Incorporation details

The front page of the share issue prospectus issued in December 1950. £3,500 had been raised by the start of 1951, but the target of £7,500 (about £252,000 today)  was never reached. (Thanks to Martin Goatley for making the document available).

The official prospectus for the issue of shares in connection with the formation of the new company in 1950/1 revealed some interesting facts about the club at that time.

It states frankly that the club had rebuilt its activities after the Second World War "largely owing to the interest and generous financial support of Mr J R Salsbury", and put the amount owing to him as at August 1950 at £4,173 7s 9d (about £140,000 today). Earlier negotiations had persuaded him to accept cash and shares in repayment, rather than insisting on the whole amount in cash, but the prospectus set out the essentials of the agreement eventually made, which was that Salsbury would be paid £2,250 in cash and £250 in shares, with an adjustment for further cash he would be advancing between August 1950 and January 1951. In return he would release the club from the whole of its debt to him. In effect, therefore, Salsbury was writing off the difference between £4,173 and £2,500, or £1,673-some 40%.  

It would be interesting to see how the debt to Salsbury had been built up-for example, some of it may have arisen back in the 1930s when he may well have paid off sums due to the estate of former chairman Dick Spencer, who in turn had probably bought out the debts due to Ted Humphries, his own predecessor (see Seasons on the Field-1930-35). However, the prospectus does not go into that degree of detail.

The agreement with Salsbury provided for the new company to pay £2,250 to Salisbury by the direction of the existing club, so in effect the whole of the purchase price for the business was being paid to him.  Robinson & Hall, Surveyors and Valuers, valued the club's assets, subject to the new lease to be granted by Charles Wells, at £2,212, so the club as being "sold" for only slightly more than the value of its fixed assets-the stands, equipment and "goodwill", although given the history of losses to date, that would have been worth virtually nothing. 

The extent of the club's losses will have become clear from some of the background information provided by the club's accountants, Bell & Co. Despite rapidly increasing gate receipts since the war-up from £2,721 in 1945/6 to £8,224 in 1949/50-losses had been made in every one of those seasons, averaging out at £1,416. These are net losses after all expenses including the hated Entertainment Tax, but not including, rather oddly, any "provision for Secretary's and Manager's salary". Presumably Charlie Bicknell's wages were regarded as those of a player. But very significantly, they are stated before "donations", presumably all or mostly from the Supporters' Club, which totalled  £2,860. As part of the incorporation deal, the Supporters' Club agreed to donate at least £1,500 in 1950/1, and at least 60% of its own net income over the next four years, plus paying "certain expenses" which would normally fall on the football club; the last named may well have been players' summer wages, since the Supporters' Club could expect income every week of the year through its pools competition, whereas the football club had no income between early May and late August.

In this light it isn't surprising that of the 15 new directors named in the prospectus, nine were members of the Supporters' Club rather than of the old football club's committee, and several of them (Harry Cosford, Leonard Noble, Thomas Eckstein and Cyril Symes) would hold office for at least the next ten years. Their occupations as stated in the document indicate that they were mostly local business men or shop keepers. 

Salsbury's 250 shares would only give him 20 votes, under a provision designed to ensure  "that it will be impossible for the control of the Company ever to fall into the hands of a single individual or small group". This, however, only related to shares-anyone who lent a large enough amount of money would in practice be able to dominate the club as Salsbury had done, and as George Senior was to do from the mid-60s.

Meanwhile the prospectus offered shareholders a 5% discount on the price of a season ticket-a "privilege" worth a princely 10 1/2 pence! That's about all that they ever got by way of return, since  it's unlikely that the club ever paid a dividend, and although Charles Wells had been persuaded to offer the limited security of a new 21 year lease of the Eyrie, the story of the new company was to be one of expenses perpetually exceeding income, requiring more loans from directors and others, until it became impossible to continue.

(To return to the previous page click 1950/1-Rooke rides to the rescue)