Post by myles on Oct 19, 2017 14:11:48 GMT
With Sumrith “Tiger” Thanakarnjansuth, until recently part-owner of Reading FC, having been seen alongside Darryl Eales at several recent matches, most recently at Bristol Rovers last week, it is reasonable to speculate that he is to become the new controlling shareholder of Oxford United.
This was put to DE by the Oxford Mail after they were seen together at the Peterborough game, and Darryl refused to comment. This is odd, because in the past he has been swift to comment, even claiming that he had not received an offer from Sartori when in fact he had. So, let us assume until it is denied that this is happening and is only a matter of time. I’ve spent some time recently trawling through various sets of accounts and contemporary press reports to find out what I can about our potential new owner.
“Tiger” at Reading
Tiger owns a Thai company which produces clothes for, amongst others, Adidas and New Balance. It seems to turn over about £30 million a year and makes a profit of maybe £2-£3 million. Not a bad business, not by any stretch, but not even the size of Ian Lenagan or Robin Herd’s old businesses. He bought 25% of Reading FC in 2014, alongside two other Thais. There was meant to be a fourth senior partner, Samrit – whose nickname is “Mr BIG” - but just before the deal was done he disappeared from being a named party, with his 25% being taken up by one of the remaining three. There was suggestion that Mr BIG had (or would have) failed the EFL Fit and Proper Persons Test.
The deal was arranged by two men called Pairoj Piempongsant and Taweesuk “Jack” Srisumrid, who subsequently became directors. Now, those two gentlemen are very interesting, because they were (or are) the chiefs of staff to fugitive former Thai PM Thaksin Shinawatra. The whole Shinawatra clan is under constant investigation. Indeed, earlier this week Thaksin’s son was arrested on money-laundering charges. Pairoj is so close to Thaksin – and Thaksin is so toxic – that when there was a potential takeover of Portsmouth FC a few years back, the Premier League specifically said that neither Thaksin nor Pairoj could have anything to do with it.
The Thais bought Reading by agreeing to pay off the £15 million of loans that the previous Russian owner had run up with an aggressive moneylender called VIBRAC. Madejski was told by VIBRAC that if either he or someone else did not re-pay the loan and interest they (VIBRAC) would take-over the whole club. So into the breach stepped Pairoj, who had noticed (ring a bell anywhere?) that the club’s assets out-stripped its debts. First, he tried to get “Mr BIG” to do it, and when that failed (see above) he came up with a group of businessmen, of which Tiger was one.
To cut a long story short (for the moment), over the following two years the Thai group asset-stripped the development land surrounding the stadium (Royal Elm Park) – you can see the Reading Supporters Trust reaction to that on this link documents.reading.gov.uk/AnitePublicDocs/00347097.pdf (particularly paragraphs 6-8) - whilst also using those assets, plus the stadium and training ground a £15million loan from an American investment firm. In the meantime, they complained that the ongoing losses of circa £5 million a year were far higher than they had thought. Meanwhile, Reading FC had to pay interest (effectively rent) of £1 million plus on the stadium it had previously owned, management charges to Pairoj of £1.5 million (see below) and further fees of £1.5 million for the “arrangement of finance” for all these shenanigans.
Once the development land had been asset-stripped and planning permission granted, the Thai group wanted out, and sold to a Chinese bidder who had, just previously, been turned down by the Premier League’s Fit and Proper Persons Test. Tiger and co were left with a small ongoing stake, and a commitment to pay a small portion of the ongoing costs.
So, in conclusion, it was a very strange two year ownership. The Thais took over an indebted, loss-making Championship club. They asset-stripped it and barely spent a penny of their own money that I can find in the accounts, paid out a fortune in management fees to their fixers (see below) and then – having got the planning land off the books – complained that £5 million a year to have a top 6 budget and therefore a chance of promotion to the Premier League was much more than the three of them could afford (£1.5 million a year each) and sold up, at a profit.
Pairoj Piempongsant and Taweesuk “Jack” Srisumrid
When Shinawatra owned Manchester City, his two chiefs of staff – Pairoj and Jack – were on the Board with Shinawatra’s son (the one arrested this week on money laundering charges). And when Thaksin suddenly had to sell – having been accused of corruption/ money laundering – it was Pairoj who arranged the sale to the Abu Dhabi people.
