UAE businessman ends fling with Premier League football club.

Dr Sulaiman Al Fahim’s purchase of Portsmouth Football Club for some GBP60 million seems as bizarre today as it did in late August 2009 when he completed the deal. The UAE property developer had never before expressed an interest in owning his own Premier League club, let alone a relatively unknown one nestled on the south coast of England.

Even when helping broker the deal that saw the Abu Dhabi royal family buy Manchester City, Al Fahim gave no indication he wanted a piece of the action. Still, Al Fahim’s role in the transaction, completed roughly one year before he engineered his own takeover of a different Premier League club, must have whetted the appetite.

On September 1, 2009, Al Fahim outlined his plans for establishing Portsmouth as a top eight side. His vision involved building a new training ground, strengthening the squad and developing the academy to nurture youth players into Premier League stars.

But only a month after unveiling his vision, Al Fahim sold the club to Saudi investors the Al Faraj brothers. Explaining his hasty departure, he told a UAE business magazine that the club’s debt and demanding repayment schedule was beyond anything he had imagined.

Portsmouth, like several other English football clubs, have spent heavily chasing the Premier League dream; its debts stand at around GBP70 million following excessive outlays on players and their wages. The investment paid off in the short-term, with Portsmouth winning the FA Cup two years ago. The club, however, now finds itself rooted to the bottom of the Premier League and on the verge of going bust. ­

Since selling the club, Al Fahim has moved to severe all ties by announcing his resignation as non-executive chairman on February 22. He claims no one at Portsmouth made him aware of the club’s financial predicament, and insists he was ignored by board members when trying to uncover the true nature of its debt.

While clearly disgruntled with the board, Al Fahim has attempted to appease fans by initially offering his 10% stake in Portsmouth to the Pompey Supporters’ Trust for free. However, reports in today’s UK newspapers suggest he may have had a change of heart.

No one really knows what lured Al Fahim to Portsmouth in the first place. Maybe it was the prestige of owning a Premier League football club and rubbing shoulders with some of the world’s best players. Whatever the reason, the marriage between Arab investor and Portsmouth FC was always likely to end in divorce. Few were convinced Al Fahim had the financial clout to rescue the ailing club, a rumour that was further fuelled following his astonishingly quick exit. As such, there seemed little point in him sticking around for the long-haul. But considering Portsmouth is now on its fourth owner this season (the Al Faraj brothers recently sold it to Hong Kong-based businessman Balram Chaainrai), Al Fahim is probably better off out of it.

Despite failing to achieve what he set out to, Al Fahim does leave a legacy behind of having the shortest tenure as owner of a Premier League club. Granted, it’s not the greatest accolade, but at least he’ll be remembered for something.

ABU DHABI

After losing a board member and with the CEO under pressure to turn a profit, Aldar Properties’ troubles have only just begun.

This latest issue of .Commerce magazine was right on the nose again with its spotlight on Aldar Properties. CEO John Bullough is said to be facing increasing pressure to conjure up profits amid the local real estate downturn.

According to an estimate by research firm HC Securities, real estate sales prices in Abu Dhabi need to rise by nearly 30 per cent to justify the price Aldar is currently paying for the land.

On cue comes the news that Khadem Al Qubaisi has resigned from the Aldar’s board of directors. The company did not give a reason for the departure in a statement posted on the Abu Dhabi Exchange (ADX) website.

Al Qubaisi is no small fish as managing director of International Petroleum Investment Company (IPIC) and head of Aabar Investments, which is listed on the ADX. The firm has secured stakes in F1 champions Brawn GP, Banco Santander of Brazil, Tesla and Virgin Galactic. Something tells us the ructions for Aldar won’t end here.

More analysis on Aldar Properties can be found in the February issue of .Commerce, which out now.

As the recession prompts a wave of CEO resignations, analysts are left wondering if the bosses left of their own accord.

