A-League hopeful Southern Expansion is offering a seven-figure sum to Sydney FC as compensation for encroaching on their territory and core membership base in the city's south.
Should the St George and Sutherland Shire based bid gain entry into the competition, it will propose paying a $1 million "structural adjustment package" to Sydney FC, who have staunchly opposed the inclusion of the group in the A-League.
Southern Expansion chairman Morris Iemma said his team was seeking to address Sydney FC's concerns that a new club would cannibalise the football market by offering a significant cash payment to cover any potential loss of Sky Blues supporters to the new side.
Iemma said the offer to Sydney FC had been included as part of the Southern Expansion proposal to the FFA and Deloitte. He said Southern Expansion was disappointed not to have received a response from the Sky Blues.
"Am I surprised? No," Iemma said. "I'm more disappointed because there's so much potential ... we had it in there as part of our formal bid. FFA were quite keen and interested. We've received no word back from Sydney FC. They've dismissed it. We know it's fallen by the wayside but we don't know why."
Sydney FC declined to comment when contacted by Fairfax Media, though club sources said there had been no direct communication from Southern Expansion on any matter and that the Sky Blues had been made aware of Southern Expansion's intention to offer compensation only through third parties.
It is understood Sydney FC will not accept payment from Southern Expansion and the Sky Blues are in no mood to enter negotiations about potential compensation.
Thirty per cent of Sydney FC's membership resides in the city's south, with more than 5000 members based south of Mascot. There are also many long-term fans who are not registered members. The club has no doubt the region is its biggest area for supporters.
To allay Sydney FC's concerns, the Southern Expansion bid, which is backed by Hong Kong-listed property development company Jiayuan, is also prepared to offer funds for their rivals' marketing budget.
Fairfax Media understands a third party approached Sydney FC to informally offer the club a seven-figure settlement by Southern Expansion for marketing. Club sources said the Sky Blues rejected the informal offer.
Iemma confirmed the bid's offer to contribute to Sydney FC's marketing, saying: "We said to the FFA we would be happy to contribute to joint marketing efforts, promote the game, promote derbies, but they [Sydney FC] weren't interested. We just fell back to offering the 'structural adjustment package' because they weren't interested."
The news comes after a war of words this week between Southern Expansion and Sydney FC, sparked by the 19,000-strong crowd that attended Sunday's Big Blue at Jubilee Oval in Kogarah, the heart of the turf war.
Southern Expansion chief executive Chris Gardiner said the fact the Sky Blues were able to attract such a healthy attendance showed why the A-League needed a permanent team in the southern suburbs.
After Sydney FC's 2-1 defeat to Melbourne Victory, Gardiner suggested the region was disconnected from the A-League. "Over 40,000 football participants are not yet connected to the A-League or a club, they're hungry for games at their local stadia with their own team," Gardiner said.
Those comments prompted a strong rebuttal from Sydney FC chief executive Danny Townsend, who dismissed Southern Expansion's claims as "pretty embarrassing" in light of Sydney's bumper crowd in Kogarah.
Sydney FC on Tuesday signed an MOU with Wollongong Wolves concerning player development. Sydney FC chairman Scott Barlow said the Sky Blues would consider playing some games at WIN Stadium while Allianz was being redeveloped.
