ZEN

                                            An Open Letter to Nick Giannotti, Chairman of ? 

''I promise to be honest, transparent, thoughtful, and open with you all'' - Nick Giannotti, July 4th

Dear Nick,                                                                                                                                                                        I'm not sure if welcoming you to Athlone is appropriate, since we're here and you're there. We've never before had a club chairman who didn't live in the town, never mind one who didn't live on the continent. Following on from the Harvard connections of the last crowd, it has been even stranger to contemplate how your business sits just two blocks from the White House. We must be very important. But the Irish have a certain history with absentee landlords.

I hope I'm not the only one who finds it absurd that something as intimately local as a small town football club can be sold and resold to a series of foreigners as if it were a regenerating cyborg. I've long ago given up on the regulator (the FAI) doing something about or even explaining this. You might wonder why, if things are so peculiar, somebody somewhere behind a desk in a media organisation wouldn't want to investigate it. Or at least run with what is undeniably an interesting and often funny story. Me too.

                                                                *****

It all happened very quickly. Coincidentally or otherwise, developments in France late last year preceded Valeo's leaving behind its operations in Ireland and Portugal without so much as a bye-bye. As usual, the people who pay for stuff have been kept in the dark. And a visit by the Criminal Assets Bureau to Athlone last March hasn't shed any light.

Life in Athlone went on as usual. The mysterious Lissywollen Sports Ltd. was registered on March 3rd. And the business name 'Athlone Town FC' was registered on March 27th [an 'Athlone Town AFC' had already been registered in May 2016], made effective from March 3rd.

There has subsequently been a lot of excitement about proposed investments led by Zack Goldman, Eric Perez and yourself (can I call ye ZEN?). It might have been assumed that Z, E and N were in competition with each other to some extent. But ZEN has been very much together since July 15th, the date on which you became the three new members of Athlone Town AFC CLG - a company you now claim to own and control [The recording of your names and places of residence with the CRO had very strangely been placed pre-July 2015 on its website, then withdrawn].  

The most interesting hiccup along the way happened in mid-May, when (as one post put it) ''Takeover has collapsed - apparently there is a big club debt that wasn't revealed to Perez Group in negotiations and they have now walked away''. The debt in question was almost certainly the E507,000 which is owed to Westmeath County Council. It is a debt which has never been mentioned in your company's accounts, in common with other big debts to my company, myself, the TUS, Queens Park Rangers, Electric Ireland and the amateur players of Athlone Town Association FC. Though you can now claim that these other debts are statute barred, you still have an obligation to record them. 

It was first put out (apparently by a member of your company, therefore questionable) that ZEN's investment would be E1.5 million, then E1.2 million - with an equal share of the investment going to each of the three local members. Given that ZEN has apparently also taken on the ownership of the stadium property (or believes it has done so), your investment is perhaps more likely to be in the region of E4-8 million. 

Those locals remain as members. They also continue to hold positions as directors and secretary of your company. Only last week, two of them (John Hayden and David Dully) submitted a form to the CRO, in order to change the annual return date. This happened two months after you had indicated that the former had stayed on a little while for the purpose of helping you to secure government grants (you also oddly implied that he was involved with licencing, which was done with before your investment commenced) and that the latter had left the club.

                                                                   *****

On the bright side, at least there are no questions to ask about drugs or match fixing this time round. And there is no reason to believe that you are involved in money laundering. But cleanliness raises the question: what is in it for you? Those charming words about community, fun and falling in love don't wash. ZEN is here, as it has been everywhere else - such as Plymouth Argyle, Truro, Leyton Orient, Patro Eisden, Cesena, Campobasso, Juve Stabia and what the Irish Independent coyly called ''Atletico Lisbon'' (the notoriously Athlone-connected Atletico Clube de Portugal) - to control clubs and make money. Nobody is investing in Germany, where there is lots of love and fun to be had but where supporters control their clubs by majority.

