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Coventry make a far from happy return: City are back playing at the Ricoh Arena tonight but an ugly affair is not over, writes David Conn

September 5, 2014

David Conn



Coventry City supporters will fill the Ricoh Arena for tonight's League One match against Gillingham, an emotional demonstration of enduring loyalty after the awful year in which the club's owner, the hedge fund Sisu, moved it out of Coventry.

The return vindicates the overwhelming majority of fans who refused to countenance the move to Northampton, but Sisu still owns the club. The deal is temporary: two years, with an option for two more, in which the club can occupy the stadium only for the day when it plays a match. The future is uncertain, and true reconciliation remains distant with the stadium's operators, Arena Coventry Limited (ACL), which is owned by Coventry city council and the local Alan Higgs children's charity.

Sisu, and the Football League for its handling of the affair, came under blistering attack in parliament this week from the Conservative MP Damian Collins and the Labour MPs Jim Cunningham and Bob Ainsworth. The last of these, MP for Coventry north east, described Sisu as "a hard and ruthless hedge fund operation," which he said employed "spin and lies" and was "prepared to destroy a children's charity to make money".

Of the league, blighted last year by the spectacle of City, with all their tradition and potential, playing at Northampton to crowds averaging 2,348, Ainsworth said: "I do not believe the Football League genuinely acts as a governing body - it is effectively a self-interested club for owners."

Sisu's conduct was set out in a high court judgment in June, following a case Sisu lost in which it accused the council of acting improperly. Mr Justice Hickinbottom found that from April 2012 Sisu refused to pay the rent it legally owed at the Ricoh, "quite deliberately to distress ACL's financial position" so they could buy a share in the arena on the cheap.

The council built the Ricoh stadium and adjoining arena in 2005, after the club under previous owners were relegated from the Premier League in 2001 and lost huge money, despite selling the old Highfield Road ground. With the club in financial difficulties, it then sold its 50% stake in ACL to the Higgs charity. The judge noted there was an option written into the deal for the club, when it had more money, to buy that 50% stake back for a minimum pounds 6.5m - and the "hope and expectation," that it would.

Sisu, a hedge fund investing money from the Cayman Islands, bought City in 2008, intending to make a profit by winning promotion back to the Premier League. They "seriously mismanaged" the club, Hickinbottom said, and lost millions, before turning their attention seriously to the pounds 1.3m annual rent they took on at the Ricoh, where ACL received the money from fans buying food and drink. They did negotiate to buy the Higgs charity's 50% stake in ACL, but after due diligence, Hickinbottom stated, Sisu was prepared to offer only close to pounds 2m, which was "irreconcilable" with the Higgs charity's preparedness, with conditions, to accept pounds 5.5m.

In January 2013, ACL agreed in principle with Sisu's club directors, and shook hands on, a new rent of pounds 400,000 at the Ricoh, with the club receiving a share of food and drink income. But Sisu's chief executive, Joy Seppala, then rejected that deal, because she was intent on Sisu owning a stake in ACL.

Two months later, Sisu stopped paying the rent, to distress ACL financially and buy a stake in it "at a knockdown price", Hickinbottom found. Sisu raised the possibilities of leaving the Ricoh, or putting City into liquidation, squeezing further pressure on ACL, the judge said.

After ACL sued for the rent owed, Sisu put the club into administration in March 2013. The owner asked the Football League in summer 2013 to sanction the move to Northampton, out of the club's conurbation, saying it could not agree an acceptable deal with ACL.

Fury with the League among fans and MPs does not stop with the decision to allow the move. Even after the judgment came out in June with firm findings that Sisu's strategy had been to distress ACL, the League said nothing; there has been no censure or sanction.

The League's response is that it allowed the unpopular relocation to keep Coventry playing, because "no mutually agreeable deal was imminent", that it urged Sisu and ACL to "explore every opportunity to resolve their differences", and ultimately that approach has proved correct.

The League's chief executive, Shaun Harvey, said: "We never sought to make any form of judgment over who was right and wrong. It was not our job to do so, and would have been virtually impossible given the available evidence at the time of the club's application to relocate."

Sisu's response to the Hickinbottom judgment was to lodge an appeal, so continuing court action against the council and Higgs charity.

Tim Fisher, the Sisu-appointed club chairman, declined to respond to the MPs' criticisms, telling the Guardian he wants to look ahead to the Ricoh return. However he maintains Sisu "have to own our own ground". and that it is continuing with plans to build a new one.

That maintains a major threat to the Ricoh Arena, a high-class stadium purpose-built by the council for Coventry City. The fans' refusal to countenance the move has brought their club back, making tonight a resounding, floodlit, people's victory. But this ugly affair is still a long way from decent resolution.

Captions:

After a year at Northampton, Coventry play Gillingham at the Ricoh Arena tonight but City's owner, Sisu, plans to build its own ground Shaun Botterill/Getty Images



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Source: Guardian (UK)


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