Why having a DoF sitting on the Everton board has never been so important as now

Why player trading for Everton is difficult this window and why Marcel Brands's voice is key

Paul The Esk 28/01/2020 72comments  |  Jump to last

At the last Annual General Meeting of Everton shareholders at the beginning of January, Professor Tom Cannon objected to the inclusion of Marcel Brands on the Everton Board, claiming it was “inappropriate for the Director of Football to be on the board”.

Well, with the greatest of respect to the Professor, the requirement for a DoF to sit on Everton’s board has never been greater. I say that as a reflection of the current level of expertise that exists on the board and particularly, the financial circumstances Everton find themselves in, combined with the regulatory environment in which we operate.

Regulated business

Whether we like it or not, football is a regulated business. Domestically, clubs in the top division are regulated by the Premier League and for those qualifying for European competitions by Uefa. Both sets of regulations aim to set out, in addition to other aspects of how clubs are to be run, the financial constraints under which clubs can operate.

Given the importance of financial compliance and the impact it ought to have on a club’s strategy, the financial performance should not be just the concern of shareholders (owners) and directors but also fans as this determines how competitive a club can be and the scope for challenging those above them in the Premier League.

Originally designed to limit losses, debt and – in the case of the Premier League – being an effective wage cap, in recent years, the financial regulations are viewed by those challenging and those looking from the outside objectively, as a means of keeping those at the top of the game at the top and making the prospects of intrusion at the winners’ table much more difficult for would-be challengers.

As such, commercial performance and the trading of player assets have never been so important as now. This is particularly relevant as the focus of the regulators is on profitability much more so than affordability – affordability being viewed as balance-sheet strength and the depth of owners’ pockets).

The importance of the Profit and Loss Account

One of the unintended (we assume) consequences of the current regulatory position is that, because new capital in its traditional form of equity or debt, has a limited effect on the Profit and Loss (P&L) account and is less valuable than income, from a regulatory point of view, new capital is rarely invested in challengers other than at the time of a change of ownership. Even then it is only by extremely wealthy individuals (where perhaps return on equity is less important than other factors) or State-owned entities for whom the levels of investment required are little more than pocket change, particularly when the soft power of such investment (sports washing) is taken into account.

Established investors now focus on injecting capital in the form of income, from connected parties, constantly challenging fair value market tests and indeed the spirit of what might be considered commercially viable sponsorship or commercial arrangements.

Everton, until very recently, due to the generosity provided by Farhad Moshiri, have been an exception. Yet, as this article argues, Everton only had a very narrow window in which capital alone can be invested. Indeed, it is fair to say that, 47 months after Moshiri made his 49.9% acquisition, that the capital injection window is now probably firmly closed – at least in respect of resourcing the football squad. It should be noted, however, that capital investment in tangible assets, such as the Bramley-Moore Dock stadium, can continue.

As a result, in the desperate search for income to cover losses arising from the expense of heavy (and largely unsuccessful) investment in players and their wages, we (like other clubs) resort to innovative and potentially challengeable solutions... such as the USM option payment for future naming rights.

So what does this have to do with a Firector of Football?

Football clubs have three sources of income: namely broadcasting/prize monies, commercial income (including sponsorships), and matchday income. In the case of Everton, with the exception of commercial income growth and an unlikely immediate return to European football or further “innovative” income boosts, income will remain fairly stable. This at a time when income is currently significantly below the costs of running the club and squad in its current guise.

The playing squad appear in the accounts as intangible assets, ie, as a balance sheet item. However, the trading of players impacts the P&L account – the area that the regulators focus on – and present Everton with its current regulatory issues.

A fundamental part of the Director of Football’s role is to manage the squad – not only in terms of first-team requirements, but also the impact it has on the club’s financial position, and therefore its ability to make necessary squad changes in a timely manner.

This is not a short-term reactionary measure; it has to be a strategy developed over a number of years. Ideally, the strategy should include the following elements: meeting the immediate needs of the first team manager, meeting the regulatory requirements in terms of cost relative to income, and – most importantly in the long term – building a reserve of value and future profits in the squad.

The final point deserves more consideration. Essentially, it means developing players from within the academy and junior teams that have a market value way beyond their development cost, and similarly for players bought from other clubs, acquiring players who are most likely to increase in value due to their age, their future development individually, and the achievements of the squad as a whole going forwards.

Having a reserve of future value or profit if a player is traded is extremely important and advantageous. It provides much greater flexibility and ability to manoeuvre in future transfer windows. The greater the increase in value, the less reliant a club is on having to sell their best players – nor are they likely to have such an issue as Everton in having significant deadwood to carry.

Unfortunately, Everton, as a result of appalling player acquisitions in the last four years and a failure to develop sufficient genuine future Premier League players from the Academy and Under-23s, have little scope in this area.

“Value Added”

£ millions Net Spend Increase in squad market value Value created
Tottenham Hotspur             90.17                                          660.22                570.05
Liverpool           264.00                                          821.28                556.75
Arsenal           334.60                                          415.22                   80.62
Everton           218.10                                          271.12                   53.02
Chelsea           406.72                                          457.62                   50.90
Manchester City       1,069.24                                          931.59 –              137.65
Manchester United           762.66                                          712.90 –              376.42

Using raw data provided by TransferMarkt.com it is possible to estimate the value added to a squad over a significant period by looking at net spend and the change of market value over a period of time. If the market value of the squad has increased significantly above the net spend, then the objective has been achieved. This calculation does not fully reflect the inflationary environment within football but it demonstrates the clubs that have done well and thus have greater flexibility with those that haven’t.

Unsurprisingly, Spurs have been most successful; Liverpool have traded and recruited well in recent years. Arsenal's numbers reflect their caution and relatively poor recruitment recently. The two Manchester clubs show no value creation, and in particular for Man Utd, some very poor recent recruitment. Player trading for them has become much more difficult now than previously, despite their hugely positive cash flow due to their commercial successes.

From 2010 to present day

When one considers the potential value in players such as Richarlison, Bernard, Calvert-Lewin, Holgate and Davies, for example, it shows how many poor player purchases we have made in recent years – purchases of players who are likely worth a fraction of their initial cost (and, in several cases, with a market value considerably below their book value).

