ALK’s Strategy: Are We Witnessing A Failing Experiment?

[bfc8]

The takeover valued the club at £202m - there was £65m borrowed from MSD and in this equation we have to ignore what was borrowed from the club.

Hadn't realised that borrowing from a club not included in leverage %, seems a little odd.

[dsr]

Equally, missing saying that most of that money was already committed to pay wages doesn't "fabricate" a strong argument that it was all borrowed by new owners to but the club.

UTC

We know that ALK have taken £115m in money out of the club. We know that £65m of this was borrowed by the club at high interest, and the balance was not borrowed. The balance could have come from nowhere else other than money owned by the club.

[NewClaret]

I agree. The law needs changing in regard to 'community assets' like football clubs etc.

It absolutely does. Football clubs are heritage, cultural and sporting assets too.

I sort of thought the premier league was getting its act together and regulating itself more effectively but after the Everton debacle I think we just need an independent regulator to sit across the whole football pyramid who rigorously enforces financial discipline and harshly punishes clubs that don’t comply.

With no leveraged buy outs allowed. May ours be the last and may we get away with it.

[NewClaret]

not really

I can help you out here CP.

It’s to obfuscate what is going on in the corporate structure above BFC. From us and probably particularly, you

Now that might be because they have something they want to hide.

But what does give me some hope that there might be another reason is JJ’s investment and Kompany getting involved. Both seem very intelligent people to me who will’ve had significant legal support when dealing with the club. So I’m hoping the fact Alan has persuaded them to come on board is a sign there’s nothing too awry going on.

[Chester Perry]

Hadn't realised that borrowing from a club not included in leverage %, seems a little odd.

It could be wrong but I seem to remember there was something to do with the time frames imposed on the borrowing in terms of when it came on stream, ALK's borrowing from the club was staggered - either way the the total borrowed is £114.8m which falls well under the 65% threshold - The Glazer takeover at Manchester United was close but I think still fell under that threshold.

It was obvious when it was passed into the rule book without much objection that it wouldn't hamper a club being sold - Owners aren't going to vote for anything that makes their asset more difficult to dispose of

[bfc8]

It could be wrong but I seem to remember there was something to do with the time frames imposed on the borrowing in terms of when it came on stream, ALK's borrowing from the club was staggered - either way the the total borrowed is £114.8m which falls well under the 65% threshold - The Glazer takeover at Manchester United was close but I think still fell under that threshold.

It was obvious when it was passed into the rule book without much objection that it wouldn't hamper a club being sold - Owners aren't going to vote for anything that makes their asset more difficult to dispose of

The £114.8m added to the £65m would breach 65% though.

Sometimes wonder if some owners understand what they're voting for, one paper today reports some clubs want to relax the financial rules, worried about Everton points deduction setting a precedent, not sure where this will end up !

[Chester Perry]

It absolutely does. Football clubs are heritage, cultural and sporting assets too.

I sort of thought the premier league was getting its act together and regulating itself more effectively but after the Everton debacle I think we just need an independent regulator to sit across the whole football pyramid who rigorously enforces financial discipline and harshly punishes clubs that don’t comply.

With no leveraged buy outs allowed. May ours be the last and may we get away with it.

What Everton debacle, all the Premier Leagues charges stood after the appeal, the elements that got turned over were decisions made by the original panel independent of the Premier League perhaps most significantly was the fact that EFL precedent should be observed, counted and act as a template, which could well see clubs entering administration while in the Premier League now being met with a 12 point penalty for example. The EFL precedent will have sent shockwaves through the member clubs, I see them being rather more cautious going forwards. It also means some rather dramatic penalties for Manchester City if they are found guilty on their many charges.

[Chester Perry]

The £114.8m added to the £65m would breach 65% though.

Sometimes wonder if some owners understand what they're voting for, one paper today reports some clubs want to relax the financial rules, worried about Everton points deduction setting a precedent, not sure where this will end up !

the £114.8m is made up of the £65m from MSD washed through the club and £49.8m directly from the club

and yes I saw that Telegraph report to

[bfc8]

the £114.8m is made up of the £65m from MSD washed through the club and £49.8m directly from the club

and yes I saw that Telegraph report to

But I thought original takeover was £170m for 84%.
£15m their money, or separately borrowed, £55m bank, £100m bfc, in round terms.

[NewClaret]

What Everton debacle, all the Premier Leagues charges stood after the appeal, the elements that got turned over were decisions made by the original panel independent of the Premier League perhaps most significantly was the fact that EFL precedent should be observed, counted and act as a template, which could well see clubs entering administration while in the Premier League now being met with a 12 point penalty for example. The EFL precedent will have sent shockwaves through the member clubs, I see them being rather more cautious going forwards. It also means some rather dramatic penalties for Manchester City if they are found guilty on their many charges.

What Everton debacle? Are you being serious?

I think it’s a debacle because:

1. The case has taken three years to bring.

2. They’ve now got their act together and Everton might just get two punishments in one season for offences committed in different seasons. I have little sympathy for them to be honest, but that is a farce in isolation.

3. I’m not entirely sure that all their other losses (especially the Covid ones, given the disparity between their supposed losses and that of other clubs) were really valid. I think they were potentially overlooked in favour of bringing the easy charge. Although tbf they don’t seem to have taken that approach with City.

4. I don’t believe EFL rules should be used as precedent. The competition is completely different given the sums of money involved, the size (and financial means) of clubs are far larger, the consequence of cheating to clubs like ours are bigger, etc. It’s a fairly nonsensical argument by the appeal panel in my opinion.

