Joe Lewis’ guilty plea and what it means for Tottenham

Joe Lewis, the billionaire and founder of the company that owns Premier League club Tottenham Hotspur, has pleaded guilty to criminal charges in the U.S. after he was charged with insider trading.

The 86-year-old investor had been indicted for “orchestrating a brazen insider trading scheme” in July.

Lewis’ lawyer had initially claimed the government had made “an egregious error in judgment” by charging Lewis and promised to “defend him vigorously”.

However, Lewis, who founded ENIC Sports Inc, the company that owns the vast majority of shares in Spurs, arrived in the Manhattan court on Wednesday and pleaded guilty to one count of conspiracy to commit securities fraud and two counts of securities fraud.

But what does this mean for Tottenham?

Lewis ‘ceded official control’ of Spurs in October 2022, didn’t he?

Technically, yes. But in reality, not a lot changed, and the noises coming out of Spurs at that time were that it was business as usual.

The club’s steer last year was that the decision was part of the restructuring of the Lewis Family Trusts, with one eye on the long-term future (Lewis turned 86 in February). The day-to-day running of the club has been unaffected and Spurs effectively remained in Lewis’ control.

The Athletic’s report on the change at Companies House, the UK’s registrar of companies, described it like this: “The key point here is that Tottenham Hotspur is still essentially Joe Lewis’ club. ENIC Sports owns 85.56 per cent of the club’s shares. And, to quote from the club’s website, ‘a discretionary trust of which certain members of Lewis’ family are potential beneficiaries ultimately owns 70.12 per cent of the share capital of ENIC’.”

That was an uncontroversial and widely reported take at the time, with The Athletic’s headline saying that “Tottenham Hotspur is still Joe Lewis’ club”. Unsurprisingly, the club’s tune has changed in the past months, with Tottenham now emphasising Lewis is no longer the “owner” of the club.

In a statement later last year, a Tottenham spokesman said: “The owner of Tottenham Hotspur is ENIC, with majority control held by a family discretionary trust of which Joe Lewis is not a beneficiary.

“The trust is managed by two independent professional trustees on behalf of its beneficiaries. Lewis ceased to be a person with significant control of the club in October 2022.

“This is a U.S. legal matter unconnected with the club and, as such, we have no further comment.

“Certain members of Lewis’ family are potential beneficiaries of a discretionary trust that ultimately owns 70.12% of the share capital of ENIC. Of the total issued ordinary share capital of Tottenham Hotspur Limited (THL), ENIC owns 86.58%. ENIC also owns one THL convertible A share.

“Lewis ceased to be a person with significant control of THL on October 5, 2022.”

But in layman’s terms, it is perhaps worth pointing out that the Lewis family trust effectively controls just over 60 per cent of the club’s shares (70.1 per cent of ENIC’s stake). The rest of ENIC’s shares are owned by chairman Daniel Levy and his family via a similar setup of discretionary trusts.

And, as The Athletic wrote in October 2022, the close relationship between Lewis and Levy is still important at Tottenham. They have been working together for almost 30 years, ever since Lewis met Levy and made the younger man — still in his early thirties at the time — his protegee and point man.

What does this mean for Tottenham?

Tottenham is not mentioned by name in the indictment, only that Lewis is the “principal owner of the Tavistock Group” and its investment portfolio includes “hundreds of companies, including in agriculture, sports, resort properties, and life sciences”.

Around eight hours after the story broke last year, Spurs issued the following statement: “This is a legal matter unconnected with the club and as such we have no comment.”

Given Lewis’ long-standing relationship with the club, this raised some eyebrows. Lewis has been synonymous with Spurs since ENIC bought Alan Sugar’s 29.9 per cent stake for £22million (then around $32m) in December 2000.

Lewis’ guilty plea does not, therefore, impact the day-to-day running of the club or give them problems with the Premier League’s owners and directors’ test.

What does this mean for a future sale of the club?

Game on. The impenetrable cloud that descended over the club last year has lifted.

When Lewis was charged, anyone who was thinking about doing business with him will have thanked their lucky stars they didn’t.

That said, anyone who was in serious talks with him, or any of his businesses, would have learned about this issue during the due diligence process, which might explain why the various rumours of interest in Spurs from North America and elsewhere went nowhere.

But now Lewis has taken the plea, the skies have cleared and those rumours can resume.

(Top photo: Mike Egerton/PA Images via Getty Images)