Rochdale AFC becomes 100% fan-owned as 'hostile takeover' lawsuit is settled and Morton House agrees to transfer shares

A high court claim between Morton House MGT and First Form Construction Limited, and Rochdale AFC and its board of directors has been settled, with the best possible outcome for the club and its fans.

Subject to formalities, the proceedings will be dismissed with no further legal action being taken against either individuals or the Dale Supporters Trust.

Additionally, Morton House has agreed to transfer its full beneficial shareholding of 212,895 shares to a consortium of seven individuals, who are all currently serving members of the club’s board of directors, for an undisclosed sum.

The club says that the transfer of these shares has received the required level of EFL approval and all seven members of the consortium have cleared OADT previously prior to their appointment on the board.

 

Read more: EFL charges Rochdale AFC and 'a number of other individuals' in relation to attempted 'hostile takeover' of the clubPublished: 16 March 2022
Morton House files High Court claim against Dale board and Dale TrustPublished: 11 January 2022
Dale Trust launches crowdfunding campaign to help fight Morton House High Court claimPublished: 28 January 2022
'Hostile takeover' of Rochdale AFC abandoned after 'investors' withdraw from EFL approval processPublished: 23 August 2021

 

Following this transaction:

• 43.3% of shares are owned by the current serving board of directors which comprises eight statutory directors and three non-executive directors;
• The Dale Supporters Trust continues to own 13.9% and is the largest individual shareholder of the club;
• The remaining 42.8% of shares are owned by over 500 different individual shareholding supporters of the club.
• The club continues to fully cooperate with the EFL following charges of alleged breaches of EFL Regulations, which were brought on 16 March 2022 against the club and a number of other individuals. The club will provide a further update when appropriate.

 

 

Simon Gauge, Rochdale AFC chairman, commented: “Having repaid a mortgage and secured the long-term future of the stadium in June 2022, my board of directors and I are pleased to have concluded just eight weeks later the transfer of the full beneficial shareholding of Morton House to a consortium of serving directors, with EFL permission and which will end all legal proceedings.

“Whilst an unwanted public hostile takeover attempt was unprecedented in the history of our club, the consortium of serving directors have stepped in and prevented a hostile takeover and then delivered a truly fan-owned and fan-led club.

“Operating on a national platform and as a local employer of over 130 people, whilst owning the largest sporting venue within the Rochdale borough which hosts community events every single day of the year, the hard work now really begins to get this club back up the football league.

“We have 41 league games remaining and everyone needs to give their full support to every single one of our players and our staff at the club who are all 100% committed to delivering the very best they can for our club, our team and our town.

“Whilst early results and performances have been under the potential which we know this squad of talented players is capable of, I would urge every person, family and businesses to come and see the investment we are making in the facilities and get the community behind the club which generates over £2m of wider economic value for the town each season as an EFL member club, starting this weekend at home to Crawley Town (3pm kick-off).

“Following events of 1 June 2021 where shareholders removed two directors from the board of the club, it was clear and obvious to all other shareholders and supporters during the summer of 2021 that the breadth, depth and personal integrity of shareholders made any forced sale via a hidden and undesired hostile takeover a practical impossibility.

“With over 500 shareholders, the biggest of which is the Dale Supporters Trust, we have now delivered the first EFL club in the North of England which is fan-owned and fan-led and we can now focus on building the club back up so that it delivers on the pitch after this completely unwanted and unnecessary distraction over the last fourteen months.

“I would like to place my personal thanks all of those who have worked tirelessly since June 2021 to maintain our independence, to those on my board of directors who have taken on much more than they ever signed up to, George Delves, all of our staff at the club and Dean Hulse and David Yazdi of HY Solicitors, the club’s legal partner.

“But my biggest thank you is to our fans. There has been no personal gain from any of this board of directors who all work for free and who have committed their significant time and financial resources to protect the club’s independence for the benefit of the town. To everyone who has donated a penny in support of us, I say thank you and you have our promise that we continue to do everything we can off the field to give the club the best chances of succeeding on it.”

The club statement also confirmed that the legal action filed by the club against a former director, as noted in the last filed statutory accounts, is ongoing, and further comment will be provided in due course.