Thus, a squad with so few players that offer value to Everton or would-be purchasers, with the only “valuable” players being the ones we wish to retain to build a competitive team, and with no wriggle room (as explained in previous articles), it is no surprise that Brands’s ability to deal in this window is extremely limited.

Our situation demands patience – something which I am sure Carlo Ancelotti understood before he took the position. It also requires even greater football input at board level by Marcel Brands – not less, as suggested by the eminent Professor!

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Reader Comments (72)

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Winston Williamson
1 Posted 28/01/2020 at 22:02:20
So... to improve the team to make it competitive, Brands needs to:

a) Find buyers for unwanted players, who are on high wages, selling at their remaining amortisation value or higher (to not impact the accounts negatively);

b) Develop youth to fill gaps in the squad, with the longer-term aim of selling to ease the stress on the accounts (or better yet, find a couple of Rooneys);

c) Potentially sell one of our ‘better' players way above their remaining amortisation value, so profits can be reinvested;

d) Scout and buy up and coming talent to develop and increase in value.

Alas, as always, we missed the boat when Moshiri came in and we wasted huge money on crap like Bolasie, Schneiderlin, Walcott, Tosun, Sigurdsson etc...

Who the fuck advised the inexperienced Moshiri? Was it our greatest fan, ever? Was it a bunch of self-serving turds? I guess it doesn't matter now! We must learn. We must trust that Brands – and now, Ancelotti – have a plan to rectify the direction of the club's recruitment policies...

Ken Kneale
2 Posted 28/01/2020 at 22:07:23
Winston raises the question we should all be asking:

How on earth did the early millions get wasted at what was a critical window of opportunity and now leaves us navigating the rocks and whirlpools?

Was it other people currently still serving the club in any capacity? If so, they should be named, shamed, and shown the door.

Dave Abrahams
3 Posted 28/01/2020 at 22:10:42
Winston (1), regarding your point (c), I heard a whisper (that's all it was, a whisper) that two players could be sold, either now or the summer. They would make Everton a decent profit in one case, and would be a bit of a surprise in the other. On one we would make a massive profit and it would be a massive surprise, well to me anyway. The other one I wouldn't like or agree with, but it was only a whisper.
Brian Williams
4 Posted 28/01/2020 at 22:21:16
Dave #3.

I'm guessing Richarlison is one of those, Dave.

Steve Ferns
5 Posted 28/01/2020 at 22:43:14
Great article, Paul. Very informative.

Dave / Brian, it'd better not be Richarlison.

I would be very surprised if we sold Schneiderlin and Sigurdsson! Does that count?

Also, wouldn't selling the cheap players like Calvert-Lewin, Holgate or Davies make the most profit for the balance sheet and so give us more room on FFP?

And I hope we retain all three of them.

Paul [The Esk]
6 Posted 29/01/2020 at 00:08:55
#1 Winston, thanks for putting in a few sentences what took me 1200 words. Agree totally.
Bill Gienapp
7 Posted 29/01/2020 at 00:35:19
If we had to cash in on Richarlison, that would be enormously disappointing (and depressing). Not only is he one of the few players we have who's worth building around but, unlike other recent stars, he's given zero indication that he's looking to move on – even after Silva was sacked. He seems to have a genuine rapport with the club and the fanbase.
Kieran Kinsella
8 Posted 29/01/2020 at 01:08:13
Steve Ferns,

Obviously profit would be higher on selling say Holgate, but what about wages? Calvert-Lewin, Holgate etc earn a lot less than most. If we sold them, we'd struggle to find anyone as good or better for a lesser wage.

Darren Hind
9 Posted 29/01/2020 at 03:02:00
Interesting stuff.

I believe the biggest problem we have is that the book value of our players is some considerable distance away from reality. I think many of our fans have an unrealistic idea of what our players could fetch.

Pickford: For me, bucks the trend. Although many an Evertonian would like to see the back of him, he is England's goalkeeper and that fact alone will inflate his true value – we'd make a profit.

Coleman: he wouldn't fetch anything. He's been a fantastic servant and we are not entitled to expect a profit. I thought Jonjoe Kenny had already gone past him this season, and it was a mistake to let him go to Germany.

Keane and Mina: they have been exposed, and I mean proper exposed. Every time Everton are mentioned, our inability to defend simple balls into the box is highlighted. That would scare most potential suitors off. I don't believe for one minute we'd get any club to pay £30M for either one of them. We'd have to take a hit.

Digne: we would have made a tidy profit if we had sold him last season when his free-kicks and excellent crossing were being highlighted; however, his defensive frailties have been laid bare this season. He's been abject. Unless he can rediscover his attacking prowess... maybe a small profit.

Sigurdsson and Schneiderlin: they wouldn't fetch a third of what we paid for
them – both losses.

Gbamin and Gomes: they have been unlucky and, in their particular cases, so has Brands. However, both have suffered the sort of injury which would force people to monitor their recovery before being remotely interested. Let's not forget, we didn't have to fight off fierce opposition for their signatures when they were fit. As it stands, Loss.

Bernard: future deadwood. Not quite consistent enough to make a huge difference, he earns big due to the fact that we got him for nothing. Attracting a buyer for him would be no problem... but getting him to move on would be. Nobody would pay him the wages he gets now; no profit.

Walcott and Iwobi: Arsenal have had us off big time... finding somebody mug enough to pay what we paid would be impossible - another loss.

Richarlison: if the clubs at the very top wanted him, we'd have heard about it by now. We can all see he has great talent and huge potential... but, as of yet, he doesn't rate with so many top players in terms of goals, creativity, or street smarts. We'd have no problem selling him, but we won't get the sort of money you see being paid to top drawer world superstars – some profit.

Keane: nobody would pay anywhere near as much as we paid for him. Best keep him here, work on his development, and hope he can justify the price we paid.

Worrying. as you say, Paul. Not much wriggle room. Ancelotti is going to have to do it with the tools he has inherited.

Whilst I agree with your point about the importance of having a Director of Football present at board meetings, I'm not sure we have the right man in Brands. Hopefully he will prove me wrong.

Paul [The Esk]
10 Posted 29/01/2020 at 07:27:04
Darren #9 - your final point, the evidence is still thin on the ground as to his effectiveness, I agree. Yet his reputation among those in the game is outstanding.

I wonder how restricted he has been to date by the changes in management, the board itself, and the involvement of Moshiri in some transfers?

