In England and Wales, fan owned clubs have a successful model that they can be set up from, created by Supporters Direct. Elsewere in Europe, different rules apply. In Germany for example, every club, by law, has to be 51% owned by the supporters. In Greece, things are a little less orthodox. Stephen Skeet takes
a look at how fan ownership from one of Greece’s biggest clubs has come under the control of a media mogul.
In October last year, just 24 hours before their Europa League clash with Spurs, Panathinaikos F.C. parted company with their talismanic captain Kostas Katsouranis by mutual consent. Chairman Yiannis Alafouzos arrived at the training ground to break the news to the club’s shocked players with local media reporting Katsouranis’ poor attitude and negative influence in the changing room.
The fact that Katsouranis was the Greek vice-Captain and holder of 98 international caps made this decision surprising enough, but it was also notable for the simple fact that since May last year Panathinaikos had been fan owned, and this decision had effectively been one ratified by the fans. This has been just one notable episode in a turbulent and challenging ten months of fan ownership, and highlights some of the perils that can be encountered when a once family run club mortgages itself chasing the dream.
Panathinaikos were founded 105 years ago last month. They are Greece’s most decorated team, and considered pioneers in the Greek game; they were the first team in Greece to boast a grass pitch and floodlights, and under the tutelage of the great Ferenc Puskas were Greece’s only ever European Cup finalists in 1971, losing to the Cruyff inspired Ajax Amsterdam.
The club was also the first club to have a supporters club in Greece; the infamous ‘GATE 13’. In 1979 Greek football went professional, and the club was taken over entirely by the Vardinogiannis family who had made their money largely through oil. Domestic trophies flowed through the 1980’s and 1990’s and there were two more European Cup semi-finals in 1985 and 1996. The early 2000’s saw some initial success but the emergence of Olympiakos as a force in domestic competition suddenly challenged the authority of the Greens as the major force in Greek football.
This heralded a change in strategic direction at the club, and in April 2008 the Vardinogiannis family decided to reduce their stake in the club from total ownership to 56%, inviting in outside investors and thus raising 80m Euros in capital stock investment. This financial investment initially seemed to have an impact and over the next two seasons big name players arrived for large wages; Gilberto Silva from Arsenal, Gabriel from Fluminese, Boumsong and Govou from Lyon and Djibril Cisse from Marseille. The club started to rent the Olympic Stadium in Athens as their new home, season tickets rocked past the 30,000 mark and in 2009-10 the club captured the domestic double.
So, how do we get from here to an effective fan bailout of the club in less than two years? In short, the European economic crisis struck exactly at the time that the club had speculated their newly acquired finance on massive wages and transfer fees. The club started to sell the players as quickly as they had arrived to reduce the wage bill, this in turn impacted upon results on the pitch and the club missed out on qualifying for the Champions League.
The financial turmoil at the club began to spiral (more on that later) and in September 2011, the Vardinogiannis family announced their intention to leave the Club. The club treaded water for six months, but after serious riots at the Panathinaikos-Olympiakos derby in March 2012 the entire Board quit. Panathinaikos would remain rudderless for the next two months.
Step forward Giannis Alafouzos, media mogul and the guy at the beginning of this article who let Katsouranis leave by Mutual Consent. He devised a plan to take the 54.7% remaining shares of the club from the Vardiogiannis family and make them available to fans around Greece so that anyone and everyone could contribute an amount to allow the club to overcome the crisis. In May 2012 the Panathinaiki Symmaxia (Panathenian Alliance) was born and a twenty member board was elected. The Vardinogiannis family agreed to transfer their 54.7% of shares to the Alliance, but It remained to be seen whether the fans would respond to the call for finance in any serious capacity.
From July 2nd 2012, fans started to contribute investment in return for shares and although the numbers of shares were linked to the level of individual investment, each investor received only one vote, irrespective of the level of their investment.
Around 3000 fans invested 1.8m Euros in the initial month, including former players such as Cisse and Gilberto Silva, and current playing staff agreed to delay their salary payments, meaning that the immediate future of the club at last looked secure. Alafouzos announced the transfer of shares to the Alliance on July 18th 2012 by stating “Panathinaikos belongs to its people…the Alliance represents the fans.”
So what of this turbulent ten months of fan ownership I referred to right back at the beginning? Well, on the field the club began to struggle. We already know what happened to the Captain in October. The Alliance began to find out the extent of the economic turmoil at the club; it was left with 35m Euros of debt to be financed (largely to the Vardinogiannis family) from whom they also rented their training facilities.
The club was also tied into renting the Olympic Stadium for ridiculous sums from the state (also in economic turmoil), and in November last year the stadium management wrote to the Greek FA stating that the club had not been able to meet its electric bills. Its solution was to offer to play games in daylight hours, but this was deemed impossible as Greek broadcaster Nova had many of the Greens match scheduled for prime time evening viewing.
Also in November, after a run of just 2 wins in 14 matches, Coach Ferreira was sacked. (He was the first donor to the Alliance for shares). Former Panathinaikos icon Juan Ramon Rocha replaced Ferreira, only to be sacked by the Alliance in January this year. Fabri Gonzalez (of no real managerial pedigree) was plucked from Spain by the Alliance to be the third Coach in as many months.
And what of the way forwards economically? The club has been courted for a number of years by Middle Eastern investment, and in January this year Prince Faisal of Saudi Arabia pulled out of a takeover bid in which he planned to invest hundreds of millions of Euros in exchange for a 67.5% share in the club, due to being continually rejected by the club’s shareholders (The fans). Alafouzos was reported as saying he was “allergic” to the idea of the takeover. Meanwhile the club has negotiated a leaving date from the Olympic Stadium and will be returning to their spiritual home on The Avenue in Athens. The Avenue is a modest 15000 capacity stadium currently in disrepair built across from the refugee housing put up to receive Greek refugees from Asia Minor in the 1920’s. Attendances have dropped to 3000, but the supporters club has hired a clubhouse close to The Avenue and is engaged in the process of moving. A recent article in The New Athenian interviewed fans in the clubhouse who were prepared to give the Alliance a chance, but felt that until the Vardinogiannis family assume the 35m Euro debt the club couldn’t move forwards. The general consensus seemed that although 9000 fans had invested anyone who did so now that the details of the finances have become clearer were foolish.
It seems a long way away, and perhaps a bit melodramatic to look at this in the context of ITFC, but I for one will be following the story of Panathinaikos and the Alliance closely to see how they progress together. I have great respect for those engaged in trying to keep their club afloat in Athens. One could cite the above highlights issues with fan ownership and management of personnel, although coaching staff turnover is a characteristic of Greek football generally.
Conversely, one could also cite the fans have had a real say in who should be investing in their club. What it highlights for me, however, is just how vulnerable a club like ITFC may be whilst in the control of one man and his business empire (of whom we know little or indeed their intentions) who has spent millions chasing a dream, and who has continued to accrue a debt at the club of which we know little in terms of construct, conditions, and liability. Should he walk away it’s not entirely inconceivable that the club could face a similar set of issues to those in Athens.