The backing to some of your investments is traceable to New York venture capitalists like Robert Lewis and Coley Parry. These are not guys who are interested in losing money. The private investing game, as I understand it, is that the investment agent offers cash up front for an appreciating asset on behalf of a wealthy investor, who can use his growing portfolio of assets to borrow money at extremely low interest rates in order to fund both his lifestyle and further investments while avoiding paying tax. Any risk is offloaded to the capital supplier (bank or hedge fund), which (bank) is effectively printing its own money once the loan is made. All of it is good news for lenders and investors, not so good for people trying to run their local football club. As you told the Between the Stripes podcast on July 15th, ''there's a world of democratisation of sports ownership and of owning of things.''

But why do investors expect to find appreciating assets in a footballing backwater like Ireland? Well, a European Super League is coming, that is almost certain. That will take all the superclubs out of the equation (and they will likely be joined by a new Dublin club which may have a suffocating effect on the old clubs in the city). Clubs which had built up unsustainable debt in chasing the superclubs may die in their absence, but the national leagues won't. Newly competitive, they are more likely to thrive, and to be at the mercy of clubs which are currently in the $5-10 million bracket of investment. Which is in or around the bracket you are investing in.

Solmate/Brera Holdings, to which you are connected, has been particularly astute in its acquisitions. It will have a big shot at owning the biggest league clubs in both Milan and Naples. There will be a lot of regrets at how cheaply such clubs were sold. It is hard to understand right now, why such regrets might also exist in Ireland. But Wall Street historically tends to know more about our wee island's future than the Irish people do. Could it be that a British and Irish league is in the offing, as a little carrot for a partial return to the Union which will go hand in hand with a heavily hyped United Ireland? Your investment in the soft Unionist Larne would make more sense in that context. But that is speculation.

                                                                 *****

Your company was created by Michael O'Connor, John Hayden and David Dully in July 2015. Its official purpose was (and remains) ''To develop and maintain the facilities of Athlone Town Stadium and to carry on all activities in relation to same''. The company acquired a different purpose, albeit without amendment to its constitution, on June 28th 2017. On that date an Athlone Town Association FC AGM purportedly approved a motion which stated (quoting the minutes of the AGM) ''All club affairs be transferred to Athlone Town AFC Company by Limited Guarantee. All future club business is to be conducted through this company and be governed by a new constitution provided for under the companied (sic) act. Resolution read over and explained.'' 

The new constitution never materialised and the resolution (below) has never been obeyed. The motion was obviously sprung on the voters without discussion. The meeting was held behind locked gates with a paid security guard, under circumstances where unreliable club members were asked (under a pretend new constitution) to pay E250 to secure attendance while the trusted only had to pay the actual club membership fee of E25. 

The subsequent payment of what I have estimated amounts to E2,126,175 (including the lowest mentioned investment from ZEN) to the four beneficiaries of your company has so far been treated in your accounts as remuneration and repayment of loans. None of that treatment makes any sense. These are voluntary positions which have never been remunerated. No claim for remuneration was ever made before 2019. No remuneration has been provided to the only two club officials (treasurer and secretary) who have some work to do. And companies awash with money have no reason to seek loans from anyone. 

The E2 million + is then more properly described as a dividend. That makes it a prohibited distribution of funds accruing to the members of a club (Athlone Town Association FC) which was done away with at a purported EGM on November 20th 2018. That EGM saw what your accounts called a ''merger'' between your company and ''the club'' (though it doesn't specifically state that the merger happened at the EGM). Two clubs had in fact been running concurrently since 2016. The league club Athlone Town Athletic FC was replaced by Athlone Town Associated FC in time for the 2019 season. Confirmation of this is hard to come by, as a shamefaced (some chance) FAI has consistently refused to reveal the name of the Athlone club playing in its League of Ireland. 

                                                                     *****

In 2017 David Dully provided a public list of the club (Association) members on whose behalf your company took over ''All future club business'' at the June 28th meeting. I don't have a list of the 2018 members and don't believe it is relevant - the year of transfer being the important one - though I might be wrong on that. Based on the E2,126,175 estimate (it may be much higher) and on a system of equity where those who invested most in membership are paid accordingly, two of those members are now each owed cE204,440: Jackie McKervey, Richard McKervey.