Tony Abrahams
11 Posted 29/01/2020 at 07:55:11
I’d guess Dave hearing little Chinese whispers, would be about DCL, because he doesn’t seem to rate Richarlison, as much as others, so I’m not sure he’d be that disappointed to see him go?

DCL, Davies, Holgate, and Jonjoe Kenny, are players I would be trying to incorporate into the team going forward. 4 English kids, 2 of them scousers, and although people might think that these lads are not good enough, I’d like to see them play alongside better footballers, before such a decision was made.

Holgate, still lacks concentration at times, Davies, is possibly having his worst spell at the club, Kenny, must be made-up to be away from the mad-house, and DCL, is improving rapidly, although he still has a fair-way to go.

Put good players with heart, next to these kids, who all possess this vital ingredient, and I’m sure they will help push Everton on, because the only “real leaders” I see at Everton, are actually in this group. (Richarlison aside possibly?)

Paul Tran
12 Posted 29/01/2020 at 08:01:53
There's two issues for me with Brands. One is the type of player he hasn't bought yet; the strong centre-mid, the scorer, the commanding centre half. The other is, now that we've swapped the 'young' manager who was 'fed' players by the DoF, for a well-established manager – who I'm sure will want good players now, never mind good in a couple of years time – where does Brands fit now? Has his brief changed? Has the set up changed significantly?
Jim Bennings
13 Posted 29/01/2020 at 08:30:44
If we had used our heads starting back in 2016 we should have simply targeted signing four absolute top class players with the millions we had to spend back then.

Four top class players would have sorted the spine of the team and we should also have told Lukaku he was staying put for one final season until we bought a suitable replacement for him.

We bought players for too much money that were questionable even at the time.

Why sign Klaassen £24 million, Michael Keane £22 million, Schneiderlin at £24 million was never needed when we already had Gana Gueye.

£27 million on Tosun mental, a player not suited to our play.

Last summer we paid a ridiculous amount for Iwobi after the failure to bring in Zaha.

The money we have had to spend since 2016 and we are still sitting here now in 12th place, haven’t had a meaningful Cup run.

We should have been where the likes of Leicester are now, a club upwardly moving in the right direction on a yearly basis.

This summer is a monumental one for this club under Ancelotti.

How can we really afford yet another campaign in the 2020-21 season to be written off by the first week in January again?

Mark Murphy
14 Posted 29/01/2020 at 08:53:08
Hind sights easy but when we signed Klassen, Bolasie, Walcott, Keane and evening Schneiderlin I personally was very happy and I remember lots of positivity at the time - especially around Klassen.
I was annoyed in the past when we bought Neville, Barry and Gomes but they did ok. I don’t blame the DOF, more the club for the lack of stability in changing meh managers for so-so managers who can’t get the best out of what they have to work with. Hopefully Carlo will be the missing cog if we can persevere for longer than 2 seasons without winning the league or CL.
Brian Harrison
15 Posted 29/01/2020 at 09:39:07

As always a well researched and well written piece, but I fundamentally disagree with your preface that it is important the DOF should be on the board. So in that case we should have appointed Steve Walsh to the board, which may have signaled the death knell for this club had he continued in his post. As for the value that Brands has brought to the club, I am yet to be convinced. I assume he was the prime mover in the sale of Gueye to PSG selling your best and most important player was grossly negligible. I am not overly impressed with some of his purchases either.

Your main reason for arguing for the DOF to be part of the board, is it is vitally important with FFP that someone understands the implications. Well I think you may have forgotten that our owner is an accountant of a couple of multi billion pound companies. So he will understand the FFP rules far more than Brands.

I question the role of how we use a DOF, he should deal only with players surplus to requirements and moving them on. He should also work closely with the managers of all the teams below the first team, to make sure that we have a steady flow of quality youngsters. But in my opinion the identifying of new purchases should be solely left to the first team manager.

Tony Hill
16 Posted 29/01/2020 at 10:08:42
Mark @14, I think what you say is fair. The only player I was unhappy to see was Rooney, though I had a couple of doubts about Bolasie and the price we paid for Sigurdsson.
Paul [The Esk]
17 Posted 29/01/2020 at 10:25:21
Thanks Brian #15 for your comments. I agree Walsh would have been disastrous as a board member, but then he was totally the wrong person to be put into the role of DoF. In that case it was a combination of the person and the lack of understanding of the role within the club.

I think the lack of understanding of the role within the club is still a major issue both at board and owner levels. Ancelotti clearly understands the relationship and how it should work, but the rest I am not sure.

Whether Brands is the right person to fuse together our needs and Ancelotti's needs on the football front, work within our financial constraints, and also work with the peculiar corporate beast that is Everton with its factions and lack of structure I don't know.

I do know that to move forward the DoF model is the right way to build a consistent and identifiable footballing strategy across the club and ultimately to provide Ancelotti with what he requires to weave his own undoubted magic.

Brands is very highly thought of by many, time will tell if he's the right man for Everton, whether we hold our nerve with this model or allow Ancelotti or (ridiculously) Moshiri to operate in a less structured environment

Phil Sammon
18 Posted 29/01/2020 at 10:26:56
Mark 14

I don’t think it was the individual signings that were the problem. It was the fact we signed Sigurdsson, Klassen and Rooney all to play the same position. I couldn’t believe it when I first saw Sandro in an Everton shirt...he too seemed to fancy himself as a deep lying forward.

Of course all of this was compounded by the fact that the manager had no clue how to use one number 10, never mind a hat full.

Sam Hoare
19 Posted 29/01/2020 at 10:48:27
Important article, well written. And a good piece to read for those who want us to spend money on older players saying things like 'age doesn't matter' and 'its not our money'.

We are a business and we must spend the resources we have wisely in order that we do not get into a mess, like we are in now!

Spending £20-30m+ or more on older players with little or no re-sale value must not be done unless their significant impact on the team and its success is a sure fire thing or near enough. The transfers of Schneiderlin, Walcott, Sigurdsson, Bolasie etc have set us back considerably. People arguing we should spend £20m+ on Vecino don't seem to see this.

Spurs have really shown the way and in this window alone they have secured Fernandes and Bergwijn, two young players with big reputations who will be worth alot of money if they come good and probably still trade at a small loss even if they don't. This is the way we should be going.

