Arsenal chairman, Sir Chips Keswick, has defended the decision to make a £3 million payment to Kroenke Sports and Entertainment [KSE], a company owned by majority shareholder Stan Kroenke.
Tackling a question [see below] posed by Fanshare, Sir Chips told Arsenal’s AGM that he and fellow board member, Lord Harris of Peckham, had sanctioned the payment in light of services rendered to the club. He refused though to be drawn on whether the cash was effectively a dividend in disguise.
“KSE is one of the most respected and successful sports organisations in the United States, operating in the most sophisticated sports business market in the world.
“They have an extensive and long experience in modern sports management.
“It is of the utmost importance that as a club we use it to our best advantage to ensure we keep progressing.
“There was no competitive tender for these services as they are directly available to us, and a tender process was inappropriate, and therefore unnecessary.
“We are entirely satisfied the fee was appropriate. In terms of any future fees, that would depend on the nature of the services provided.”
Sir Chips also faced down a question asking whether Stan Kroenke might be able to leverage any KSE debt on the club should he raise his shareholding above the 75% threshold and de-list Arsenal from the stock exchange.
“My answer is this, the board and Mr Kroenke have been very clear that we are all committed to a self-funding model for the club and that remains the case.
“In terms of the specific question, it is entirely hypothetical because the terms of our existing [Emirates] stadium bonds preclude the club from arranging additional debt.”
On the subject of Josh Kroenke, Stan’s son, being appointed a non-executive director of the club back in December last year, Sir Chips dismissed suggestions the 34-year-old lacked experience.
“As a board we welcome his [Josh’s] expertise and contributions. Let me remind you of his background. He has the Chief Executive role as President of the Denver Nuggets basketball team, he has the Chief Executive role as President of the Colarado Avalanche in the National Hockey League, he is the alternate governor of the Colarado Rapids Major League Soccer team.
“That puts him in the most senior executive position at three teams in the biggest, most advanced sports market in the world. It is also important to note that as a younger man Josh was a talented football and basketball player before embarking on a career first in finance and then as a professional in the sports industry.
“All of this gives him a knowledge and insight which is now at the disposal of Arsenal. We are fortunate to have him, he will help us accelerate our plans as we can continue to compete at the top of the game both here and in Europe.”