MELBOURNE has merged with the Bentleigh Club, following an extraordinary general meeting on Monday night.
The members of the Bentleigh Club overwhelmingly supported the merger proposal put forward by Melbourne, with 98 per cent in favour. Of the 1,232 votes received, only 28 were against the proposal.
Melbourne president Jim Stynes thanked the members of the Bentleigh Club for their support and endorsement.
He added that the merger ensured the survival of the Bentleigh Club and continued a long-standing relationship between the clubs.
“We believe we have rebuilt Melbourne off the back of inclusiveness and a strong respect for heritage and we will seek to rebuild the Bentleigh Club on the same basis,” Stynes told melbournefc.com.au.
A key strategy for Melbourne has been to strengthen its financial position and the club believes the Bentleigh Club merger is another step towards achieving its aim.
On the back of its highly successful Debt Demolition campaign, which erased the club’s debt, the Demons set their sights on building assets, which would also generate income.
Melbourne will now add more than $9m to its balance sheet. These assets are offset by $1.8m of debt taken over and $1.2m in gaming machine entitlement obligations. But in a net sense the improvement on the balance sheet will be at least $6m.
“This strengthening of the balance sheet creates the potential for further strategic investment, as we continue to explore all avenues to grow the club,” Stynes added.
The club now believes the Bentleigh Club is the first real asset Melbourne has owned.
From August 2012, Victoria’s gaming regime will also change dramatically.
Stynes said this will provide Melbourne with significant opportunities for increased profits.
“We believe that we can operate the Bentleigh Club at close to a break-even level, until the new regime commences and after that make solid returns for reinvestment back into the club,” Stynes said.
“It is important to point out that the projections we have done for our gaming operations indicate that the debt assumed under the merger can be repaid from the profits of the venues - not from any other activities of the club.
“This was a key criteria in our decision making - the debt taken on had to be able to be repaid from gaming operations, so that the rest of the core operations of the club remain debt free.
“We believe that not only will this be achieved, but the profits from the venues will allow cash to be injected into key areas like our community programs and the football department.”
The merger was originally proposed to members of the Bentleigh Club in July 2010, following in principle discussions with its board.
Melbourne then sought to engage with as many of the Bentleigh Club members as possible. It held two information nights and a Consultative Committee was formed.
After more than seven months negotiations with the Bentleigh Club board and the Consultative Committee, it resulted in the signing of a memorandum of understanding in November 2010.
From there the arrangements were formalised in the Transfer Deed in March, which formed the basis of the vote on Monday.
Stynes thanked the Bentleigh Club board and the Consultative Committee for their tireless efforts.
“On behalf of Melbourne, I would like to thank the Bentleigh Club and the Consultative Committee for its professionalism throughout the process and acknowledge the personal time they committed to the negotiations in representing their members,” he said.
Melbourne will assume control of the Bentleigh Club in the coming months, once the relevant licenses and contracts have been transferred.
The impact of the merger will appear in the 2012 financial statements and will be clearly explained in Melbourne’s Annual Report.
The members of the Bentleigh Club overwhelmingly supported the merger proposal put forward by Melbourne, with 98 per cent in favour. Of the 1,232 votes received, only 28 were against the proposal.
Melbourne president Jim Stynes thanked the members of the Bentleigh Club for their support and endorsement.
He added that the merger ensured the survival of the Bentleigh Club and continued a long-standing relationship between the clubs.
“We believe we have rebuilt Melbourne off the back of inclusiveness and a strong respect for heritage and we will seek to rebuild the Bentleigh Club on the same basis,” Stynes told melbournefc.com.au.
A key strategy for Melbourne has been to strengthen its financial position and the club believes the Bentleigh Club merger is another step towards achieving its aim.
On the back of its highly successful Debt Demolition campaign, which erased the club’s debt, the Demons set their sights on building assets, which would also generate income.
Melbourne will now add more than $9m to its balance sheet. These assets are offset by $1.8m of debt taken over and $1.2m in gaming machine entitlement obligations. But in a net sense the improvement on the balance sheet will be at least $6m.
“This strengthening of the balance sheet creates the potential for further strategic investment, as we continue to explore all avenues to grow the club,” Stynes added.
The club now believes the Bentleigh Club is the first real asset Melbourne has owned.
From August 2012, Victoria’s gaming regime will also change dramatically.
Stynes said this will provide Melbourne with significant opportunities for increased profits.
“We believe that we can operate the Bentleigh Club at close to a break-even level, until the new regime commences and after that make solid returns for reinvestment back into the club,” Stynes said.
“It is important to point out that the projections we have done for our gaming operations indicate that the debt assumed under the merger can be repaid from the profits of the venues - not from any other activities of the club.
“This was a key criteria in our decision making - the debt taken on had to be able to be repaid from gaming operations, so that the rest of the core operations of the club remain debt free.
“We believe that not only will this be achieved, but the profits from the venues will allow cash to be injected into key areas like our community programs and the football department.”
The merger was originally proposed to members of the Bentleigh Club in July 2010, following in principle discussions with its board.
Melbourne then sought to engage with as many of the Bentleigh Club members as possible. It held two information nights and a Consultative Committee was formed.
After more than seven months negotiations with the Bentleigh Club board and the Consultative Committee, it resulted in the signing of a memorandum of understanding in November 2010.
From there the arrangements were formalised in the Transfer Deed in March, which formed the basis of the vote on Monday.
Stynes thanked the Bentleigh Club board and the Consultative Committee for their tireless efforts.
“On behalf of Melbourne, I would like to thank the Bentleigh Club and the Consultative Committee for its professionalism throughout the process and acknowledge the personal time they committed to the negotiations in representing their members,” he said.
Melbourne will assume control of the Bentleigh Club in the coming months, once the relevant licenses and contracts have been transferred.
The impact of the merger will appear in the 2012 financial statements and will be clearly explained in Melbourne’s Annual Report.
