Estrella Football Group has seen the recent statements issued by Greenock Morton FC and the MCT Board. Following our statement of 18 August confirming our withdrawal from the proposed investment, we have deliberately chosen not to make any further public comment. We have respected the club, its supporters and the MCT membership and have sought to allow the situation to settle. However, the recent statements and the significant amount of speculation that has subsequently emerged have created an increasingly unsettled and undesirable situation.

Estrella is receiving questions based on inaccurate information and, more importantly, we are increasingly concerned that MCT members who have acted in good faith and with the best interests of Morton at heart are themselves being subjected to unwarranted criticism and accusations. We therefore believe it is now important to set out the facts clearly, so that Morton supporters, MCT members and everyone connected with the club can understand Estrella's position.

Our current position

We have noted the MCT Board's statement to its members. However, it should not be interpreted as an indication that Estrella has reconsidered its decision to withdraw from the proposed investment or that discussions regarding the investment have resumed. At present, Estrella is not in negotiations with the MCT Board or Greenock Morton FC. Following the AGM, our focus has been on bringing the previous process to an appropriate conclusion and addressing the outstanding matters arising from that process.

We appreciate that both the GMFC Board and the MCT Board have sought to provide supporters with further context regarding the process. Unfortunately, however, this has had the effect of further confusing an already difficult situation, which emerged largely because of the way our proposal was initially communicated to MCT members on 15 August. We believe it is therefore important to set out the facts and explain why Estrella took the decision to withdraw from the proposed investment.

The process and communication with MCT members

Estrella invested approximately eight months of significant time and effort in developing a proposal for Greenock Morton. We had great confidence in the project and genuinely believed that the proposed partnership could provide the club with the financial stability, investment and long-term development it needs. We were therefore deeply disappointed by the circumstances surrounding the AGM on 17 August.

An incomplete Investment Agreement was issued to MCT members without Estrella's knowledge or consent, contrary to the arrangements that had been agreed and in breach of the NDA governing the process. In addition, the proposal was communicated by MCT as giving Estrella "majority control over GMFC whilst being a minority shareholder". Estrella did not see these communications until 18 August. We note that MCT has subsequently acknowledged and apologised for the breach of the NDA that was in place and has also acknowledged that the proposed investment would not, in fact, have resulted in Estrella having majority control of the club.

We regret deeply that the AGM was therefore conducted in an atmosphere of significant confusion. This was caused in part because of the way the proposal had been communicated and in part by the circumstances surrounding the changes to the proposal in early August. The situation had become sufficiently concerning that Estrella had considered withdrawing from the investment on 15 August due to a serious loss of trust in the then MCT Board. We nevertheless decided to make one final attempt to provide members with the necessary context to allow them to make an informed decision and, importantly, to allow the proposed investment to proceed in time for Estrella to become meaningfully involved in the club during the current season. The postponement of the vote and the circumstances that led to it meant that this was ultimately no longer possible.

There were several substantive matters that Estrella sought to clarify to members, and which remain important to understanding our decision.

1. The financial position of the club

Our concerns about the club's financial position first arose when Estrella was unexpectedly approached during the due diligence process with a request for a £50,000 loan. This raised immediate and serious questions about the club's underlying cash position and the extent of its financial obligations. At that point, we became concerned that the investment we were proposing as growth capital could instead be absorbed immediately by existing liabilities and short-term financial pressures, including legal costs and other deficits within Greenock Morton's budget. That would fundamentally change the nature of the investment and would not provide the club with the resources required to invest in its future.

Despite those concerns, Estrella was not provided with a full explanation of how the financial shortfall was ultimately covered or how the outstanding obligations were being addressed. This was the first point in the process at which we felt that the MCT Board was not being fully transparent with us about the club's financial position.

These concerns were compounded by the fact that information concerning the actual financial position of GMFC had not been fully disclosed to Estrella during the process, particularly in relation to the full extent of outstanding sponsorship arrears. Estrella did not become aware of the full extent of this deficit until 10 August. It was not until 11 August that we had a clear indication that these outstanding payments were unlikely to be received in the short term, if at all.

This was highly material to our investment decision. The investment proposed by Estrella was intended to provide growth capital for the club, including investment in the playing squad and the development of the club. It was not intended primarily to fund historic liabilities, legal costs and accumulated payment arrears.

2. The club's financial budget

A further concern arose when the club's new Finance Director confirmed to Estrella that the budget for the current financial year, which had been shared by the MCT Board in the Data Room as part of the due diligence process, was significantly too optimistic. This was a third clear indication that the financial position of the club was materially different from what had initially been presented to us. In our view, this is precisely the type of information that should be identified, explained and transparently shared with a prospective investor during a due diligence process.

This information was intended to be included and further explained in a covering letter to MCT members, which was to accompany the information being circulated to members ahead of the meeting at which they would be asked to vote on the proposed investment. A director of MCT subsequently requested that this information be removed from the communication to MCT members. Estrella did not agree to remove it and, as a result, the covering letter containing this important financial context was ultimately not sent to the members. We believe this is important because it meant that MCT members did not receive the full financial context that Estrella considered relevant to their assessment of the proposed investment.

