Following on from an announcement made by Sports Direct (LON: SPD) on the 21st October 2019 confirming that it did not (subject to the reservations set out in that announcement) intend to make an offer for Goals Soccer Centres plc, Sports Direct notes the press reports attributed to “a spokesperson for Goals” that “Goals has provided Sports Direct with all of the information they have requested as and when it became available. The board has not frustrated in any way Sports Direct from making an offer for the business”.
Sports Direct believes that, contrary to these reports, Goals and its board did not truly engage with an offer process; access and co-operation was limited and fitful. In particular, key information including access to forensic accounting reports as well as the ability to engage with the main lender was provided to Sports Direct extremely late in the process and Goals’ board was not then willing – or able – to agree to an extension of time for consideration of the potential offer.
Given the issues within the Goals business, Sports Direct believes that it would be convenient for those concerned if Goals, and its corporate history, disappeared as a result of the AMA process. From the beginning, the attitude of the Goals board made no sense, including proclamations to senior management of Sports Direct that the issues impacting on, and leading to the catastrophic failure of, the business had only been perpetuated by one person.
Sports Direct considers the Goals board members it was dealing with to be intelligent, and anyone with any common sense could tell it could not be only the result of one person’s behaviour given the relative size and timeframe over which what would appear to be considerably more than “inappropriate actions” took place. This leads Sports Direct to conclude that the behaviour of the Goals board, and its apparent failure to spot and deal with the issues, amounts to incredible incompetence and ignorance, wilful or otherwise, at the very least and potentially far worse. Sports Direct continues to believe that all relevant matters should be fully investigated, by both the AIM Regulators and an independently appointed third party, with no scope exclusions, and hopes that any eventual purchaser of the Goals business through the AMA process is not connected to the current management team given the investigations needed.
Yet again, the independent shareholders of a UK listed company get wiped out through the skulduggery of others; as these constant corporate failures show, the current rules and regulations do not do enough to protect independent shareholders or to prevent fiscal irresponsibility.