5. But I DO think that the Premier League should’ve set absolutely clear, irrefutable guidance on what points deductions should be applied for breaches of their rule book. From what I can tell they didn’t and that’s equally incompetent.

6. I actually think financial cheating should lead to auto relegation. It’s the only way that we’ll stamp it out. 10 points, and certainly six acts as no deterrent whatsoever. Clubs now thinking about whether to cheat or not just have to ask “will signing player X win me 6 points or more across a season”? If the answer is yes, sign them. I’d argue Dwight’s crossing has earned them that this season already.

7. It doesn’t really impact us, but Luton, Forest, Brentford etc have not known where they stand point/placement wise for half a season. And still don’t given the second hearing to come. In theory, the forthcoming Forest/Everton hearings have been delayed by this one which should’ve been sooner. So for this whole season a bunch of clubs at the bottom have no real idea as to their fate.

8. For the penalty to be deducted by FORTY percent the initial hearing massively ****ed up. You have to draw the conclusion that was either incompetent or this whole thing has been stage managed to look like they were taking tough action. Or the media reaction panicked them.

Overall, it’s just been entirely miss managed and that makes it a debacle. I’m not sure how anyone can argue otherwise tbh.

[Chester Perry]

But I thought original takeover was £170m for 84%.
£15m their money, or separately borrowed, £55m bank, £100m bfc, in round terms.

It has been a while since I went through this so I will repeat

there was an initial down payment of £10m from ALK, plus £65m from MSD and circa £23m from the club, following that there was another £14m borrowed from the club and that is where some people get £37m from because that was in the July 2021 accounts, as was the fact ALK had borrowed another £10m in the interim which takes us to £47m.

The July 2022 Accounts put the debt to the club at £114.8m so even though it wasn't mentioned directly, and because no interest has accumulated, we must reason another £2.8m was borrowed to give that debt total.

We also know that there were stage payments made to a level that go beyond the sums borrowed in a time frame that any further loan to ALK would again be noted as post account date activity in the July 2022 accounts. As no such notes occurred we have assumed that ALK/VSL have found the means to pay the difference from funds provided by new investors in their ownership group or other means that have not leveraged the club further.

An assumption that is firmed up because we also know that Barry Kilby told the London Clarets AGM last summer that the final payment on the original deal had been paid, before the 2023 Account date.

We must not forget that the club was forced to repay MSD £20m in June/July 2023 and voluntarily paid another £12.2m in August 2023 before closing the remaining MSD balance on November 10 2022 via a £39.7m refinancing loan. It is unlikely that the club had monies to cover the MSD payments and the stage payments of Sept 2022 and June 2023 (that was a sum exceeding £30m).

[bfc-njr-2017]

We all require a bit more patience.

Yes. This season has been awful. Yes. The recruitment hasn’t worked, yet. Yes. We’re all annoyed and upset about seeing our club being a it shot on the pitch. However.

We’re commercially improving month on month, our brand awareness internationally is growing more than anyone could have imagined, we do have some exceptional talent on our books (albeit they’re not quite ready yet and still a bit half-baked) and an ownership group that are clearly present, fairly open and communicative (I do wish they explained stuff a tad more mind).

This ‘project’ has only just started. There’s no many successful business plans go from busy to boom in 22 months. It’s going to take a bit of time.

(Allan Pace paid me to write this… )

(Joking of course)

[Spike]

We have always been a selling club but we cannot simply be a club that only buys with a view to being able to sell at a profit

I don’t know who picked the summer signings was it Vince , Pace or Williams ? Whoever it was got it badly wrong by just looking at profit rather than building a team
The other problem is that the summer signing strategy has resulted in a massive amount of devaluation of players . Muric, Cullen , Cork , Benson , Annass, Ramsey , Tressor, Twine, Ekdal, Al - Dakhil,Vigouroux, Roberts, Bastien and Obafemi all worth less .Not to mention Trafford

For Williams to go on Radio Rovers saying how good things are shows he is totally delusional. He only had months rather than years as a CEO before he came here and that was at mighty Shrewsbury . His failure to sort this seasons ground safety problems are perhaps down to his inexperience

I have never seen a season as bad as this . The points tally is nothing but a disgrace
The flags idea was a disaster

[aggi]

We have always been a selling club but we cannot simply be a club that only buys with a view to being able to sell at a profit

I don’t know who picked the summer signings was it Vince , Pace or Williams ? Whoever it was got it badly wrong by just looking at profit rather than building a team
The other problem is that the summer signing strategy has resulted in a massive amount of devaluation of players . Muric, Cullen , Cork , Benson , Annass, Ramsey , Tressor, Twine, Ekdal, Al - Dakhil,Vigouroux, Roberts, Bastien and Obafemi all worth less .Not to mention Trafford

For Williams to go on Radio Rovers saying how good things are shows he is totally delusional. He only had months rather than years as a CEO before he came here and that was at mighty Shrewsbury . His failure to sort this seasons ground safety problems are perhaps down to his inexperience

I have never seen a season as bad as this . The points tally is nothing but a disgrace
The flags idea was a disaster

I can kind of see how the summer happened.

Last summer we signed a load of relative unknowns (Al-Dakhil, Zaroury, Benson, Muric, Vitinho, Maatsen, Tella, etc) who were young and had a minimal track record and were great. There was clear development over the course of the season of the ream and the players.

If Kompany wants to do that again in the summer just gone it is tough to say no, there's a a track record that makes it look successful.

