Stewart Donald to sell Sunderland: What we know, the major questions and what comes next
Sunderland’s troubled season took another twist on Monday, with Stewart Donald now actively pursuing a sale of the club.
Phil Smith runs you through what you need to know...
Frustration with Donald’s ownership has been growing as Sunderland dropped to their lowest ever position, 15th in League One before the 2-1 win over Doncaster Rovers on Sunday afternoon.
They remain well off the promotion pace despite that result, with the appointment of Phil Parkinson proving unpopular with supporters who have on more than one occasion chanted for his departure.
Donald and now departed Executive Director Charlie Methven had set the club a 100-point target in the summer but the squad went backwards and investment was minimal.
That underperformance on the pitch has combined with significant turbulence on it.
Methven left the board citing family reasons, his relationship with fans also unquestionably becoming increasingly strained.
Managing Director Tony Davison also left and has not been replaced.
It has raised questions amongst fans as to the organisation of the club, the suitability of those in charge of the footballing operation and Donald’s ability to drive the club on.
The 0-0 draw with Bolton Wanderers on Boxing Day saw that discontent reach a crescendo and last Friday, a number of supporters groups launched a campaign on social media to urge the Chairman to sell.
They also released a joint statement, saying ‘SAFC is a club with a proud history that deserves so much better than what we are currently being offered. As it stands we don’t know who is running the organisation within the club.
“We don’t expect to be playing in the Champions League, but we don’t expect to be set up defensively to the bottom club in League One at home on what is traditionally the biggest game of the season in terms of attendance. Nobody knows what the long term plan is and any trust that fans had in the boardroom has eroded.”
Donald has subsequently made clear his intention to pursue the sale of the club.
Donald, of course, has twice been in advanced talks regarding a takeover of the club.
In that sense, there is no dramatic change in the club’s situation.
Real estate businessman Mark Campbell led a group that came close to purchasing Sunderland in the aftermath of the play-off defeat to Charlton Athletic. He spent time on Wearside alongside members of his team, including John Park, who had expected to be installed as Director of Football.
Talks ended and Campbell’s subsequent attempts to take control at Falkirk also ended in failure.
Donald then came close to selling a controlling share to the FPP group.
Robert Platek, Glenn Fuhrman and John Phelan also spent time on Wearside as they pursued a sale, but eventually opted to inject £9 million into the holding company owned by Donald, Methven and Juan Sartori.
Those funds, a loan to be repaid, were secured against the club’s assets.
As such, there has been significant uncertainty over the long-term structure of the club at boardroom level for some time.
What has changed, however, is the major shift in Donald’s relationship with vast swathes of the Sunderland support.
In both of those previous discussions, the chairman was expected to stay on in some capacity.
That is now clearly highly unlikely, if and when he sells, and as such a significant knock-on effect on the club’s personnel and strategy would be certain.
Where do FPP stand?
FPP’s injection of funds into the club via Madrox means they are of course well placed should they wish to pursue a deal to take control of the club.
Whether that is the case remains unclear.
They are not believed to have made any move to that end in recent times and still have not made any public comment since agreeing the deal with Donald earlier this season.
At a recent meeting with the Red & White Army and other supporter groups, the chairman claimed the high profile nature of the deal may have put the group off a full takeover.
The minutes read: “The intention was always to keep the current off-pitch management team at the helm, but the investors opted for loan agreement instead.
“They liked the City and the people but are private people. The investors picked up on the excitement of the fan base about their proposed involvement, viewing it as a business opportunity which they wanted to succeed but which would also be an incredibly high-profile investment for them.”
He has previously rejected claims that a difference in valuation was behind the change in deal.
Where the parties stand remains to be seen, but that debt from Madrox to FPP ultimately must be satisfied and any sale would need to take that into account.
When asked about a potential future sale by BBC Newcastle earlier this season, Donald suggested that the most likely scenario would be a new buyer acquiring Madrox.
Is a sale likely and what will the price be?
At the same meeting with fans, Donald said that he valued the club between £30-£50 million.
The deal he struck with Ellis Short saw him acquire the club for £15 million, with Short using the £25 million parachute payment to contribute to his clearing of the club’s external debts.
Sunderland’s cost base has been significantly reduced since then but parachute payments end this season and a large investment is clearly required if the club is to climb through the divisions.
Though there has been interest in the club of late, there are not believed to be any significant talks taking place as it stands.
As such, an imminent sale can be considered unlikely in the extreme.
What happens to Sunderland in the interim?
In the interim, the onus will remain on Donald to run the club and a crucial January window looms.
Phil Parkinson has discussed his plans for the month in recent weeks, clear that Sunderland would need to explore the loan market. He added that there was the capacity to make signings that add ‘value’, but it is clear also that some outgoings are certain.
Even if boardroom uncertainty has been ongoing for some time, it plunges the club into yet another period of instability.
Parkinson himself had been assured during talks before he took charge that the investment deal would bring stability and that the management structure above him would not be changing.
Given the significant concerns many rightly hold about the structure of the club, and the lack of a chief executive or managing director to oversee daily operations, this news will raise even further questions with Donald’s attentions likely to be again taken away from the club’s long-term trajectory.
Two non-executive directors were appointed of late but their role is not to help lead the club full time.
Sunderland is a club lacking clarity and identity and this news only serves to underline it.
Unclear, too, is whether Juan Sartori intends to remain on the board and a shareholder.
Of course, by purchasing Donald’s 74% in the club, any buyer could take control, but Sartori would retain a stake unless he is bought out.
Both Donald and Methven have recently said he will step up his involvement, but there has been no sign of an increased presence and he has not been to a game since the opening day of the season.