Swansea City are exploring new investment opportunities and have held talks with interested parties.
The club's majority owners, US-based Steve Kaplan and Jason Levien along with Jake Silverstein, are looking to bring on board more outside financial support for the Championship club.
It would be not be in the form of a takeover, however, with the ownership group still committed to their long-term goal of taking Swansea back to the Premier League.
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Silverstein issued a significant loan to the club in 2020 and was subsequently appointed as a director at Swansea, with the American making numerous trips to south Wales in recent years to address a range of club matters.
It comes after the club this evening confirmed the final set of loan notes - worth £3million - held by Kaplan, Levien and Silverstein have been converted into equity.
It means a total of £19m worth of loan notes have been converted into equity since October 2022, with the conversions in October 2022 and February and March this year each being confirmed on Companies House.
Other shareholders - including Swansea City Supporters’ Trust - have been further diluted as a result of the latest conversion.
In a statement published on Tuesday evening, the club confirmed that the conversion of the third and final set of loan notes would "not affect the Trust’s fully protected and non-dilutable five per cent shareholding in the club, nor their continued involvement and engagement with the club and majority owners on a broad range of matters".
It was revealed that Silverstein’s shares, held via US entity Stormlight Elyrch LLC, will move into Swansea Football LLC. As a result, Silverstein’s shareholding will now sit alongside those of Levien and Kaplan.
A statement from the Trust read: "As a result of the conversion, the Trust’s overall stake in the club has been diluted alongside all other shareholders who did not take up the offer to purchase more shares.
"However, the Trust’s protected five per cent effective shareholding has not been diluted. The Trust has permanent legal and economic protections in place, which are set out in the confidential shareholding agreement between all shareholders of the club.
"We have recently responded to a large number of queries and feedback about our comments on our shareholding – we would like to be clear that the Trust is well aware that dilution is not ideal, but the Trust does not have the financial resources to match incoming funds each time a new investment in the club is made by another party.
"In instances like this, our responsibility is to put the security of the football club first, and it is our collective view that the club should operate with only sustainable debt – if that means more equity must be released to support this, then it is a position that we accept.
"We have mentioned on several occasions already that we would prefer any investment to be targeted at playing squad improvements or upgrades to the club’s infrastructure, and not to cover shortfalls in the club’s accounts. We know that this is shared by all concerned with Swansea City, but the club is not financially sustainable enough to do this yet.
"Our outgoings are still higher than what we bring in through commercial revenue and player sales. This balance is something we are continuously discussing with the owners and senior management team.
"It is also worth noting that the Trust is not the only shareholder diluted in instances like this – as none of the other shareholders beyond the majority ownership group have invested additional funds, their respective shareholding in the club has also been diluted."
The club's ownership group have long been eager to secure fresh investment, with Swansea no longer receiving parachute payments having been relegated from the Premier League just shy of five years ago.
In January, it was revealed that the top brass had held discussions with potential investors.
A segment from the Supporters' Trust board meeting minutes published during the January transfer window read: "The owners have been speaking to potential investors over the past few months. The club will update us if any investment is confirmed."
Kaplan was in attendance for Swansea's Championship clash with Millwall at The Den earlier this month and held lengthy talks with head coach Russell Martin prior to the game in London.
The club's latest set of accounts are expected to be published before the conclusion of the 2022/23 Championship season. Their most recent accounts reported a pre-tax loss of £4.6million.
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