Dundee United have asked supporters for a second cash injection to “assist recovery from the Covid-19 crisis”.
The Tangerines have approached the Dundee United Supporters’ Foundation (DUSF), whose members voted to make a £100,000 investment in the club in June 2020, to request another “one-off” payment of “up to £100,000”.
Ballot over investment in Dundee United
The DUSF will ballot members on the request – along with an appeal from the club for an extension to the agreement struck over June’s investment – over the coming days.
In an email to Foundation members, seen by The Courier, details are given of an address to the group’s AGM in December by United owner Mark Ogren in which the financial impact of Covid-19 on the club was laid bare – and a stark warning issued over future operations.
The document states: “Mark Ogren addressed the meeting and outlined the serious financial impact that the pandemic was continuing to have on the club’s budget as a result of the huge reduction in income following lockdown and fans not being allowed into games.
We are delighted that Scott and Mark Ogren, Tony Asghar and Micky Mellon have become members of the @DUSF2017 . Join us at https://t.co/wnBO0QruTihttps://t.co/4Cy1XUOvE9
— DUSF (@DUSF2017) January 15, 2021
“This, coupled with the high cost of implementing the Covid-19 protocols necessary to allow football matches to go ahead under closed doors, is threatening the current operation and structure which has been put in place to take the club forward.
“Mr Ogren said that United were in a unique situation in that he had invested a lot more money than he expected to win promotion and he did not have a contingency fund to draw on for the unforeseen Covid-19 crisis and the drastic reduction in income that this has caused.”
Should Foundation members vote “Yes” to the club’s request, the resultant cash injection will not – unlike June’s funding – be tied to any future capital projects and will instead be used to boost liquidity.
‘A one-off payment to assist recovery from Covid-19 crisis not tied to future capital project’
The proposed alteration to members’ £100,000 summer investment would see an extension granted to the August 2021 deadline for work to commence on United’s proposed academy project at Gussie Park.
As it stands, if no progress is made, the Foundation stands to increase its current shareholding in the club tenfold.
The group’s email to members says: “In light of the current situation Mr Ogren asked the DUSF members to consider…
“1 – A twelve month extension to the timescale detailed in the June 2020 partnership agreement with DUSF for work to start on the funded youth academy project.
“2 – A request for the transfer of another tranche of Foundation money as a one-off payment to assist recovery from the Covid-19 crisis not tied to a future capital project.
“Following discussions with members at the AGM, the [DUSF] steering group decided we should ballot members on those requests.
“Therefore, during the last few weeks we have been drafting a funding proposal to transfer up to £100,000 to the club to assist during the current crisis and we have now agreed a formal proposal that the DUSF steering group are now inviting members to vote on.
“We have always considered that the Foundation money should be used to build something that was sustainable and that would become an integral part of the club’s future. That still remains one of our main aims.
‘Uniquely difficult period’
“However, we appreciate the unprecedented financial climate the club is now operating in and we understand why the club is asking for the foundation to offer financial assistance now to help the club through this uniquely difficult period.
“We also recognise the reasons why capital expenditure projects have been suspended currently which is why the club is asking for an extension to the original agreement.
“Therefore we are opening up a ballot of members to allow members to vote on the funding proposal.”
United owner Mark Ogren, his son and vice chairman Scott, Tangerines sporting director Tony Asghar and manager Micky Mellon last week became members of the DUSF.
The ballot is to be held online between Sunday morning and midnight on Tuesday.
Dundee United and the DUSF were approached for comment.