I think Brands has been doing this for the most part and I disagree with some of Darren@9's evaluations. I believe the likes of Digne, Richarlison, Bernard would go for good profit and that the Mina and Gomes would still be worth near what we bought them for. Kean, Gbamin and Iwobi have not played enough but all are young and I think will prove good purchases in time.

I don't think Brands nailed the last window but certainly he has done a better job than Walsh. It will be interesting to see our next raft of signings this summer with the Ancelotti pull now in play and the stadium looking closer.

James Hughes
20 Posted 29/01/2020 at 10:55:43
Signing Sigurdsson is still a mystery, would love to know how we got conned into paying that much for him.

it's like something from The Hangover, with Koeman and Walsh waking up amongst all the debris. Finding a signed contract for £45 million and asking what the hell happened here.

Agree about Klassen, thought we had a decent player on our hands. He's a regular starter for Werder Bremmen at present, did we sell him or is it a loan ?

Ken Kneale
21 Posted 29/01/2020 at 10:57:50
Jim Bennings - absolutely correct - we threw away money on players of dubious quality, ability or mental fortitude to the detriment of team building - in doing so paying some inflated wages along the way making the recovery process more difficult
Joe McMahon
22 Posted 29/01/2020 at 11:03:47
Particularly for the money Sigurdsson has been the biggest transfer disaster in Evertons history. To also think Tosun cost the same as Lukaku and when Rooney came back he was earning 60k a week more than Salah who notched over 30 goals that season.
Steve Ferns
23 Posted 29/01/2020 at 11:53:19
Brian, in addition to what Paul said, Moshiri is not on the board.

If you keep Brands off the board, then you are giving the final word on football matters to Kenwright, DBB, and Moshiri’s Russian (Sasha R). So would you really want Kenwright and his yes-lady running wild like they did under Walsh, or would you prefer Brands in the boardroom banging heads together?

And how do you know that the board didn’t force Brands to sell Gueye? You’re making an assumption there.

Daniel A Johnson
24 Posted 29/01/2020 at 11:57:48
I agree with Mark Murphy [14]

Hindsight is a wonderful thing. At the time Bolasie, Williams, Schneiderlin, Klassen, Tosun even Sigurdsson were all legitimate purchases. We can all come on here 3 season later and say gee what a waste of money.

At the time how many genuinely bulked at the prospect of those joining us?

The problem we had back then at the start of the Koeman regime was the calibre of player we wanted to attract just didn't want to join Everton FC. We ultimately went for mid level players hoping they would improve us and we tempted them to come with big wages.

Its okay saying build a spine with 4 genuine world class players but those players don't want to join EFC especially when we have nothing to offer but high wages and a fight for a top 6 spot.

The likes of kean, DCL, Davies and JJk are the players that will propel us up the league not a Robinho type who accidentally signs on the dotted line.

chris williams
25 Posted 29/01/2020 at 12:29:42
It’s possible that a lot of Brand’s recruitment to date has been constrained by the FPL issues outlined above. And aggravated by the inability to shift much of the costly deadweight, currently out on loan, as well as those still in the squad.

Possibly a rush to judgement on him needs to take this into account. He’s already shifted out over 30 players permanently and there are over a dozen out on loan too. That’s before considering the merits of Schneiderlin, Sigurdsson, Walcott etc. None of these players is he responsible for, just their disposal.

Whether he is a Board Director or not does not make any difference to his status, as an employee, he can be fired either way if he doesn’t perform. He doesn’t ‘report to himself’ as has been said on here from time to time, he reports to the Board, as all of them do.

It does make a difference in how the Board is able to go about its business of running the club. As Steve pointed out it’s important to have someone there with Director status, who is not Kenwright or his mini me. Particularly with only four directors.

He’s working with at least one hand tied behind his back, and he is probably going to have to go into the loan market, unless he shifts some of the Dead wood out, or their contracts run out.

He’ll probably have to sell some of our younger players and assets, like he did with Lookman, Vlasic and Onyekuru, all of whom we made a profit on.

Interesting times.

Paul Tran
26 Posted 29/01/2020 at 12:29:48
The thing about Siguurdson was that Koeman was convinced that he would make the difference between us being a Europa League and Champions League team. Which was presumably why he shunted him onto wing?

As now, our problems are more about the type of players we didn't buy - no striker, no dominant centre mid. You could make an argument that solving those two positions would have made a huge difference, as it would right now.

Rob Dolby
27 Posted 29/01/2020 at 12:33:33
Bottom line is that our recruitment since Moyes left has been very scattergun with no real structure or footballing philosophy in place and will continue to be a mess unless we introduce more structure.

Ffp as already mentioned above was brought in to prevent teams crashing the big boys party. We are nowhere near that level yet but have got ourselves into a right mess.

PSG and Man City have managed to escape sanction but continue to spend big money.

The dof could do worse than ask Carlo about his philosophy and try to put players in place.
7 hard workers with an average goalie and 3 quality players at the top end would be enough to complete for top 6.

Moshiri has been fooled into thinking that paying stupid money for players get rewards. All that he has achieved is filling a squad with mercenaries who don't care if we win or lose.

Craig Walker
28 Posted 29/01/2020 at 13:12:34
Superb analysis and post as always Paul.

What is the likelihood that we will see any new faces in before Friday's deadline lapses? Is it absolutely critical to sell before we can buy? Difficult to know who we could offload, especially those on lucrative contracts who won't get what we are paying them.

The jury is still out for me on whether I think Brands is doing a good job. Some of his buys are as bad as Walsh's.

It is a massive disappointment that we have wasted so much money on dross and are in this predicament despite having a billionaire owner and a world-class manager.

