Dejphon Chansiri-owned 'Sheffield 2' accounts released - what does it mean for Sheffield Wednesday?
Accounts released. Everybody panic, right?
Not really. Accounts released by ‘Sheffield 2’ have dropped, not than the annual release of Sheffield Wednesday’s club accounts and the scramble for answers that inevitably follows.
But why is this of interest to Owls fans and what does it all mean? We spoke to Dr Dan Plumley, a football finance expert at Sheffield Hallam University, to get some expert insight on the headline takes.
So, a company called Sheffield 2 have filed their accounts. Why is this on a Sheffield Wednesday page?
It’s a good question with a simple answer.
Basically, Sheffield 2 is a shell company set up by Wednesday owner Dejphon Chansiri when the club were going about setting up the sale of Hillsborough. They sort of own Sheffield Wednesday. Over to Dan to explain a bit more.
“Essentially Sheffield 2 is a new company that was set up on June 21 2019 to acquire two other companies; Sheffield Wednesday Holdings Ltd, the Hong Kong-based one, and Sheffield Wednesday Football Club Ltd.
“The main person at the forefront of this is Dejphon Chansiri because he’s the director of Sheffield 2, he owns the holding company and by proxy owns the football club.
“It was one of the things done at the time to facilitate the sale of the stadium and move funds around in that way.”
Why is the release of these accounts of any interest?
Unlike the annual release of the football club’s accounts, this one is one for the detail boffins really and doesn’t tell us a great deal we didn’t already know before.
They are the first set of accounts we’ve seen from this company and are by their very nature more or less in-line with the club accounts published earlier this summer.
“There is some stuff around the edges that are interesting and that you can pull out,” Dan says. “But the bottom line here is that irrespective of the number of companies that are knocking about, the companies are indebted to the owner Dejphon Chansiri.
“Whenever the owner is alright with that, the club are OK in the short term.”
What are the headline takes then?
Dan? “The accounts do cite things such as the performance of the club and the risk of the performance of the first team in terms of divisional status, but that stuff has been in Sheffield Wednesday’s accounts. It’s broadly similar and in-line with the football club’s accounts.
“Eyes are drawn to a couple of things. One is the £77.25m figure linked to the future rent of Hillsborough stadium. This is nothing we don’t really know already, but it’s highlighted there as a future cost and is one the company will have to pay as part of that agreement.
“There’s a big loan from a controlling party of £56.7m, but that is essentially another Chansiri company.
“It’s essentially one and the same company that the football club is indebted to, whether that’s Sheffield 2, Sheffield Wednesday Football Club Ltd, Sheffield Wednesday Holdings.”
A loan of £56.7m sounds scary.. is there any reason for concern there?
In a word, no. Not as long as Chansiri retains his love for bankrolling Sheffield Wednesday, which has so far shown no sign of wavering.
“This is the thing,” Dan said. “Chansiri is the named director of all these companies. This has long since been the case with these things at Wednesday, that it is of no immediate concern as long as Chansiri is invested in the football club.
“All we know is that there’s another company that is owed money. It’s not named, but it is another Chansiri company.
“He’s invested his own money. Strip it all back and the club essentially owes him a lot of money. What he chooses to do with that moving forward is entirely up to him. Going off past evidence, we’ve seen owners write that off and say they’re not interested in it.
“We’ve seen owners look to sell and get some of that money back in a sale, with Mike Ashley at Newcastle an example there, which pushes the price of any sale up.”
What’s this about ‘proceeds on disposal of player intangibles’ totalling £16m?
Bit of a mystery, this, on a section that usually amounts to player and staff sales. The sale of Lucas Joao fell in this period, plus the compensation paid by Newcastle for Steve Bruce and his staff but £16m seems a stretch.
Dan said: “The word disposal could mean any contracts that were written off or ceased in that period. Some clubs use the word sales.
“It essentially means the disposal of players and staff, there’s very little else that a football club would class as an intangible asset. It’s about where the player registrations sit.”
And what’s this about Sheffield 5?!
Oh yeah, there’s another set of accounts on their way. Sheffield 5, another holding company owned by Chansiri, have filed their accounts.
Again, it’s unlikely to be anything to get too excited about, said Dan.
“Sheffield 5 have filed, but these are being processed by Companies House,” he said. “There’s a notice on there suggesting it will be another 10 days until these are published to the public.
“The correspondence address is Hillsborough, the director is Chansiri and the company was formed around the same time as Sheffield 2, so I expect it is another shell company that came with the same of them.
“There’s a note there saying there’s a ‘Total Exemption of Full Accounts’, which means we may not see a great deal when they are published. But we won’t be able to comment too much on those until they are made available.”