Plain language Van Praag about Ajax director Kroes: ‘Alex was stupid and naive’ | Sport

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Chairman Michael van Praag of the Ajax supervisory board makes a harsh assessment of general manager Alex Kroes, who has been suspended due to insider trading in shares. “He is to blame for this affair and no one else.”

Ajax had no choice but to suspend director Kroes two weeks after his appointment due to insider trading, says Van Praag. “Alex has been stupid and naive.”

On Tuesday morning, Ajax announced that Kroes has been suspended because he purchased another seventeen thousand shares a week before his appointment in August 2023. Insider trading is market abuse according to the definition of the Netherlands Authority for the Financial Markets (AFM).

“We have ended up in a bad film,” says Van Praag during a press interview in the Johan Cruijff ArenA. “A CEO who allows this does not fit our moral compass.”

Ajax does not report the incident

Insider trading is punishable, but Ajax has not filed a report with the AFM. Van Praag: “We are not going to do that either. We have explained why Kroes was suspended, it is now up to the AFM to investigate it further.”

Kroes left AZ for rival Ajax in August and was ordered by the AZ management to wait six months due to a non-competition clause before he could start working in Amsterdam. On October 6, Ajax said in an explanation to the shareholders’ meeting that the new director had 42,500 shares in the company.

Only on March 15, the day on which Kroes officially joined Ajax, did the club report this to the AFM. After this notification in the public register, the supervisory board received questions from both the media and internally about the origin of those shares.

Michel van Praag in gesprek met Louis van Gaal.

Alarm bells went off

At the request of the supervisory board, at the end of last week, Kroes showed the dates of his purchases in an Excel sheet, after which alarm bells went off for Van Praag and the other members. Kroes appeared to have purchased another seventeen thousand shares on July 26, 2023, while his appointment as general manager was still only a formality. Van Praag: “In fact, he was already with Ajax. As Alex said: ‘My mind was already with Ajax.'”

Yet Kroes decided that very day to increase his share package to 42,500. An Ajax share is currently worth about 10 euros. “And he did not report that,” says Van Praag. “Kroes was the only one who knew at that time that he would become director. Other shareholders did not. That is called insider trading.”

It is the conclusion of the lawyers of Nauta Dutilh that Ajax has hired. Until the Easter weekend, they looked through Kroes’ email exchanges and app traffic with the supervisory board. “Nauta Dutilh’s advice was clear,” says Van Praag. “There are strong indications of insider trading and numerous documents and video calls underlie this.”

In a statement on LinkedIn, Kroes speaks of “skin in the game“. He says that in addition to his 25,000 shares, he has bought another 17,500 shares to radiate confidence to the shareholders. “And I also run financial risks myself, this is not quick win-thought.” Naive and stupid, say investors and stock market analysts. “Unacceptable for a CEO of Ajax,” says Van Praag, who says he owns a hundred shares.

Kroes spreekt zelf van “skin in the game”.

According to Van Praag, Kroes should have known better

Van Praag rejects Kroes’ defense. As an entrepreneur and founder of the SEG agent office, he should have known better. “Alex was nonchalant about it towards us. He had made a mistake and said he didn’t know the rules. I said, ‘It’s not up to us to explain the rules to you.’ As a director of a listed company, you are expected to know the law.”

Kroes’ request to submit his actions to the AFM is also not answered by Ajax. Van Praag: “It is not the AFM’s task to arbitrate, that has never happened before. The AFM only supervises listed companies.”

After lengthy deliberation, Ajax’s supervisory board unanimously decided on Easter Monday that only one measure is appropriate: Kroes will be suspended and the club will aim for dismissal. Van Praag: “It would be unbelievable to keep Kroes.”

A CEO of a publicly traded company may own shares and even sell them under certain conditions. But why didn’t anyone at Ajax wonder in August when Kroes bought them? “No idea,” says Van Praag. “I was not present at the negotiations with Kroes. We knew that Alex owned those shares and that was allowed.”

Could Ajax have prevented Kroes’ premature departure if the commissioners had taken their supervisory task more seriously? Would Kroes’ appointment have been immediately blocked in that case?

‘It was common knowledge that Kroes had shares’

Van Praag: “I know where you are going, but it was common knowledge that Kroes had shares. We did not have to ask him when he acquired them. The lesson is that we have to ask more sharply from now on. But it was up to Kroes to tell us when he had bought his shares.”

Van Praag denies that Ajax is partly to blame for the fall of Kroes. “The blame lies with Alex and no one else. We had to wait six months for him. I went to AZ with advisor Louis van Gaal on my knees and asked if he could start with us earlier. We really wanted him “We had the confidence that everything was going well. It’s terrible that it ended like this.”

As delegated commissioner, Van Praag will assist the Ajax management in the already extensive search for a new trainer, a new head of youth training and a new technical director. The man who was supposed to supervise that process has already left. And so Ajax once again has to fill the vacancy of general manager.

Van Praag: “With the arrival of Kroes we had new leadership. That is why this outcome is so worthless. But we are taking the path we already took with Alex on the way to a better Ajax.”

The article is in Dutch

Tags: Plain language Van Praag Ajax director Kroes Alex stupid naive Sport

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