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At the belated Rovers AGM in September 2003 it was announced the directors of Raith Rovers FC recently took one of the most important decisions in the history of the club and sold Stark’s Park to West City Developments Ltd, a company which has former directors, Mr. Colin McGowan and Mr. Turnbull Hutton, as its only shareholders and directors.

The Trust raised concerns about this move and a special meeting was called of members on October 25 to discuss the way forward.

Below are links to Press reports and a summary of our understanding and statements quoted since the announcement broke.

The Trust is currently putting in motion a number of sub-committees to carry forward the motions passed by members at the meeting. If you would like to help on any of these committees or any other project please contact us and if you are not yet a member then we are sure you’ll agree there has never been a more important time to get involved.

Click here to read the Fife Free Press reports


Our Understanding of the Facts

West City Developments, Ltd (WCD) constituted in early 2002

WCD buy land behind Stark’s Park for around £250k in Summer 2002

Planning permission granted for 18 houses and 18 flats Summer 2003

Mr. Hutton and Mr. McGowan resign as directors in June 2003

Sale of Stark’s Park to WCD completed on 27th August 2003

RRFC to lease stadium at £6,000 per month rent

Lease agreement to run for 10 years with inflationary increase in rent in year 6

SFL/SPL currently require clubs to have at least five year access to stadium therefore negotiation must take place in 2008 regarding the lease

RRFC have cleared £1.161M secured debts

RRFC still have £206k unsecured debts to pay and £500k of ‘soft’ loans

Maintenance to be carried out by WCD starting with remedial work on South Stand

If promotion was possible WCD would borrow money to repair Railway Stand

RRFC remain responsible for the seating in the Railway Stand

RRFC will receive all sponsorship, catering and advertising revenue at Stark’s Park

Colin McGowan is also a director of Deeka Ltd, who own Hamilton’s Stadium

Allied Irish Bank holds a standard security over Stark’s Park against the debts of WCD


Quotes

Turnbull Hutton – Fife Free Press 26/9/03

“The last thing I wanted to do was own a football pitch and we really just fell into it when it became clear something had to done about the financial situation.”

“Every month last season, the board met to put in money to pay players’ wages but eventually you reach a point of no return and can’t just throw money away all the time.”

“No bank in Europe will get involved with football clubs; we had to help ourselves.”

“Effectively it has given the club breathing space.”

“A lot can happen in 10 years.”

“We are effectively the bankers now.”

“There is no longer an overdraft facility.”

“There are no more aces to pull out of the hat.”

“I can understand the suspicions of some of the fans.”

“I can assure the (the fans) there is no hidden agenda, it was basically a needs must situation which has bought the club time.”

“We hoped to build a training pitch and car parking… we also had interest from a retailer… the local authority were not very helpful.”

“We then looked at housing and put together a plan which included a training pitch and a gymnasium and all-weather pitches… again this was knocked back.”

“It was clear that nothing was going to work so we decided to clear the site and sell it, which should happen fairly soon.”

“What I do hope more than anything else is that the club is able to buy the park back at some stage because it is not in my long term plan to own a football stadium.”


Danny Smith – Fife Free Press 26/9/03

“I cannot see anything negative about it at all.”

“We did not manage to sell any players, and some major investment we had hoped for didn’t materialise.”

“No-one was prepared to keep throwing money into a black hole.”

“The bank only valued the ground at £350k so to be able to clear almost £1.2M of debt has to be a good thing.”

“None of the debt we have left could close us.”

“With the budget we have this year, at worse we will break even.”

“£6,000 rent is a fair figure as we were paying around £5,000 interest.”

“This really was the only solution.”

“As long as we can service the rent, there is a bright future.”


Eric Drysdale – official website messageboard

“The bottom line is that our debt burden is GONE, our tenancy is secure, and we can buy the stadium back if we find ourselves in the position to do so.”

“We have a financial budget that will work, set at approximately 55% of turnover.”

“We are due £206k to other unsecured creditors and that will be repaid over the next 2 years in accordance with agreed repayment schedules within the current budget.”

“The bank were not prepared to wait any longer for material debt repayment to start.”

“We can’t be thrown out and West City can’t simply announce a rent rise.”

“Hutton and McGowan are personally guaranteeing West City’s debt to the tune of £500,000.”

“The £6,000 pm rent stays the same until 2008 when there is an inflation linked rise.”

“In regard to the cost of a buy back – what will matter will be the level of debt re this deal that West City have outstanding when the club is able to come up with the money.”

“The landlords will fund a gradual programme of repair primarily to the paintwork/rust.”

“The deal has taken many months to broker.”

“They (West City) don’t want to own it, they certainly don’t want to profit from it.”

“In regard to previous losses, not enough energy has been devoted to some matters… fire-fighting has had to take priority over the last four years.”

“Without that other bit of land this deal could not have happened. It was bought as derelict property and cleared at considerable expense to West City for one reason only. So that planning permission for residential development would be granted thereby substantially raising the value of the land and allowing West City’s bankers to lend against that increased value to enable that company to buy Stark’s Park.”

“The lease is legally binding.”

“In regards to the repayment of debt – trade creditors 24/30 months. Shareholders and directors after that.”

“The directors have fulfilled their duty by ensuring that shareholders were informed first.”

“… but the bottom line is that it is simply impractical to seek shareholder approval in advance.”

“If West City go bust any buyer would have to honour the lease.”

“Directors funded losses to date. Not prepared to continue doing so to the same extent. Bank attitude hardened, demanding we repay overdraft by instalments which we simply could never do unless we went amateur.”

“As has been the case for the last 4 years, if our budgets are wrong and there is a shortfall, it’s the same as it’s always been. We have to try and make good that shortfall by asking individuals to dig deep into their pockets.”

“There was no opportunity of borrowing any money whatsoever from any financial institution in the UK or overseas – whether we still owned the stadium or not.”

“And it’s not as simple as saying £1,161,000 less however many months at £6000 pm – bank interest payable by West City comes into the equation.”

“Of course we will buy it back as soon as we can. The $64,000 question is when, and that depends on us having a team in the Premierleague.”

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