Ken Kneale
29 Posted 29/01/2020 at 13:46:35
Steve I agree with the general thrust of that - however, Brands should be on the board on merit in any functional organisation not on the basis he is the best of a (very) inept bunch alongside Kenwright, DBB and Moshiri's patsy - he needs to be really strong and get rid of the many many appointments within Everton who rely on cosying up with Kenwright and his acolytes to earn a living - those individuals will never bite off the hand that is feeding them and they seem everywhere from checking tickets to being responsible for the underwhelming production line of young talent flowing through the club. We have had thirty years of such appointments dragging the club to its knees - our footballing stock has never been lower in our history than the current era.
Ancelotti and Brands have an opportunity here to slowly turn us around, or conversely, we wither a little further on the branch. Time will tell meanwhile the agony goes on.
Andrew Ellams
30 Posted 29/01/2020 at 14:04:14
They key question for Brands now is that if recruitment remains on the same damaging path that it has done for the past 4 years (I know some if that was Walsh) why would a manager like Ancelotti hang around to do what would basically be an impossible job?
Brian Harrison
31 Posted 29/01/2020 at 14:26:56

Surely if Brands is the DOF to suggest he wasn't the main mover in selling Gueye is a big assumption by you. Brands has been very open that his idea is to buy younger players who will also have resale value, so selling 31 year old Gueye would fit his plan. You suggest a board member forced him to sell Gueye, well no point having a DOF who wont stand up for his opinions.


You give an assessment of the current book value of our present first team, so can I ask how come that both DCL and Davies are missing from your critique.

Steve Ferns
32 Posted 29/01/2020 at 14:40:13
How is it an assumption by me? It would be an assumption if I said the board sold him. My position is open, maybe Brands signed him? Maybe the board sold him? Maybe someone else (Silva or Moshiri) sold him?

Brands' plan is to buy young, yes. But this does not equate to keeping everyone young or having to sell someone because they are 30. If a board member sold Gueye, why does it mean that Brands didn't stand up for his opinion? Maybe he fought tooth and nail to keep him and was overruled? Is he then meant to resign over this hypothetical situation?

I think the reality is what always happens in football now. A year ago this month PSG came in for Gueye. Silva and Brands both spoke to him, and he expressed his desire to leave. Both agreed to sell him in the summer if the player gave his all for the rest of the season. Gueye's performances improved and he left as promised. And yes this is an assumption.

It is possible to do deals that do not come into effect until months down the line, so perhaps we rubberstamped a transfer a year ago (January 2019) and it came into effect in July when he then moved on.

The whole point of resale value is not to become a club that buys young and sells all the players for profit, that's the last thing we wish to do, it's about avoiding the situation we have now with Sigurdsson, Schneiderlin, Walcott, and Bolasie. All are over 30, all earn massive money (reportedly over £100k a week, except for Bolasie who earns £70k a week). No one would give us our money back for these guys, and no one wants to pay their overinflated wages.

Instead Brands wants to sign players like Moise Kean who is on £55k a week, so half what the others are on, and even when he hadn't scored for us, even when he was judged a failure, there was a line of clubs wanting to take him back to Italy, who would pay his wages and give us our money back, because he was still very young and there was still plenty of time to get him playing well. This is the difference.

chris williams
33 Posted 29/01/2020 at 15:22:49

Wasn’t Gueye sold because it was a good fee, much higher than his current ‘book value’ and because of his age?

Brands alluded to this in his presentation at the AGM I think.

But possibly not unconnected to the FFP issues.It may be a scenario that we will see repeated, and maybe this is now considered to be part of his brief?

He also said we can’t afford £60m players.

If it is, it might be evidence of an understanding finally that the Board and specifically Moshiri understand the situation we find ourselves in, and hopefully no more vanity pursuits of the likes of Zaha.

Scant comfort though.

chris williams
34 Posted 29/01/2020 at 17:04:44
Sky sources

£85m bid for Richarlison rejected

John Raftery
35 Posted 29/01/2020 at 17:04:52
At the time I thought the purchase of Sigurdsson was a mistake; the wrong player for the wrong position for the wrong price. I also had reservations about Keane having seen him turned so easily by Lukaku at Goodison, about Pickford after his nervous performance for Sunderland at Goodison and about Klaassen after his underwhelming performance in the Europa League Final.

None of the above named players had made a convincing case for their purchase before we signed them. The club’s ambition to make its mark in the transfer market in the summer of 2017 was matched by an impatience to deliver instant success. Patience is what is now required along with steady team building over a period of two to three years.

Brands is ideally placed to support the creation of a proper team comprised of young players with the talent and hunger to improve with Ancelotti driving things on the pitch. It remains to be seen if they can succeed.

Andrew Ellams
36 Posted 29/01/2020 at 17:05:05
Sky Sports are claiming we have turned down £85m from Barcelona for Richarlison. That's him gone then, just a matter of for how much I guess.
David Pearl
37 Posted 29/01/2020 at 17:07:14
Couldn’t blame him for having his head turned but we hold all the cards... l hope.
John Otway
38 Posted 29/01/2020 at 17:15:38
Can someone let Merson know!
Mike Benjamin
39 Posted 29/01/2020 at 17:18:34
Well done Paul, excellent analysis. From your financial knowledge do you know the answer to the following. When planning permission is granted can the spend so far on preparing BMD be retrospectively transferred to capital spending out of the main accounts? If that was the case then would not that positively affect FFP?I am sure I heard something last year but now can’t find any reference to it.
Geoff Lambert
40 Posted 29/01/2020 at 17:20:30
!25 million and we can start talking.
Danny Broderick
41 Posted 29/01/2020 at 17:29:35
The problem with having Brands on the board means that he will be judge and jury. He effectively won’t be held to task by the board, as he is part of the board that will evaluate his performance. We’ve effectively just added in a layer between the board and the team when it comes to football matters. I would prefer to have an independent board that evaluate the Director of Football, like the Director of Football evaluates the performance of all football matters. That is how I understand it should work anyway.

In any case, I’m not a fan of this Director of Football model. It has been an unmitigated disaster for Everton. Some of our better performers this season (Holgate and DCL) were signed with no involvement from Walsh and Brands. Compare that to some of the players we have signed under Walsh and Brands for big transfer fees and big salaries. We will struggle to give some of these players away now, never mind sell them! And they were bought under the watch of supposed football ‘experts’.

Brands’ record is patchy at best. For every good player we have sold well (e.g. Lookman), we have sold others cheap (e.g. McCarthy). We still haven’t replaced Lukaku. And we have bought all of our players from top clubs like Barcelona, Juventus etc. We haven’t unearthed any gems, we’ve more often than not paid over the odds for established players. There are big question marks over the character of the players that we have recruited in the last few years also.

The jury is out on Brands at best.

