Investor

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claretandy
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Re: Investor

Post by claretandy » Sun Jul 26, 2020 11:54 am

Chester Perry wrote:
Sun Jul 26, 2020 11:42 am
not much and they have been trying to get out for around 3 years now, though continue to invest in the meantime, Palace have a number of advantages over us (they are very distinct too)

- Palace's immediate environs particularly Norwood and Croydon provide a local community of over 385,000 and growing it provides much of their hardcore support and sells out the current capacity.

- The next couple of seasons will see an expansion of the ground by over 8000, of which around 3000 will be corporate seats, that is expected (given the central London Proximity) to double matchday revenues

- The Croydon Norwood area has provided the biggest talent pool of youngsters in the last 10 years or so. much more than any other area of the country, their move to Academy 1 status means that their youth teams, together with a £20m Academy infrastructure upgrade will not be so regularly stripped
The new stand is projected to cost over 100m.

Chester Perry
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Re: Investor

Post by Chester Perry » Sun Jul 26, 2020 12:27 pm

claretandy wrote:
Sun Jul 26, 2020 11:54 am
The new stand is projected to cost over 100m.
yes. and I understand that finance is in place with a payment schedule that would leave the majority of revenue uplift with the club (much like White Hart Lane and Anfield expansions.

Chester Perry
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Re: Investor

Post by Chester Perry » Sun Jul 26, 2020 12:41 pm

If you are interested enough to want to know a bit more about Private Equity - the area that investment is almost certainly going to come from. if it does come I put some very informative podcasts on the MMT thread the other day viewtopic.php?f=2&t=20891&start=4766

I suspect that any PE that wants us would have to be the "Family Office" type with a history of sports investment that are prepared to take a long view. The biggest risk all of these see in European football is relegation with so few teams able to avoid relegation for structural reasons in the big 5 leagues.

Anyone who has read my recent posts about articles/podcasts from The Esk on the MMT will be aware of the dilemmas that even a well meaning and deep pocketed investor can bring. particularly when expectations are not set, or strategies are not determined/communicated.

Belial
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Re: Investor

Post by Belial » Sun Jul 26, 2020 12:55 pm

gandhisflipflop wrote:
Sun Jul 26, 2020 11:17 am
Didn't we win an award for most enterprising town in the country at one point? Part of the problem is a lot of people think the world starts and ends in Burnley. There is life outside the town, and people are scared of change. There is huge opportunity out there. When venkys said that they wanted to make them lot massive in India it wasn't such a bad idea. A nation with 1bn population that can be tapped into. The problem is that the people who had this idea didn't have a clue what they were doing. Had they left the guys in charge that ran the club and focussed on promoting Blackburn in India they may well have been a totally different animal today. I bet Leicester are massive in Thailand. A whole mentality shift needs to happen though and it needs to be positive
Burnley did yes, a few years ago. From a business and investment perspective, the town is attractive due to the low rental prices and with the m65, not a bad link to the motorway network.
I think this is reflected in the house prices etc which have done better over the last 5 years or so than a lot of places in the country. The town, in my opinion, is slowly on the up and significantly improved than say, 20 years ago.

However, whether the town and more specifically the club is an attractive option to foreign investors will remain to be seen.
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superdimitri
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Re: Investor

Post by superdimitri » Sun Jul 26, 2020 5:07 pm

Too many people to reply too but my point is it has nothing to do with the country an investor is from but more about the investor themselves.

The right person is the right person be they from Malaysia, the UK or the USA.

We aren't little old Burnley any more. We're on the biggest stage world wide and we have made lots of fans abroad. Soccer in the USA is more popular than it used to be you know.
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gandhisflipflop
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Re: Investor

Post by gandhisflipflop » Sun Jul 26, 2020 6:46 pm

We play the 'little old Burnley ' line far too much as fans and while we are proud as a fan base, the 'little old burnley' mantra really doesn't wash in the bigger world. It doesn't create a good image.
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Re: Investor

Post by jojomk1 » Sun Jul 26, 2020 6:50 pm

But we are "little old Burnley" and always will be

We may be on a bigger stage but I don't see any evidence that we have made all these new fans abroad

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Re: Investor

Post by Cubanclaret » Sun Jul 26, 2020 6:52 pm

What’s Michael Knighton up to?

superdimitri
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Re: Investor

Post by superdimitri » Sun Jul 26, 2020 6:53 pm

jojomk1 wrote:
Sun Jul 26, 2020 6:50 pm
But we are "little old Burnley" and always will be

We may be on a bigger stage but I don't see any evidence that we have made all these new fans abroad
We are an established club in the top league in the UK. Arguably the best in the world. Little ol' Burnley doesn't cut it any more.