3. The proposed ownership structure

In the week leading up to the MCT members' meeting, Estrella held discussions with several MCT members and subsequently with the MCT Board regarding how our proposal could be adapted considering the club's deteriorating financial position. Our intention throughout these discussions was to find a constructive solution that could bring the different parties together and provide a way forward that was in the best interests of the club, its members and Estrella.

Two principal options were discussed. One option was to increase Estrella's shareholding from 35% to 51%, which would have resulted in Estrella holding a majority stake in the club. The other option was to reduce the level of Estrella's investment while retaining a 35% shareholding.

Estrella ultimately chose the latter option. We believed this provided a more appropriate balance between protecting the club's community ownership structure and ensuring that the investment remained at a level that we considered financially responsible given the circumstances.

During these discussions, the prevailing advice from the MCT members we spoke with was to reduce the amount of Estrella's investment and, if appropriate, consider increasing the investment again at a later stage once there was greater certainty about the club's financial position. The MCT Board, however, advised Estrella to pursue the 51% option instead. This came as a significant surprise to us, particularly given that our discussions had been aimed at finding a solution that could accommodate the different interests involved and provide greater certainty around the club's financial position.

We ultimately chose to retain the 35% shareholding while reducing the level of our investment, as we believed this represented the most appropriate balance between maintaining strong community ownership and ensuring that the club received responsible and sustainable investment.

What surprised us even more was that, despite our decision to retain a 35% shareholding, the MCT Board subsequently described the proposal in communications to MCT members as giving Estrella a "controlling minority" interest. This communication had not been agreed with Estrella, despite previous assurances from the MCT Board that communications concerning the proposal would be agreed with Estrella before being issued. More importantly, the description was factually incorrect. Estrella's proposal was for a 35% shareholding and did not provide Estrella with control of the club.

Given the increasing uncertainty surrounding the club's financial position and the concerns we had about the transparency of the information being provided to us, we included a number of additional reserved matters in the Investment Agreement. These were introduced in response to the circumstances that had emerged during the negotiation and due diligence process and were intended to provide appropriate protection for the capital Estrella was committing to the club.

Such investor protections are entirely normal in investment agreements, particularly where an investor is committing significant capital in circumstances where the financial position of the business has become less certain than initially presented. They were not intended to give Estrella operational control of Greenock Morton FC, nor were they designed to allow Estrella to interfere in the day-to-day running of the club.

Instead, the reserved matters were intended to protect Estrella's investment and, importantly, to protect the club and its members by ensuring that significant financial decisions could not be taken without appropriate oversight and approval. In the context of the events that had taken place during the negotiation process, we considered these protections both reasonable and necessary.

It is therefore important to distinguish between appropriate investor protections and control of a football club. The former was part of Estrella's proposal; the latter was not.

4. The sporting situation and recruitment

The sporting performance of the team had not gone unnoticed by Estrella. During the process, members of the technical staff approached us with a request to appoint a Technical Director who could assist with assessing the squad and supporting the recruitment process.

In response, we used our network to identify David Moyes Jnr. as someone with the experience and expertise to assist the club with this work. David was prepared to do so on his own time and at his own expense until Estrella's proposed investment had been fully completed. The MCT Board was informed of this arrangement. Despite this, David was subsequently denied access to Cappielow. We were explicitly informed by email that David was not permitted to enter the stadium under any circumstances. The reason given was that he was not an employee of the club and had not signed an NDA. The club also sought advice on this matter from an individual who was neither an employee nor a director of the club or the MCT Board and who also had not signed an NDA.

This was particularly concerning to Estrella because the purpose of David's involvement was simply to assist the existing football staff in assessing the squad and identifying potential recruitment opportunities. He was not being asked to assume control of the football operation.

The subsequent assessment of the squad was deeply concerning. Our analysis indicated that, irrespective of the club's financial position, the squad required approximately seven to eight additional players of sufficient quality to significantly strengthen the team and reduce the risk of relegation. Estrella repeatedly communicated the importance of strengthening the squad and was prepared to support the process of identifying and recruiting players who could materially improve the team. However, the MCT Board repeatedly declined to pursue several opportunities to strengthen the squad with better quality players.

The original intention was for the investment to be completed by 1 July, allowing Estrella to become actively involved in the club in the period leading into the new season. This would have given us the opportunity to work alongside the existing football and technical staff, help strengthen the squad and provide additional expertise and information to support the recruitment process and build a stronger team for the season ahead.

As the process continued to take longer than anticipated, that opportunity progressively disappeared. By the time of the AGM in August, there was simply no longer sufficient time for Estrella to become meaningfully involved in the preparation for the new season or to have a meaningful impact on the squad before the transfer window closed. This was particularly concerning given our assessment of the squad and the need for significant strengthening.