[randomclaret2]

We have always been a selling club but we cannot simply be a club that only buys with a view to being able to sell at a profit

I don’t know who picked the summer signings was it Vince , Pace or Williams ? Whoever it was got it badly wrong by just looking at profit rather than building a team
The other problem is that the summer signing strategy has resulted in a massive amount of devaluation of players . Muric, Cullen , Cork , Benson , Annass, Ramsey , Tressor, Twine, Ekdal, Al - Dakhil,Vigouroux, Roberts, Bastien and Obafemi all worth less .Not to mention Trafford

For Williams to go on Radio Rovers saying how good things are shows he is totally delusional. He only had months rather than years as a CEO before he came here and that was at mighty Shrewsbury . His failure to sort this seasons ground safety problems are perhaps down to his inexperience

I have never seen a season as bad as this . The points tally is nothing but a disgrace
The flags idea was a disaster

Matt Williams was also club secretary at Blackpool for nearly 10 years, dealing with the Oystons...one can only imagine the experience he picked up there.

[CoolClaret]

We have always been a selling club but we cannot simply be a club that only buys with a view to being able to sell at a profit

I don’t know who picked the summer signings was it Vince , Pace or Williams ? Whoever it was got it badly wrong by just looking at profit rather than building a team
The other problem is that the summer signing strategy has resulted in a massive amount of devaluation of players . Muric, Cullen , Cork , Benson , Annass, Ramsey , Tressor, Twine, Ekdal, Al - Dakhil,Vigouroux, Roberts, Bastien and Obafemi all worth less .Not to mention Trafford

For Williams to go on Radio Rovers saying how good things are shows he is totally delusional. He only had months rather than years as a CEO before he came here and that was at mighty Shrewsbury . His failure to sort this seasons ground safety problems are perhaps down to his inexperience

I have never seen a season as bad as this . The points tally is nothing but a disgrace
The flags idea was a disaster

COO not CEO

Recruitment is VK & his team.

But yeah, Williams - though he came across really well in MtB has said some bizarre things recently so I don't particularly pay much attention to what he says, the one that actually quite irked me was, "Vincent Kompany is the best thing to ever happen to Burnley Football Club" - given our rich history I find nonsensical, hysterical statements like that to be a complete crock of sh1t.

[ClaretPete001]

It has been a while since I went through this so I will repeat

there was an initial down payment of £10m from ALK, plus £65m from MSD and circa £23m from the club, following that there was another £14m borrowed from the club and that is where some people get £37m from because that was in the July 2021 accounts, as was the fact ALK had borrowed another £10m in the interim which takes us to £47m.

The July 2022 Accounts put the debt to the club at £114.8m so even though it wasn't mentioned directly, and because no interest has accumulated, we must reason another £2.8m was borrowed to give that debt total.

We also know that there were stage payments made to a level that go beyond the sums borrowed in a time frame that any further loan to ALK would again be noted as post account date activity in the July 2022 accounts. As no such notes occurred we have assumed that ALK/VSL have found the means to pay the difference from funds provided by new investors in their ownership group or other means that have not leveraged the club further.

An assumption that is firmed up because we also know that Barry Kilby told the London Clarets AGM last summer that the final payment on the original deal had been paid, before the 2023 Account date.

We must not forget that the club was forced to repay MSD £20m in June/July 2023 and voluntarily paid another £12.2m in August 2023 before closing the remaining MSD balance on November 10 2022 via a £39.7m refinancing loan. It is unlikely that the club had monies to cover the MSD payments and the stage payments of Sept 2022 and June 2023 (that was a sum exceeding £30m).

I realise you go over this a lot Chester but is it possible that they paid the £68 million to the former owners out of cash.

We know we made £70 million on sales of players with little debt on them apart perhaps from Cornet in Summer 22.

By negotiating hard on the players we bought (Weghorst was bought in January) and driving hard bargains with the clubs we sold to they could feasibly have generated a lot of cash prior to January.

You can then add the advanced PL broadcast money, and the rumours that we effectively brought forward future PL broadcast revenue. I remember there was talk of this at the time but I can't remember the detail and you can easily see that if all the income was brought in early and all the debt deferred as far back as far as possible they could generate a lot of cash.

I don't know the timelines but the previous owners managed to generate a great deal of cash (£80 million at the point of sale) without seemingly resorting to or wanting resort to the kind of negotiation ALK are likely to have been involved in. The last sets of accounts was in July 22 so none of this would be available publicly.

[Big Vinny K]

I realise you go over this a lot Chester but is it possible that they paid the £68 million to the former owners out of cash.

We know we made £70 million on sales of players with little debt on them apart perhaps from Cornet in Summer 22.

By negotiating hard on the players we bought (Weghorst was bought in January) and driving hard bargains with the clubs we sold to they could feasibly have generated a lot of cash prior to January.

You can then add the advanced PL broadcast money, and the rumours that we effectively brought forward future PL broadcast revenue. I remember there was talk of this at the time but I can't remember the detail and you can easily see that if all the income was brought in early and all the debt deferred as far back as far as possible they could generate a lot of cash.

I don't know the timelines but the previous owners managed to generate a great deal of cash (£80 million at the point of sale) without seemingly resorting to or wanting resort to the kind of negotiation ALK are likely to have been involved in. The last sets of accounts was in July 22 so none of this would be available publicly.

What we do know though is that the £80m in cash was a pretty significantly inflated number due to the anomaly in timing of the tv revenue payment and our year end cut off.
It’s clear that was not the true cash figure in terms of our real asset figure.
What we also know is that for a number of the sales like Wood, Pope and maybe others (I can’t remember exactly which players) that we actually entered into factoring agreements to bring in the money sooner than they were due under the transfer agreement.
I suspect this was for cash flow purposes due to whatever cash we had in the bank being used for the purchase - can’t think why else we would enter into such an expensive finance transaction as I know that factoring deals tend to be. Unless we had loan repayments / commitments that became due directly as a result of the relegation (on top of low cash at the back possibly ?)