Why can't we get some ambition and have some expectation?

I'm personally fed up of the little ol Burnley mantra, we already pay more wages than a few clubs in the league.
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Re: Investor

Post by gandhisflipflop » Sun Jul 26, 2020 7:09 pm

jojomk1 wrote:
Sun Jul 26, 2020 6:50 pm
But we are "little old Burnley" and always will be

We may be on a bigger stage but I don't see any evidence that we have made all these new fans abroad
That's because they haven't yet. The potential is there for them to be made. That doesn't mean to say we have to lose bfc from our local community but personally we always say how diverse and inclusive we are as a club so what is so wrong in opening up to the world? Fans are fans and it would be fantastic to expand our fanbase internationally. It benefits the club enormously.
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aggi
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Re: Investor

Post by aggi » Sun Jul 26, 2020 7:11 pm

Bournemouth and Watford are probably the most comparable teams in terms of population size, revenue and appeal. They've obviously taken different routes to each other, and Burnley.

Neither have managed to significantly boost their appeal or revenue though and their luck eventually ran out, regardless of how much they spent.

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Re: Investor

Post by gandhisflipflop » Sun Jul 26, 2020 7:19 pm

aggi wrote:
Sun Jul 26, 2020 7:11 pm
Bournemouth and Watford are probably the most comparable teams in terms of population size, revenue and appeal. They've obviously taken different routes to each other, and Burnley.

Neither have managed to significantly boost their appeal or revenue though and their luck eventually ran out, regardless of how much they spent.
We have a proud history as a football club. Maybe telling the world how we were once twice champions of England and fa cup winners could have appeal to fans who like an underdog? It's all about how you sell and promote the club. Some countries just having their nation associated with the PL gives them a sense of national pride. I look at Leicester in Thailand. It's also partly why at first I was gutted the venkys took over because as I've said the initial idea wasn't so far fetched if they actually had a clue. I'd bet having a premier league Burnley FC associated with a particular country could yeild a sense of national pride. It just needs any potential investor to see this and not be a complete loon like Vincent tan at Cardiff, or the Egyptians at Hull. We have the stability and infrastructure in place. They'd just need to invest and promote the brand in their respective regions and leave the football to the professionals.
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jurek
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Re: Investor

Post by jurek » Sun Jul 26, 2020 9:06 pm

Whatever the pros and cons are in respect to getting the right
investor's in it's probably the only way we can progress and develop
albeit top ten is probably the best we can hope for.
Possibly a decent cup run also.

dsr
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Re: Investor

Post by dsr » Sun Jul 26, 2020 11:17 pm

In the USA as a rule, investors invest in sports clubs because they want to make a profit. Either by taking cash out of the club, or by selling it on as a profit. Neither is a good basis for choosing an owner.

GodIsADeeJay81
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Re: Investor

Post by GodIsADeeJay81 » Sun Jul 26, 2020 11:20 pm

jurek wrote:
Sun Jul 26, 2020 9:06 pm
Whatever the pros and cons are in respect to getting the right
investor's in it's probably the only way we can progress and develop
albeit top ten is probably the best we can hope for.
Possibly a decent cup run also.
We've already got regular top 10 appearances sorted, just cup runs to get the hang of.

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Re: Investor

Post by Father Jack » Thu Aug 06, 2020 7:13 am

Appreciate we’re not a club that does our business in public but there haven’t been any rumours or leaks on the progress of the Middle East investor for afew weeks.
Does anyone know what the latest position is? MRG or anyone else who had received a tip-off previously?

I am hopeful that it will happen whilst the “substantial funds” could our significantly improve our transfer window and help to ensure that Dyche stays in the short term.

