firstname.lastname@example.org Thomas Sandgaard has revealed that Charlton Athletic’s coffers were empty before his takeover a week ago – and has provided more detail on the deal he has struck with Roland Duchatelet.
The 62-year-old US-based Dane was confirmed as the Addicks new owner last week.
Sandgaard was approved by the EFL a fortnight ago and the completion of his deal has also seen the club’s transfer embargo – which had been in place since January – lifted to allow signings.
“Since December or January no money has been put into the club,” he told the South London Press.
“It was basically running with money from the EFL and some sponsorship money.
“That really ended up decimating the squad – 12 players had left. The cash balance in the last few days was about zero and there was a more than $1million tax bill to pay. That would have been when the club would have gone into administration – because that was due.
“My money has already gone into the club and without that the wages would not have been paid. There are a lot of old bills that are legitimate and are being paid with the money put in.
“I didn’t want to be in the same situation as you saw at Wigan [who went into administration in July]. They got relegated because of that.”
East Street Investments struck a deal for the Addicks in January. But they failed to provide the source and sufficiency of funding. They paid £1 to Duchatelet for the club, but the Belgian retained The Valley and training ground in Eltham. The rent for both was £200,000 a year.
Sandgaard says that what he paid ESI directors Tahnoon Nimer and Matt Southall for the League One outfit is undisclosed.
But he has revealed that there is no longer any commitment to acquire both pieces of land off Duchatelet.
“ESI’s deal came with a £44m balloon payment which forced them to buy the whole thing within five years,” explained Sandgaard. “My deal means I pay much higher rent for the stadium and training ground – many times higher. But, in return for that, I got all these weird side deals eliminated.
“It is a 15-year lease. The fact they got that £1 deal is just shocking. Why would Roland do that? He should never have done that. It would’ve been a lot easier for me to negotiate with one party rather than numerous individuals.
“Part of why it took so long is because he [Duchatelet] didn’t necessarily like the way we wanted to do things. But this is transparent and simple.”
It means Sandgaard is free to pick up negotiations over a deal for both pockets of land at a future date.
So how much does he think is the correct amount to pay?
“If you look at the division we’re in and also take Covid into consideration – which depresses prices pretty much on everything – you’d probably value it at £15m to £20m as things are today,” said Sandgaard. “It was nearly worth twice that a couple of years ago.
“I can also see a lot of frustration in Belgium how everything played out for him. I can see where he is coming from.
“I did offer a lot of incentives so that he can make a lot more money than he was ever offered – but it was dependent on the results of the club. They were not interested. Fair enough then, they want to hang on to the real estate and we continue to be able to play football at The Valley and use the training ground.
“It buys me 15 more years to find out if we buy the stadium or training ground, or what is the best thing for the club.”
The South London Press played a small part in Sandgaard acquiring Charlton – as we broke the news that he wanted to buy it.
Peter Varney, the club’s chief executive during their Premier League heydays, advised the Colorado-based businessman to make contact with the paper.
“I remember speaking to Peter at the time about my frustration in terms of being able to get hold of the different parties,” said Sandgaard. “I had various people trying to reach out – including my attorneys to Roland Duchatelet’s attorneys. But no-one wanted to call me or any of my friends back.
“I made the decision to try and put the word out publicly and Peter told me a good place to start.
“A nice side-effect to it was the way the fans responded with me going public. It wasn’t the intention but was fantastic to see how the fans got behind me. It built some good momentum. There has been a lot of positivity which we can build on.”
Charlton supporters look unlikely to be able to return to The Valley until at least the early months of 2021.
The Addicks were allowed a crowd of 1,000 for their last home fixture against Doncaster Rovers as part of a pilot scheme, only for the government to shut things down again after a nationwide rise in positive Covid-19 tests.
Sandgaard doesn’t believe it will have a huge financial impact on the SE7 outfit.
“It’s not going to be that bad because the club doesn’t have that many expenses right now with the way it has been run over the last nine months,” he said. “Of course we’re missing the income from the ticket sales, but I’m sure we can do better and get more on the sponsorship side.
“It’s actually not that expensive to run the club right now, but there is a lot of rebuilding to be done and that will take some money.
“The reception I got from the 1,000 fans we had in the stadium will be burned into my memory. I didn’t know what to do and what to think. It blew me away – I didn’t even own the club at that stage. There are no words to describe it.
“I’m not worried about the short-term effects of Covid. I’m very fortunate I can focus on building the club and the team. I’m in this for the long haul.”
Sandgaard’s arrival came after League One clubs had voted in a salary cap only allowing a player wage bill of £2.5m a season. It averages out at around £2,000-a-week per player.
“It’s quite a puzzle – but also the challenge,” said Sandgaard.
“What we do have is a club with a brand recognition. Charlton has a big fanbase and is based in London, so we do have a leg up on many other clubs.
“We have the same limitations in terms of the money we can offer but it also comes down to ambition – if you want to play for a top-six club then you’re going to probably pick us.”
Sandgaard is the founder of Zynex, whose value on the NASDAQ ranges between $600m and $1billion. He owns half of the company, which he formed in 1996. It sells medical devices.
“I set it up from scratch,” he said. “Before that I worked for big multi-national companies like Siemens, Philips and ITT. I was very much a corporate HQ guy, travelling to work with general managers in various countries.
“Then I got the chance to import medical devices to the US and decided to move over there. I started in a one-bedroom flat – sat on the floor with a notebook, computer, £2,000 and a credit card.
“I couldn’t get finance so I was boot-strapping. It means you buy a few devices, sell those, you’re able to buy a few more and sell those. You can’t buy more because you need to eat, so sometimes you borrow $1,000 from a friend to buy food or pay the rent. For the first 18 to 20 years it has been like that but we managed to refine things in the last five years to be consistently very profitable.
“The orders are growing really crazy – even during Covid we have doubled our orders compared to last year.
“There is a huge opioid crisis in the US and our devices focus on pain management and getting off opioids. There is a huge demand for our services. You can say we’re just getting started.
“We now have 450 sales reps and in the next two years we’ll have about twice as many. We’ll also start selling products in Europe and other parts of the world. It’s pretty exciting.”
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