SIMON COHEN AND TOM SCOTT

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Turnaroundspecialist
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SIMON COHEN AND TOM SCOTT

Post by Turnaroundspecialist » Mon Dec 02, 2019 7:19 pm

Simon Cohen and Tom Scott effectively took control of the Club between 2013 and 2015, with Tom Scott becoming the effective controlling shareholder in 2015 with 46% and Simon Cohen being appointed CEO in November 2013. At the same time the remaining long time club men and ex players such as Peter Wheeler, Gary Adey and Roy Jackson left the board.

Since Simon Cohen and Tom Scott took control the club has been in almost continuous year on year decline in the three critical measures of league points, season tickets sales and profit as follows

Profit and Loss £k
Season P&L £k Decline
13/14………… 482
14/15………… 479……….... -3 down
15/16……….. -424 loss……. -903 down
16/17……….. -666 loss……. -242 down
17/18……….. -991 loss……..-325 down
18/19……….. -1,915 loss…..-924 down

Season tickets decline
Season Tickets Decline
13/14………. 14,945
14/15………. 15,239 ……… 294 up
15/16………. 14,775 ……… -464 down
16/17………. 14,500 ……… -275 down
17/18………. 14,027 ……… -473 down
18/19………. 13,530 ……… -497 down

League points
Season Points Decline
13/14…………..... 74
14/15…………..... 68…………… -6 down
15/16…………..... 65…………… -3 down
16/17…………..... 66…………… 1 up
17/18…………..... 63…………... -3 down
18/19…………..... 41………….. -22 down
19/20 run rate..18…………... -23 down

Such sustained deterioration across the board signals a failing Club which only a root and branch strategic, cultural and management change can reverse, as more of the same is highly unlikely to work.

The Club has implicitly accepted this by the decision to sell. The problem is that the sale price of £60m, at a time when the club is failing, is much higher than ascribed to it when it was successful. At a value of £60m, Tom Scott’s 46% shareholding would be worth around £27m, a profit of c £18m over my estimate of his investment at between £8m to £10m. Something is wrong here.

The danger is that the high price being sought together with continuing deterioration will make it impossible to achieve a sale. This could then lead to a default outcome of no change and thus continued deterioration, which can only be reversed by the controlling management recognising the failure and/or external pressure from other stakeholders to instigate change.

Ian Cant
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Re: SIMON COHEN AND TOM SCOTT

Post by Ian Cant » Mon Dec 02, 2019 9:24 pm

Well done. Spot on. No wonder we are in decline on and off the field.
We used to have people in important positions who were a Tigers to the core.
I will always support my club and now reckon I/Tigers’ fans should start doing the Euro Lottery to be able to buy the club. There has to be some rich folk who support our club and want to put a sensible business and playing structure in place.

chewbacca
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Re: SIMON COHEN AND TOM SCOTT

Post by chewbacca » Mon Dec 02, 2019 9:27 pm

Turnaroundspecialist wrote:
Mon Dec 02, 2019 7:19 pm
Simon Cohen and Tom Scott effectively took control of the Club between 2013 and 2015, with Tom Scott becoming the effective controlling shareholder in 2015 with 46% and Simon Cohen being appointed CEO in November 2013. At the same time the remaining long time club men and ex players such as Peter Wheeler, Gary Adey and Roy Jackson left the board.

Since Simon Cohen and Tom Scott took control the club has been in almost continuous year on year decline in the three critical measures of league points, season tickets sales and profit as follows

Profit and Loss £k
Season P&L £k Decline
13/14………… 482
14/15………… 479……….... -3 down
15/16……….. -424 loss……. -903 down
16/17……….. -666 loss……. -242 down
17/18……….. -991 loss……..-325 down
18/19……….. -1,915 loss…..-924 down

Season tickets decline
Season Tickets Decline
13/14………. 14,945
14/15………. 15,239 ……… 294 up
15/16………. 14,775 ……… -464 down
16/17………. 14,500 ……… -275 down
17/18………. 14,027 ……… -473 down
18/19………. 13,530 ……… -497 down

League points
Season Points Decline
13/14…………..... 74
14/15…………..... 68…………… -6 down
15/16…………..... 65…………… -3 down
16/17…………..... 66…………… 1 up
17/18…………..... 63…………... -3 down
18/19…………..... 41………….. -22 down
19/20 run rate..18…………... -23 down

Such sustained deterioration across the board signals a failing Club which only a root and branch strategic, cultural and management change can reverse, as more of the same is highly unlikely to work.

The Club has implicitly accepted this by the decision to sell. The problem is that the sale price of £60m, at a time when the club is failing, is much higher than ascribed to it when it was successful. At a value of £60m, Tom Scott’s 46% shareholding would be worth around £27m, a profit of c £18m over my estimate of his investment at between £8m to £10m. Something is wrong here.

The danger is that the high price being sought together with continuing deterioration will make it impossible to achieve a sale. This could then lead to a default outcome of no change and thus continued deterioration, which can only be reversed by the controlling management recognising the failure and/or external pressure from other stakeholders to instigate change.
Absolutely this. I would be surprised it current valuation put it as high as 50% of the £60m. Greed will destroy the club.
I'm not cynical just experienced

fentiger
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Re: SIMON COHEN AND TOM SCOTT

Post by fentiger » Mon Dec 02, 2019 9:36 pm

Yeah, I've thought for some time that Cohen fancies himself as some kind of poor mans Daniel Levy, unfortunately he hasn't a fraction of the nous!

anz3001
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Re: SIMON COHEN AND TOM SCOTT

Post by anz3001 » Mon Dec 02, 2019 9:56 pm

Turnaroundspecialist wrote:
Mon Dec 02, 2019 7:19 pm

The Club has implicitly accepted this by the decision to sell. The problem is that the sale price of £60m, at a time when the club is failing, is much higher than ascribed to it when it was successful. At a value of £60m, Tom Scott’s 46% shareholding would be worth around £27m, a profit of c £18m over my estimate of his investment at between £8m to £10m. Something is wrong here.
I agree with the sentiment of your post but out of interest, where are those figures from. Is it public knowledge how much was invested and what comparison can we use to suggest £60m is over priced?

