Charlton Athletic owner Thomas Sandgaard has agreed with SE7 Partners’ claim that the collapse of their takeover talks will not prevent the League One club from being sold.
SE7 Partners, led by former Sunderland chief executive Charlie Methven, had entered into a period of exclusivity in December and have threatened legal action after the deal failed to reach completion.
US-based Dane Sandgaard had ended negotiations in early February citing that the interested party had not complied with “very specific terms”.
SE7 Partners said earlier this week that they had “reluctantly decided” to make a statement following Sandgaard’s “public utterances”.
“On December 20, 2022, SE7 Partners agreed terms with Thomas Sandgaard for the purchase of a majority shareholding in Clear Ocean Capital, the holding company which owns Charlton Athletic FC.
“The agreement was to purchase 90 per cent of COCL. SE7, and certain named co-investors, were given exclusivity to complete the deal – including passing the EFL approval process – until March 1, 2023.
“An agreed new management team consisting of Jim Rodwell, Andy Scott, Ed Warrick and Dean Holden was appointed to run the club under Mr Sandgaard in the meantime, with the aim of ensuring that relegation to League Two was avoided (as of December 20, CAFC was in 18th place in League One and had not won a match for two months).
“It was envisaged that the purchase would be completed around a month later, in early February thus giving the EFL plenty of time for approval.”
Sandgaard told our paper on Saturday that SE7 Partners had “clearly lost exclusivity on February 1 by not funding 90 per cent” of the club expenses from that point forwards.
SE7 Partners statement said: “During the envisaged approval process, SE7 agreed to take responsibility for funding its 90 per cent of Charlton Athletic’s financial needs (with a mechanism for repayment in the event EFL approval was withheld). The financial needs of the club were to be as determined by the interim chief financial officer in consultation with Thomas Sandgaard.”
SE7 Partners claim on February 2 that Sandgaard’s lawyers contacted them “demanding substantial funding be paid within 24 hours or SE7 would be considered by him in breach of its obligations”.
Their statement adds: “The interim CFO immediately responded in writing that according to the cashflow forecast, which was updated daily, there was no such funding requirement for at least three weeks.”
Sandgaard said: “They got reminded three times in the first few days after we had exceeded the last day of January. As to the 90 per cent they were supposed to fund, I repeatedly reminded them by email.
“They were not only reminded about how much they needed to put in, and they were reminded several times by my attorneys: ‘Hey, this is it guys’.
“Of course I still kept negotiating in good faith because it would have been nice if the deal had completed – it would’ve given me peace of mind and all that.
“They kept not funding it. So eventually on the 10th I said: ‘This is it, we can’t keep doing that’. I even told them back then that I’ll keep funding, I’ll fund it through February. There is no doubt they were out of exclusivity. ”
SE7 Partners claim that Sandgaard had not funded his 10 per cent share and that the EFL might object to a third party funding the club before it has agreed to the takeover.
Sandgaard said: “I keep sending money over to Charlton’s account all the time. Many times a month. I kept funding it every day.”
SE7 Partners’ statement added it was shocked that “on February 10 Mr Sandgaard unilaterally terminated the agreement by email and disabled access and IT accounts for the senior management team.”
Sandgaard said: “On the 10th I told Charlie: ‘We’re done’. And I told him I would confirm it by email. I confirmed it about two hours later. Half an hour later I believe my attorneys confirmed it to their attorneys. And we were done then, on the 10th.”
Charlton’s club fan adviser (@CAFCFanAdviser) tweeted a conversation they claimed to have had with Sandgaard on February 14.
“Following an article published by The Athletic today, Thomas informed us that American businessman Marc Spiegel is one of many people interested in investing in the football club.”
Spiegel had posted earlier that month a football with an emoji indicating to keep quiet.
That tweet has since been deleted, along with a February 5 post which said: “Made a move today that could turn out to be momentous. Cross your fingers.”
SE7 Partners claim that “ongoing negotiations with a third party during the exclusivity period” is a “clear breach of the legally binding exclusivity agreement”.
Sandgaard said: “I wasn’t negotiating anything during the exclusivity period. It was after that had run out and they had been reminded several times that I started having initial talks with another group.
“I was still trying to come to an agreement, because I didn’t know what the talks to another group were going to lead to. We kept talking but they kept not wanting to fund anything.”
SE7 Partners’ statement said: “Putting all of this to one side, over the last three weeks SE7 and its major investors have none the less continuously offered Mr Sandgaard the opportunity to reverse his breach of exclusivity and complete the deal on the agreed terms, which have never changed. He has refused to do so.
“So with the exclusivity period now ending, SE7 has this morning offered again either to complete the deal, or – failing that – for Mr Sandgaard to come to a reasonable settlement which recognises costs incurred and time wasted.”
Sandgaard said: “I wasted a lot of time too. So how about that?”
SE7 Partners continued: “Failing either option being taken, SE7 has no further recourse save the last resort of taking legal action against Mr Sandgaard.
“It is worth noting that no such legal action would prevent Mr Sandgaard selling Charlton Athletic in the meantime, as has been wrongly alleged. Indeed, SE7 and its investors wish only the very best for this great club in its future and hope that it flourishes under new ownership, even if that is not to be us.”
Sandgaard said: ”I would agree with that legal opinion. It has no impact on who I can sell the club to now or in the future.
“My opinion is the same as theirs.”
Subscribe to Blog via Email
Everyone at the South London Press thanks you for your continued support.
Former Housing Secretary Robert Jenrick has encouraged everyone in the country who can afford to do so to buy a newspaper, and told the Downing Street press briefing:
“A free country needs a free press, and the newspapers of our country are under significant financial pressure”.
If you can afford to do so, we would be so grateful if you can make a donation which will allow us to continue to bring stories to you, both in print and online. Or, please make cheques payable to “MSI Media Limited” and send by post to South London Press, Unit 112, 160 Bromley Road, Catford, London SE6 2NZ