At the AGM of Bradford Park Avenue Community Benefit Society on Thursday, it was announced that the directors are proposing a change in the ownership structure of the club.
The club’s first team currently plays in National League North, just two divisions below the Football League. The cost of surviving at this level has escalated to a level which the club cannot afford beyond the short term, under its current ownership structure. Operational costs are eating up capital which had been earmarked for off-the-field development, and new investment is needed.
Two years ago the club became a Community Benefit Society (a “CBS”), intending that its ownership should be spread amongst the local and regional community. However, very few new members have joined. As a CBS the club is entitled to issue Community Shares to potential investors, but the law provides for a maximum of £100,000 in community shares for any individual, which is not enough to make a crucial difference. In addition the CBS is heavily indebted to its current benefactor, and as an investment opportunity the club in its current form is unattractive.
The directors have decided to face reality, and they propose to change the structure of the club so that it becomes a privately owned enterprise, from which investors can potentially earn dividends or at least look to recover their investment at some point in time.
Any change in structure is subject to the approval of the current members of the CBS, the FA and also to the approval of the Financial Conduct Authority, whose advice has already been sought. A further meeting of members will be held in the near future at which specific proposals will be put forward.
The proposed change indicates the determination of the directors to find new sources of investment so as to maintain the club at its present level and possibly above.