He was rumoured to be assisting in the purchase of Portsmouth by a weird and wonderful UAE con man called Sulaiman Al-Fahim a year or two later, but – interestingly – this report caused such alarm at Premier League level that Sir Dave Richards was wheeled out to say that no deal could be done if Thaksin or Pairoj was involved, given the former’s status as a fugitive money launderer and the latter’s status as his chief henchman. It was a sort of pre-emptive failing of the Fit and Proper Person’s Test. Unsurprisingly, since then Pairoj has kept his head down with regards to the Premier League, but has instead been getting himself involved in the EFL, where such tests are weaker.
In the meantime, Pairoj and Jack set up a complex web of companies under the “Empire” banner. Based out of Singapore, then linked to the British Virgin Islands, and on to the offices of Panama Papers law firm Mossack Fonseca (both Empire Asia and Pairoj on a personal basis appear in the Panama Papers). In 2016, the Thai government announced that it was launching a money-laundering investigation into the 16 Thai nationals whose names appeared in the Panama Papers (those names included both Pairoj and Thaksin’s wife, Potjaman). The duo’s multi-million pound fees for both setting up the Reading deal and then for helping “manage” the club were paid out to Empire Asia (website of which was recently closed down, but you can still see the cached weblinks), whilst another company, Empire Global, received the stripped Reading property assets. Meanwhile, someone who met Pairoj at this time was presented with a business card that simply stated “Owner of Reading FC”.
Whilst the owners of Reading FC were often absent, Pairoj and “Jack” were the real movers and shakers in the Reading boardroom, extracting huge fees in the process, not to mention the property assets. Meanwhile, Pairoj had introduced Reading to an exciting new shirt sponsor, albeit at the rather less-than-exciting sum of £150k a year (about what LionTrust pays OUFC): Thai-based energy drink Carabao.
Carabao and Intercarabao
The former is a successful energy drinks business in the Far East, turning over around £280 million a year. The latter, by contrast, is a small business (based out of an accountancy firm in Reading) that has gained the exclusive rights to promote Carabao in the UK. So, it is the separate, foreign-based distributor of a medium-sized drinks brand. In the last year of accounts, its turnover was a measly £600,000 or so, whilst incurring “administrative expenses” of over £14m. That tiny company has decided to “invest” vast marketing budgets, mostly on sports sponsorship deals, e.g. £30m over three years on Chelsea, £18m over 3 years on the EFL Cup. Where this money is coming from is not clear – though the holding company (in Luxembourg) has had to make a statement effectively saying that Carabao (the drinks brand) will contribute to financing if required to enable it to trade as a going concern. Leaving aside Intercarabao’s own measly turnover, its marketing spend is something like 25% of the turnover of Carabao itself; a quite extraordinary sum.
Pairoj is the “president” of Intercarabao, and Empire Asia (the company he and Jack share) is its founding entity, through an agreement with master company Carabao.
Concluding questions
What is clear is that the web of different interests and companies at Reading was unbelievably complex. Indeed, so complex that the local newspaper wrote a forceful column urging more transparency (http://www.getreading.co.uk/sport/football/football-news/opinion-reading-fc-fans-deserve-8165421). The machinations were so intricate that the fans did not even know that their stadium had been used as collateral for that extra £15m loan (which, oddly, is not transparently in the club's accounts). To be fair though, the Reading Supporters Trust were at least on top of the rest of the asset-stripping.
“Tiger” – with his small to medium sized tailoring business - is clearly not a major player. He is just the latest obscure Thai businessman to be placed into UK football by Pairoj et al. Nor is it clear that he was in charge in any meaningful way (though reports I have heard of him bursting into the manager’s office to tell him what to do, and running up and down the touchline at the training ground, are worrying, if true). But in business terms, Pairoj and Jack were clearly pulling the strings. So if Tiger does pitch up at OUFC, who will be standing behind him? And why would someone who could barely put a penny into Reading FC be in a position to fund us to take us to the next level?
After all, his share of the £5 million a year that it was costing to make Reading competitive in the Championship was no more than what DE and IL have been putting into OUFC for the last ten years. If we WERE to go up to the Championship then the necessity for an owner to contribute would escalate massively (as DE has himself stated). So why find as a new owner someone who could not stand that burden at a club with a much better set-up (25,000 seater stadium and Cat 1 academy) and assets to strip to help fund it?