Tom Bowers
42 Posted 29/01/2020 at 17:34:13
Barca want Richarlison and have offered 85 million. Is this for real ?
Everton should take it as the lad will now have his head turned, who wouldn't want to go to Barca from a club like Everton.
Cannot see this lad being 100% in his concentration if he stays.
Everton have rejected this offer but that may not be the end of it.
Winston Williamson
43 Posted 29/01/2020 at 17:35:59
Dave (3), your whisper is being shouted all over Sky Sports News! Looks like you have a good source of info
Jonathan Tasker
44 Posted 29/01/2020 at 17:38:10
Brands is not to be trusted
Jim Bennings
45 Posted 29/01/2020 at 17:42:43
If Everton sell Richarlison this month it says everything we need to know about the ambition of the club.

Same when it sold Lukaku, what use is the money when its spent of shite?

Richarlison is a frustrating players but he’s also the only real potential game changer that we have in the squad.

£85 million won’t score you 13-14 goals, that just sits in the bank until it gets wasted on more defensive minded midfielders.

I expect the transfer request to arrive tomorrow morning, the question is, are Everton going to act big.

Brent Stephens
46 Posted 29/01/2020 at 17:50:31
Jonathan #44 a stirring thought.
Ray Roche
47 Posted 29/01/2020 at 17:50:51
Jonathan, what are your thoughts on Mr Kenwright? I don’t recall you having an opinion on him.
Andrew Ellams
48 Posted 29/01/2020 at 17:51:36
£100m in the bank and Rodriguez in on loan to play behind the striker?
Drew O'Neall
49 Posted 29/01/2020 at 17:52:37
Barcelona enquired after Richarlison last summer and we said no.

His head wasn’t turned then.

If we do sell him it will be for more than £100m and that will provide decent funds for Ancellotti to spend and represent good business as far as FFP is concerned.

As far as Everton’s ambition is concerned (Jim Bennings), signing Carlo Ancellotti as our manager and building a £1bn stadium tells me everything I need to know about Everton’s ambition.

You shouldn’t be upset so easily.

Chris Gould
50 Posted 29/01/2020 at 17:58:42
Richarlison just signed a new contract and it's coming to the end of the window. Why bid now?
It's interesting that it's Barcelona, a club that Brands has good relations with. Maybe he's told them that Richarlison is available for the right price? More than likely this bid has come in now to set the sale up for the summer. That way it doesn't come as a shock to us, Richarlison has time to get his house in order, and Everton can say that they were big enough to reject Barcelona in January but couldn't hold him back from his dream move any longer. Just like they did with Gueye.
Nick Page
51 Posted 29/01/2020 at 18:00:03
Like I’ve said, a million billion times, NOTHING WILL CHANGE AT EVERTON FOOTBALL CLUB UNTIL KENWRIGHT AND HIS CRONIES ARE GONE. The club is run appallingly, there is no clear and obvious strategy and we haemorrhage cash like there’s no tomorrow. Basically our business model is unsustainable as we don’t return our cost of capital (Paul the Esk has written some great articles on this). Therefore expect Richarlison to be gone in the next two windows. Now, it’s fine selling players for a profit but here’s where the problem really lies - REINVESTMENT. We’ll sell this lad and we’ll have no clue who to replace him with, no lists, no stats of players that would fit into a non-existent system (think Moneyball), nothing. Just a hit and hope. And that will take a whole window of to-and-fro negotiations that will be splashed all over every media outlet going because the club doesn’t do simple and straightforward. It’s the same dance, it’s just a different tune.
Brent Stephens
52 Posted 29/01/2020 at 18:00:09
Don’t encourage him, Ray!
Ray Roche
53 Posted 29/01/2020 at 18:01:36
Brent, look at it as Blood Sport.😁
Brent Stephens
54 Posted 29/01/2020 at 18:07:38
Ray, I don’t want to see all that red blood.
Dave Abrahams
55 Posted 29/01/2020 at 18:14:51
Tom (42), got to be honest, Richarlison wasn’t the player I had heard the whisper for, find it hard to believe that Barcelona, or any club,would offer that much, even in these crazy transfer days, for the lad, if it’s true tell them, privately, they can have him for that sum in the summer, gives us plenty of time to get a better replacement for a lot less than £85M. Having said that I still don’t believe the story.
Jay Wood

56 Posted 29/01/2020 at 18:16:47
The irony is not lost on me that some are proposing the very sensible model of developing or recruiting promising younger players with potential that would both give us a few good years as well as return a comfortable profit if sold. Ideally, such recruitment would represent the 'spine' of the team around which we could build.

Well, four years ago Farhad Moshiri inherited such a team, already bolted onto some high-performing senior players in their prime.

Only, such is the nature of the fickle football fan, every single one of a genuine 'Fab Four' was constantly lambasted on TW and beyond for what they didn't do (even though their 'failings' were highly exaggerated by some).

John Stones, Ross Barkley, Gerard Deulofeu and Romelu Lakuka were exactly the right age, profile and potential of what, presumably, many would now like Marcel Brands to recruit for the exceedingly low fees we paid (or developed) for them.

They were EXACTLY the profile of player we should have worked hard to not only recruit, but to retain. Deulofeu is an exception in that Barcelona triggered the buy-back clause in his contract, but the other three, we allowed to leave. In the case of Ross Barkley the public humiliation and lack of support at Everton effectively drove him out of the club.

Within four months of taking over the club, Moshiri ditched Martinez and installed his man, Ronald Koeman. By the season's end we looked a solid outfit with plenty to build on.

Everton splashing the cash as they did that summer under Koeman and Walsh was heady stuff which Blues definitely enjoyed. But at the same time there was NOT universal approval of all of the signings and disquiet WAS expressed about the 'duplication' of similar type players for single positions whereas other areas were neglected.

That remains the critical transfer window which continues to hamstring us to this day. With the money Moshiri expended in fees and salaries, if there had been a more considered and structured transfer, recruitment AND retainment policy, we would be much further ahead in our development on the footballing side of things than we are.

He is a billionaire accountant. He must really rue signing off and backing the judgement of people who took a scattergun approach with his money.

We have wasted both time and money to basically stand still. Go backwards, even, as we are now saddled with considerable debt as well.

On footballing matters now, we have two highly-respected and wise old heads overseeing things. They need to be trusted to do what is best for the club.

IF there is no interference from the suits, Marcel and Carlo between them can still turn the tanker around. For Marcel, it's been as much about getting players off the books as recruiting them. He has done very well in that regard, middling on recruitment.