Eight members are each owed cE102,220: Vincent Brookes, Chris Enright, Damien Finlass, Eddie Francis, Gabrielle Gaffey, Gerry McManus, Shay O'Brien, Cieran Temple.                                              

And 44 members (some deceased) are each owed cE20,216: James Blacoe, Joey Boland, Lee Bolger, John Brennan, Declan Browne, Tom Burke, David Byrne, Fiona Collins, Martin Collins, Niall Craven, Eamonn Cunningham, Padraic Devaney, Mick Dolan, Michael Doyle, David Dully, David Dully Snr., Edweena Dully, Padraig Egan, Michael Gallagher, Liam Gaffey, Shauna Gilligan, Ann Hayden, Cian Hayden, Dara Hayden, John Hayden, Mark Hayden, Paul Hayden, Larry Kildea, Brian Lawless, Niall Lynch, Brian McCormack, Bridget McNamara, Jimmy McNamara, Colm Melia, Pat Murtagh, Michael O'Connor, Miriam O'Connor, Clive O'Neill, Darragh Quinn, Michelle Quinn, Danielle Rohan, Geraldine Rohan, Cormac Sheehy, John West.                                                                                          

Taking equity percentages out of the equation, the monies would then belong equally to each of the 59 members (five non-paying honorary members are added - Martin Egan, Tom Fitzgerald, Tony Gilmartin, Michael Ganly, Paddy McCaul). cE36,037 would then be owed to each of these members. It is possible that the small few people who applied for membership in 2017 but were not replied to may have legal grounds to make a claim. They would certainly have as much right to consideration as those who were recorded as members but never handed over the E25.

Additional difficulties arise in relation to the legality of your takeover of Athlone Town AFC Company Limited by Guarantee. You said it ''isn't a takeover in the traditional sense'' and it cannot be. It is not possible to buy a CLG, it can only be taken over voluntarily, e.g. a tenant in a management company for rental properties resigns his membership and is replaced by the new tenant, with no money changing hands. 

Service is the point of a CLG, and it is marked by flexibility of membership and non-profit status. I don't know any means by which the members of a CLG can be legally and ethically bought out. You might argue that, because Messrs. O'Connor, Hayden and Dully are still members, then the handing over of monies to them is incidental and the takeover (your casting vote as Chairman gives ZEN control) is accidental. That might be sufficient, but you need to make it all understandable to the community whose trust you are hoping to win.

                                                                      *****

Your company's latest accounts (for 2023) make the odd statement, ''The company is in full control of its stadium''. This may reassure you that ZEN does now have full legal ownership of the property. Speaking to the Westmeath Independent recently, you said, ''I think it's pretty clear about the stadium in the courts'', apparently under the impression that all of that ended with your company owning all of it. Nope.

The 23 May 2019 'settlement' may be unsigned bollocks, but the judges think it's cool and that, for now, is all that matters. Your company pushed it and your company is bound to it (below). Which means that whatever entity will own the property, it cannot be your company. And Garda Dully has near total control in deciding who the new owners will be. 

Some quotes from what you said on July 15th: ''when you have a women's team that's in the Champions League qualifiers, you don't want to mess any of that up'', ''it's been transitioned over me ... with the help of having one person still involved, and so that way we keep all of those things like licencing, all that kind of stuff.''

 Now that the club has been knocked out of European competition, it is time to raise the question of whether or not it had any right to participate in it in the first place. Athlone Town Associated FC was the club which won last year's Women's Premier Division and therefore it was Associated which qualified for this year's Champions League. But your negotiations have not been with Emelio Williams and Javid Nickpour, the effective owners of Associated. The business name registered in March has an 'FC' but no 'A'.  And it has been reported that the CLG itself is now the club. 

All of this strongly suggests that Associated is no longer an active club and UEFA has been deceived by both your company and the FAI. More importantly, it appears that the players of Cardiff City and ZNK Agram have been cheated out of their opportunities to advance in the Champions League.

Hopefully you will clarify these matters and deliver on your very welcome promise of transparency. We haven't had a sniff of that since 2012. First, tell us the name of your club. Second, release the contracts. 

Yours faithfully,                                                                                                                                                                        a supporter.