Dein

Dein: what really happened

When, in April 2007, David Dein suddenly left Arsenal, having been not just vice-chairman but also the man who brought Wenger to Arsenal, there was shock and amazement.

But what really happened?

Although this web site does regularly benefit from insights and information from insiders on this issue it is important to say clearly that none of the writers here is a board member, and none of us has a direct line to David Dein.

What we have done however is gathered together every snip of information we can find, including those bits conveniently overlooked by the papers and TV channels.  We draw our conclusions, and also say to David Dein, if you feel we have got anything wrong, please do get in touch (directly or through an agent) and we’ll immediately correct anything that is in error.

So here’s how we read it.

1983 Dein buys 16% of the Arsenal’s shares for £300,000. Peter Hill-Wood describes the investment as ‘dead money’. Dein’s company, London and Overseas Sugar, runs into financial difficulties because of the collapse of a major creditor, leaving him in some difficulty/

1986 Takes a seat on the Football League Management Committee

1990 Dein and Noel White, a Liverpool director, are chosen by the directors of Manchester United, Liverpool, Tottenham and Everton to approach the FA to back their plan to break away from the Football League

1990-91 Buys most of Peter Hill-Wood’s shares, taking his stake in Arsenal to 42%

1991-92 Dein sells his first tranche of shares, 10,000, to Danny Fiszman

1992 London and Overseas loses a legal action to recover money from the Esal collapse. Debts exceed assets by £11m.   This legal case has been described as a serious error of judgement.  Of course we don’t have all the insider information on this, but to lose £11 million is never a good way to stress your ability as a businessman.

1995 Dein sells a further 5,000 Arsenal shares

1996 Sells 3,000 more shares to Fiszman. Gets most credit for the appointment of Arsène Wenger.  Dein supports Wenger’s vision of a unique training complex and the gradual introduction of World-Wide Scouting – both of which take the British establishment by surprise. 

1997 London and Overseas Sugar is dissolved.  It is suggested that all the creditors of London and Overseas (that is the people who lost money because at the moment it went bust, London and Overseas owed them money) got paid – although we can’t find anything to substantiate or counter this notion.

1998-2000  Arsenal engage in a strange experiment playing their European games at Wembley to crowds of between 71,000 and 74,000.  It is believed to be a last ditch attempt by Dein to suggest that a new stadium should not be built but instead Arsenal should share Wembley.  However the experiment merely proves that Arsenal can fill large arenas, but that players, the manager and the supporters do not like Wembley.  Dein’s plan fails, and as a result he becomes increasingly marginalised, as the next two entries show.

1999 Sells a further 2,840 shares to Fiszman, cutting his stake to 14%

2000 Arsenal submit planning application to build what became the Emirates Stadium. Dein is not believed to have been in favour. Elected a main board director of the FA as a Premier League representative. Also a member of the FA Council.  Now we see a pattern here – more activity outside the Arsenal, less inside, as his opposition to the Emirates places him in a minority of one.

2006 Dein is voted off the FA Board. Becomes chairman of the G-14 clubs.  The Emirates opens to huge acclaim, and every game for the first season is sold out.  Not only does this allow Arsenal to follow the agreed plans to reduce their rate of borrowing and spread the loan, it also shows the benefit of Arsenal running the whole development programme themselves – again something Dein did not like.  What’s more with the sale of the old ground not even showing on the club’s accounts, the position of the club’s finances is incredibly healthy.  

2007  The financial success of the Emirates slowly begins to emerge, as not a single game in the first season goes on general sale, and 38,000 turn up to see the youth team for a game against Man U.   With his position now almost totally based on the sole fact of having brought Wenger to Arsenal Dein’s position has less and less security.  He thus tries one final move – to bring in new money from the US, supposedly to help Arsenal compete with Man U and Chelsea.  Dein negotiates a deal with a team in Colorado which would see the American club adopting Arsenal’s colour and name.    This was presented to the board as a marketing deal, and so it seemed at first, until the Americans bought up a 9.9% share holding in Arsenal.   

Now no one minded this too much.  ITV in footballing terms were, and indeedf are, a laughing stock.  ITV Digital had promised a fortune to clubs out of the top flight, but had eventually gone bust, leaving clubs with huge debts.  Meanwhile they had committed themselves to buy Arsenal shares at a later date, which they dutifully did, buying them at far more than the market price at the time.

So Kronke, the American, had his shares, and no one thought it was anything more than cemeting the new Colorado / Arsenal relationship.

Any expansion of this shareholding would go exactly counter to the view of the board, and when the board discovers that Dein has had conversations with Kronke about investment, he is forced to resign his position on the board.   What makes his position even more difficult is the fact that bringing in a foreign investor is by no means a certain way to guarantee money.  Although Chelsea have had Russian money to rebuild their club, other teams with foreign money have found that all they have had is increased debt and a desire to make money out of the club.   It makes it hard for Dein to sustain his position since the argument looks untenable. 

This of course left Wenger in a difficult position.  Wenger had said that unless he was being very naive he could not see that Kronke was preparing to take over the club.  But then he found his old friend had been caught following his own agenda to do something Wenger himself had said was not acceptable..

The question to be asked then was what Dein had actually been doing in the 10 years since Wenger arrived.  He had opposed the building of the Emirates, he had proposed a deal with Wembley (which clearly would have been an utter disaster and made Arsenal the joke of football), and he had followed his own line in trying to get Americans to invest in Arsenal, in the light of evidence that this is not what overseas investors do (with the exception of Abramovich).

What he had been doing was running the club to club negotiations for new players.  An important job, but not a unique one – the world of football has many such people.  While people such as Wenger and Edelman have proven themselves as unique in football terms, Dein has not.  Even if non-Arsenal projects have run into the quicksand – most notably with G14 seeming to go nowhere.

We’ll see over time if I am right – but my suggestion is that Dein is a man whose time had been and gone.  And if so, he won’t be missed too much.