DeMbare’s big loss

heavy cost for the club that borrowed heavily hoping to offset the debt with proceeds from a good run in the tournament.
It has emerged that Dynamos will have to find resources to pay off over US$105 000 they used for their brief flirtation with this year’s Champions League.
As had become a tradition at the Glamour Boys, Dynamos had been hoping that Lloyd Mutasa’s class of 2011 would reach the mini-league stage of the Champions League, which would have guaranteed them at least some financial return for participating.
However, Dynamos chairman Farai Munetsi revealed yesterday that his club, without a corporate partner to help foot their costs, had borrowed to cater for their first round clash against Algerian champions MC Alger.
But after crashing out on the away goals’ rule following a 3-0 defeat by the Algerians, which had tied the game 4-4 on aggregate in Algiers last Sunday, Munetsi painted a gloomy picture of a club that would now have to grapple with paying back the costs they incurred.
Munetsi said a place in the group stages of the tournament would have ensured Dynamos would get some money to meet the costs they would have incurred for participating while a top four finish could have meant that they at least broke even.
However, all that remains a pipe dream after Mutasa’s men flattered to deceive by taking what appeared a comfortable 4-1 lead in the first leg at Rufaro before succumbing to a 3-0 loss in the reverse tie in Algiers, amid complaints of biased officiating by Egyptian referee Fahim Omar.
Munetsi said although Dynamos remained committed to playing continental football, they would only do so after ensuring they have a sponsor, as doing so without sound financial backing was proving a huge disaster for them.
The Dynamos boss said they were now in a quandary, as they would have to run around to look for money to pay off the debts they had incurred.
“The flight to Algeria and the players and technical staff allowances chewed up US$70 000, hosting MC Alger in Harare required US$12 500, taking care of the match officials and the allowances for that match at Rufaro needed US$8 000 and there was also US$11 000 which we used for the winning bonuses for that first leg.
“There are other costs related to the first leg such as that of camping for our team, car rentals for the match commissioner and the referees vehicles and when you look at all those bills and the fact that we only netted US$26 000 you can see that we are in the red.
“We really need the support of everyone. I appreciate that the government has its own challenges but without either corporate or government support we will always remain in trouble.
“It is unfortunate that we lost the match and got knocked out but for us to fulfil the match against the Algerians we had to run around to borrow,” Munetsi said.
The Dynamos chairman, however, conceded that the Harare giants could not continue borrowing and jumping from one crisis to another.
Munetsi said although he had his proposals for a possible solution to the DeMbare woes, it would need the approval of the Dynamos board of directors.
“My solution for Dynamos is that we should float shares to raise capital but that is the prerogative of the board.
“Dynamos is already a private company but without capital.
“I applaud what the board has done to set up the company but some of the shares just have to be sold because Dynamos does not have assets so its capacity to borrow is limited.
“So the only way to go is to the market to raise capital. There are various projects that we should be undertaking and we should also be taking advantage of the fact that we have a large following in the country”.
Munetsi noted that efforts by Dynamos to maximise financially on their huge support base in the country would remain just talk if the club fails to raise capital to undertake projects like the sale of replica jerseys and memorabilia.
“We need to develop our players, our technical team and to venture into commercial projects but all that needs capital, so in short for Dynamos to be a business that it should be we need capital,” Munetsi said.
He also revealed that Dynamos were still reeling from another debt they secured, believed to be from a local commercial bank, to finance the signing-on fees that enabled them to register players for the domestic Premiership campaign.
“We have borrowed to finance the Champions League campaign so we have to run around and ensure we pay back the money.
“It must also be remembered that we had a huge bill of signing-on fees but it is one hurdle that I am happy we have cleared and all our players now have contracts.
“Maybe if we had qualified for the mini-league we would have made about US$280 000 for being in the group stage and it would cover some of the costs.
“But for us to break even from this competition we need to qualify for the semi-finals where you get around US$800 000.
“Even then that has its own expenses which does not make it viable to compete without a sponsor because there is also a ridiculous fee you have to pay for broadcasting yet we believe we should be benefiting from the live television of our games.
“Last year we had to pay US$145 000 for the broadcast of our matches and the issue of broadcasting costs was also a thorny one with our predecessors (the Patson Moyo executive)”.
Munetsi also remained hopeful that Dynamos, rated the ninth best club in Africa after slumping from sixth last year, would not be forced to take the drastic measure of withdrawing from continental football in future competitions.
“Emotions are high about the way we lost in Algeria but there is a school of thought that if we do not have sponsorship then why we go into Africa.
“But for the development of football in the country and for the sake of the players’ careers we should constantly take part in the Champions League, it will help us measure our strength against other countries and give our players the international exposure that will also benefit the national teams.
“If the board feels we should not take part we would have to respect their decision but personally I feel we should play but only when we have sponsorship because at the moment the costs are leaving us in worse off financial problems,” Munetsi said.
With Munetsi recommending a sale of the DeMbare shares to raise capital, the matter could come up for discussion at the long-delayed Dynamos annual meeting at the National Sports Stadium on Saturday.
After suffering some false starts, the Dynamos shareholders – a coalition of founding fathers and former players – are now scheduled to meet this Saturday.
The Dynamos shareholders, formerly known as the Electoral College, could have met last weekend but the indaba was again called off under a cloud.
Sources close to the board indicated that members had resolved that the annual meeting had to take place this Saturday without any further delay.
“First the meeting was called off because treasurer Harrison Mbewe was engaged at a PSL meeting and could not present the accounts.
“Now last Saturday, the meeting was called off in unclear circumstances following claims that there was no quorum yet the majority had turned up.
“After this postponement members resolved that the meeting will have to take place on 9 April whether there is a quorum or whether two members turn up, the leadership cannot keep giving excuses,” the sources said.
With revelations that Dynamos are now saddled with debts emanating from their failed Champions League campaign, board chairman Richard Chiminya and his leadership would have to also find ways to ensure the Harare giants move out of their financial quandary.