[Paul Waine]

I think you've misunderstood here- that's not my argument nor my point, I responded to someone saying that we had 0 money at the end of Garlicks tenure. I've quite rightly pointed out that the accounts show we did have some money, some of which was committed to wages, but certainly not 100 percent of it. There's no argument beyond that, I was just pointing out that the accounts seemed to suggest that we could have bought another player or two under Garlick so the suggestion we had no money is false.

I've literally no idea why you dragged the new owners in to it?

Have I dragged them in? I thought they were the subject of this thread?

Mike Garlick didn't want to spend the money in the club's bank account on any new players in the summer of 2020. Sean Dyche wanted to hold onto James Tarkowski and let him run down his contract. If Mike Garlick wasn't looking to sell the club and if Sean Dyche had been prepared to sell James Tarkowski maybe there would have been some investment in new players. There's logic in Mike Garlick not wanting to sign new players - allow the new owners (whoever they would be) to make their own decisions about new players. There's also logic in Sean Dyche wanting to hold onto James Tarkowski.

No worries, what happened in 2020 is long gone.

UTC

EDIT: I note after posting that others on this thread are still discussing the amount of money available in the club's accounts in summer 2020.

[ClaretPete001]

What we do know though is that the £80m in cash was a pretty significantly inflated number due to the anomaly in timing of the tv revenue payment and our year end cut off.
It’s clear that was not the true cash figure in terms of our real asset figure.
What we also know is that for a number of the sales like Wood, Pope and maybe others (I can’t remember exactly which players) that we actually entered into factoring agreements to bring in the money sooner than they were due under the transfer agreement.
I suspect this was for cash flow purposes due to whatever cash we had in the bank being used for the purchase - can’t think why else we would enter into such an expensive finance transaction as I know that factoring deals tend to be. Unless we had loan repayments / commitments that became due directly as a result of the relegation (on top of low cash at the back possibly ?)

Possibly, however it crept up over the years regardless of operating profits probably because of the anomolies of the amortisation of players.

We also know, ALK took almost £50 million out of the bank to pay for shares (£37 million plus £10 million in the 20 accounts) and still retained a significant bank balance the year after.

So, it's quite possible with cute transfer dealings and bringing forward various revenue streams they may well have generated a lot of cash.

Who knows - just a point of debate.

[Paul Waine]

We know that ALK have taken £115m in money out of the club. We know that £65m of this was borrowed by the club at high interest, and the balance was not borrowed. The balance could have come from nowhere else other than money owned by the club.

Hi dsr, yes, the club's owners/shareholders owed the club (July 2022 accounts) £115 million. ALK borrowed £65 million from MSD immediately before they bought the previous directors' shares in Dec 2020 and a couple of days later transferred this loan to the club. We also know that repayments were made against the £65 million when the club was relegated at the end of season 2021/22 and the total loan cleared in November 2022 and replaced with a new loan of (just under) £40 million. We also know that there have been further borrowings since that date - but, will have to wait until we can see the July 2023 accounts (expected in 8 or 9 weeks time) before we know some further details.

The interest rate on a commercial loan of £65 million to a football club wasn't particularly high. It's where you'd expect it to be. (Yes, it's a lot more than most of the posters on here would be able to borrow as a mortgage against buying a house, but those are vastly different markets).

[boyyanno]

Have I dragged them in? I thought they were the subject of this thread?

Mike Garlick didn't want to spend the money in the club's bank account on any new players in the summer of 2020. Sean Dyche wanted to hold onto James Tarkowski and let him run down his contract. If Mike Garlick wasn't looking to sell the club and if Sean Dyche had been prepared to sell James Tarkowski maybe there would have been some investment in new players. There's logic in Mike Garlick not wanting to sign new players - allow the new owners (whoever they would be) to make their own decisions about new players. There's also logic in Sean Dyche wanting to hold onto James Tarkowski.

No worries, what happened in 2020 is long gone.

UTC

EDIT: I note after posting that others on this thread are still discussing the amount of money available in the club's accounts in summer 2020.

They may be the subject of this thread, but I was responding to a very specific point R:E the statement that was made about us having 0 money at the end of Garlicks tenure. You and I nothing agree that wasn't true, as does anyone who has looked at the accounts so I standby what I said that it's pure fabrication.

I appreciate Garlick did not want to spend the funds, if you search back on previous posts I was one of the first on here that thought the way the club started operating was as a result of seeking to sell. But not wanting to spend money, and not being able to because you have 0- are two completely different things.

[bfc8]

It has been a while since I went through this so I will repeat

there was an initial down payment of £10m from ALK, plus £65m from MSD and circa £23m from the club, following that there was another £14m borrowed from the club and that is where some people get £37m from because that was in the July 2021 accounts, as was the fact ALK had borrowed another £10m in the interim which takes us to £47m.

The July 2022 Accounts put the debt to the club at £114.8m so even though it wasn't mentioned directly, and because no interest has accumulated, we must reason another £2.8m was borrowed to give that debt total.

We also know that there were stage payments made to a level that go beyond the sums borrowed in a time frame that any further loan to ALK would again be noted as post account date activity in the July 2022 accounts. As no such notes occurred we have assumed that ALK/VSL have found the means to pay the difference from funds provided by new investors in their ownership group or other means that have not leveraged the club further.

An assumption that is firmed up because we also know that Barry Kilby told the London Clarets AGM last summer that the final payment on the original deal had been paid, before the 2023 Account date.