It is hard not to note, too, that – I’m sure entirely by honest mistake – these people have been in close business proximity to money-launderers. From Shinawatra himself, to his son, to Tiger’s co-bidder at Reading Mr BIG, to the Panama Papers. And let’s not even get onto Intercarabao!
This was put to DE by the Oxford Mail after they were seen together at the Peterborough game, and Darryl refused to comment. This is odd, because in the past he has been swift to comment, even claiming that he had not received an offer from Sartori when in fact he had. So, let us assume until it is denied that this is happening and is only a matter of time. I’ve spent some time recently trawling through various sets of accounts and contemporary press reports to find out what I can about our potential new owner.
“Tiger” at Reading
Tiger owns a Thai company which produces clothes for, amongst others, Adidas and New Balance. It seems to turn over about £30 million a year and makes a profit of maybe £2-£3 million. Not a bad business, not by any stretch, but not even the size of Ian Lenagan or Robin Herd’s old businesses. He bought 25% of Reading FC in 2014, alongside two other Thais. There was meant to be a fourth senior partner, Samrit – whose nickname is “Mr BIG” - but just before the deal was done he disappeared from being a named party, with his 25% being taken up by one of the remaining three. There was suggestion that Mr BIG had (or would have) failed the EFL Fit and Proper Persons Test.
The deal was arranged by two men called Pairoj Piempongsant and Taweesuk “Jack” Srisumrid, who subsequently became directors. Now, those two gentlemen are very interesting, because they were (or are) the chiefs of staff to fugitive former Thai PM Thaksin Shinawatra. The whole Shinawatra clan is under constant investigation. Indeed, earlier this week Thaksin’s son was arrested on money-laundering charges. Pairoj is so close to Thaksin – and Thaksin is so toxic – that when there was a potential takeover of Portsmouth FC a few years back, the Premier League specifically said that neither Thaksin nor Pairoj could have anything to do with it.
The Thais bought Reading by agreeing to pay off the £15 million of loans that the previous Russian owner had run up with an aggressive moneylender called VIBRAC. Madejski was told by VIBRAC that if either he or someone else did not re-pay the loan and interest they (VIBRAC) would take-over the whole club. So into the breach stepped Pairoj, who had noticed (ring a bell anywhere?) that the club’s assets out-stripped its debts. First, he tried to get “Mr BIG” to do it, and when that failed (see above) he came up with a group of businessmen, of which Tiger was one.
To cut a long story short (for the moment), over the following two years the Thai group asset-stripped the development land surrounding the stadium (Royal Elm Park) – you can see the Reading Supporters Trust reaction to that on this link documents.reading.gov.uk/AnitePublicDocs/00347097.pdf (particularly paragraphs 6-8) - whilst also using those assets, plus the stadium and training ground a £15million loan from an American investment firm. In the meantime, they complained that the ongoing losses of circa £5 million a year were far higher than they had thought. Meanwhile, Reading FC had to pay interest (effectively rent) of £1 million plus on the stadium it had previously owned, management charges to Pairoj of £1.5 million (see below) and further fees of £1.5 million for the “arrangement of finance” for all these shenanigans.
Once the development land had been asset-stripped and planning permission granted, the Thai group wanted out, and sold to a Chinese bidder who had, just previously, been turned down by the Premier League’s Fit and Proper Persons Test. Tiger and co were left with a small ongoing stake, and a commitment to pay a small portion of the ongoing costs.
So, in conclusion, it was a very strange two year ownership. The Thais took over an indebted, loss-making Championship club. They asset-stripped it and barely spent a penny of their own money that I can find in the accounts, paid out a fortune in management fees to their fixers (see below) and then – having got the planning land off the books – complained that £5 million a year to have a top 6 budget and therefore a chance of promotion to the Premier League was much more than the three of them could afford (£1.5 million a year each) and sold up, at a profit.
Pairoj Piempongsant and Taweesuk “Jack” Srisumrid
When Shinawatra owned Manchester City, his two chiefs of staff – Pairoj and Jack – were on the Board with Shinawatra’s son (the one arrested this week on money laundering charges). And when Thaksin suddenly had to sell – having been accused of corruption/ money laundering – it was Pairoj who arranged the sale to the Abu Dhabi people.
