`You ain't going to get screwed,' Bates promises

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Ken Bates, chairman of Chelsea Village, made his own inimitable contribution to the corporate governance debate yesterday by urging wary shareholders to trust him and his fellow directors on the thorny issue of share options.

"Have faith that you ain't going to get screwed by the guys on this board," he told a questioner at the company's maiden annual meeting who was worried about the potentially dilutive effects of Chelsea's executive share option scheme.

Mr Bates also insisted the board was not unstable despite the resignation of three directors since Chelsea Village, owner of the football club, was floated on the Alternative Investment Market this year.

The latest departure came a fortnight ago when Peter Middleton abruptly resigned as non-executive director after losing out to Mr Bates in a boardroom power struggle.

Mr Middleton, a leading figure in the City, left after Mr Bates refused his request to appoint an independent executive director to the board following the sudden death last month of Matthew Harding, the insurance industry millionaire who held a quarter of Chelsea Village's shares.

Mr Bates told shareholders it was "not wise to discuss at the present time" the reason for Mr Middleton's resignation.

On the financial front, Mr Bates said he did not expect Chelsea Village to be cash positive until the development of Stamford Bridge, the company's West London stadium, is completed in 1998.

Only after a cash positive position was achieved would the board consider paying a dividend, he added.

Last week Mr Bates claimed to be well on the way to raising pounds 30m to continue the development, which had been thrown into doubt by Mr Harding's death in a helicopter accident.

The Stamford Bridge redevelopment involves a 160-bedroom hotel, four restaurants, a 1,000-capacity banqueting suite, a 10,500 sq ft merchandising centre, a seven-room business centre and 24,000 sq ft of serviced offices.

Mr Bates said completion of the South Stand by the end of 1997 would bring Stamford Bridge's capacity to 34,000, adding that the planned redevelopment of the West Stand would increase capacity further to 44,000.

Designs for the redevelopment of the West Stand are at an advanced stage and a planning application to the local council will be made in the first week of December. Building work should start in May 1997.

Mr Bates said that when the Stamford Bridge development was complete it would be one of the most overdeveloped 12-acre sites in the world.