Thursday, February 19, 2009

Adelaide United Update

I was struggling to understand Vidmar's outburst and the reaction by the club, Vidmar's subsequent statements and the reactions to that.

Now I understand.

Vidmar has been under a volcano of pressure. And his outburst has put the club into damage control to protect its goodwill. Goodwill in an accounting sense. The major item of value on many professional club balance sheet.

According to press reports released today, last week the owner of Adelaide was on TV last week saying Adelaide United was for sale and that the price was $5 million.

The value is in the prestige of the club, what it has done, what it could do, who plays for it and how many fans it has.

Adelaide United is a very tightly run club. Across all areas and particularly in financial management. They have been around a long time and understand the benefits of making sure everything is done on the right scale for the potential revenue including sponsorship.

The international financial situation and success in the Asian Champions League may well have proved key in any decision. It would also be a motivator to cut costs to maximise the net income and ultimate sale value. Convincing Vidmar to stay - and not sign with a Japanese club - may have been an issue. Selling or reducing the player costs may have been another. As would minimising the coaching and operational costs. But there are other players that must be kept for any new owner.

It is easy to see how this would upset the player group and, in particular, the highly valuable coach of the year.

During a takeover you want to keep your goodwill and keep the people happy. The new buyer needs to know what they are getting.

Has this been resolved by Vidmar speaking out? I doubt it.

'Vidmar said he would be sad to see owner NickBianco relinquish control of the club. But he said speculation that Adelaide United could be snapped up by a foreign consortium wasn't surprising.' Richard Earle 'Fined $2,000, but Vidmar vows to fight on' The Cour-Mail 18 february 2009 page 85

'Last week, Bianco declared on local TV that the club was up for sale, but no-one was keen to take it out of his hands at that point.... It's believed Bianco wants $5 million for an owner to take the club off his hands.' 'Adelaide up for Sale' Australian Football Weekly Issue 22 Feb 19 - 25 2009, Page 5

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