He was rumoured to be assisting in the purchase of Portsmouth by a weird and wonderful UAE con man called Sulaiman Al-Fahim a year or two later, but – interestingly – this report caused such alarm at Premier League level that Sir Dave Richards was wheeled out to say that no deal could be done if Thaksin or Pairoj was involved, given the former’s status as a fugitive money launderer and the latter’s status as his chief henchman. It was a sort of pre-emptive failing of the Fit and Proper Person’s Test. Unsurprisingly, since then Pairoj has kept his head down with regards to the Premier League, but has instead been getting himself involved in the EFL, where such tests are weaker.
In the meantime, Pairoj and Jack set up a complex web of companies under the “Empire” banner. Based out of Singapore, then linked to the British Virgin Islands, and on to the offices of Panama Papers law firm Mossack Fonseca (both Empire Asia and Pairoj on a personal basis appear in the Panama Papers). In 2016, the Thai government announced that it was launching a money-laundering investigation into the 16 Thai nationals whose names appeared in the Panama Papers (those names included both Pairoj and Thaksin’s wife, Potjaman). The duo’s multi-million pound fees for both setting up the Reading deal and then for helping “manage” the club were paid out to Empire Asia (website of which was recently closed down, but you can still see the cached weblinks), whilst another company, Empire Global, received the stripped Reading property assets. Meanwhile, someone who met Pairoj at this time was presented with a business card that simply stated “Owner of Reading FC”.
Whilst the owners of Reading FC were often absent, Pairoj and “Jack” were the real movers and shakers in the Reading boardroom, extracting huge fees in the process, not to mention the property assets. Meanwhile, Pairoj had introduced Reading to an exciting new shirt sponsor, albeit at the rather less-than-exciting sum of £150k a year (about what LionTrust pays OUFC): Thai-based energy drink Carabao.
Carabao and Intercarabao
The former is a successful energy drinks business in the Far East, turning over around £280 million a year. The latter, by contrast, is a small business (based out of an accountancy firm in Reading) that has gained the exclusive rights to promote Carabao in the UK. So, it is the separate, foreign-based distributor of a medium-sized drinks brand. In the last year of accounts, its turnover was a measly £600,000 or so, whilst incurring “administrative expenses” of over £14m. That tiny company has decided to “invest” vast marketing budgets, mostly on sports sponsorship deals, e.g. £30m over three years on Chelsea, £18m over 3 years on the EFL Cup. Where this money is coming from is not clear – though the holding company (in Luxembourg) has had to make a statement effectively saying that Carabao (the drinks brand) will contribute to financing if required to enable it to trade as a going concern. Leaving aside Intercarabao’s own measly turnover, its marketing spend is something like 25% of the turnover of Carabao itself; a quite extraordinary sum.
Pairoj is the “president” of Intercarabao, and Empire Asia (the company he and Jack share) is its founding entity, through an agreement with master company Carabao.
Concluding questions
What is clear is that the web of different interests and companies at Reading was unbelievably complex. Indeed, so complex that the local newspaper wrote a forceful column urging more transparency (http://www.getreading.co.uk/sport/football/football-news/opinion-reading-fc-fans-deserve-8165421). The machinations were so intricate that the fans did not even know that their stadium had been used as collateral for that extra £15m loan (which, oddly, is not transparently in the club's accounts). To be fair though, the Reading Supporters Trust were at least on top of the rest of the asset-stripping.
“Tiger” – with his small to medium sized tailoring business - is clearly not a major player. He is just the latest obscure Thai businessman to be placed into UK football by Pairoj et al. Nor is it clear that he was in charge in any meaningful way (though reports I have heard of him bursting into the manager’s office to tell him what to do, and running up and down the touchline at the training ground, are worrying, if true). But in business terms, Pairoj and Jack were clearly pulling the strings. So if Tiger does pitch up at OUFC, who will be standing behind him? And why would someone who could barely put a penny into Reading FC be in a position to fund us to take us to the next level?
After all, his share of the £5 million a year that it was costing to make Reading competitive in the Championship was no more than what DE and IL have been putting into OUFC for the last ten years. If we WERE to go up to the Championship then the necessity for an owner to contribute would escalate massively (as DE has himself stated). So why find as a new owner someone who could not stand that burden at a club with a much better set-up (25,000 seater stadium and Cat 1 academy) and assets to strip to help fund it?
It is hard not to note, too, that – I’m sure entirely by honest mistake – these people have been in close business proximity to money-launderers. From Shinawatra himself, to his son, to Tiger’s co-bidder at Reading Mr BIG, to the Panama Papers. And let’s not even get onto Intercarabao!