In the aftermath of the ill-fated European Super League, the governance of football has come under the spotlight, most notably through the Government’s Fan-Led Review of football governance, to which THST has already submitted evidence. As part of our work, we have conducted a review of the legal structure of the Club.
Tottenham has a relatively complex set of arrangements (although comparable with those at Arsenal) and understanding how they work is important to inform discussions on future governance and ensuring fan influence.
Our work involved reviewing the financial statements (as at 30/06/2020) of the Club’s subsidiaries held at Companies House, supplemented by reference to planning applications to Haringey Council for the various property developments that the Club is pursuing. We believe we can now set out a reasonably accurate picture of the corporate structure of the Club in one place for the first time.
The review splits the structure into three parts: Ownership, Operations and Property. We have referred to the sole financial statements of relevant subsidiary companies where this helps inform our analysis.
1. Ownership
The main holding company of the Club is Tottenham Hotspur Limited (“THL”), incorporated in the UK with its registered address at Lilywhite House. The ownership structure is set out in Figure 1 below.
85.6% of the share capital of THL is owned by ENIC Sports Inc., which is in turn 100% owned by ENIC International Limited (“ENICIL”); both of these entities are incorporated in the Bahamas. 14.4% of THL is owned by private shareholders, most likely fans who took the opportunity to purchase shares when they were readily available through previous flotation on the London Stock Exchange.
ENICIL is in turn ultimately owned 70.6% by Joe Lewis and 29.4% by Daniel Levy, although the mechanism by which these shares are held is not entirely clear. ENICIL is listed as part of the Tavistock Group, which appears to be the vehicle through which Joe Lewis manages his interests in a multiplicity of companies spanning property, hospitality, restaurants, energy retail, technology, agriculture and finance (Portfolio – Tavistock Group). The precise legal form of the Tavistock Group is unclear – it bills itself as an “international investment organisation” and does not publish financial statements. Joe Lewis is assumed to own 100% of Tavistock but there is some unverifiable online comment suggesting there may be a small number of minority interests.
According to the financial statements of THL, “Daniel Levy and certain members of his family are potential beneficiaries of discretionary trusts which ultimately owns 29.41% of the share capital of ENICIL”. The rationale for such arrangements is not disclosed but the use of such trusts is common in inheritance tax planning. If these trusts work in the typical manner, then Daniel Levy and other beneficiaries do not have day-to-day control of these shares. Rather, this is left in the hands of appointed trustees to manage the assets in accordance with the trust arrangements.
2. Operations
There are four main operating subsidiaries underneath THL, of which the two making by far the largest contribution are Tottenham Hotspur Football & Athletic Co. Limited (“THFACL”) and Tottenham Hotspur Stadium Limited (“THSL”) All but one of THL’s subsidiaries are incorporated in the UK.
THFACL is the original Tottenham Hotspur company, established many years ago, and is responsible for the majority of the Club’s revenue generation, contributing £292m of THL’s £392m revenues for the year ending 30th June 2020. THFACL earns income through competition prize money, TV money, sponsorships, NFL income, stadium tours and Club memberships. THFACL owns the players’ registrations.
THSL owns and operates the stadium and contributed £96m in revenues in 2019-20. It earns income from ticket sales, corporate hospitality and, we presume, match day food and drink sales. THSL is owned by an intermediate holding company, Tottenham Hotspur Stadium Development Limited (“THSDL”). The rationale for this additional layer is unclear. THSL also holds the majority of the Club’s debt.
There is a management agreement in place whereby THFACL provides a team to THSL to play at the stadium and similar arrangements are in place for use of the training ground.
The legal structure of the Club at this level is set out in Figure 2 below.
The other two operating subsidiaries are Tottenham Hotspur Women Football Club Limited (“THWFCL”) and Tottenham Hotspur Football Co Limited (“THFCL”). THWFCL appears to operate in a similar manner to THFACL, albeit at a much smaller scale. It is currently heavily loss-making (or at least was as at 30/06/20). THFCL operates the Enfield training ground and makes it available to THFACL under a management agreement as well as renting it out to third party users (it is reported that England have used it during the European Championships). It holds the Investec debt (£22m as at 30/06/20) used to finance the training ground’s construction.
Other subsidiaries make a minimal contribution to the group:
- White Hart Lane Stadium Limited operated the old stadium and is consequently currently inactive. Financial statements for 30/06/20 have not been presented.
- Tottenham Hotspur Academy (Chigwell) Limited owned and operated the old training ground. It retains certain residual assets but as at 30/06/20 generated zero revenues.
- Tottenham Hotspur Football Club Holdings Limited is listed at Companies House as a dormant company. Its previous purpose, if any, is unknown.
- Tottenham Hotspur Inc. (“THI”) is a recent acquisition and is incorporated in Delaware, USA with branches in Florida and Massachusetts. Financial statements are not readily available, although it is clear from THL’s accounts that as at 30/06/20 it made a negligible contribution.
- Tottenham Hotspur Property Company Limited (“THPCL”) owns the Club’s property portfolio on and around the High Road via a number of subsidiaries (see below). Only one of these companies made a (very small) profit in 2019-20.
THFACL (and presumably some of the other subsidiaries too) pay a management fee to THL. Of the group’s 647 employees as at June 2020 the majority (526) were employed directly by THFACL. THWFCL accounted for a further 36 with the balance presumably employed directly by THL. Despite its revenue generating activity THSL had no-one directly on its payroll.
3. Property
THPCL manages the Club’s property portfolio via a number of subsidiary companies. It does not own or operate assets in its own right. The structure of this arm of the group is set out in Figure 3.
Financial statements for these companies provide little detail of the assets under their management and we have resorted to other public sources, primarily Haringey Council’s planning portal, to obtain further details. Figure 3 almost certainly does not set out the entirety of the Club’s property interests.
Of these companies, only Star Furnishing Company Limited and Canvax Limited generate revenues, and only the latter posts a profit (of just £74k). We would suspect that these two companies act as landlords and receive rental income from businesses and private tenants.
Not all property developments may be channelled through THPCL. We are aware of two developments (798-808 High Road and 867-879 High Road) where the applicants are listed as THL and THFACL respectively.
There is also another company, High Road West (Tottenham) Limited, which is not ultimately owned by THL but directly by Joe Lewis (between 50-75%) and a certain Donovan Wijsmuller (between 25-50%). Daniel Levy and Matthew Collecott are listed as the sole directors. The company was registered in Oct 2019 but has no activity and is listed as dormant.
Conclusion
While the legal structure of the Club is relatively complex, there is nothing in it that is necessarily unusual or untoward. Separation of assets and cash flows can aid transparency and facilitate external finance. But it is important when we talk about football governance to recognise that our Club comprises a number of separate legal entities.
Supporters are mostly concerned about the key assets of the Club – players, stadium, trademarks and the training ground. Ownership of such assets is often held at a subsidiary level and decisions concerning such assets (e.g. their sale) is taken by the Boards of such companies. THL could sell the stadium, for instance, through the sale of its shares in THSDL but it cannot sell the stadium directly because it does not have legal title.
In practice, the Club is run as a unified entity. The Executive Board members of THL are, in various permutations, also the Board members of the subsidiary companies. The Club has offered fan representation on the Board (presumably of THL) but in designing a new governance structure, it is necessary to ensure that new arrangements accommodate the legal complexity of the Club’s corporate structure and that fan influence is not by-passed at the subsidiary level.
THST Board
16 July 2021