I’d like to set the record straight on some serious allegations made in the Coventry Observer about the Council (and my actions in particular) and the decisions we have made over the future of the Ricoh Arena.
When the Council took the decision in January 2013 to refinance ACL’s loan (before I became Leader of the Council), we did so on the back of a business plan which showed that ACL could survive without the Football Club. This was scrutinised at the recent Judicial Review hearing, which was found in the Council’s favour.
We always knew that ACL would be far more viable with a long term tenant for the sports part of its business. Indeed, within days of the loan being refinanced the ACL Board initiated negotiations to secure the return of Coventry City Football Club. Sadly, these came to nothing.
It is no surprise that the complex legal battle instigated by the football club’s owners and involving ACL, the Council and the Higgs Charity has put pressure on its trading performance – and in 2013/14 resulted in a loss. But ACL still has a positive net profit to date and positive shareholder funds.
It is true that Joy Seppala said Sisu needed a freehold or clean restriction-free long lease.
The reality of a restriction-free long lease is that is that ACL, who still held a valid 40 year lease, would have had to disappear from the scene. This was simply not possible – ACL had a series of contracts, employees and a loan to the Council which needed to be protected, and 50% was owned by the Higgs Charity. They would not and could not agree to ACL being, in some way, collapsed to allow SISU to buy a “restriction-free long lease.” Equally, it was not clear how such a proposal would deal with the loan.
The way to unlock things at the Ricoh Arena was for a third party to buy ACL from the Council and the Higgs Charity at market value, recognising that the loan needs to be repaid in full. This was open to SISU, but at no point did they make the Council any offer for our shares.
I could not have been clearer that my door was always open to anyone with a viable business plan, including SISU. But it was Wasps who negotiated a deal and who believe ACL can be a profitable and successful business – and the early signs under their ownership could not be better.
The Council has achieved a commercial price for its shares in ACL, and protected the loan it made. ACL is now in a position to reach its full potential including being a regeneration asset for the city, creating jobs and prosperity. The Council’s actions have been publicly challenged in a Judicial Review and successfully defended.
Wasps, CCFC and Coventry Rugby Club all have a part to play in a successful future for our great city. I’m disappointed that legal action bought by SISU continues, and means we have been advised we cannot comment further.
Councillor Ann Lucas OBE
Leader of Coventry City Council