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Re: Investor

Post by bfcjg » Thu Aug 06, 2020 9:45 am

The "investor " buys the shares from the directors at a profit for them, they are quids in, the investors promise substantial funds ably spent by some French, Dutch,Portuguese, Italian or Spanish (delete as appropriate) to fund their outlay and promises they sell Pope Tarks Taylor etc when it goes wrong they sell on to another saviour, the cravers of the foreign investors still get excited whilst they take their socks off to count even more tens of millions of debt we are saddled with.

aggi
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Re: Investor

Post by aggi » Thu Aug 06, 2020 11:09 am

bfcjg wrote:
Thu Aug 06, 2020 9:45 am
The "investor " buys the shares from the directors at a profit for them, they are quids in, the investors promise substantial funds ably spent by some French, Dutch,Portuguese, Italian or Spanish (delete as appropriate) to fund their outlay and promises they sell Pope Tarks Taylor etc when it goes wrong they sell on to another saviour, the cravers of the foreign investors still get excited whilst they take their socks off to count even more tens of millions of debt we are saddled with.
It's a bit difficult to tell what kind of profits the directors would be making as we don't know what prices they bought at. I imagine (back of a fag packet) if we sold the club at the moment Mike Garlick could make £50m - £80m which is a decent profit but I suspect not the amount some would think (although some of the shareholding is a bit unclear so it could be more).

DCWat
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Re: Investor

Post by DCWat » Thu Aug 06, 2020 11:15 am

aggi wrote:
Thu Aug 06, 2020 11:09 am
It's a bit difficult to tell what kind of profits the directors would be making as we don't know what prices they bought at. I imagine (back of a fag packet) if we sold the club at the moment Mike Garlick could make £50m - £80m which is a decent profit but I suspect not the amount some would think.
A silly question but what is actually being bought, for that price. When the club has at least three players, whose value would be in excess of 30, 40 or 50 million, where does their worth come into the 50 to 80 million?

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Re: Investor

Post by aggi » Thu Aug 06, 2020 11:19 am

DCWat wrote:
Thu Aug 06, 2020 11:15 am
A silly question but what is actually being bought, for that price. When the club has at least three players, whose value would be in excess of 30, 40 or 50 million, where does their worth come into the 50 to 80 million?
My back of a fag packet calculation was valuing the whole club at about £250m and that's the whole thing including players, the ground, etc. The £80m was just Mike Garlick's share (as our biggest shareholder) although I'm not convinced I've got his shareholding correct.
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Royboyclaret
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Re: Investor

Post by Royboyclaret » Thu Aug 06, 2020 11:32 am

aggi wrote:
Thu Aug 06, 2020 11:19 am
My back of a fag packet calculation was valuing the whole club at about £250m and that's the whole thing including players, the ground, etc. The £80m was just Mike Garlick's share (as our biggest shareholder) although I'm not convinced I've got his shareholding correct.
My understanding is that since 2017 Mike Garlick owns 60,308 shares which represents 49.24% of the total Share Capital. John B next with 28.2% and the remaining five share 16.36%.

The balance of shares, just over 6%, are distributed amongst 1,800 BFC shareholders.

aggi
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Re: Investor

Post by aggi » Thu Aug 06, 2020 11:42 am

Royboyclaret wrote:
Thu Aug 06, 2020 11:32 am
My understanding is that since 2017 Mike Garlick owns 60,308 shares which represents 49.24% of the total Share Capital. John B next with 28.2% and the remaining five share 16.36%.

The balance of shares, just over 6%, are distributed amongst 1,800 BFC shareholders.
Yes, I think I've underestimated their shares as some are held in by what I assume (can't find on companies house) are overseas companies. I know Clarets go Large is Garlick and Freight Investor Holdings is John B but a few are less clear.
Clipboard01.jpg
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arise_sir_charge
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Re: Investor

Post by arise_sir_charge » Thu Aug 06, 2020 11:43 am

At the figure (albeit plucked from thin air quoted above) that values each share at around £2k. A nice little bonus for those other shareholders.

claretandy
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Re: Investor

Post by claretandy » Thu Aug 06, 2020 11:49 am

Aren't the shares sold at £200 each ?, all depends on what an investor values the club at.

aggi
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Re: Investor

Post by aggi » Thu Aug 06, 2020 11:53 am

claretandy wrote:
Thu Aug 06, 2020 11:49 am
Aren't the shares sold at £200 each ?, all depends on what an investor values the club at.
They were many years ago (when they were probably worth much less). Now there isn't really an avenue to buying shares so it's whatever you can persuade an existing shareholder to sell for.

