The League Management Company (LMC) Chairman, Shehu Dikko has replied to the claims of the owner FC IfeanyiUbah, Dr Patrick Ifeanyi Ubah over unpaid entitlements and also highlight the success and work in progress so far in taking the league to the next level.
In a lengthy statement Dikko expressed as thus:
I will certainly not join issues with my “FRIEND”, Chief Ifeanyi Ubah, regarding his reported comments on LMC, as I know for a fact that he has never attended any of the LMC AGMs, Consultative Meetings or Club Owners Meetings, since his club Chairman (Chukwuma Ubah) has been the one attending these meetings and has, even recently, been appointed by the Clubs as a director of LMC. Surely, Chief Ifeanyi Ubah, doesn’t have the correct information and, thus, can be excused for making these remarks.
However, I must clarify that the comments credited to Chief Ubah are absolutely non-factual and misleading.
LMC has a very robust and professional revenue distribution formulae (agreed with the clubs since July 2013) and this has formed the basis of payment to the clubs, based on the available revenues for each season, as approved at the AGM. The distribution template comprises payments to or on behalf of Clubs (Basic Award, Technical/Performance/Bonus Award, Merit Award, Match officials, insurance etc ) and operations/admin cost (branding, overheads, salaries, statutory payments etc). In all the allocations, LMC ensures a minimum of 75% of its earnings is deployed to the Clubs payments and cost centers.
The way it works is that before the start of every season at the LMC AGM, a budget is presented and agreed based on the guaranteed revenue forecast and allocated in line to the standard distribution formulae. This way, all participating Clubs are aware of what is available and due based on the guaranteed income. At the end of season a report of also presented at the AGM on the actual for the outgoing season and proposal for the coming season which are also captured in the annual reports.
For the avoidance of doubt, FC IfeanyiUbah has received payments/support 14 times within the last two years from LMC under different payments schemes on the following dates:
1.10.03.2016. (2016 Basic Award);
2.10.03.2016 (MD1 Performance Incentives);
3.10.03.2016 (MD5 Performance Incentives);
4.02.06.2016 (2016 Basic Award);
5.02.06.2016 (MD6-19 Performance Incentives);
6.07.09.2016 (MD20-33 Performance Incentives);
7.08.09.2016 (2016 Basic Award);
18.104.22.1686 (2016 Merit Award);
9.06.12. 2016 (2016 Merit Award);
10.06.12.2016 (MD 34-38 Performance Incentives)
11.09.12.2016 (2016 Basic Award);
12.13.01.2017 (2017 Basic Award);
13.03.04.2017 (2017 Basic Award);
14.30.08.2017 (2017 Basic Award)
In addition to the foregoing, LMC directly pays for all match officials indemnities, match day branding, media coverage, independent videos coverage of all matches, to produce highlights, provide clubs with official training and match balls, match day Beebs, insurance premiums, e.t.c, as well as other support where necessary for each match day.
It’s important to note here that over 90% of the League’s revenues, like most major sports, is generated through broadcasting and media rights. In 2017, as every stakeholder is aware, the major broadcast partner of NPFL (LMC ) reviewed their participation in some African countries’ domestic leagues (Nigeria, Ghana, Kenya and Zimbabwe). Thus, the major revenue source of NPFL was lost. However, LMC did not go to sleep but quickly rolled its sleeves and went to work to start from ground zero, with the objective of building a new sponsorship and revenue model anchored on a non-exclusive broadcast model, with LMC duly in control of the production of NPFL matches and other events in line with best international practice across the football world. Accordingly, the following major steps, among others, were taken since 2017:
1. LMC restructured the league central sponsorship strategy and went to sound out the market, including plans to set up an independent production company to take control of its contents.
2. LMC entered into an MOU with NTA with the support of FGN to work together to use existing infrastructure network to set up an independent production company to serve not just to produce the entire games of the NPFL but be of service to other sports and the entertainment industry. – Ongoing
3. LMC used its LaLiga partnership window to get Laliga production technical experts to advise on the production company set up and operation, which is aimed to be purely indigenous.- Ongoing
4. LMC set up a process and sourced and got commitment for partners to assist with the refurbishment of the production company equipments and training of personnel across the county at all match venues cities – Ongoing.
5. LMC/NFF also engaged Government, including making detailed presentation to the National Economic Management team under the Vice President to push for specific interventions government can do in the provision/upgrade of facilities and enactment or necessary legislation to promote and protect the domestic football industry and drive its professional development. Very soon a landmark legislation to the benefit of not just football but all sports will be unveiled by the FGN which will certainly be the game changer to drive the business or sports in Nigeria – Ongoing
6. LMC conducted an International bidding process to source interested partners/Agencies and broadcast companies to express interest in NPFL rights for both domestic, international and other platforms.
