Kretinsky completes acquisition of £180m+ stake in West Ham

November 11 – Czech billionaire Daniel Kretinsky has purchased a minority stake in West Ham United, the latest overseas investment in a Premier League club.

Kretinsky has completed the acquisition of a 27% stake in the high-flying London club with West Ham saying  the deal would help reduce long-term debt and continue the “positive progress” made in recent years.

The shares are estimated to have cost Kretinsky between £180-£200 million and make him West Ham’s second-largest shareholder. David Sullivan’s shareholding reduces from 51.5% to 38.8%, while David Gold’s from 35.1% to 25.1% and Tripp Smith’s from 10% to 8%, with the number of shares in the hands of other investors falling from 3.4% to 1.1%.

Kretinsky (pictured) owns Czech top-flight side Sparta Prague and has personal fortune estimated at about £4 billion. He and colleague Pavel Horsky are being appointed to the West Ham board alongside joint-chairmen David Sullivan and David Gold and vice-chair Karren Brady.

“We are always looking to continue to progress and Daniel’s involvement brings investment which strengthens the club’s position, and in turn will assist in the development of the club’s key areas of focus,” said Brady. “Daniel’s strong business acumen and football experience will be of huge benefit to the club.”

The new windfall could potentially mean manager David Moyes being handed fresh transfer funds in January. The Hammers are third in the Premier League following Sunday’s win over Liverpool, have qualified for the knockout stages of the Europa League and reached the domestic Carabao Cup quarter-finals.

“I am passionate about football. I greatly appreciate and respect the exceptional history and tradition of West Ham United as well as its loyal and passionate supporter base and also the highly inspiring role it plays in many social programmes and initiatives,” said Kretinsky.

“The development and growth of the club in recent years has been clear for everyone to see and I am delighted to be part of what I believe is a very exciting future ahead. Having been to the London Stadium recently to watch David Moyes’ team, I know it is an incredible time to become part of the West Ham United family.

“I feel privileged to now have the opportunity to help everyone here build on the proud traditions of this great club.”

West Ham was bought by David Gold and David Sullivan in 2010. Since then they have moved the club’s home to the London Stadium, the £900 million+ facility that was built by taxpayers’ money and was the centrepiece of the London Olympics in 2012.

That deal to move West Ham over from Upton Park has been mired in controversy with critics arguing that it gave away a public-financed national asset away for virtually nothing. Barry Hearn, owner of Leyton Orient (the nearest club to the stadium) when the West Ham deal was done, said at the time that anyone buying West Ham would effectively get a brand new stadium thrown in to the deal. While the deal will reflect some value for the stadium, Hearn’s words are now looking a little prophetic.

West Ham has a 99-year lease on the stadium for which they pay just £2.5 million. Under the deal in 2013 with the London Legacy Development Corporation (LLDC), Sullivan and Gold would have to pay a windfall tax to the Greater London Authority of about 20% of any sale over £300 million. Sullivan and Gold are expected to retain majority control until March 2023 before completing the club sale. That is the date when the windfall tax would not be applicable.

The Kretinsky acquisition values West Ham at £700 million+, considerably more than the £305 million paid for Newcastle United

Sullivan and Gold are expected to retain majority control until March 2023 before completing the club sale.

Sullivan and Gold paid £86 million for 86% of the club. West Ham posted a £65 million loss for past year and have agreed a £120 million, 5-year loan with MSD UK Holdings.

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