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Re: Investor

Post by ClaretTony » Thu Aug 06, 2020 11:55 am

aggi wrote:
Thu Aug 06, 2020 11:42 am
Yes, I think I've underestimated their shares as some are held in by what I assume (can't find on companies house) are overseas companies. I know Clarets go Large is Garlick and Freight Investor Holdings is John B but a few are less clear.

Clipboard01.jpg
I can confirm that Parklane Textiles is Brian Nelson

Mala591
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Re: Investor

Post by Mala591 » Thu Aug 06, 2020 12:01 pm

How would a shareholder (even with only one share) put their share(s) up for sale?

Spike
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Re: Investor

Post by Spike » Thu Aug 06, 2020 12:31 pm

The funniest thing I’ve heard for ages is Palace needing 3000 corporate seats!

Their new stand had stalled long before COVID emerged.

New investors are a big risk! None are as daft with their brass as the Venkys. The new owners at Bury and Wigan were toxic

The current board are given far too much stick.

They cannot be sacked and to utter such bull is stupid

It is sheer fantasy that Burnley will see new owners this season so let’s occupy our minds with more meaningful thoughts

claretandy
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Re: Investor

Post by claretandy » Thu Aug 06, 2020 12:42 pm

aggi wrote:
Thu Aug 06, 2020 11:53 am
They were many years ago (when they were probably worth much less). Now there isn't really an avenue to buying shares so it's whatever you can persuade an existing shareholder to sell for.
I think the minimum to become a director is a 1k shares, i.e £200k.

aggi
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Re: Investor

Post by aggi » Thu Aug 06, 2020 1:20 pm

claretandy wrote:
Thu Aug 06, 2020 12:42 pm
I think the minimum to become a director is a 1k shares, i.e £200k.
I can't imagine they'd be selling them for £200 now, that would be a significant undervaluation.

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Re: Investor

Post by aggi » Thu Aug 06, 2020 1:24 pm

Mala591 wrote:
Thu Aug 06, 2020 12:01 pm
How would a shareholder (even with only one share) put their share(s) up for sale?
Advertise privately and sell it for whatever the two people agree it is worth. There's no real market as it's a private company and all those little shareholdings make up about 6% of the total shareholding so they're no real use to an investor trying to get a foothold.

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Re: Investor

Post by aggi » Thu Aug 06, 2020 1:29 pm

ClaretTony wrote:
Thu Aug 06, 2020 11:55 am
I can confirm that Parklane Textiles is Brian Nelson
Yes, that's one I could find. It's technically Brian and Sandra Nelson (his wife it seems). Can't say I know much about him

ClaretTony
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Re: Investor

Post by ClaretTony » Thu Aug 06, 2020 1:30 pm

aggi wrote:
Thu Aug 06, 2020 1:29 pm
Yes, that's one I could find. It's technically Brian and Sandra Nelson (his wife it seems). Can't say I know much about him
Big fans are Brian & Sandra. Bump into them on away trips from time to time.

claretandy
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Re: Investor

Post by claretandy » Thu Aug 06, 2020 2:00 pm

aggi wrote:
Thu Aug 06, 2020 1:20 pm
I can't imagine they'd be selling them for £200 now, that would be a significant undervaluation.
Yes, it's been a long while since the last board members joined in the Championship.

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Re: Investor

Post by KRBFC » Thu Aug 06, 2020 2:27 pm

People don’t understand that players you bring in aren’t suddenly worth £0, we have a squad worth £150m+, that’s £150m+ in income if we ever need it. We can absolutely keep Tarkowski and spend £40m on transfers, then sell Tark/Pope/McNeil next summer to recoup that outlay.
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Mala591
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Re: Investor

Post by Mala591 » Thu Aug 06, 2020 2:49 pm

Why are players bought and sold like inanimate commodities? After all, at the end of the day, it's just another form of employment (job).