7. Accordingly, several global brands expressed interest in the NPFL under several proposed business and technical models, but hinged on the professional production of the NPFL matches. This confirms that if production of NPFL matches can be sorted out to international standards, the market is available to be exploited or, created altogether.
8. However, along the way one of the world top sports media company came on board and offered to work with LMC/NPFL to completely turn around the media and commercial rights of the NPFL, by producing the entire 360 games, marketing across the world on all possible platforms, and drive the commercialization of the NPFL. We immediately signed a Non-Disclosure Agreement and commenced negotiations, which took place both in Nigeria and abroad for several months, with several visits both ways. A due diligence was also duly completed on the NPFL and contracts documents drafted. Furthermore, private contact meeting was held at the Eko hotels Lagos with these Global media brand with morethan 40 top brands in Nigeria where the entire structure was sold out to the market to gauge the appetite of the corporate world to guide the business plans. Further meetings were also held in Abuja with top level agencies. The meetings were quite successful and gave direction to the fact that NPFL can be turn around to create its own market and compete.
9. Consequently, a Long Term Contract (12years) was agreed in principle with this world class brand, which was duly endorsed at the LMC AGM in Port Harcourt on May 28th 2017 by the Clubs. Afterwards, signing and unveiling was scheduled to take place soonest (after the world cup) with view to commence activities from next season. Unfortunately, due to ongoing avoidable crisis in our football polity, the partners have put on hold any further conversion until further notice. Hopefully, we will be back on track soonest.
10. LMC and proposed partner duly took the strategic decision to hold on major sponsorship activities until the new Broadcast structure is agreed, as these will have a bearing on the values that could be generated from this transaction. Consequently, only a few partners have agreed to come on board with the clear understanding captured in contract clauses that, if the new Broadcast structure is agreed, then the contracts with those partners will be reviewed to reflect the new opportunities presented, by having all games on TV.
Above is the current situation and arrangements being worked on, since 2017, to restructure the NPFL commercial activities. Thus, since 2017, the LMC has been managing and operating the league based on the funds its saved from the previous years (budget surplus), and the few partners available and, has been able to meet up most importantly with its core obligation of funding the operations of the league and welfare of its personnel, engaged both full time and part time and other technical development.
Indeed, every step of the way, the participating Clubs were duly involved and are briefed on the progress made. It is noteworthy that very credible partners always invariably demand the involvement of the participating clubs in these arrangements, as a condition for engaging the LMC/NPFL, in keeping with best international practice for transparency and accountability. We have the firm belief that, very soon, NPFL would achieve a total and complete turnaround, all things being equal, in a manner that would be sustainable, commercially viable and benefiting for all stakeholders, clubs, players, fans, investors, e.t.c Technkcallu the present 2018 season was all agreed to be like a transition season pending the activation of the transactions being structured.
Finally, Chief Ifeanyi Ubah only came into the league in 2015 and, thus, I will excuse him for not having the correct history of league administration before the LMC. It’s on record that before LMC, Clubs received NOTHING from the then league (NFL/NPL) but instead, were, in fact, PAYING to play in the league in the name of Registration Fees, Insurance Fees and, indeed paying for the referees and match officials indemnity and other costs for each of their home matches. Staff of the defunct league operator were owed for several months. When LMC took over, in 2013, the league was in the red to over N400m debts and liabilities, with staff not paid for over 8 months.The entire guaranteed revenue of the league before LMC was just about N150m for the broadcast rights annually, which was even paid in paltry instalmental sums weekly, and at the mercy and discretion of the right holder. This was how the league collapsed and led to the formation of LMC to manage and operate a new league arrangement.
LMC was able to introduce changes in all aspects and within a few years, turned around everything, with clubs getting a huge part of the revenues and, by 2016, was declaring surplus.
Certainly, even in leading global leagues big clubs do get a maximum of about 30% of their revenues from the central distribution pot and have to work to raise their own revenues from other sources such as ticketing/match day revenues, merchandising, club sponsors and partners, players sales, etc. In fact under the FIFA, CAF and NFF Club Licensing Regulations, each Club is mandatorily required to submit its Commercial/Marketing Plan, as one of the pre-conditions for licensing and registering each club to participate, every season.
So, the point really must be seen for what it is; that FC IfeanyiUbah having not activated any of these commercial windows to boost its revenue streams as required of a professional football club by governing regulations, now, apparently and unfairly, wishes to blame LMC for not meeting the club’s contractual obligations, when indeed in 2015, Chief Ifeanyi Ubah, duly, provided LMC with a guarantee to ensure this situation does not happen.