Why Sheffield Wednesday are stuck in takeover limbo

For Sheffield Wednesday, things haven’t turned out too bad in the past ten days.

Fans are protesting and boycotting the club as they attempt to reduce owner Dejphon Chansiri’s income in the background, which is being fueled by the club’s financial crisis and takeover turmoil.

In response to earlier this summer, Chansiri admitted to turning down two offers for the club, one of which was worth $40 million and the other of which was worth $30 million, along with another $30,000 from a US-based group.

The 57-year-old said in a statement at the time, “I repeat that I am willing to sell, but the deal must be true on every front.”

More than two-and-a-half times what Chansiri paid when he purchased the club from Milan Mandaric in 2015, the Owls’ estimated value is believed to be around £100 million. That figure, is it accurate?

The $ 57,500 Chansiri split with a decade ago would now be worth about $ 52 million, which is only about half of what he appears to be demanding now.

Football finance expert Kieran Maguire claims that the majority of EFL clubs are being sold for roughly two or two-and-a-half times their revenue. That puts Sheffield Wednesday in the “equals of about $ 40 million to $ 50 million” range.

They should be at the bottom of that scale when you consider the state of the stadium and the fact that the club doesn’t own it. The $100 million valuation has no logical support, and it seems to have no merit.

Wednesday have lost almost $ 200 million since Chansiri took over the club. He frequently turned down significant offers from rival clubs for highly sought-after players as he sought a return to the Premier League for the first time since 2000.

However, his spending has decreased significantly in recent years, and the Owls are much more likely than ever to play in League One than Premier League.

An investigation into the English Football League (EFL) is currently being conducted into the club’s financial issues, including late payments to HM Revenue & Customs, a failure to pay transfer fees to other clubs, and delayed salary payments to staff and players.

Given that Wednesday has a much smaller senior squad than other division teams and is unable to sign players on permanent contracts due to an EFL embargo, that could result in a significant points deduction and an inevitable championship relegation.

Some people now think Chansiri doesn’t really want to sell the club because he is turning down bids and offering an unrealistic price.

According to Maguire, “I think Chansiri is perhaps being a little naive.” It’s a little perplexing to figure out what his motivations are if he only tries to recover as much of his losses as he can.

His father, Kraisorn, founded the Thai Union Group, a seafood seller that earns billions of pounds annually shipping goods around the world. Chansiri is a member of one of Thailand’s richest families. Thiraphong, Dejphon’s older brother, is now in charge of the business.

Therefore, the owner of the Owls has a largely undeveloped family history and little to no actual business acumen.

Although Chansiri owns a sizable portion of the family business, Maguire claims that his personal wealth has decreased as well as his share value over the past few years.

You can have a lot of assets and have a lot of cash. He is undoubtedly not poor by his own standards, but his losses at Sheffield Wednesday and the decline in the family business have had him.

By limiting Chansiri’s income, Wednesday supporters are attempting to force him to sell.

Only 7, 801 fans were present for the penalty shootout victory over Leeds at Hillsborough earlier this week. That is 20 fewer supporters than the team’s last home game against the same Championship foes last year, which was against them.

The club reduced the cost of tickets to £15, as a result of fans’ calls for a boycott of the game.

If the club had had the same number of fans present this time, the club would have generated about £300,000 in gate sales as opposed to the roughly £120, 000 they would have taken with a significantly lower attendance.

According to Maguire, “The fans on Wednesday are committing to support the team, not the regime,” adding that this is to put more pressure on Chansiri.

Even if Chansiri’s attempts to stifle the club’s revenue do more harm, a buyer needs to be willing to offer a sum that will persuade him to finally cut ties.

Former Crystal Palace owner John Textor, who still holds the reins over both Lyon in the Ligue 1 and Brazilian club Botafogo, stated earlier this summer that he was looking for a traditional English club to purchase or to partner with. I keep an eye on the situation.

It’s not always certain whether Textor would or should now pass the EFL’s Owners and Directors’ Test.

Following errors in Uefa’s multi-club ownership regulations, which led to the Eagles being demoted to the Conference League from the Europa League, his ownership of Palace came to acrimony and widespread mockery from fans earlier this year.

Following the sale of his shares in Crystal Palace, “Textore does have £80m burning a hole in his pocket,” claims Maguire.

The EFL requested Chansiri’s resignation in July, saying that the current owner must either pay off his debts to a well-funded party for fair market value, putting an end to the current uncertainty and impasse.

The EFL has the power to fine clubs and owners for violations of their financial obligations, including unpaid wages and other financial obligations, and to require owners to divest their shares in some extreme cases.

However, the ownership of Chansiri’s property has not met the requirements for a forced divesture, and the club’s and Chansiri’s allegations are still in the writing stage, which means the outcome may not be certain until after the fact.

The new independent football regulator is currently being established as a result of the government’s Football Governance Bill, which was passed into law in July.

In the end, the regulator will be able to revoke owners’ licenses, effectively forbid them from playing for a football team.

However, the appointment of regulator chairman David Kogan must be approved, a board must be established, and secondary legislation must be passed before that system can be implemented. This would make it impossible to imagine the regulator imposing a resolution on Wednesday in the near future.

The EFL and regulator are unable to act as they see fit, so Chansiri has the authority to decide the club’s future, despite ongoing fan boycotts and protests putting personal and financial pressure on them.

One of the following appears to be required for a sale to be completed: