March 23, 2025

The Tale of Fitzroy and the Merger

“Those who cannot remember the past, are condemned to repeat it” – George Santayana. With that in mind, let’s run through the Fitzroy debacle of 1995 and some of the background that younger followers of the AFL may not remember or may have missed.

Fitzroy was one of the VFL/AFL founding clubs, created in 1883, and for most of their existence carried the nickname “the Lions”. They won a flag in the VFA and a further 8 to 1944 before merging with the Brisbane Bears in 1996.

The Fitzroy saga is a sad story of a club that struggled through the 80’s and 90’s and a league that did everything possible to eliminate the club for its own designs. The lesson appears to have been learnt at AFL headquarters with masses of money now being thrown at struggling clubs, and the league seems determined to keep all clubs operating and viable.

Fitzroy were behind the 8-ball from the late 70s. In 1978 they reported a loss of $120,000 at a time when that was not an insignificant amount of money. They weren’t alone, South and St Kilda also reported 100k+ losses, while Richmond and Melbourne reported somewhat lesser financial troubles. By 1983 at least four clubs reported capital issues and were technically bankrupt – Collingwood, Footscray, Fitzroy and Geelong.

By July 1980, Fitzroy was announced as technically bankrupt and $300,000 in debt. Fitzroy began looking at alternatives, these plans included possibly moving to Sydney. This was defeated by the members and a fundraising campaign and instead the option was taken up by South Melbourne the following year.

From 1984 Fitzroy became something of a nomadic team, playing at 4 home grounds, including Junction Oval, Victoria Park, Princes Park and finally, the Western Oval. According to some accounts, Fitzroy made no money from their time at Princes Park, held to a somewhat onerous arrangement by the grounds manager, the Carlton Football Club.

In 1986, Fitzroy again began looking at a merger, this time with Melbourne, and while talks were advanced, Melbourne later withdrew from the arrangement. This was again proposed in 1994 with an in principle agreement to form the Melbourne-Fitzroy football club, operating as the Melbourne Lions for the 1995 season. Around the same time Fitzroy evidently looked at a merger deal with Hawthorn which failed to get anywhere due to the in principle agreement with Melbourne.

In the end, the merger was defeated by the Melbourne board due to the limited benefits they perceived they would get from a Fitzroy merger. Its understood that even if the Melbourne board had agreed, the membership was absolutely against the merger.

Little publicity has ever been given to St Kilda considering a merger as reported by The Age in 1986, where top St Kilda people believed Fitzroy presented the best option for the struggling club, ahead of privatisation or moving interstate. Around the same time Richmond may have presented a merger option.

In 1986, Leon Wiegard, then Fitzroy president, stated that there was a 50% chance the club would fail to survive. The VFL proposed a relocation to Brisbane (ten years before the merger) which the Lions approved of. However this became a non starter when Hecron offered enough money to keep the Lions viable in Melbourne. The Lions stayed and began playing at Princes Park.

The joy was short lived however as the VFL refused to allow Hecron to take part ownership of the club as was part of the deal, leading to a smaller sponsorship.

In 1989, Fitzroy directors evidently agreed to merge with Footscray who were also in dire financial trouble. The proposed merger would massively favour Fitzroy who held all the aces (according to The Age). Fitzroy people even wrote opinion pieces in the paper assuming the deal was all set and done offering commiserations to the Bulldogs fans.

“Now Footscray is dead and Fitzroy lives,” wrote Ken Merrigan in The Age.

While Footscray members ratified the deal, some including one Irene Chatfield refused to give up, obtaining a three week injunction to raise funds for the embattled Footscray. In the end she and her supporters staved off the arrangement by amassing enough donations to keep the Footscray club going. The VFL then staged a secret meeting with Footscray where the clubs voted to allow the Footscray to remain in the league in its own right. Fitzroy weren’t told, according to the Age, who quoted Leon Wiegard.

To add insult to injury, according to The Age, Fitzroy eventually lost sponsors to Footscray the following year. Where Footscray came about debt free as a result of its Save the Dogs campaign, Fitzroy were left with $700,000 in the hole and perceived to be haemorrhaging money and support.

In 1991, the Lions experimented by going to Tasmania for four home matches over 1991 and 1992, but evidently lost money in the process. Fitzroy people allege that there was no financial help from the AFL for this, that travel and accommodation for the club were paid for by Fitzroy. In 1994, Fitzroy finally moved to the Western Oval – the club’s fourth home ground in a decade.

In 1995, Fitzroy took on West Coast in Canberra in the first ever AFL game in the capital. Fitzroy people allege that the AFL later declined to go ahead with a deal between Fitzroy and the ACT to play up to 7 games a year in an arrangement which may have given the club a firm financial footing.

In 1996, Nauru Insurance called in its debts when Fitzroy were unable to pay, and appointed an administrator. The AFL provided funds for the remainder of its 1996 operations. However, at this time the writing was on the wall for the foundation club. At this time Fitzroy were reportedly 4.5 million in debt, with Nauru owed 1.25 million (and their whole country soon to be in financial strife), and according to an Age article, unable to meet their tax obligations or player payments.

By July 4, 1996, Fitzroy and North Melbourne boards had agreed to terms on everything from playing colours to club song and the merger was set to proceed. Peter De Rouch, former North director, believes one of the reasons the agreement stalled was that Dyson Hore-Lacy was told that he would not be allowed on the board, although Hore-Lacy says he was trying to make sure there would be no further changes to the agreement.

Further, AFL clubs were wary of any such merger, believing that such a combination could form a superteam and voted 14-1 against the merger – Leon Daphne from Richmond believed that the Brisbane merger would create less of an issue in this regard, and other Presidents were concerned with North’s demand that the merged list be for 50+ players, instead of the Lions proposal of 45.

On the afternoon of July 4, 1996, the Administrator of Fitzroy, the AFL Commission and the majority of the AFL clubs voted in favour of a merger with Brisbane. Brisbane CEO at the time, Noel Gordon, believes that the Brisbane deal won out because of a better understanding of corporate law. At the time the administrator was appointed, the effective control of the club passed to the administrator, and was out of the hands of the directors. This rendered any deal the directors made pointless without the consent of the controlling adminstrator. Dyson Hore-Lacy wrote in his book that he believes the time taken by North to quibble over details ultimately cost the Fitzroy board its ability to decide its future.

Footscray later went to court to seek an injunction against the merger due to it breaching the 20-year contract Fitzroy had reportedly signed for home games at the Western Oval. The injunction was denied.

As a result of the process North and Fitzroy directors and members were entitled to feel more than a little disgruntled with the AFL commission. Greg Miller, North CEO, was absolutely sure that the AFL had sacrificed Fitzroy on the altar of northern expansion, accusing the AFL of lying all time, and doing the deal behind the back of both North and Fitzroy.

Fitzroy fans’ opinions were probably summed up by the cheer squad banner according to former director Colin Hobbs, “I think the banner read ‘Seduced by North, raped by Brisbane, and something by the AFL that starts with F’. I was not critical of that, because that’s exactly what happened,” he said.

Allegations from Fitzroy supporters about AFL conduct:
While most of the above was reported extensively, Fitzroy fans have always maintained the AFL and other clubs actively pursued agendas against them. These allegations include:
■refusing assistance to help with options in Tasmania and Canberra
■vetoing essential sponsors (ie. Solo, Galaxy and Schweppes)
■refusing to allow Fitzroy to use AFL funds for debt retirement
■refusing to advance funds critical to Fitzroy’s ability to operate
■leaking of sensitive information to the press and government
■telling creditors and potential merger partners a different story to that told to Fitzroy (i.e. North and Nauru)
■arranging a merger behind the back of Fitzroy directors and board
■actively helping other clubs with recruitment of top Fitzroy players
■actively cheering when receiving the news of the demise of the club

These allegations are presented in books by, and conversations people have with, previous directors and other people associated with the Fitzroy football club who were present.

The Saga Timeline:
■1978 – Fitzroy announce losses of $120,000 for season (St Kilda and Footscray report significant losses)
■1980 – Fitzroy announces its technically bankrupt, debts of 300,000
■1980 – Fitzroy begins looking at playing in Sydney, but the move is defeated by members
■1984 – Last Fitzroy games at Junction Oval
■1985 – Fitzroy plays 2 years at Victoria Park
■1985 – The Victorian Corporate Affairs Commission threatens to send Fitzroy into Liquidation.
■1986 – Last Fitzroy home games at Victoria Park
■1986 – Fitzroy survival chances rated at 50% by Leon Wiegard, looks to Gold Coast but saved by cash injection
■1986 – Fitzroy discusses merger with Melbourne, but Melbourne withdraw
■1987 – Fitzroy plays home games at Princes Park until 1993
■1989 – Fitzroy agrees to amalgamate with Footzray, defeated by Footscray members who begin Save the Dogs campaign
■1991 – Fitzroy plays 4 games over 2 years in Launceston
■1993 – Last Fitzroy games at Princes Park
■1994 – Fitzroy begins playing home matches at the Western Oval
■1994 – Fitzroy and Melbourne officials gain AFL approval for merger, deal scrapped by Melbourne.
■1995 – Fitzroy play West Coast in the first AFL game in Canberra
■1996 – Nauru Insurance calls in debts and appoints administrator
■1996 – Brisbane and Fitzroy merge (see more detailed timeline below)
■2008 – Fitzroy Football Club re-establishes in the VAFA

Timeline of Specific events leading to the Brisbane merger:
■Mar 6, 1996 – Fitzroy board authorises board members Dyson Hore-Lacy, Elaine Findlay and Robert Johnstone to enter non-binding merger agreements with other AFL clubs.
■May 6, 1996 – Fitzroy and North Melbourne hold first merger talks.
■May 11 1996 – A non-binding agreement to merge and the basic terms of name is struck between Fitzroy and North Melbourne. A Heads of Agreement document detailing the conditions of the merge in writing is signed.
■May 13 1996 – A Brisbane merger offer is formally rejected by the Fitzroy board.
■May 20 1996 – First Fitzroy shareholders’ meeting to explain the conditions of a North Melbourne – Fitzroy merge.
■May 28 1996 – Second Fitzroy shareholders’ meeting.
■Jun 14 1996 – First draft document of the merger was completed.
■Jun 18 1996 – A meeting between North and Fitzroy to execute the merger document canceled. Greg Miller, North Melbourne’s Chief Executive Officer (CEO) tells Dyson Hore-Lacy that North Melbourne wanted to change the name of the merged club from the already agreed ‘Fitzroy-North Melbourne Kangaroos’ to ‘North Melbourne-Fitzroy Kangaroos’.
■Jun 20 1996 – The Fitzroy board rejects North Melbourne’s revised conditions.
■Jun 24 1996 – The Brisbane Bears are contacted by Fitzroy and advised to submit their best merger offer to Fitzroy for consideration.
■Jun 25 1996 – A compromise between North Melbourne and Fitzroy is reached.
■Jun 26 1996 – Fitzroy Football Club offers $550,000 plus $100,000 to be paid over the next two years to their only secured creditor the Nauru Insurance Company to settle their debt. This offer is rejected. Nauru wanted $750,000 by the end of August and $100,000 for the next three years to consider their debt settled.
■Jun 27 1996 – Nauru Insurance Company agrees to $750,000 by the end of August and $100,000 for the next two years and $50,000 for the third. North Melbourne board member and one of the chief merger negotiators Peter de Rauch says North Melbourne will not allow any more than $550,000 to be paid.
■Jun 28 1996 – Nauru Insurance Company appoints an administrator (Michael Brennan) to recover their debt.
■Jun 29 1996 – Fitzroy negotiates with Nauru to pay $550,000 by August 1996, $150,000 in 1997 and $100,000 in 1998. Peter de Rauch agrees to put that proposal to the North Melbourne board on Monday 1st July
■Jul 1, 1996 – The Fitzroy board agrees to underwrite all monies owed to Nauru over the sum of $550,000. The AFL commission gives Fitzroy and North Melbourne until Friday 5th July to complete their merger.
■Jul 2, 1996 – North Melbourne’s Greg Miller informs Dyson Hore-Lacy that North Melbourne now wants only four Fitzroy board members on the board of the merged club. Fitzroy refuses to accept that condition.
■Jul 3, 1996 – North Melbourne backs down on their demand of 2nd July, but still wanted none of the current Fitzroy directors on the board. North Melbourne was asked by Dyson Hore-Lacy to give an undertaking to Fitzroy that there would be no more changes to the agreement of 25th June. No such undertaking was given.
■Jul 3, 1996 – Nauru Insurance Company accepts $550,000 paid before August 31st, $350,000 paid before October 31st 1997 and the rest of the balance payable in $50,000 payments annually from 1998 onwards.
■Jul 3, 1996 – The Fitzroy board re-opens merger discussions with the Brisbane Bears. The Bears are told that the merger door with Fitzroy is “open half an inch”
■Jul 3, 1996 – Greg Miller the CEO of North Melbourne informs the media that without 54 players on their 1997 list there would be no merger with Fitzroy.
■Jul 4, 1996 – Fitzroy is informed by the AFL that the merger would be rejected by the other AFL clubs if North Melbourne continued to demand 54 players. Dyson Hore-Lacy informs North Melbourne’s Ken Montgomery and Greg Miller of this fact.
■Jul 4, 1996 – Fitzroy settles last niggling disputes in their proposed merger agreement with North Melbourne and signs a formal document setting out the merger in fine detail, which includes the new agreed name of the club to be the ‘North Fitzroy Kangaroos Football Club’. The merger agreement is set to be signed by the AFL on Friday morning (5th July) subject to the AFL clubs’ endorsement.
■Jul 4 1996 – AFL Presidents’ Meeting rejects the Fitzroy-North Melbourne merger. After a meeting between the administrator of Fitzroy and the AFL commission, the AFL commission recommends a Bears-Fitzroy merger. North Melbourne withdraws from the merger race. A reconvened AFL presidents’ meeting endorses the AFL commission’s recommendation of a Brisbane Bears-Fitzroy merger.

Theres considerable discussion and speculation on this matter, including the AFL’s involvement, in the Fitzroy forum on bigfooty. The Deed of Arrangement for the merger can be located at the viclions website.

References:

Other Notes by RoyLion on Bigfooty

the following is a list of measures that the AFL took against Fitzroy in the years leading up to 1996. This expands on the list provided by Wookie in his opening post. Much of it was not well known merger history…but it did happen.

  • Fitzroy were forced to move from the Junction Oval in 1984 as part of VFL’s ground rationalisation policy, beginning the process of the Club depending on other clubs such as Carlton and Collingwood (their traditional rivals) to generate significant revenue from a home ground.
  • the VFL refused to allow Hecron in 1987 to take part ownership of Fitzroy as part of a sponsorship deal that had seen the club reject a relocation to Brisbane in 1986.
  • the AFL refused permission for the club to play four home games per year in Canberra from 1995 onwards. The club even offered to play up to seven-eight home games a year in a partial relocation. Upon their application to play four games in Canberra the Club was told that Fitzroy’s application to play 4 home games in Canberra (which would have netted the club $350,000 annually guaranteed) would not be a credible exercise in the Canberra market and would not be enough games to be worthwhile. Ross Oakley later said that Fitzroy was their ‘worst product” and that the AFL wasn’t going to send their ‘worst product” up to Canberra. Fitzroy then offered to play 7 home games in Canberra, which would have netted Fitzroy at least an extra $700,000 a year on top of what had already been negotiated. This was refused as well. In fact when adding in corporate sponsorship, and ground rights at Bruce Stadium (which would have been upgraded), Fitzroy’s projections were they could have made $1 million extra per season. Fitzroy’s application had the support of ‘AFL for Canberra’ organisation, the Canberra Raiders, the Ainslee Football Club and the ACT chief minister who had offered for the ACT government to upgrade Bruce Stadium. However the AFL point blank refused to entertain the idea. An AFL commissioner later admitted that the reason why the AFL knocked it back was because they wanted Port Adelaide in the competition and therefore wanted to keep the pressure on Fitzroy to merge.
  • the AFL refused to help financially assist Fitzroy’s Tasmanian experiment in 1991-1992. Fitzroy had to pay the whole cost themselves, including accommodation. Fitzroy had to even billet players in supporters’ homes. Since that time, AFL support for Hawthorn, St Kilda and North Melbourne home games in Tasmania has been significant
  • the AFL refused to guarantee on at least three occasions the annual club dividend to pay creditors; standard procedure for all other clubs and forcing the club to consider merging, relocation or folding.
  • In 1993 the AFL threatened to sue Fitzroy for $250,000 that had been paid to Fitzroy by CUB as part of a club sponsorship, which included selling CUB’s product in the Fitzroy Club Hotel. CUB was the AFL’s sponsor and the AFL thought they should have received the money instead of Fitzroy. This was despite the fact that CUB had been a minor sponsor of Fitzroy for over ten years previously. They even threatened to reduce the dividend to other clubs by the amount Fitzroy received. This was the major reason the Lions had to consider a better financial deal at the Western Oval, in order to try and raise more revenue which in turn alienated some supporters and players. That new deal included Footscray loaning Fitzroy the $250,000 demanded by the AFL. Alistair Lynch later said that Fitzroy’s forced move to the Western Oval was the major reason why he decided to leave Fitzroy and sign with the Bears. Broderick, Gale, Elliott and Dundas followed Lynch shortly after. Robert Shaw the Fitzroy coach lamented at the time that he’d just lost his next three club captains.
