Football finance expert Stefan Borson has explained why the Lewis family’s decision to pump money into Tottenham Hotspur may be the last thing that Daniel Levy wanted.
Last week, Spurs confirmed that their majority owners had injected equity of £100m into the club.
The club made it clear that the cash injection was intended to support CEO Vinai Venkatesham and the club’s technical staff to deliver the club’s ambitions.
It has been reported by Alasdair Gold that ENIC’s ownership of Spurs has gone up from 86.91 per cent to 87.62 per cent after their investment, and this may have interesting ramifications for Daniel Levy.
Daniel Levy’s share of Tottenham may be diluted
Levy retains minority shares of Spurs due to the fact that he and his family members own 29.88 per cent of ENIC, who in turn are the majority shareholders of the North London club.
Stefan Borsen has now suggested that only a small portion of the £100m equity injection may have come from Levy, which could mean that the former Tottenham chairman’s ownership of ENIC may have been diluted.
Borsen told Football Insider: “The interesting thing really is much more about how the £100m has been put in. ENIC is the vehicle that Daniel Levy and his family own shares in, and therefore at the ENIC level, they would have needed a cash call from their shareholders to put the £100m into ENIC, which then goes down into Tottenham Hotspur.
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“So, the question there is, did both parties stand their corner? I think it’s unlikely, i.e. the Lewis family and the Levy family both asked for cash, or was there effectively an issue of equity that went off to the Lewis family and diluted down Daniel Levy at ENIC because the £100m had to come in?”
Things could get worse for Levy
According to some reports, the Lewis family is prepared to inject more money into the club in the near future and remain committed to financially backing the club to achieve on-pitch success.
Borsen has suggested that if more keep coming into Tottenham from ENIC, that may mean that Levy’s percentage continues to get progressively diluted.
He continued: “Let’s say Daniel Levy and his family couldn’t put up their £30m share of the £100m and, therefore, they would be diluted down.
“Now, it’s only a small amount of dilution, but it might well be a sign of things to come if there is going to be more and more money pushed down from ENIC into Tottenham Hotspur, where Daniel Levy is not in a position to stand his corner for his share of the cash that’s required to go into ENIC that then is flowed down into Spurs.”