Personally, I had hoped to see more of what he became renowned for in Holland: recruiting raw unheard of talent from around the globe, watching them blossom and turning a very tidy profit on them.

Not one of his signings to date falls into that category.

Winston Williamson
57 Posted 29/01/2020 at 18:22:09
Regarding the possible sale of Richarlison: there’s only a few players I wouldn’t consider selling, and I’m on the fence with Richarlison. A big enough fee and as Nick Page says above, we reinvest wisely, I’d let him go. BUT! I’d not do so without finding a suitable replacement FIRST!

Incidentally, DCL, Holgate and Kenny are the players I wouldn’t consider selling. They have a quality lacking in most of our other players: they hate losing

Jim Jennings
58 Posted 29/01/2020 at 18:34:30
“ Richarlison: if the clubs at the very top wanted him, we'd have heard about it by now.“

Written about 12 hours too early, that post.

Nick Page
59 Posted 29/01/2020 at 18:40:16
Agree on those three players, Winston. Holgate has been a revelation this season. He was always touted as the more talented of the two players we bought from Barnsley, and we’re now beginning to see that. Long may it continue.

So, if we sell Richarlison and we reinvest, we have to reinvest in a system. This is basically all that Klopp has done, and got incredibly lucky with the actual signings (Salah, for instance). And we stick to that system and put the square pegs in the square holes. That way they develop better, increase in value, the team moves up the league etc etc. It’s not rocket science, but clearly it is to some although I actually think there are other agenda’s at work behind the scenes that hinder any progress we wish to make.

Winston Williamson
60 Posted 29/01/2020 at 19:43:34
Totally agree Nick. Take the 4-4-2 we’re currently using. If that’s the chosen way forward, we plan accordingly, and set our recruitment and player development on that path. Not just the first team, but throughout every team at the club.

I also agree that there could be influences inside the club that don’t want their power and status quo to change. Cushy jobs for under-performers, but that is entirely supposition on my part, admittedly having no insider knowledge on the workings behind the scene

Brent Stephens
61 Posted 29/01/2020 at 19:48:56
Jim “clubs at the very top”. Maybe that doesn’t include Barca!
Darren Hind
62 Posted 29/01/2020 at 19:51:28
What a pair of toby's
Simon Harrison
63 Posted 29/01/2020 at 21:17:30
If we do allow Richi to gor £85m, it may not be this window as many other have pointed out. Probably preemptive for the summer window.

Also, this may give legs to the Everton Soares (LS attacker) story. Sell Richi for £85m, buy Soares for £25m, and keep £60m in the bank to offset the £30m credit we are going to lose in the P&S count for Y3 where we had a £30 credit, rather than debits and losses.

Still leaves us with £30 to spend, and when the players who leave in the summer go, their wages gives us enough wriggle room, to bring in one or two more quality players. Plus, hopefully, we'll have Gomes and Gbamin back to, oh and Beni.

Slowly build the foundations now, for the future.

I wouldn't mind swapping Richi for Soares, and bank some cash for the future.

Bill Gall
64 Posted 29/01/2020 at 22:01:31
I realize that we are struggling this year but this is the wrong time to buy or sell, we are starting to get a system that the players are getting comfortable in and we don't want anyone leaving from the recognized 12-15 first team players. We have players coming back from injury apart from Gbamin who may not even be ready at the end of the season, and young players should be used on the bench as subs, and if they get on prove they are worth keeping.
Depressing looking at the league table when you consider we are 40pts behind first place ans still not far from the relegation places.
Every game will have to soon become a must win game.
Jerome Shields
65 Posted 30/01/2020 at 09:08:01
I agree with Paul the Esk regarding the Director of Football in the immediate term.

But if the Everton Board was of overall sufficient competence, it would not be necessary for the Director of Football to sit on the Board. In a well run Football Club with the correct reporting structures and governance the Director of Football would not sit on the Board.

The problem with Brands on the Board is that he appears to have the same authority as he had when he was not in the Board. Brands Is a Football professional not a Financial Professional. Is he now suddenly going to sprout wings ?

Basically Paul the Esk has been put in the situation of advocating the shoring up of the Board, like myself , by having the Director of Football on it. The right situation would be for incompetent Directors on the Board to take a walk and be replaced by competent ones, something that Paul The Esk I am sure would agree with.

The whole Everton AGM was a shoring up exercise and Professor Smith was technically right. Brands could be being used as a buffer to cover incompetence, something Moshiri did not appoint him to be. As yet Moshiri reasons for Brands appointment are unproven, as the debacle of the Summer Transfer window would suggest.

It's going to be hit or miss whether the whole thing is going to end up as the same Shambles after a New Dawn, as we all have been experiencing for years.

Moshiri has to tackle the Boardroom issue at some stage if Everton are to progress, before he runs out of money and Usmanov decides he has had enough.

chris williams
66 Posted 30/01/2020 at 12:44:27
Jerome, you don’t have to be a Financial Professional to be a Director.

On a typical Board you Will have a Chairman, CEO or MD, Finance Director, Marketing Director, and some sort of Operations Director. This last one tends to change depending on the industry the company operates in.

So in Retailing this might be Buying/Supply Chain, or in Financial Services, Business Development or Sales.

In Football it might be Director of Football. How can it be wrong in a football club to have a Director of Football on the Board? In the case of Brands with his reputation and experience as a Football Professional, how can it be wrong?

The FD at Everton is the Russian isn’t it?

The sheer fact that he is on the Board with an equal voice means that he has equal authority with the other Directors. This does not mean he has autonomy. No Director does, or should have. They are there to set strategy and run the business as a Board. Part of Brands’ job is to represent the views of Ancelotti for example.

All major decisions should be debated, and consensus reached. If in what should be a minority of cases this is not possible, a vote is taken, and as such a decision is minuted. If in the event of a tie, the Chairman has a casting vote to break the deadlock. On Everton’s Board with three Directors and a Chairman, numerically this should not happen.

I stress this is what should happen, not what is currently happening.

But if there are Corporate governance or professionalism issues at Everton, and none of us really knows(and I share your opinion) it is certainly not because Brands is on the Board.

As it stands, there may well be legal reasons why incompetent Board members can’t be removed.

