Cormack ‘to bring £5 million of investment’ in restructure at Pittodrie
Monday November 25th 2019 at 9:32 AM
Dave Cormack is set to become the new chairman of Aberdeen Football Club in a restructuring at Pittodrie, which includes new investment and a strategic partnership with Atlanta United, the US Major League Soccer club.
The Aberdonian and lifelong Dons fan will take up the reins from Stewart Milne immediately after the club’s AGM on December 16.
After 22 years at the helm of AFC, Milne is stepping down as part of a planned succession process that he says paves the way for fresh investment.
He said: “For four years, we’ve been working on a succession plan. It’s been no easy task to find the right person who is willing to take on the onerous role of Chairman, with responsibility for both the financial health and growth of the club.
“In bringing Dave onto the board and then appointing him vice-chairman, we viewed him as the natural successor. He qualifies on both counts. He is prepared to take on the commitment and has already proved his ability to secure significant new investment. Importantly, he is passionate about Aberdeen and the club.”
The club says that since June 2017, Cormack has delivered £11.2 million of new investment, including £1.4m for the Aberdeen FC Community Trust, and, on taking control, he will front a further £5m of investment which will provide working capital for the club’s day-to-day operations.
With completion of the first phase at Kingsford, combined with strong football and commercial performance, Milne believes the time is right to step aside as chairman.
He added: “I have always said I would relinquish the reins when the right opportunity arose and I believe that time has now come. I’m proud to have had the opportunity to lead the Club I love for over two decades. It’s been a real privilege but not without its challenges. Like the fans, I’ve shared in a rollercoaster of emotions from pure joy and exhilaration through to frustration and despair.
“We have been in a consistently healthier position for several years now and I’m pleased to be able to hand the Club over to safe hands in the knowledge that we are debt-free and have more than doubled revenues from around £7.8m in 2013 to almost £16m today.
“The opening of the £12m Cormack Park represents the completion of phase one of our vision for a new home. We’ve achieved this while still increasing the first team budget to its highest level yet and continuing to invest in our youth programme. Our annual spend on the overall football operation now amounts to £9m.”
These factors combined have helped to secure the new investment from Cormack and his group of investors, including Tom Crotty, Roger Lee and now AMB Sports & Entertainment – parent company of Atlanta United.
Cormack said: “As an Aberdonian and lifelong Dons fan, I’m honoured and privileged to become chairman of the famous Aberdeen. I’m also pleased to be able to announce a strategic partnership with Atlanta United, details of which will be announced tomorrow, and further investment from myself, Tom and Roger.
“Today, however, I’d like to focus on paying tribute to Stewart. During more than 20 years in the driving seat, he has had to deal with some turbulent times, both at the club and within Scottish football.
“Thanks to his astute commercial acumen, his financial contributions and an unwavering loyalty, both as a chairman and a fan, he has successfully led the club through those times, having to make difficult decisions along the way.
“Not all of these have been popular among fans, but they have helped to get the club into a good position on and off the pitch. I am very pleased that he has agreed to stay on the board in a non-executive capacity to ensure a smooth transition.
“There are some real challenges ahead but, with the support of my fellow directors and new investors, along with our fans, we will do our utmost to deliver success which, at the end of the day, is measured by the team’s performance.
“The new investment and this partnership with Atlanta will allow us to punch above our weight, aspiring to attain UEFA’s top 100 status, and trying to level the playing field against significantly higher income generated by Celtic and Rangers.”
Having worked alongside Milne for 17 years and played a major role in the success of the club, Duncan Fraser has also decided to step down. He will leave his position of chief executive with immediate effect but remain as a non-executive board director.
Board directors Ian Jack, Duncan Skinner and Craig Brown will also be stepping down to make way for the new investors to shape the board and the executive team for the future.
Brown will remain at the club in an ambassadorial role and Skinner will continue as chairman of the board of trustees of Aberdeen FC Community Trust.
These announcements are in the AGM notice and annual report which have been issued to shareholders this weekend. The accounts for the financial year ended June 20 2019 reveal an increase in turnover of half-a-million from £15.4m to £15.9m.
The club says a substantial increase in commercial income together with gate income, from cup competitions, was offset by a reduction in UEFA prize money and a drop in broadcasting income as a result of finishing fourth in the Ladbrokes SPFL Premiership.
Total staff costs increased from £8.56m to £9.24m. The wages to turnover ratio increased from 56% to 58%,
The operating loss pre-amortisation was £0.58m which compares to a small profit in the previous year. The position over the five-year business plan period shows a profit of almost £1.5m.