this.. If there was simply no other option on the table then I could understand it, but there clearly is – to play at the Ricoh at a reduced price."
Mokrzycki, who revealed that early discussions about the emergence of a phoenix club have taken place, said: "The Football League has just sat on the sidelines and said 'it's not up to us'. It's sad for Coventry but it's sad for football that the League has shown itself to be so toothless."
Coventry's latest manager, Steven Pressley, was appointed in March but was only able to sign his first player this week due to a transfer embargo imposed on the club. The Sky Blues previously signed promising players and sold them on at a profit, with Scott Dann, Keiren Westwood, Aron Gunarsson and Ben Turner all departing the club and going on to play at a higher level in recent seasons.
That successful policy was abandoned by Sisu, which admits that mistakes were made during its early tenure, when it ploughed significant funds into the club but could not prevent relegation from the Championship.
However, the decision to relocate to Northampton appears to be the nadir in the club's steady decline. Described by Fisher as "a commercial risk" and by Hoffman as "commercial suicide", the club believes that building a new stadium will provide financial benefits in the long term.
Yet the short-term damage could be catastrophic. The attendance for Coventry's first home game last season was 12,621. On Sunday that figure will be cut by approximately 10,000 and the majority of fans instead plan to attend a charity match at the Ricoh, where former players including Darren Huckerby and Noel Whelan will feature alongside local celebrities.
The club insists that it needs matchday revenue to comply with financial fair play, yet the shortfall in gate income given the decrease in ticket sales will be significant, while it has been estimated that the police costs for Coventry's home matches will cost Northampton taxpayers £70,000 per season.
ACL optimistically claims that the Ricoh will not be turned into a white elephant without the football club. The Higgs Charity wants to sell its stake in the stadium and the head of Coventry city council, Ann Lucas, would not rule out a sale of its stake when asked by the Guardian.
In reality, the club needs the stadium and the Ricoh Arena needs a football team. Both sides appear to have long forgotten this, as the Sky Blues edge closer towards the blackest of black holes.
Relegated to League One, penniless and now homeless, the Sky Blues are preparing for their first 'home' game at Sixfields
A group of Coventry City fans make their feelings clear about the club's owners, Sisu. Photograph: Adam Fradgley/Action Images
James Riach View all 2 comments
Coventry City will play their first home match of the season on Sunday in Northampton, 34 miles away from the Ricoh Arena, which was built only eight years ago. Supporters who have seen their club torn apart by bitter and petty disputes in recent years use epithets such as embarrassing, laughable and shambolic to describe their current plight. They are right: Rome is burning and plenty of people are fiddling.
The Sky Blues' sorry demise is a depressing tale of hedge funds, stadium revenue and complex company law. Some would argue it is the epitome of everything wrong with the modern game, where the fan is an afterthought behind profit, assets and stakeholders. Either way, it is perhaps the most disheartening of all downfalls in recent times because personal vendettas and rancorous relationships rather than overspending have left the situation at an alarming impasse, with a modern, state-of-the-art stadium facing the possibility of not staging a professional match for at least three years.
When contacted by the Guardian this week, the Coventry City ticket office claimed their phone lines had been "extremely busy" with requests for Sunday's game against Bristol City at Northampton Town's Sixfields Stadium. However, the figures paint a different picture. As of Friday morning the Sky Blues had sold only 491 season tickets for the current campaign, with a "guaranteed attendance" of just 1,200 for their opening home match in League One this season, of which 400 are for Bristol City fans.
The Sky Blue Trust has been vociferous in its protests against the groundshare. It organised a 5,000-strong march through the city, while blue ribbons have been put up around Coventry and will only be taken down when the club returns.
"Going to Northampton is just one nail in the coffin of this club," said the trust spokesman, Jan Mokrzycki. "Once fans stop going it is very hard to get them back and I think the club has been shocked by the vehemence of the opposition to the move."
Arena Coventry Limited, made up by Coventry city council and the Higgs Charity, is the company that owns the Ricoh Arena, which the club moved to in 2006 after leaving Highfield Road where they played in the Premier League up until 2001. The club were £50m in debt during the botched move to the Ricoh and could not afford a stake in the stadium, signing a deal as tenants that committed them to paying £1.3m in annual rent.
Sisu took control of the club in 2007 and relations with ACL have deteriorated since then, with the Mayfair-based hedge fund refusing to pay the high rent in April last year. There have been offers from ACL to reduce the rent – down to £400,000 per annum and even to £150,000 – in an attempt to salvage the situation, but the club has rejected them and claims that it deserves access to the matchday revenue at the stadium as a matter of urgency due to new financial fair play rules, which as a tenant it is not currently entitled to.