Jerome Shields
67 Posted 30/01/2020 at 13:17:46
Chris #66

Yes you are right when everything is going well, but expecting Brands a Football man to turn around the financial factors that has contribute to record losses and get Everton back far enough from FFP thresholds is a tall order to expect. Paul Esk and myself are hoping rather than being convinced.

The Everton Board is a funny old Board, where a minority shareholder and Chairman is able run the Club as he has always done and appoint a Chief Executive. At the moment he has control of the Board legally with his casting vote. Though millions have been been wasted and with recent record losses, he is still in situ. The adm management of the Club is not producing and those involved in team are also not producing, but still there, unless Ancelotti can change things.

In the case of Brands there is no sign that his appointment to the Board has resulted in any progress on what has happened previously. The Summer Transfer Window was not all Brands. I actually believe Brands had to resort to sabotage to prevent it turning into a disaster. It was a debacle anyway, because Brands was distracted by the action of others.

Everton are in a worse position than five years ago.

I have never attended a Everton Board meeting, but after the reports on the AGM I know they must be a absolute hoot.

Just 're read your post , you obviously know something about Boards and how they act. I like you think there are legal reasons why things are as they are. In my opinion when Moshiri took over he had to accept A shareholders agreement with Kenwright. It could be that Moshiri was looking at the bigger picture , in that Everton would end up being worth a lot more in the future, but most Investors would have not touched Everton with a barge pole under Kenwrights conditions.

chris williams
68 Posted 30/01/2020 at 14:01:32

As I said, that was how it should happen. It happened more or less that way on all the Boards I sat on. Not always to the letter. It is more important when things are not going well.

It is not Brands’ job to turn round the the financial problems, it is his job to work within them and improve them within his brief over time. A major job, which I believe he has started with the sales of Gueye, Onyekuru, Vlasic and Lookman. All of which will have been signed off by the Board, not at Brands’ whim. His hands are significantly tied by the fact that he can’t shift the players that nobody wants. It possibly explains the uninspiring business in the last window and the lack so far this window. Watch out for more sales though.

We should be celebrating every sale as much as every signing, if we are to make progress, but it may not be the sales we want.

We will know just how good he is when this works it’s way through, but we should not rush to judgement.

The financial issues are also dependent on income from all sources, not just transfers, like sponsorships, corporate partnerships, commercial activities, all of which are nowhere near good enough. Tv income is what it is, and over time will probably diminish. So not all down to Brands? And maybe at least as big an issue?

The Chairman’s casting vote only occurs in the event of a tied vote, unlikely on a Board with only three directors, unless one abstains. Otherwise it will always be 2 1 one way or another. So if he is intervening in the way you describe it’s certainly not legal. The fact that there are two directors who you might consider Moshiri appointments also maybe tells a story.

Votes are usually rarely necessary.

Moshiri certainly seems to involve himself, as with Zaha, last window. But we didn’t sign him. Sabotage you may say? Thank Christ anyway.

I think that maybe the penny re FFP may have finally dropped maybe even with Bill. But it seems he now has an ‘enhanced position’ within the club, which if true shows what a smart political operator he is, and how dangerous, especially to Brands.

That is the major issue, not Brands’ status on the Board

chris williams
69 Posted 30/01/2020 at 14:16:15

When a company is sold, an SPA is prepared. This is a legally binding document which covers all aspects of both the sale and purchase. It is typically huge and detailed and includes all the requirements and conditions of both parties.

It is possible that a condition was included covering Bill remaining as Chairman. This should have a time limit on it if any sense was applied. It would also cover the timing and transfer of Bill’s shares. Bill still retains about 5% from memory. The Purchaser would need to agree it. He may even have asked for it.

The timing may perhaps be tied in to, say, getting planning permission. Once that happens, the value of EFC increases massively.(as happened when LFC got planning permission in Stanley Park). So a nice final payout?

I’m only surmising as are we all, and it may be that Moshiri thinks he’s brilliant. Maybe he is and we’re all wrong!

Kieran Kinsella
70 Posted 30/01/2020 at 14:22:02
I think having a football man on the board is essential. Now whether that role should be distinct from DOF is up for debate. Brands apart we have an accountant, a charity worker, an oligarch and a carny. We need a football voice there as ultimately we are a football team
Jerome Shields
71 Posted 30/01/2020 at 14:31:10
Chris #68

What you say is true reference the Board and Kenwright as Chairman. As you say the situation I have described rarely happens, votes taken accompany a lot of awareness regards legally and where the power lies. Kenwright is a good political operatior and has enriched himself in the process. His remaining shares will go up in value no matter what he does.

Brands has done a good job off loading players via sale and loan, but there must be a feeling that realising value is important, so as not to make Moshiri look a complete idiot.

I have been involved in Clubs, across various sports and without fail the Club that won the Cup had a well run Committee/Board as well as a well run team. A Chairman through a unsuccessful tenure, will never be the Chairman through a successful tenure.

Brands can do his bit and professionally
with Ancelotti. But they are going to be up against it because of the way Everton is currently run.

Jerome Shields
72 Posted 30/01/2020 at 16:34:31

I think your summation is pretty accurate and the SPA probably also consists of conditions and authority of his continuing tenure as Chairman.

Kenwright was a Director during the Johnson era, Johnson made money on the sale of Everton and Kenwright has topped that. It has occurred to me that Kenwright position is not a bad one. As you say it depends timing and what Moshiris motivation is in buying Everton.

John Woods former Director it was reported on ToffeeWeb said that it would be difficult to sell Everton, because of Kenwrights condition of sale. Moshiri got Everton at a bargain price, though he did have to accept Kenwright conditions. The future potential value of Everton, a front seat on a major Docklands and a Premier League Club of standing where probably the main incentives.

Kenwright can sit back with his 5% shareholder assured that it will be worth something. Brands I believe was brought on to the Board to stop Kenwright &Co hemeraging more money. The money waste on appalling player was a disgrace. The longer Kenwright can hang in the richer he will become and it may cheaper for Moshiri to buy him. off rather than lose now money.

Moshiri/Usmanov is prepared to to!erate Kenwright, because Kenwright does know the authorities and they have seen at Chelsea what happens if a foreign owner puts hishead above the parapet. They are well use to doing business the way they are doing it.

The problem is the result of all of this on Everton on the pitch.

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