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Knights knock back $10m Tinkler offer
BY JAMES GARDINER
10 Nov, 2010 04:00 AM
THE Newcastle Knights have rejected a $10million offer from mining magnate Nathan Tinkler to buy the financially embattled club on behalf of ‘‘the Hunter Region, its communities and its families’’.
Mr Tinkler submitted the offer to Knights chairman Rob Tew on Monday.
Under the proposal, the club would be based on the same community model as the Newcastle Jets, who Mr Tinkler saved from oblivion two months ago.
Mr Tinkler would invest up to $10million to buy and operate the club’s NRL licence over the next 10 years. The club would be a not-for-profit organisation and all outstanding debts would be cleared.
Mr Tinkler also guaranteed that Knights members would have control over the name, colours and location of the club, and members would have first right to buy the club from the Tinkler Group if it was offered for sale.
Mr Tew said last night that he had rejected the offer without taking it to the Knights board because he did not think that it was a very good deal.
‘‘My response was that to consider that offer we would need the existing levels of revenue, as a minimum, guaranteed each year,’’ Mr Tew said.
‘‘That is all the sponsorships and the existing ticketing, because that is what it takes to run the club.
‘‘If that was guaranteed, that is something substantial that I could take to the board and then to the members.’’
Ken Edwards, the executive chairman of the Tinkler Sports Group, said Mr Tinkler had chosen to make his offer public because he wanted it debated by the community.
‘‘Nathan has been in discussions with the Knights board for 12 months,’’ Mr Edwards said.
‘‘It is fair to say that he is now frustrated with the process and the responses he is getting.
‘‘The reason we have gone public is really to make this a community issue and let the community have a say on what they think the right model is going forward.
‘‘In no way are we critical of the current directors or program, but we think there is a better way to do this.
‘‘I think we have demonstrated in other ways that there is a better way. We want to push the Knights back in to the community and make it more family friendly.’’
The Knights have battled financial hardship throughout their 22-year history and carry an accumulated debt of more than $2.5million.
Mr Tinkler, whose personal fortune has been put at more than $600million, bailed the Knights out of a cash-flow shortfall two years ago when he secretly lent the club $500,000.
He is also a sponsor of the club through his thoroughbred empire, Patinack Farm.
The current Knights board has been investigating models of full or part privatisation for several years.
Mr Tew said if members wanted the Tinkler offer debated they could do so.
‘‘If it needs to be pressed and taken to the members by any of our members, our individual members, they can generate 100 signatures and call a special meeting,’’ Mr Tew said. ‘‘That is available to them now.’’
The Tinkler offer will expire on December 31.
‘‘We put the deadline in there because we think it is possible for the board to call a meeting of members to vote on this if they desire before the end of December,’’ Mr Edwards said.
‘‘Part of wanting to make this a healthy community discussion is obviously everyone is going to listen to what feedback we get from the public, particularly the members.’’
Any change to the Knights constitution would require the approval of 75per cent of the Knights 8000 members who chose to vote.
Mr Edwards said Mr Tinkler was confident of getting that approval.
‘‘He is confident that people will see that he is fair dinkum, that this is a not-for-profit organisation in the same way as the Jets are not for profit,’’ Mr Edwards said.
‘‘If there are profits they are churned back into junior development and rugby league.’’
When he took over the Jets licence from Con Constantine, Mr Tinkler’s aim was to return the club to the community and make attending soccer games more affordable.
The same theory would apply to the Knights.
‘‘We believe attending football is too expensive for families, and we believe attending rugby league is too expensive for families,’’ Mr Edwards said.
Mr Tinkler has doubled the Jets football budget and said he would also improve the resources at the Knights.
‘‘What we are offering is to institute best practice in rugby league, in the same way we are in the process of doing at the Jets,’’ Mr Edwards said.
‘‘We think there are probably additional resources and funding required to bring the Knights up to the standard of other cutting-edge clubs.’’
Asked why Mr Tinkler was doing this, Mr Edwards said: ‘‘He has done very well and is doing very well. He believes in this region. He has demonstrated that recently with what he has done.
‘‘Nathan also has a vision of including basketball and netball, a whole range of sports for the Hunter Region and northern NSW, as cutting edge sports.
‘‘There is more to come. He is not going to stop at this.’’
http://www.theherald.com.au/news/local/news/general/knights-knock-back-10m-tinkler-offer/1992598.aspx?storypage=0
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