We must not forget that the club was forced to repay MSD £20m in June/July 2023 and voluntarily paid another £12.2m in August 2023 before closing the remaining MSD balance on November 10 2022 via a £39.7m refinancing loan. It is unlikely that the club had monies to cover the MSD payments and the stage payments of Sept 2022 and June 2023 (that was a sum exceeding £30m).

Thanks for this, have had a good look now.

So go back to £170m for 84% valuing bfc at £202m. Think you said somewhere, can't find, that ALK now at 94% bought up more shares, that's £190m or thereabouts.
Is that financed ALK £10m, Bank £65m, bfc £115m, total £190m.
The 'bank' figure has seen various lenders over the period, including new individuals.

Have I interpreted your piece correctly, or have I made a howler.

[aggi]

Thanks for this, have had a good look now.

So go back to £170m for 84% valuing bfc at £202m. Think you said somewhere, can't find, that ALK now at 94% bought up more shares, that's £190m or thereabouts.
Is that financed ALK £10m, Bank £65m, bfc £115m, total £190m.
The 'bank' figure has seen various lenders over the period, including new individuals.

Have I interpreted your piece correctly, or have I made a howler.

There's a lot of uncertainty over this. If anyone tries to give a definitive answer I'd be suspicious.

We know there was £115m from BFC (made up of cash and loans that they have taken out, including the MSD one). We suspect there's £10-15m from ALK (putting together a few things from other filed accounts, offer to shareholders, etc).

We are virtually sure that all tranches to the old shareholders have now been paid but how that was paid we don't know. Maybe it came from the club (either cash balances from shrewd dealing, another loan or a facility on future tv money), maybe it came from Pace, et al, maybe it came from new investors in ALK, maybe a combination of everything (Vlad Torgovnik coming in maybe introduced some free capital for ALK for instance).

[Paul Waine]

Thanks for this, have had a good look now.

So go back to £170m for 84% valuing bfc at £202m. Think you said somewhere, can't find, that ALK now at 94% bought up more shares, that's £190m or thereabouts.
Is that financed ALK £10m, Bank £65m, bfc £115m, total £190m.
The 'bank' figure has seen various lenders over the period, including new individuals.

Have I interpreted your piece correctly, or have I made a howler.

The key bit is that the £65 million is part of the £115 million. ALK had to pay the previous directors £X million. They borrowed (in stages) £115 million from the club. The club borrowed £65 million from MSD (and replaced by new loans) so that the club could make up the £115 million it was lending to the new owners.

[bfc8]

The key bit is that the £65 million is part of the £115 million. ALK had to pay the previous directors £X million. They borrowed (in stages) £115 million from the club. The club borrowed £65 million from MSD (and replaced by new loans) so that the club could make up the £115 million it was lending to the new owners.

Was beginning to suspect that, thanks.

There's a gap though. ALK £10m, bfc £115m, total £125m.

But bfc cost ALK apparently £170m for 84% and now around £190m at 94%. Where does the £45/65m come from, balance from £125m.
Or was that £170m just a newspaper headline figure, and wrong. A bit of a puzzle.

[dsr]

Hi dsr, yes, the club's owners/shareholders owed the club (July 2022 accounts) £115 million. ALK borrowed £65 million from MSD immediately before they bought the previous directors' shares in Dec 2020 and a couple of days later transferred this loan to the club. We also know that repayments were made against the £65 million when the club was relegated at the end of season 2021/22 and the total loan cleared in November 2022 and replaced with a new loan of (just under) £40 million. We also know that there have been further borrowings since that date - but, will have to wait until we can see the July 2023 accounts (expected in 8 or 9 weeks time) before we know some further details.

The interest rate on a commercial loan of £65 million to a football club wasn't particularly high. It's where you'd expect it to be. (Yes, it's a lot more than most of the posters on here would be able to borrow as a mortgage against buying a house, but those are vastly different markets).

It depends how you define high interest, really. However you swing it, the interest on the new loan is going to be £6m a year or so. Compared with the figure before we took out that loan, £zero. Every year, BFC is paying out large sums of interest on a loan that benefits the club not at all, and that interest payment will continue unless yet more club profits (that could have been spent on players) are used to pay it off.

And crucially, that interest payment will not fall when the PL TV income falls. It will be ongoing.

[Chester Perry]

I realise you go over this a lot Chester but is it possible that they paid the £68 million to the former owners out of cash.

We know we made £70 million on sales of players with little debt on them apart perhaps from Cornet in Summer 22.

By negotiating hard on the players we bought (Weghorst was bought in January) and driving hard bargains with the clubs we sold to they could feasibly have generated a lot of cash prior to January.

You can then add the advanced PL broadcast money, and the rumours that we effectively brought forward future PL broadcast revenue. I remember there was talk of this at the time but I can't remember the detail and you can easily see that if all the income was brought in early and all the debt deferred as far back as far as possible they could generate a lot of cash.

I don't know the timelines but the previous owners managed to generate a great deal of cash (£80 million at the point of sale) without seemingly resorting to or wanting resort to the kind of negotiation ALK are likely to have been involved in. The last sets of accounts was in July 22 so none of this would be available publicly.

Any funds that come from the club to pay for the shares owned by ALK/VSL has to be recorded as a loan - aggi was very specific on this some time back on the takeover thread, and his is a word I have never been given cause to doubt when he is dealing with such certainties. The club cannot by law pay for shares in itself on behalf a specific shareholder is how I understand it.

We have learned that the 5 payments for the initial takeover were Jan 2021, Sept 2021 (money for which was taken out early to be in the July 2021 accounts - which is not an unusual fiscal management approach from a club, we see similar in player sales) March 2022, September 2022 and June 2023 (all the last 4 payments arrived late but that is not of consequence to this thread). Add to that the March 2022 date for the shares bought from the small shareholders.

