Friday, 23 September 2011

SMFA Update: Costs

At the end of August, we reported on the launch of the controversial Steve McMahon Football Academy. In the article we quoted a fee of $1000 per child per year as reported in this newspaper article. Well, after an unexplained delay, the Academy finally opened for registration this week and the costs were revealed in all their inglory.

As expected, the fee is Rs 45,000 per child. So if a child enrolls at the youngest age possible (6) and stays for the full ten years, the cost will be Rs 450,000 ($9,145). But the annual fee is only 45,000 if you pay in one lump. You also have the option of splitting the annual payment into three amounts: 10,000/25,000/15,000. Do the maths and that's 50,000 ($1016) per year or 500,000 ($10,160) for the full ten years.

There is one final option: monthly payments of Rs 6,000. Yes, that's Rs 720,000 for the full ten years or $14,620. The average gross annual income per person in India is $441.

All of which could still arguably be a small price to pay if these kids make it as big-time professional footballers. But, realistically, what are the chances of that? Almost all of the players you see on your TV screens playing in the EPL, La Liga, Bundesliga, Serie A and so on, will have served their apprenticeships with professional clubs; not in a private school in an industrial zone somewhere outside Delhi. Furthermore, because of the prices, the Academy will only get to see the skills of kids from the top five percent of Indian society.

None of which would be a problem if there were scholarships, a staple of any self-respecting football school. Alas, no. There are no scholarship places and no plans to add any.

Sunday, 11 September 2011

View from a Singaporean (ex-)Liverpool Fan

I think if we could get the following passage translated into Thai, Malay, Bahasa Indonesia, Vietnamese, Chinese, Arabic and Japanese, and read by EPL fans all over Asia, then our work would be done! The following are selected extracts from the Hougang United fans' blog. The full article-cum-speech in all its glory is HERE.

I've always been a Liverpool fan since I was a teenager but these recent years I have started questioning my soccer faith for a football club almost half way round the world.

I have no idea what England is like or what Liverpool as a city is. No clue about the lives of the English fans other than the 11 players who grace my TV screen every weekend. Although I was proud of a club with long history, I have no connection or relation to that place. I have no club identity, no club to call my own.

We have no football club to call our own.

We were just chasing someone else's glory.

Frankie from the KallangRoar forum sums up the same sentiments saying:

"To me, the so-called fans who just watch European football are not real football fans, but people who eat in front their sofa, watching TV. Just that the content is football. Watching football in the stands is just different, because you shout from where you are in the stadium and the referee, linesmen, players, coaches all can hear you."

This blog is about passion and love for Hougang United Football Club, about connecting with the players of Hougang United. It's also about the people who run the S-league week-in week-out. And most importantly, about creating a community amongst Hougang United fans and supporters.

If fans want to see improvement in the S-League, they have to be the change themselves and select an S-League team to support. They can buy match tickets, club merchandise and help spread the word about their favourite football club.

And hopefully with this initiative, we may one day see Singapore move away from EPL colonialism and stand proudly for our own S-league.

Local support has been long overdue, thanks to our misplaced love and loyalty for other clubs elsewhere. It's time to shed those years and years of shyness and embarassment. Peel those layers off and reveal the true Singaporean in you. It's time to be a real football fan... NOW!

Tuesday, 6 September 2011

Liverpool, Steve McMahon and Profitable Group.

Liverpool warm up in Bangkok with Profitable Group in the background

In our last article we looked at the launch of a new football academy in India – a joint venture between Steve McMahon and his former club Liverpool.
Two years ago, in July 2009 to be precise, McMahon and Liverpool also teamed up as the Reds played exhibition matches in Singapore and Thailand in their so called 'The Kop Comes to Asia' tour. At the time, McMahon was commercial director of Strategic Sports Investment Co Ltd: the company that organised the tour. SSI was a part of Profitable Group one of Liverpool's 'official partners' (i.e sponsors) on the tour.

So why is that tour meritorious of an article in this blog? Because Profitable Group (PG) has, at the time of writing, 304 complaints lodged against its land-banking arm Profitable Plots (PP) by disgruntled investors who believe the company to be scammers and fraudsters. PG is currently being investigated by the Commercial Affairs Department (CAD) in Singapore and is being sued by ESPN for allegedly defaulting on advertising payments. The company's website no longer exists and PG is destined for the Hall of Shame occupied by the likes of Polly Peck and Stanford.

Our main concern in this article is the link between one of the world's great football clubs and an unpleasant little get-rich-quick fly-by-night company. However, a little background information on the PG scandal is necessary so that you can judge whether this is the type of company that Liverpool should be doing business with.

Profitable Plots was in the business of selling undeveloped land in England to investors, most of whom were from Asia. The idea is that, through PP, you buy your small piece of land and then, one day, a housing developer will want to buy your land from you and thus you make your profit. The problem is that most of the land PP held was green-belt land. The whole point of green-belt is that it provides, well, a green belt between urban and rural areas so as to prevent urban sprawl. As such, it is practically impossible to get planning permission. As one analyst put it "it's a legal scam. Once you buy your plot you can't build on it and you can't sell it. Who's going to buy [i.e which housing developer is going to buy] a small plot surrounded by other plots owned by other people? Yes, on paper it increases in value, in practice you can never sell." Sure enough, the complaints started rolling in as promised returns never materialised, and investors were either ignored by PP or given endless excuses.