At the same time, new players were signed despite Estrella having expressly requested that no further commitments of this nature should be made without prior discussion with us. These decisions further reduced our confidence in the ability of the parties to work together effectively and in the prospects of achieving the sporting objectives of the proposed investment.

For Estrella, this was a significant concern. An investment in a football club must be made with the objective of building a stronger and more sustainable club. The prospect of entering our first year as an investor with a significantly under-strength squad and a substantial risk of relegation was not one we could responsibly accept, particularly when combined with the financial circumstances described above.

Why Estrella withdrew

It is important to put the current situation into the context in which Estrella originally agreed to pursue an investment in Greenock Morton. When we began this process in March, we were looking at a financially healthy football club, with no operational loss, playing in the middle of the table in the second tier of Scottish football. On that basis, and after extensive discussions and due diligence, Estrella believed that an investment in the club represented an attractive opportunity to provide growth capital and support its long-term development.

Since March, however, both the financial and sporting position of the club have deteriorated materially. The financial requirements became significantly greater than originally anticipated, while the sporting situation developed to a point where the squad required substantial strengthening simply to reduce the risk of relegation. In those circumstances, the level of investment required to address the club's immediate needs, combined with the risks associated with the sporting situation, became too great for Estrella to proceed responsibly.

The difficulties in the relationship and alignment with the MCT Board during the process further increased those risks. A strong partnership between an investor and a community owned club requires transparency, trust and alignment on the key decisions affecting the future of the club. Unfortunately, our experience during the latter stages of the process gave us increasing concerns about whether those conditions existed.

We hope that Morton supporters and MCT members will understand that our attempt to provide them with the necessary context at the AGM was not intended as an attack on them or the club. If anyone felt personally offended, criticised or attacked by our statement, we sincerely apologise. That was never our intention.

Our decision to speak publicly at that stage was driven by the circumstances immediately preceding the AGM. Incorrect information about the nature of our proposal had been communicated to MCT members and, shortly before the meeting, we were informed that the MCT Board had received another proposal and that this alternative proposal would need to be presented to the members. This was contrary to the exclusivity arrangements that had been agreed and, from our perspective, it created a situation in which we felt the partnership we had been working towards was slipping out of our hands.

Against that background, our statement at the AGM was a final attempt to provide members with the necessary context and information to allow them to make an informed decision. It was not an attempt to attack the club, its members or its supporters. It was also an attempt to preserve the possibility of moving forward with the proposal in time for Estrella to become meaningfully involved in the club during the current season.

The postponement of the vote and the circumstances that led to it meant that this was ultimately no longer possible. The combination of a significantly more challenging financial position, the inability to strengthen the squad within the required timeframe and an increasingly negative and inaccurate narrative meant that, from Estrella's perspective, the risk associated with proceeding had become too great.

In certain circumstances, time can be an advantage in a complex investment process. In this case, however, the length of the process ultimately contributed to the opportunity being lost. What began in March as an investment in a financially healthy club competing in the middle of the Scottish second tier had, by August, become a materially different investment with significantly greater financial and sporting risk.

Our position today

We deeply regret that the proposed investment did not go ahead. We had great confidence in the project and genuinely believed that the partnership could provide the club with the financial stability, investment and long-term development it needs. The circumstances described above ultimately meant that the proposal was withdrawn.

There has been considerable speculation about Estrella's decision to withdraw and about our current position. We believe we have now set out the relevant facts clearly. For the avoidance of doubt, Estrella has withdrawn from the proposed investment. There are currently no negotiations taking place with the MCT Board or Greenock Morton FC and Estrella has not reconsidered its decision. The suggestion that Estrella has withdrawn for reasons other than those outlined above is simply incorrect. We hope that the Morton community will continue to approach the situation with care and consider the facts rather than speculation or information that does not accurately reflect what took place.

Honesty, transparency and mutual trust are fundamental principles for Estrella. We deliberately choose to work with clubs that believe in our mission and vision and genuinely want to work with us to build a stronger and more sustainable future. The clubs we select are not expected to be without challenges. We understand that football clubs can face significant financial, sporting and organisational difficulties and we do not shy away from those challenges. On the contrary, supporting clubs through those challenges is a fundamental part of what Estrella aims to do.

However, our involvement must be genuinely wanted and there must be a shared belief in the partnership and in the way forward. Without that mutual commitment and trust, we do not believe it is right for Estrella to become a partner of a football club. This is not about expecting circumstances to be perfect. It is about ensuring that, when we commit our capital, expertise and time to a club, there is a genuine willingness on all sides to work together towards the same objectives.

We continue to believe strongly in the potential of Greenock Morton and have great respect for its supporters and the community that surrounds the club.

We therefore wish Greenock Morton, MCT members, supporters, players, staff and everyone connected with the club every success for both its immediate and long-term future. We recognise that Greenock Morton has faced many challenges throughout its long and proud history and we have no doubt that the club and its community will continue to show the resilience and determination that have carried it through difficult times before. We sincerely hope that Greenock Morton can build a stronger and more sustainable future and we will always look upon our time working with the club and its community with respect.