The accounts for July 2022 were signed off on 28th April 2023, which means only the final two payments are outside the scope of reporting if ALK/VSL were borrowing money for all payments from the club, but I also know that the sums paid out by the completion of that March 2022 payment are some way in excess of the monies owed to the club.

The cash in hand at point of sale was more likely £50m - £55m. As has been pointed out, the £80m in the July 2020 accounts is because of a change in account date, which included additional deposits for the following season from the Premier League. Take that away and the added costs of that extra month and you are probably looking at a flat or sightly negative year on year cash in hand situation - which makes sense given the reported £10.5m losses in revenue as a direct result of Covid in the second half of that financial year.

It always paid to offset the accruals in the accounts to the cash in hand (not a clear marker but a useful one) - future commitments showed a clear gap to that point in time figure and what was actual additional available cash. I produced this in an article for the London Clarets in 2021 about the 2020 accounts (note the use of Reserves is my wording and incorrect in accountancy terminology)

Burnley FC Cash position 2020.png (38.25 KiB) Viewed 1144 times

look how the accruals jump, that is in large part the Premier League advance for the following season (a payment reduced by the club's share of the rebate to broadcasters)

[Paul Waine]

Was beginning to suspect that, thanks.

There's a gap though. ALK £10m, bfc £115m, total £125m.

But bfc cost ALK apparently £170m for 84% and now around £190m at 94%. Where does the £45/65m come from, balance from £125m.
Or was that £170m just a newspaper headline figure, and wrong. A bit of a puzzle.

See CP's post re the cash flows and funding ALK share purchases. I don't think we have any published information that we can look at to confirm where the rest of the cash came from to complete payments for the previous directors' shares and pay the small investors, however, we've seen the announcement of a few "minority shareholders" including JJ Watt and Kealia Watt. The corporate set up of ALK Capital alongside Velocity Sports Partnership LLP (have I got the name right?) indicates that VSP is the entity where other investors can buy shares. The Watt's have been named, a few others have been named. There's also the possibility that others have become investors without being named. That's how the ALK/VSP corporate structure operates in US (there are many, many, such corporate structures across a whole host of business sectors, they aren't just for sports investing). We don't know, as yet, how much has been invested in ALK/VSP. It's very possible that these investments can close the gap in the figures that we do know. Maybe we will learn more in time.

[Chester Perry]

Was beginning to suspect that, thanks.

There's a gap though. ALK £10m, bfc £115m, total £125m.

But bfc cost ALK apparently £170m for 84% and now around £190m at 94%. Where does the £45/65m come from, balance from £125m.
Or was that £170m just a newspaper headline figure, and wrong. A bit of a puzzle.

The £170m was confirmed in the October 4 2021 Offer letter to the small shareholders where a minimum price per share was specified (the actual sum is less than £500 below £170m) - there was the potential for it to be more based on performance but we do not know if that was ever triggered, I suspect not, though Premier League status was maintained in 2021.

ALK/VSL now have just over 90% of the shareholding, Vlad Torgovnik takes the boards holding past 94% and ALK still have a ringfence over shares still in possession of Messers Crabb, Flood, Holt, Nelson and Kilby which would take the boards holding to over 96%

[aggi]

It depends how you define high interest, really. However you swing it, the interest on the new loan is going to be £6m a year or so. Compared with the figure before we took out that loan, £zero. Every year, BFC is paying out large sums of interest on a loan that benefits the club not at all, and that interest payment will continue unless yet more club profits (that could have been spent on players) are used to pay it off.

And crucially, that interest payment will not fall when the PL TV income falls. It will be ongoing.

I think this is the important bit. Taking out a loan to buy players (although arguably not that wise) or improve the ground for instance gives the promise of future revenues from the use of that capital. Effectively you're putting somebody else's money to work in order to get that margin of higher revenue less loan costs.

The leveraged buy-out is much more of a grey area. Are we benefiting that much from ALK owning us that those extra revenues are offsetting the cost of capital? Last season quite a few people may have said yes. This season it's a tougher call (hence threads like this one).

[bfc8]

The £170m was confirmed in the October 4 2021 Offer letter to the small shareholders where a minimum price per share was specified (the actual sum is less than £500 below £170m) - there was the potential for it to be more based on performance but we do not know if that was ever triggered, I suspect not, though Premier League status was maintained in 2021.

ALK/VSL now have just over 90% of the shareholding, Vlad Torgovnik takes the boards holding past 94% and ALK still have a ringfence over shares still in possession of Messers Crabb, Flood, Holt, Nelson and Kilby which would take the boards holding to over 96%

Think I'm slowly getting there. Cost £170m, ALK £10m, bfc £115m, where does balance £45m come from...

[Chester Perry]

Think I'm slowly getting there. Cost £170m, ALK £10m, bfc £115m, where does balance £45m come from...

The working assumption until proven otherwise is ALK/VSL - whether it is via loans outside the sphere of impact on the club or from new investors in that group we do not know

then again there is much we do not know - for instance who supplied the November 10th 2022 refinance loan to terminate the deal with MSD, the responsibility to service it was given to the club but no charges were ever registered upon club assets.

[Chester Perry]

What Everton debacle? Are you being serious?

I think it’s a debacle because:

1. The case has taken three years to bring.

2. They’ve now got their act together and Everton might just get two punishments in one season for offences committed in different seasons. I have little sympathy for them to be honest, but that is a farce in isolation.

3. I’m not entirely sure that all their other losses (especially the Covid ones, given the disparity between their supposed losses and that of other clubs) were really valid. I think they were potentially overlooked in favour of bringing the easy charge. Although tbf they don’t seem to have taken that approach with City.