However, Mr Justice Males ruled in the high court this week – when an application from Sisu, that accused the council of acting unlawfully when buying out ACL's £14m mortgage debt in January, was thrown out – that the club "had caused rent to be withheld as a means of exerting pressure in their commercial negotiations", calling into question Sisu's intentions when refusing to pay for use of the Ricoh.
Last week part of the club, Coventry City Football Club Limited, was facing liquidation after it entered administration last season. A company voluntary arrangement was rejected by ACL, a creditor, meaning the club was docked 10 points by the Football League for a second successive season.
The administrator, Paul Appleton, appointed by Sisu when CCFC Ltd entered administration in March, selected Otium Entertainment Limited as the preferred bidder to take over the club during the process, although there was also a bid from the American multi-millionaire businessman Preston Haskell IV, introduced to the club by the former vice-chairman Gary Hoffman, a lifelong Sky Blues fan. Otium was founded by three former Coventry City directors who all have connections to Sisu, which is headed by Joy Seppala, meaning the club is effectively being run by the same personnel.
The chief executive, Tim Fisher, a banker specialising in financially distressed companies who was appointed in December 2011, agreed a deal with Northampton to stage Coventry's home matches at Sixfields for three years, potentially five, during which time the club claims it will build a new stadium in the Coventry area.
The club has agreed a £1m bond with the Football League with assurances that it will return to Coventry and says it is assessing a site at the Brandon speedway stadium and another in the south west of the city. However, the League chairman, Greg Clarke, admits he "does not know" if they will really build a new ground.
Asked whether he believed the club would build a new stadium, Clarke said: "I don't know, they haven't told me whether they will or not. Everybody is posturing to get a deal, people say things to create impressions. Unreasonable things are happening. We have no power over the stadium owners or the club to tell them how to run their businesses. At some point there will have to be a compromise.
"I can understand why the Coventry fans are outraged. If I was a fan I would be incandescent. But what would have happened if we had refused them permission to share grounds and they could not afford to play?"
The League has been criticised for its role in the saga. The Sky Blue Trust has labelled the organisation "toothless" while Hoffman, head of the Football Foundation charity that works alongside the Football Association, the Premier League and the government, implored it to do more.
Hoffman said: "I think the FA should ask whether the Football League is acting within its rules, because I'm not sure that it is. I'm not happy about the way the football authorities have dealt with this.. If there was simply no other option on the table then I could understand it, but there clearly is – to play at the Ricoh at a reduced price."
Mokrzycki, who revealed that early discussions about the emergence of a phoenix club have taken place, said: "The Football League has just sat on the sidelines and said 'it's not up to us'. It's sad for Coventry but it's sad for football that the League has shown itself to be so toothless."
Coventry's latest manager, Steven Pressley, was appointed in March but was only able to sign his first player this week due to a transfer embargo imposed on the club. The Sky Blues previously signed promising players and sold them on at a profit, with Scott Dann, Keiren Westwood, Aron Gunarsson and Ben Turner all departing the club and going on to play at a higher level in recent seasons.
That successful policy was abandoned by Sisu, which admits that mistakes were made during its early tenure, when it ploughed significant funds into the club but could not prevent relegation from the Championship.
However, the decision to relocate to Northampton appears to be the nadir in the club's steady decline. Described by Fisher as "a commercial risk" and by Hoffman as "commercial suicide", the club believes that building a new stadium will provide financial benefits in the long term.
Yet the short-term damage could be catastrophic. The attendance for Coventry's first home game last season was 12,621. On Sunday that figure will be cut by approximately 10,000 and the majority of fans instead plan to attend a charity match at the Ricoh, where former players including Darren Huckerby and Noel Whelan will feature alongside local celebrities.
The club insists that it needs matchday revenue to comply with financial fair play, yet the shortfall in gate income given the decrease in ticket sales will be significant, while it has been estimated that the police costs for Coventry's home matches will cost Northampton taxpayers £70,000 per season.
ACL optimistically claims that the Ricoh will not be turned into a white elephant without the football club. The Higgs Charity wants to sell its stake in the stadium and the head of Coventry city council, Ann Lucas, would not rule out a sale of its stake when asked by the Guardian.
In reality, the club needs the stadium and the Ricoh Arena needs a football team. Both sides appear to have long forgotten this, as the Sky Blues edge closer towards the blackest of black holes.
