Wembley Result Could Go To Penalties

Once England’s Football Association eventually accepted that Wembley Stadium won’t be staging any of the soccer and music events scheduled for 2006, it soon became clear that the result of the ongoing stadium saga is likely to involve several lawyers arguing about who should pay the financial penalties this mess will cause.

The battle lines were being drawn within hours of the news that the Community Shield soccer match slotted for August 13th, the European Nations’ Cup qualifiers against Andorra September 2nd and Macedonia October 7th will have to be moved, along with The Rolling Stones‘ August shows and five Robbie Williams dates slotted for September.

The August 26th Rugby League Challenge Cup has moved to Twickenham and the soccer matches – apart from The Community Shield going to Cardiff – will probably be switched to major Premiership club stadiums.

The news that Wembley Stadium in London won’t open this year came after three weeks of U.K. national newspaper stories reporting work stopping for a day when a roof girder collapsed, concerns that the sewers underneath the £757 million building are already caving in and the likelihood that 120 steelworkers, welders and scaffolders would have to be laid off by subcontractors because Multiplex is slow to pay its bills.

It seems the public battle between Multiplex and Wembley National Stadium Ltd. has already started – although the legal war will probably last longer than it takes to eventually build the stadium. The Australian site developer’s U.K. managing director Martin Tidd has been quick to say, “The construction of Wembley had been subject to many design changes, historical and ongoing.

“These changes have implications on time and under the terms of our contract. A fixed-price contact was entered into with Wembley National Stadium Ltd. The contract is adjustable in the event of change by the client.”

WNSL chief exec Michael Cunnah, who – along with chairman Michael Jeffries – is already under media pressure to resign, says, “We have a fixed-price contract that we are happy to rely upon.”

As what many regard as a national disgrace quickly turns into an international embarrassment, statements like that make it sound like there’s little chance the two sides are going to sit down and talk about it over a nice cup of tea.

It also seems certain that Cunnah and Jeffries will try to ride out the media storm, as much as it’s gathering at the moment, and make sure they don’t pay the penalty for this disaster with their jobs.

The latter told The Daily Telegraph, “I don’t feel under any pressure to resign because I think we have husbanded the interests of WNSL perfectly satisfactorily so far.”

It remains to be seen whether the Football Association will share that view of how its management subsidiary has performed, particularly as it’s due to pay back the first £40 million of the £434 million it borrowed to fund the project in six months.

Since there won’t be any summer revenues to put toward that payment, it looks increasingly likely the FA will have to talk to the merchant bank managers from Credit Suisse First Boston, West L.B., Societe Generale and Lehman Brothers to try to reschedule the payments.

A couple of papers have speculated the FA might try to refinance the debt through a bond issue. But there’s a risk that investors might not queue up to buy into that – at least until the stadium has a guaranteed opening date and a healthy events diary. At the moment, it has neither.

It will also have the problem of transparently funding a legal battle without causing further media scorn by cutting back on its Academy of Excellence or any of its other youth and grassroots soccer projects.

Both the national news and sports journalists will be keeping an eye on that situation, apart from trying to dig for information among any correspondence between Multiplex and WNSL they can lay their hands on.

As more than 750,000 people paid more than £30 million for the stadium’s music shows alone, the papers should have no problem holding public interest.

The more popular media-driven conspiracy theories look likely to concern how much Multiplex kept WNSL in the dark over the true extent of the problems, how WNSL could possibly have allowed them to do that, and – when it became obvious it was much more serious than had been made public – did the two parties collude to keep the country in the dark by letting the news dribble out a little at a time?

That is, until a roof girder, a collapsed sewer and 120 potentially redundant steelworkers brought the project back into sharper media focus. Confirmation that the June shows were scrubbed came only 24 hours before the news that the rest of the year has also been scrubbed.

The legal battles look likely to be protracted and therefore the sort that neither FA, WNSL nor Multiplex can afford. The project has already set the Sydney-based company back £757 million – more than £200 million more than it’s getting at fixed-contract price. It also has several ongoing legal wrangles with its former steel supplier and various subcontactors.

There’s also the question of Wembley’s lost summer revenue and any claims that might come from artists or (more likely) promoters who will have spent money organising and marketing their shows. However, those costs might have been kept to a minimum with some prudent and damage-limiting contingency plans.

Rolling Stones European tour producer John Giddings wouldn’t discuss details of the costs and what the act would be doing about them beyond saying it’s “mainly advertising and legal fees.” He said, “We see no need for it to be in the public domain.”

“Things hadn’t looked too good for Wembley for a long time and so we didn’t go into the idea of playing there without covering our backsides,” he explained.

Knowing London’s Twickenham Park has only three live music slots each year (and Eagles had already taken one), Giddings is thought to have had the other two (August 20 and 22) on hold as cover for at least three months.

At the end of February, when giving an update on the redevelopment of the south stand – which will include a 156-bedroom Marriott hotel, a Virgin Active Classic leisure club, significant conference, banqueting and exhibition facilities – the Rugby Football Union’s Richard Knight told Pollstar, “We’ll continue to host all events including the Eagles concert and the likelihood of one or two others as a result of the Wembley issue.”

Giddings said he is more annoyed about being messed around for so long than he’s worried about compensation. He said the Wembley fiasco – and the mess the country made over the Millennium Dome – doesn’t augur well for London’s chances of making a good job of staging the 2012 Olympics.

“It’s become a national disgrace. We laughed when we saw the Greeks trying to get venues together for the last Olympics but, in comparison to us, they didn’t really do too badly, did they?”

The speed at which Manchester’s SJM Concerts and AEG‘s London office announced they’d be moving their respective Take That and Bon Jovi shows to Milton Keynes Bowl suggests they had also covered their backsides.

SJM chief Simon Moran was also tight-lipped about his company’s losses and wouldn’t comment about how he intends recouping them beyond saying, “That’s a private business matter but I’m confident we’ll reach a satisfactory conclusion.”

Bob Angus from Metropolis Music, which was promoting the five Robbie Williams shows scheduled September 14-19, said he’s “bitterly disappointed because we wanted to do the shows at Wembley.” He said he and agent Ian Huffam of X-Ray Touring are “looking at all the possible alternatives” as far as relocating is concerned.

Angus and Huffam had least cause to worry about the building delays. The Williams shows were slotted for four months after May 13, the day the stadium was due its flagship opening with soccer’s FA Cup Final.

However, they have a five-show run to move and Angus didn’t anticipate being able to announce alternative dates before April 7.

The ironic twist to the FA, WNSL and Multiplex finally owning up to the full extent of the Wembley mess on March 31, apart from the rescheduled date put back from January when Multiplex was due to hand over the keys to the stadium, was that it also coincided with the reopening of the new, spruced-up Wembley Arena.

A statement detailing the £35 million in improvements to the venue’s acoustics, seating, foyer and concourse areas, toilets and merchandising kiosks, was accompanied by a note from venue commercial and marketing manager Colin Roberts that said: “Please find attached a press release relating to today’s reopening of Wembley Arena – on schedule!!”

– John Gammon