Turnaroundspecialist
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Re: SIMON COHEN AND TOM SCOTT

Post by Turnaroundspecialist » Mon Dec 02, 2019 10:07 pm

The figures are from the annual accounts

jgriffin
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Re: SIMON COHEN AND TOM SCOTT

Post by jgriffin » Mon Dec 02, 2019 10:23 pm

Good to see a constructive and informative post. Why join now to post it? Motive?
Leicester Tigers 1995-
Nottingham 1995-2000
Swansea (Whites) 1988-95
A game played on grass in the open air by teams of XV.

ourla
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Re: SIMON COHEN AND TOM SCOTT

Post by ourla » Mon Dec 02, 2019 11:45 pm

jgriffin wrote:
Mon Dec 02, 2019 10:23 pm
Good to see a constructive and informative post. Why join now to post it? Motive?
Short posting history but looking it seems legit.
You're either in or you're out

CitizenSmiff
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Re: SIMON COHEN AND TOM SCOTT

Post by CitizenSmiff » Tue Dec 03, 2019 12:42 am

Great post, good to be able to put some figures behind the deficiencies we've all known about for years.

Mark62
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Re: SIMON COHEN AND TOM SCOTT

Post by Mark62 » Tue Dec 03, 2019 9:01 am

jgriffin wrote:
Mon Dec 02, 2019 10:23 pm
Good to see a constructive and informative post. Why join now to post it? Motive?
Maybe the clue is in the posters user name

jgriffin
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Re: SIMON COHEN AND TOM SCOTT

Post by jgriffin » Tue Dec 03, 2019 9:21 am

Mark62 wrote:
Tue Dec 03, 2019 9:01 am
jgriffin wrote:
Mon Dec 02, 2019 10:23 pm
Good to see a constructive and informative post. Why join now to post it? Motive?
Maybe the clue is in the posters user name
Thought it might be an FB poster who travels a lot and is an accountancy lecturer.......
Leicester Tigers 1995-
Nottingham 1995-2000
Swansea (Whites) 1988-95
A game played on grass in the open air by teams of XV.

Mark62
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Re: SIMON COHEN AND TOM SCOTT

Post by Mark62 » Tue Dec 03, 2019 9:23 am

jgriffin wrote:
Tue Dec 03, 2019 9:21 am
Mark62 wrote:
Tue Dec 03, 2019 9:01 am
jgriffin wrote:
Mon Dec 02, 2019 10:23 pm
Good to see a constructive and informative post. Why join now to post it? Motive?
Maybe the clue is in the posters user name
Thought it might be an FB poster who travels a lot and is an accountancy lecturer.......
Fair shout

Scuttle
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Re: SIMON COHEN AND TOM SCOTT

Post by Scuttle » Tue Dec 03, 2019 9:34 am

jgriffin wrote:
Tue Dec 03, 2019 9:21 am
Mark62 wrote:
Tue Dec 03, 2019 9:01 am
jgriffin wrote:
Mon Dec 02, 2019 10:23 pm
Good to see a constructive and informative post. Why join now to post it? Motive?
Maybe the clue is in the posters user name
Thought it might be an FB poster who travels a lot and is an accountancy lecturer.......
FB poster?
As Good As It Gets

ads
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Re: SIMON COHEN AND TOM SCOTT

Post by ads » Tue Dec 03, 2019 9:56 am

I agree with most of the OP but this bit:

League points
Season Points Decline
13/14…………..... 74
14/15…………..... 68…………… -6 down
15/16…………..... 65…………… -3 down
16/17…………..... 66…………… 1 up
17/18…………..... 63…………... -3 down

Doesn't really scream continual decline. Those points would have got us into the play offs last season.

Turnaroundspecialist
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Re: SIMON COHEN AND TOM SCOTT

Post by Turnaroundspecialist » Tue Dec 03, 2019 12:02 pm

The motive for my post is to point out that the responsibility for the sustained decline lies with the current controlling shareholder and management, and that this can only be reversed if there is root and branch change here. Blaming the various sub standard coaches they have appointed over the past few years misses the point.

The situation is worsened by the proposed solution to sell for £60m. First this would provide a distasteful reward for failure - my estimate is of 46% (c£27m) going to Tom Scott, giving him a c£18m profit, tax free in Guernsey. Second it would potentially build in destructive future financial obligations, taking money out that could be spent on rugby success and community support

I imagine, given current performance, a sale at this price is proving difficult. Assuming this is the case the following are possible outcomes
1. The current controlling management and shareholder move aside. No evidence of this.
2. The Non execs on the board engineer a change. No evidence so far, especially since they are in effect the appointees of the controlling shareholder
3. The company sells for less than £60m. Still has the danger of taking money out of the club, not putting it in
4. A financial crisis, possibly triggered by relegation. Not good.
5. The Club limps along, with change put off to another day, hoping something turns up. The current approach

The only satisfactory outcome is for the board to take responsibility and instigate root and branch change without burdening the Club with destructive future financial obligations.

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