By Kris Gonzo | Senior West Ham Columnist (Follow on X)
Reports that David Sullivan will be nothing more than a silent partner at West Ham are not entirely accurate.
As Claret & Hugh reported last night, sources were at pains to point out, following the backlash from fans, that Sullivan would have no operational control at the football club.
And whilst that may well be part of a pre-arranged agreement between shareholders, it doesn’t necessarily make Sullivan powerless.
The important number here is 40%.
Sullivan’s increased shareholding does not give him control of West Ham. Ordinary shareholder resolutions are generally passed by a simple majority, so Daniel Křetínský, as the club’s largest shareholder with around 46%, remains in the stronger position.
But some of the really big corporate decisions are different.
Sullivan’s 40% Comes With Significant Power
Under UK company law, certain decisions require what is called a special resolution, which needs at least 75% approval from the votes cast.
And that is where Sullivan’s 40% becomes hugely significant.
With considerably more than 25%, Sullivan potentially has what is effectively a blocking stake. If all voting shares participate and he votes against a special resolution, the other shareholders cannot reach the required 75% without him.
That can include significant corporate matters such as changes to a company’s articles of association.
So both things can be true at the same time.
David Sullivan may have no operational role. He may not sit on the board, run recruitment or involve himself in the day-to-day running of West Ham.
But calling him powerless would be completely wrong.
Kretinsky is now the most powerful man at West Ham but Sullivan still wields influence
Křetínský Is In Charge — But Sullivan Still Matters
C&H revealed yesterday how Sullivan initially purchased his full allocation of Vanessa Gold’s shares, temporarily taking his holding considerably higher, before shares were subsequently redistributed to Daniel Křetínský as part of the agreement between West Ham’s existing shareholders.
The expected outcome leaves Křetínský with approximately 46%, Sullivan with around 40% and Tripp Smith on 11%.
The arrangement was designed to ensure Křetínský became West Ham’s largest shareholder and block Amanda Staveley’s route into the club through Vanessa Gold’s shareholding.
Křetínský therefore emerges as the most powerful individual shareholder at West Ham.
But Sullivan’s 40% means he remains a significant force in the ownership of the football club, irrespective of whether he ever sets foot inside the boardroom again.
Exactly how far that influence extends will depend upon West Ham’s articles, shareholder agreements and the particular decision being taken.
No operational control does not necessarily mean no power.
The reality is that under the rules that give existing shareholders first option on any shares for sale, when Vanessa Gold sold her shares ALL the remaining shareholders increased their proportion of shares – not only Sullivan
Would Staveley be better than Kretinsky ? I have no idea but I feel that he had little option but to follow his chosen path if he didn’t want to roll over
OMG , the man has power , in reality he has disgraced our club , fans and others and dragged our club into the media. All for the wrong reasons . How can we as a club accept that , I hope there are plans to buy the worm out . IMO he should sell up and go and should be nowhere near the club we need a total new board . Let’s hope someone buys him out . Maybe staveley , why not ⚒
36% or 40% makes no difference
Nothing has changed in terms of Sullivan’s potential influence, ge has only increased his shareholding by about 1%
Gonzo, what say is true, but the context paints a different picture. Special Resolutions are rare corporate events and companies often go years without needing one. It’s unlikely the Board we need change the name of the Company, placing it into administration or liquidation, change or even make changes to the Articles of Association.
Most resolutions are ordinary just requiring 50% shareholder approval like appointing or reappointing directors, removing a director, signing off annual accounts etc so the Board will not need Sullivan’s approval
It seems that Kretinsky has been forced into some sort of pact with Sullivan. There is the questionable morality of that to consider but fans will also be concerned about where that leaves any future investment into the squad, particularly following an approx £150m negative spend over the summer window. It is clear that Kretinsky does not want full control so presumably will not put additional funds in unless this will be matched in some way by the other shareholders (mainly Sullivan). So unless I misunderstand matters, it seems likely that we will need to finance any January signings from existing finance or further player sales. Not a great position when you already have substantial debts and reduced income due to relegation.
One thing no one has mentioned in all this is Trip Smith. If he chooses to vote with Sullivan, then they have 51%. He should be on good terms with Sullivan as he allowed him to buy that last 10% and effectively double his money overnight. Do we know TS’s intentions?
Why do you lot keep worrying about it , what will be will be?
He just won’t flush away no matter how many times we pull.the chain
He already had 38% and didn’t want to sell. In ideal world he’d be gone completely be we need to be realistic and patient. Things are a whole lot better than six months ago (and that’s despite our relegation!).