In a time when no one can be sure which way the economy will turn and when, one thing is certain: more CEOs will wave goodbye to their jobs.

The dizzying litany of local management departures gained momentum in May this year when the Dubai government dismissed its head of finance, Nasser Al Shaikh. The Emirati’s purported crime was to wax lyrical on radio about Dubai’s plan for its next US$10bn bond issuance.

Since then, the list of recent management step-downs has grown as long as it is illustrious: Taqa, Damac, Damas, Shuaa Capital, Union Properties and Sorouh being among the best-known companies left bereft of their senior figures.

Beyond doubt, the financial crisis has placed company performance under the microscope: exposing a mixed bag of corporate weaknesses: from clashing visions to slack corporate governance and lack of training.

The accompanying PR patter has grown predictable: “After 23 years of dedicated service contributing towards the successful growth of the company, Simon Azzam has decided to dedicate his time to other pursuits,” claimed a statement issued by Dubai-based real estate firm, Union Properties, in June this year.

Weeks later, the CEO of investment bank Shuaa Capital resigned. Iyad Duwaji, who had been with Dubai-based Shuaa for two decades and run the company for 14 years, insisted his resignation was “personal”.

But the biggest surprise came last month as Peter Barker-Homek, CEO of state-backed energy company, Taqa, told reporters he had stepped down.

“I had a discussion with my board at Taqa,” he said. “We discussed the future direction of the firm, my future direction, and we decided it would be best for me to step down at this time. It was my choice.”

This spate of inopportune departures comes at a time when solid leadership is crucial – and it begs the question: is there more to the story?

“I don’t believe the local CEOs have resigned, they hardly ever get up and leave of their own accord,” says Dr Tommy Weir, author of The CEO Shift and former management trainer at Nakheel.

“The sheer volume of departed CEOs citing ‘personal reasons’ raises questions. The answer is that they were all fired in the same way that they were hired. We reacted to the bust in exactly the same way that we reacted to the boom: in a reactionary manner.”

Recent reports from management consulting firm Booz and Company said global CEO departures rose 0.6 per cent in 2008, however, forced removals nearly doubled from 3.8 per cent to 6.1 per cent across Asia in the same year.

Aroop Zutshi, global president and managing partner at Frost & Sullivan, argues that citing “personal reasons” is nothing more than a sugar-coated excuse for leaving the company. “It’s likely they have all been fired. CEOs get hired and fired very quickly. Boards are not patient. The reality is that they would have been fired for not meeting their KPIs [key performance indicators]. In today’s more difficult and competitive environment, it could be that they didn’t know the business, the region or their customers well enough,” he says.

Weir agrees that CEO departures are directly connected to the performance, or not, of the company. So, while the cash was unabashedly flooding into the region up until 2007, local chairmen were able to turn a “blind eye” to any attributes of the management they were less than happy with.

“A lot of family-owned local businesses grew into big players and once they reached a certain size, bringing in an outside CEO was seen as a trendy thing to do, but at their heart they are still family businesses,” Weir says. “It was fine while the money was coming in and the outside impression looked good.”

According to David Coleman, a senior consultant at Booz & Company, another reason local companies may be keener to get rid of their CEOs than in the west is because they have more access to credit than the US and Europe, having been less exposed to the global financial fallout.

“In the west, companies are more prone to holding on to their CEOs during the crisis because they simply don’t have the money available to take any risks,” he says.

The volume of CEOs biting the dust during the recession has highlighted weaknesses in company structures and succession planning capabilities, as well as hires.

Companies that want to avoid the pitfalls of short CEO tenure must pay attention to training and hiring techniques, warns Hazel Jackson, the boss of corporate training firm, Biz-Ability.

“Before, it was possible to be successful despite yourself, but now it’s a highly competitive market. There was a shortage of talent, so the best people were cherry- picked to manage others, even though they didn’t have management training and companies got lost in a wave of growth,” she says.