4. I don’t believe EFL rules should be used as precedent. The competition is completely different given the sums of money involved, the size (and financial means) of clubs are far larger, the consequence of cheating to clubs like ours are bigger, etc. It’s a fairly nonsensical argument by the appeal panel in my opinion.

5. But I DO think that the Premier League should’ve set absolutely clear, irrefutable guidance on what points deductions should be applied for breaches of their rule book. From what I can tell they didn’t and that’s equally incompetent.

6. I actually think financial cheating should lead to auto relegation. It’s the only way that we’ll stamp it out. 10 points, and certainly six acts as no deterrent whatsoever. Clubs now thinking about whether to cheat or not just have to ask “will signing player X win me 6 points or more across a season”? If the answer is yes, sign them. I’d argue Dwight’s crossing has earned them that this season already.

7. It doesn’t really impact us, but Luton, Forest, Brentford etc have not known where they stand point/placement wise for half a season. And still don’t given the second hearing to come. In theory, the forthcoming Forest/Everton hearings have been delayed by this one which should’ve been sooner. So for this whole season a bunch of clubs at the bottom have no real idea as to their fate.

8. For the penalty to be deducted by FORTY percent the initial hearing massively ****ed up. You have to draw the conclusion that was either incompetent or this whole thing has been stage managed to look like they were taking tough action. Or the media reaction panicked them.

Overall, it’s just been entirely miss managed and that makes it a debacle. I’m not sure how anyone can argue otherwise tbh.

This area of discussion should probably be on a different thread, but as it continues a discussion here I will make my final post on the topic in this thread

I am entirely serious

re 1. - the charges were raised heard and judged and appealed in 10 months - a timetable structure has since been agreed by the 20 member clubs to shorten this enabled by early reporting of issues in December rather than March for the previous seasons accounts

- The period covered by the charges is three years but that ended at the 2022 account date

re 2 - The clubs make the rules, with the Premier Leagues guidance, which is not always adhered too when it comes to the vote - The Premier League wanted the initial charge heard last season, but Everton argued successfully that they did not have time to prepare a case, So the reason Everton get hit twice is in part down to my response to 1 and in part Everton themselves.

re 3 - you are not the only one to think that (but they are not the only club that have been allowed large losses by the Premier League or UEFA. By contrast I have worked out our clubs losses over the entirety of covid were around £28m with £13.4m of that being broadcaster rebate (Everton paid less by virtue of finishing below us in 2019/20. It is also a fact that the Premier League warned Everton about their excesses after the 2021 accounts and came to an agreement (settlement?) that they get their house in order.

- City's charges are entirely different and do not cover Covid financials - the only charges that cover the period 2019 - 2023 are to do with non-cooperation with the Premier Leagues investigation into their finances and actions

re 4 - this was the original commissions judgement, but it has been overturned. There is logic to it given that the Premier League have the promotion/relegation relationship, both fall under the FA and there has been a growing, deliberate alignment of rules (at the Premier Leagues instigation). What we have now is a clear ruling and that will be established precedent that will probably never be overturned.

re 5 - the Premier League wanted to do this in the summer, clubs deferred, the original commission said if such structures were in place it would have been bound to use them, and now we have the established precedent that EFL penalties can apply. the only way forward appears to be that the Premier League and the EFL jointly establish a common set of rules and penalties

re 6 - at no point did the Premier League or the commission say that Everton had deliberately cheated, there were interpretations that were misjudged and mis-management not cheating and Everton (or indeed any club) would never admit to that in these circumstances. Note that Manchester City have never admitted to wrongdoing over any charge in the Abu Dhabi ownership - they have reached settlements for commercial reasons but always denied that they have broken rules.

re 7 - when something like this is first tested it always has impacts and as I have pointed out there have been rule changes to stop this in the future. the charges raised against Forest and Everton in mid January are to be heard next month with Forests being next week, with so much precent being set and definitions of rules/penalties being firmed up things will continue to move quicker overall - Everton think they have worked out what penalty they will receive over the new charges. Some of that will be dependent on how the double jeopardy claim goes - I suspect that point will be settled at appeal

re 8 - the commission are the ones that gave the penalty, the Premier League wanted more with the commission determining (but not publicly defining their own criteria). Where there are no defined penalty criteria per action/outcome it is pretty normal for a circa 40% deduction on appeal. On the MMT i suggested that it almost seems like panels decree such a large number with an absolute expectation that an appeal will be made and se it reduced, sometimes I am given to think they plan it so the offender will get the actual penalty they think is justifiable


in general far to many have made the false association that the original commission panel is part of the Premier League it is not - that is why it is called an Independent Commission, Overall it is the Panel in The Independent Commission that have come out of this negatively, not the Premier League.

If you want more understanding of the Manchester City case I suggest you listen to the excellent podcast on the subject I posted on the MMT yesterday

[ClaretPete001]

The working assumption until proven otherwise is ALK/VSL - whether it is via loans outside the sphere of impact on the club or from new investors in that group we do not know

then again there is much we do not know - for instance who supplied the November 10th 2022 refinance loan to terminate the deal with MSD, the responsibility to service it was given to the club but no charges were ever registered upon club assets.

And that to some extent answers all your points above. If ALK can get short term loans of tens of millions then how can you know that they haven't used these kind of loans along with clever financial management to defer inter company loans to the summer of 2023.

No to avoid it being published in the accounts but to take advantage of the finances that would come with promotion to the PL.

With 3 guaranteed payments of around £120 million you could make a killing in terms of divis, inter company loans and give handsome returns to those who can bridge the time between being in the Championships and in the PL.

