Reply To: Statement 06/07/23

Iron Bru Forums Blast Furnace Statement 06/07/23 Reply To: Statement 06/07/23

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Please see statement dated 06.07.23 below. I have posted here as a last resort to attempt to bring the fans up to date as I don’t have any social media accounts.

There comes a time, during every business transaction, when a party must state certain facts due to media posts and speculation in the public domain, which are untrue, misleading and causing harm to one or more of the associated parties. I hope this statement clarifies in writing, what can be substantiated with evidence if ever challenged.
We as a family decided to look to sell the club and Glanford Park a couple of years ago and had various interests from multiple parties. Those potential purchasers worked with us on establishing the value of the club and land, working through budgets, creditors and debtors etc. Over that period all of those offers and interests fell away due to a lack of proven funds but not until a substantial amount of time and money was spent in accommodating those interested parties. In January, we decided to appoint an advisor to add clarity to the situation and we hoped to be able to move the club on quicker and with transparency. Sadly, each new potential buyer fell away at the proof of funds and finance stage of the purchase, even with a professional independent advisor on board.
In the middle of January, I was told that we had serious interest from an individual who already owned a club and wanted to step in and take the football club and land associated with it and that our advisors had seen proof of funds. The land and stadium were priced at £3m and the individual was notified that the club would probably need £600k of liquid investment to finish the season. Management accounts, budgets and all other details were at hand, as we had prepared and provided these for many other previous potential investors. Everything was clear in the financial package and the purchaser, Mr David Hilton, had access to this and so much more information. The price was agreed – Mr Hilton was happy with the £3m price tag and understood the investment needed to finish the season and take on all the existing debts and loans. As such, we decided to sell the club to Mr Hilton for a few pounds and proceeded to enter an exclusivity period, which was Mr Hilton’s idea and also included extended timescales, at Mr Hilton’s request, for any extra due diligence on the asset and so that, in his words, he could liquidate the funds required to purchase.
In late January, we signed a 4-month exclusivity agreement, which meant we could not sell to another party and were bound into that period with Mr Hilton. During this period, Mr Hilton had explained he was using the best professional people to advise him on the land and stadium and didn’t require his lawyers until the transaction was to be concluded. Although in breach of the exclusivity deal, we were happy to work on this premise. At no time did Mr Hilton raise concerns over the price and in fact on multiple occasions had stated he was happy with the price and would be concluding on time or even earlier.
The first red flag surfaced when Mr Hilton announced the 1899 club membership scheme, which uncannily reflected the figures for the purchase of the club and stadium, as well as the likely liquid funds required to finish the season. We approached Mr Hilton on this and explained we were concerned he did not have the funds to purchase, which is when the relationship went south, to a point where direct contact was impossible due to the content of certain emails and texts received by myself. The lawyers then took control and no direct discussions have taken place since. No new proof of funds, as asked for by me, or statement of wealth has been forthcoming.
During the exclusivity period, we continued to work tirelessly, answering his enquiries via our solicitors in a timely and professional manner and overcoming all questions asked on the matter. Despite this, still the process dragged on. We received an offer for the full amount spaced over a period, which we agreed to but required proof of funds and security over the property until the amount was paid in full. However, Mr Hilton asked to secure the balance payments on a personal guarantee, which would have been just less than half of the agreed purchase price over 12 months or more, interest free. We again asked for proof of funds, which were being withheld. Mr Hilton refused to accept security over the land and stadium and after we did our own due diligence decided we couldn’t accept a personal guarantee, which now was being asked to be put against SUFC rather than himself in any case. This was unacceptable for us, and we were sure this is something that would not go down well with the fans either. From about a month before the end of the exclusivity period, Mr Hilton refused to pay the agreed sum and started to impose unrealistic demands which we could not accept under the agreement that was in place.
We have acted with full professionalism, respected the exclusivity agreement in full and with flexibility where needed, never moved the transaction to benefit us beyond the agreement and in fact have worked to accommodate any deal that would have ensured Scunthorpe Utd had the best possible chance of moving forward and staying at Glanford Park (GP). These range from a discounted one-off price, to a deposit and interest free payments, to a part sale with agreement to change the price if any issue was found to devalue the site. In fact, that is still available and has been on the table – Mr Hilton could have owned the site, secured possession and the future of the club by paying just 50% of the asking price and working on the remaining monies needed. To this day I have still not seen proof of funds directly or, received via the solicitors, any up-to-date proof of funds or wealth as requested and we must question until proven otherwise whether those funds were available and / or are still available to purchase the site under the exclusivity agreement.
The recent media / news reports and online chatter regarding a new stadium, training facilities and a potential ground share agreed late April and licenced by the National League at that time, have convinced us that Mr Hilton does not have the money to purchase the site and in fact was ready to vacate after the May deadline as stated in the exclusivity agreement. To our complete surprise we received notification shortly before the deadline that Mr Hilton would be himself issuing SUFC a short term 7-day periodic lease, in contravention of the exclusivity agreement and where he had no legal right to do so. This lease will be challenged in the courts shortly and Mr Hilton and SUFC will be asked to vacate the land. The lease he issued himself does not constitute a security of tenure required by the National League or the FA. We have made this point very clear to the National League alongside many other ongoing major issues, however they have refused to work with us or even communicate with us properly to discuss these concerns.
It is unfathomable that Mr Hilton has not truly informed the fans of this situation, still continues to claim the club holds a two-year secured lease, that SUFC will 100% be playing at GP, and that a groundshare had been agreed as a backup! SUFC has been taking monies for season tickets, sponsorship, home friendlies, car parking, as well as signing numerous players on contracts who have likely committed with the expectation of playing at GP this season – all these parties making purchases and commitments not knowing the true nature of the situation. Mr Hilton is completely aware of all of the above and yet both he and SUFC continue to publicly pretend all is well and that GP will be where SUFC play their football this season.
It is time Mr Hilton answered publicly and directly to inform the fans what is going on – not hiding behind closed doors, in closed interviews, through Facebook or through others’ social media accounts. Mr Hilton needs to tell the fans the truth of the position he is in, not only on the purchase, but why he hasn’t publicly kept them in the loop regarding the situation both himself and SUFC find themselves in. There are many more serious questions that must be answered and there is still a chance the situation could be recovered, if Mr Hilton decides to pay what was agreed, in whichever format that works for all parties and with accompanying legitimate proof of funds. However, currently the occupation of GP and a complete lack of any recent considered efforts by Mr Hilton and his team to come to any form of amicable agreement on the purchase has meant we have been forced into legal action to regain possession of the property.

Good Evening Peter,

First of all I will reiterate that I am not a supporter of Scunthorpe United. That said, back in early April I was sent a copy of an interview which Hilton gave and I was asked for my observations and opinion which I duly provided after conducting some due diligence and checks. Based on my findings, I have some questions, please.

1) What due diligence relating to Hilton did you and your professional advisors conduct prior to entering into an exclusivity agreement with him?

2) As a follow on to my first question, you hint that a deal for the freehold could still be rescued. With this in mind, why do you consider Hilton to be a suitable custodian for the club?

3) How was the sale of Scunthorpe United Football Club Ltd and the freehold structured? Were your families shares in the company transferred to Hilton on the condition that he would complete on the freehold? In other words, if Hilton reneges on the deal for the freehold what happens to his shareholding in Scunthorpe United Football Club Ltd? Can you take back control of the club?

4) What supporting evidence was provided to Mark Ives and the National League which resulted in them approving the transfer of shares?

I have no interest in falling out with you or any Scunthorpe supporter, but I think you had a bad day at the office entertaining Hilton and I suspect by now you know it.

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