  • the AFL objected to a Fitzroy sponsorship deal with Schweppes because the AFL were sponsored by Coca Cola. Fitzroy managed to raise $110,000 from this sponsorship.
  • it was later discovered that it was the AFL that had been advising player manager Damian Smith on the best way for the Bears to acquire Alistair Lynch from Fitzroy.
  • From 1993 the AFL issued a number of solvency notices to Fitzroy where the club had to satisfy AFL criteria that they could meet their financial debts for the next 12 months or their AFL licence would be withdrawn. Fitzroy was the only club to receive a solvency notice.
  • the AFL refused to allow millionaire Bernie Ahern to lend any more money to Fitzroy, after he saved them from merging / folding in 1991. He lent money to Fitzroy for a second time later on, because in his words he felt Fitzroy had been treated unfairly.
  • From 1994 onwards the AFL presented several proposals to the Fitzroy directors to surrender Fitzroy’s licence to the AFL and thereby liquidate Fitzroy Football Club Ltd., if it could not effect a merger, in return for “assistance packages” to keep the club going. That way Fitzroy’s creditors wouldn’t get paid. One of these included a merger with the Port Adelaide Football Club to form the “Port Adelaide Power Lions.”
  • the AFL regularly leaked sensitive information provided by Fitzroy about their finances to the media, in order for media flunkeys like Mike Sheahan to write negative stories about Fitzroy, which in turn scared off potential sponsors.
  • the AFL regularly informed potential sponsors who would make inquiries about the possibility of sponsoring Fitzroy that not to bother because Fitzroy would not be in the competition for much longer (That’s from a Fitzroy director at the time)
  • Fitzroy’s auditors KPMG were even raided by the Australian Securities Commission under a warrant to investigate Fitzroy for ‘suspect trading while insolvent’ for 1993 and 1996. The ASC claimed they were acting on information passed to them. Naturally Fitzroy believe it was probably the AFL, who were the only external organisation who had full access to Fitzroy’s finances.
  • ….and even at the end, the AFL gave Fitzroy and North Melbourne until July 5th 1996 to complete their merger, only to give the go-ahead to a Brisbane – Fitzroy merger on July 4th, after a Richmond led protest over the merger conditions agreed to by the AFL and communicated to North Melbourne and Fitzroy.
  • The reason that Nauru appointed an administrator to recover their $1.25 million loan was because the AFL was telling North that if they held out against Nauru, they wouldn’t have to pay them at all and would receive the merger money themselves. Then the AFL threatened to not guarantee the merger money which forced Nauru to step in and recover the money themselves by appointing an administrator. This was despite the fact that the Fitzroy directors had already done a deal to settle with Nauru, out of the merger money. However on the AFL’s advice and urging North refused to authorise Fitzroy to pay any more than $550,000.

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