Dunfermline Athletic today announced that a 30% stake in the club has been acquired by a German investment group, who have the option to increase their stake to 75.1% by summer 2022 at the latest.
The club, who were rescued from the brink of extinction in 2013 by a community consortium (Pars United Community Interest Company, with the Pars Supporters Trust holding 29% of the shares), have become a fixture in the Championship in recent years. Community ownership has brought stability to the club, but despite turning a modest profit more seasons than not, poor on-field performances in season 2018/19 exposed the precarious nature of Scottish football finances. The club have been in discussions with the German investors for around a year, and today have concluded a deal which goes ahead despite the uncertainty caused by the COVID-19 pandemic.
Many may see this as a setback for the cause of supporter ownership; but in truth, while those like us who believe passionately in supporter ownership as the ideal structure for our football clubs will be disappointed to read this news, we must recognise the progress that has been made at East End Park. The Masterton/Yorkston regime, which ran up massive debts and almost eviscerated a 128 year old community institution, was replaced by a broad representative body which blended the democratic principles of the supporters trust with a number of wealthy local individuals, who together steered the club into calmer waters. The supporters trust’s stake was enough to ensure no takeover could progress without their approval, and they have been fully engaged in the discussions and due diligence activities over the last year which have culminated in today’s deal. Their stake in Pars United, and their hard work over many years, gave them a seat at the table when this deal was struck and ensured that the fans had a voice in this major development.
The irony is that this is a deal which could not have taken place in the investors’ home country. German football is famous for having the “50 + 1 rule” enshrined in its governance structures – the majority share in every club (allowing for a small number of exceptions where the clubs were founded by local industry) means that supporter ownership is the norm, not the exception. And with that rule in place, German football is thriving – this season’s European champions are evidence that there is no glass ceiling for supporter-owned football clubs. But they need to exist in an environment which allows them to thrive, and the pressures facing Dunfermline Athletic in recent years expose the fundamental flaws in our national game… not just for supporter-owned clubs but for every club. The financial distribution model which hoards the bulk of our wealth at the top of the game means that an occasional poor season can push clubs towards the brink, and in a country with 4 small divisions the financial consequences of under-performance are amplified. We must address the imbalance that this causes, whether for clubs finishing a few league places lower than budgeted, or for those slipping down a division (whether at the end of a full season or as a result of this year’s curtailment). Relegation can force clubs to make cuts that undo years of hard work and progress, and with 15% of our clubs facing relegation every season we must re-align the financial distribution so that relegation is a “normal” event rather than an existential crisis.
The incoming investors must surely be encouraged by the fine work done by Pars United over the last 7 years, and the incredible fundraising efforts that have sustained the club over the last 5 months. This should prove to DAFC Fussball GmbH that the club’s supporters are one of their most valuable assets, and should remain at the heart of the club regardless of their shareholding.