If a club offers a player a four year contract then that player should be able to give notice and leave at any time.

Significant bonuses could be payed based on length of service to encourage players to fulfil their original contract.

Maybe it's time for a complete rethink on the financial structure of football?
Last edited by Mala591 on Thu Aug 06, 2020 5:32 pm, edited 1 time in total.

GodIsADeeJay81
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Re: Investor

Post by GodIsADeeJay81 » Thu Aug 06, 2020 3:08 pm

Mala591 wrote:
Thu Aug 06, 2020 2:49 pm
Why are players bought and sold like inaminate commodities? After all, at the end of the day, it's just another form of employment (job).

If a club offers a player a four year contract then that player should be able to give notice and leave at any time.

Significant bonuses could be payed based on length of service to encourage players to fulfil their original contract.

Maybe it's time for a complete rethink on the financial structure of football?
https://www.inbrief.co.uk/football-law/ ... contracts/

Worth a read.

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Re: Investor

Post by Mala591 » Thu Aug 06, 2020 5:30 pm

GodIsADeeJay81 wrote:
Thu Aug 06, 2020 3:08 pm
https://www.inbrief.co.uk/football-law/ ... contracts/

Worth a read.
Interesting that a player can unilateraly terminate their contract if they haven't played in 10% of official matches in a season.

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Re: Investor

Post by Danieljwaterhouse » Thu Aug 06, 2020 5:39 pm

aggi wrote:
Thu Aug 06, 2020 1:24 pm
Advertise privately and sell it for whatever the two people agree it is worth. There's no real market as it's a private company and all those little shareholdings make up about 6% of the total shareholding so they're no real use to an investor trying to get a foothold.
Or conversely, you use a broker who values your company using an ebitda model consistent with your industry which will dictate the value of any shareholding of the business.

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Re: Investor

Post by dsr » Thu Aug 06, 2020 6:01 pm

Mala591 wrote:
Thu Aug 06, 2020 2:49 pm
Why are players bought and sold like inanimate commodities? After all, at the end of the day, it's just another form of employment (job).

If a club offers a player a four year contract then that player should be able to give notice and leave at any time.

Significant bonuses could be payed based on length of service to encourage players to fulfil their original contract.

Maybe it's time for a complete rethink on the financial structure of football?
If a club gets no benefit from giving a player a 4 year contract, then they won't give a player a 4 year contract. Why would they? Long contracts would commit the club to paying the player's wages if he isn't very good and no-one else wants him, but to losing him in an instant if he is good. All the benefit to the player, no benefit to the club, so the club wouldn't do it.

And if players are on week-to-week, then what happens if they get injured?

Of course, players in the third and fourth divisions will have to go part time because their clubs won't have much money at all. No more transfer fees received and they will never have a "star" player because he'll be gone in five minutes. But the £500k per week men will get a big pay rise.

That's why the abolition of contracts would be a bad thing. IMO.

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Re: Investor

Post by dsr » Thu Aug 06, 2020 6:02 pm

Danieljwaterhouse wrote:
Thu Aug 06, 2020 5:39 pm
Or conversely, you use a broker who values your company using an ebitda model consistent with your industry which will dictate the value of any shareholding of the business.
I don't think EBITDA can really reflect the risk of relegation from the Premier League. The value of Burnley FC is more or less totally wrapped up in its Premier League place, and models based on past history can't cope with that.

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Re: Investor

Post by Chester Perry » Thu Aug 06, 2020 6:09 pm

There have been a number of conversations and models looked at in regards to valuing clubs on the MMT thread - not a single one led to satisfactory conclusion or even one that appeared to throw up a reasonable valuation to those discussing the subject.