In August 2010 the CAD raided PG's offices in Singapore and seized thousands of documents. Two months later, the CAD delivered their first report stating that "Profitable Plots' liabilities and obligations far exceed its assets. Therefore, CAD has grounds to suspect that the schemes were introduced to defraud its clients." By March of 2011, 229 complaints totalling $23.5m had been received by the CAD. By July those figures had risen to 304 and $30m. The courts in Singapore have repeatedly granted the CAD time extensions in their investigations as the complaints continue to pour in. The next hearing is due on November 8th.

But let's get back on track. How exactly do Steve McMahon and Liverpool fit into this? You might be forgiven for saying "Hang on! The CAD only raided PG in August 2010; Liverpool's PG-organised and sponsored tour occurred thirteen months earlier. How were they to know PG were dodgy?" The answer is simple: Because it was common knowledge well before July 2009 that PG was a highly suspicious outfit.

In 2008, the company's UK-based arm Profitable Plot Co Ltd went into liquidation for "failing to produce accounts". And PP's Malaysian subsidiary Profitable Plots Sdn Bhd was raided in October 2008 for "offering investments in illegal land investment schemes." As 2008 became 2009, the complaints from cheesed-off investors were already coming in by the dozen and in April 2009, PP first defaulted on a payment to ESPN. It was against this backdrop then that Liverpool decided to allow PG to organise and sponsor the Reds' Asian tour.

Liverpool wouldn't have known about the ESPN situation, but it's ludicrous to think that they wouldn't have known about, at least, the collapse of Profitable Plot Co Ltd, and in all likelihood the Malaysian subsidiary too, as the story had made the national press in England and, of course, Steve McMahon was a senior employee of PG. It's a very safe assumption that Liverpool chose PG on the recommendation of McMahon. From a business point of view it was a strange decision: PG had no experience of organising such tours and it showed. This was what Singaporean financial expert Hun Boon had to say: "My suspicions were raised by the Profitable Group's website. I first visited it when I wanted to purchase tickets for the Liverpool football match in Singapore in May 2009. The website was poorly designed and I couldn't find any information on how to buy. Why is an investment company in the business of organising football matches? The coordination and traffic management on match day were poor, highlighting their lack of experience in event management. They even played the Liverpool club anthem 'You'll Never Walk Alone' twice, but failed to broadcast the Singapore anthem when the Singapore national team marched in, displaying blatant disrespect for the host nation."

And things were just as bad for the match in Bangkok. This from an expat who attended the match there: "The crowd control was appalling. We had to go through an extremely narrow gate to reach the concourse where our tickets were checked. There was a huge crush at the entrance as hundreds of people tried to push their way through. The location of this gateway was at the top of a set of steps so the crowd were on all different levels. It also seemed to be the only way to gain access to the East stand - all the other ways in had be fenced off and were manned by security staff. This was an hour before kick off so it wasn't as if everyone had arrived late and was rushing to get in."

In 2011, Liverpool used ProEvents to organise their tour of Malaysia and China. ProEvents have an exemplary twenty-year history of organising such tours. The fact that they weren't used in 2009 suggests Liverpool were listening to McMahon rather than to their heads. Indeed, as Red Sports said in April 2009 "With the growing presence of Profitable Group in Singapore, it is unsurprising for the English side to be scheduled a visit to Singapore as Profitable Group's Commercial Director is none other than former Liverpool star Steve McMahon."

Despite the poorly organised tour and despite the mounting complaints against his employers, McMahon was in typically bullish mood just two days after the Singapore match as PG ended their interest in a takeover of Newcastle United.

PG had announced very loudly their intention to buy out Mike Ashley and bring the good times back to St James's. Their plans included expanding the stadium up to a 60,000 capacity and installing Alan Shearer as manager. But on 28th July 2009, it was reported that PG had pulled out owing to a lack of "communication and response" to their bid. McMahon blasted Newcastle and Ashley: "We [PG] wanted to come in and turn the club around because it clearly needs something at the minute. We have put in a bid and we have had no communication, no response – nothing. It really is poor form from Newcastle, but if that's the way they want to run their business good luck to them."

That last line should haunt McMahon and keep him awake at night. Newcastle are now back in the Premier League whilst PG are in the gutter. Mike Ashley may not win many popularity contests on Tyneside, but he absolutely made the right decision by ignoring PG's advances. Remember what the CAD said: "Profitable Plots' liabilities and obligations far exceed its assets". In layman's terms, they've got no dough. Had Ashley accepted PG's offer, it's not difficult to imagine the Magpies 'doing a Leeds', ending up in administration and having a local derby with Hartlepool instead of Sunderland.

It's unclear when McMahon eventually cut his ties with PG, but it was likely to have been sometime in 2010 when the shit really started to hit the fan. Undeterred, he has resurfaced in India and has again convinced his former club to put their faith in him. It goes without saying that we will be monitoring the Steve McMahon Football Academy, and the little-known Carnoustie Group behind it, very closely indeed.

In many ways, Liverpool is a great football club, but the way they conduct their overseas business does a disservice to their great name, traditions and remarkable fans back in England. Again and again when we look at Liverpool's activities in Asia we are left wondering,

What would Shankly say?