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Re: Investor

Post by aggi » Thu Aug 06, 2020 6:13 pm

Danieljwaterhouse wrote:
Thu Aug 06, 2020 5:39 pm
Or conversely, you use a broker who values your company using an ebitda model consistent with your industry which will dictate the value of any shareholding of the business.
You could do that but given there's a tiny market for a (very, very) minority shareholding in BFC and it is mainly driven by sentiment rather than commercial consideration the number that they come up with won't be very meaningful (and I would think that five different brokers would come up with five different valuations given the difficulty in valuing a football club).

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Re: Investor

Post by aggi » Thu Aug 06, 2020 6:17 pm

dsr wrote:
Thu Aug 06, 2020 6:02 pm
I don't think EBITDA can really reflect the risk of relegation from the Premier League. The value of Burnley FC is more or less totally wrapped up in its Premier League place, and models based on past history can't cope with that.
When I've done this in the past for clubs that are at potential risk from relegation (or promotion) I've done two valuation models (generally on the basis of the Markham model) and then considered the likelihood of promotion/relegation to come up with a figure. In terms of an EBITDA model I guess you'd factor the likelihood of relegation to come up with your multiple.

The impacts of promotion/relegation and the difficulty in predicting it are so large though that it's all a bit finger in the air.

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Re: Investor

Post by Paul Waine » Thu Aug 06, 2020 6:21 pm

Mala591 wrote:
Thu Aug 06, 2020 12:01 pm
How would a shareholder (even with only one share) put their share(s) up for sale?
I think by reading the company's Articles of Association and seeing what it says about transferring shares from "transferor" to "transferee."

Note: 22. "The Directors may refuse to register and transfer of Shares.... to a person of whom they do not approve."

Paul Waine
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Re: Investor

Post by Paul Waine » Thu Aug 06, 2020 6:43 pm

How would I value the club? I'd start with some comparable club purchases. For example, if Mike Ashley was prepared to sell Newcastle United for £300 million, then that could be the ceiling valuation for Burnley. Then there'd be downwards adjustment for the fan base - as the number of fans attending a game and bringing revenue into the club determine a proportion of the club's revenue. Newcastle has population approx 800,000. Sunderland is 15 miles away. Middlesbrough 40 miles. Distances from Burnley to Leeds, Blackburn, Manchester (2 clubs), Liverpool (2 clubs) etc. Then think about tv income. What do Burnley need to do to stay in the Premier League? How long has Burnley been in Premier League compared with Newcastle? What are the chances or tv money increasing in future years? Then consider the costs of player wages. Are these going to increase, particularly as a proportion of tv revenues? The more players (and their agents) take out of the game the harder it is for clubs to find them revenue to cover those costs. How much does Gareth Bale add to the value of Real Madrid? Wages, somewhere around £650k per week, but the coach doesn't play him. Or Mesut Osil, £375k/week? Or, Sanchez at Manu? (now reported released on free). How much do these contracts add to the values of their clubs? On the other hand, if a club can only afford to sign players that other teams don't want.... how does that impact on the opportunity to compete?

So, is £200 million a fair value for Burnley FC? or £150 million? or are these figures still too high?

Where would Venkys value Blackburn Rovers? or Andy Holt Accrington Stanley? Similarly, what value Bolton Wanderers or Wigan or Bury?

Clarets4me
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Re: Investor

Post by Clarets4me » Thu Aug 06, 2020 7:26 pm

Venky's couldn't give Rovers away, if it was dependent on their loans being repaid .... If they were to write the loans off, then perhaps £5m - £15m ? They're running an operating loss of roughly £250,000 a week, during a normal season ...

Burnley Ace
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Re: Investor

Post by Burnley Ace » Thu Aug 06, 2020 7:31 pm

Just heard that LeBron James owns 2% of Liverpool FC

BenWickes
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Re: Investor

Post by BenWickes » Thu Aug 06, 2020 7:33 pm

Burnley Ace wrote:
Thu Aug 06, 2020 7:31 pm
Just heard that LeBron James owns 2% of Liverpool FC
Who's he/she? :?: :?

GodIsADeeJay81
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Re: Investor

Post by GodIsADeeJay81 » Thu Aug 06, 2020 8:25 pm

BenWickes wrote:
Thu Aug 06, 2020 7:33 pm
Who's he/she? :?: :?
Some fella from the US, plays their version of Netball.
This user liked this post: BenWickes

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