By selling key assets for £70 million, forwarding PL broadcast revenue and squeezing both creditors and debtors ALK could generate hundreds of million and with the help of private bridging loans could escape any scrutiny for quite a period.

[aggi]

And that to some extent answers all your points above. If ALK can get short term loans of tens of millions then how can you know that they haven't used these kind of loans along with clever financial management to defer inter company loans to the summer of 2023.

No to avoid it being published in the accounts but to take advantage of the finances that would come with promotion to the PL.

With 3 guaranteed payments of around £120 million you could make a killing in terms of divis, inter company loans and give handsome returns to those who can bridge the time between being in the Championships and in the PL.

By selling key assets for £70 million, forwarding PL broadcast revenue and squeezing both creditors and debtors ALK could generate hundreds of million and with the help of private bridging loans could escape any scrutiny for quite a period.

But why? It all seems unnecessarily complicated and I'm not sure what is the upshot that wouldn't happen anyway. Paying loads of interest on private loans just so they can do what they'd do anyway seems strange. And obviously we all know that there haven't been dividend payments.

It all sounds a bit conspiracy theory.

[ALP]

I'm not often given to gripes against the board, however.

Gone are:

Daz Bentley
Pete Oliver
Gibbo
Fordy Four Eyes

plus many more.

The current media and backroom staff are nothing but interns, the American way. No knowledge of the clubs history, just cheap and cheerful sound bites. I am so happy that I didn't get the jobs in the photography at Burnley, let them carry on with Sharon Latham and co (not that I bear any grudge as she is a super photographer), but still City through and through alongside Gallagher. Sorry but the board have really screwed this over.

[NewClaret]

And that to some extent answers all your points above. If ALK can get short term loans of tens of millions then how can you know that they haven't used these kind of loans along with clever financial management to defer inter company loans to the summer of 2023.

No to avoid it being published in the accounts but to take advantage of the finances that would come with promotion to the PL.

With 3 guaranteed payments of around £120 million you could make a killing in terms of divis, inter company loans and give handsome returns to those who can bridge the time between being in the Championships and in the PL.

By selling key assets for £70 million, forwarding PL broadcast revenue and squeezing both creditors and debtors ALK could generate hundreds of million and with the help of private bridging loans could escape any scrutiny for quite a period.

Has anyone ever said you have an active imagination ClaretPete?

[Paul Waine]

And that to some extent answers all your points above. If ALK can get short term loans of tens of millions then how can you know that they haven't used these kind of loans along with clever financial management to defer inter company loans to the summer of 2023.

No to avoid it being published in the accounts but to take advantage of the finances that would come with promotion to the PL.

With 3 guaranteed payments of around £120 million you could make a killing in terms of divis, inter company loans and give handsome returns to those who can bridge the time between being in the Championships and in the PL.

By selling key assets for £70 million, forwarding PL broadcast revenue and squeezing both creditors and debtors ALK could generate hundreds of million and with the help of private bridging loans could escape any scrutiny for quite a period.

Hi Pete, what are you seeking to say? ALK borrowed £65 million from MSD secured against Kettering Capital - that owned shares in Calder Vale - Calder Vale that owned shares in Burnley FC Holdings Limited - and owned shares in Burnley Football & Athletic and Longside Properties and other subsids - and secured against all the assets of Burnley FC Holdings Limited, plus all property and all shares in the subsidiaries etc. My point is ALK were able to borrow money provided they could provide security for that borrowing.

What other assets has ALK got that can be pledged as security for borrowings in addition to the existing borrowings secured against the club assets?

ALK's "clever financial management" is to understand what they can do by carefully planning the club's cashflows, including the timing of those cashflows, plus the scenario analysis to consider "what if" analysis that plans for different cashflows. Planning, for example, how loan obligations would change in the event of relegation - or promotion - and transfer commitments, both incoming and outgoing, change with add-ons, depending on results. So, relegation in May 2022 required some of the £65 million MSD loan to be repaid - and, we saw evidence of cashflow planning by factoring the Chris Wood transfer to Newcastle in April/May 2022 to prepare for this obligation. Similarly, promotion in May 2023 enabled the club to borrow against Premier League (and parachute payments) for up to 3 years.

I don't understand what you are saying with "make a killing in terms of divis, inter company loans and give handsome returns..." Similarly, what are you saying with "selling key assets for £70 million, forwarding PL broadcast revenue and squeezing both creditors and debtors ALK could generate hundreds of million..." And, again "with the help of private bridging loans..."

What is a "private bridging loan?" Who would make such a loan to ALK? What assets would ALK provide to any such lender to be able to secure such a loan? What conditions would the lender impose to ensure that ALK repay a "private bridging loan?"

If the loans ALK has arranged by offering all the available assets/property the club has have already "exhausted" all the borrowing capacity of those assets, where is ALK get additional assets from that they would be able to offer as security for the "private bridging loans" you imagine ALK could obtain?

It's a lot easier to imagine that ALK/VSP have brought in other investors, people like JJ Watt and others - and some of these others have remained "private" so we don't know any names. So, it's money from the additional investors that if "bridging" the gap between what we know about the club's finances and what we don't (yet) know. Of course, if there are other investors, they will also expect their share of the returns that ALK will achieve by successfully running Burnley Football Club. That's "ALK's Strategy" run, Burnley Football Club successfully.

Yes, as we've seen, it has always been challenging to be a successful football club. This season, so far, hasn't got a great deal in the "success" column. We should give the club, the coaching staff, the players, the owners and Alan Pace time to create their success. To borrow a phrase that the club used a few seasons back, we should "Dare to Dream."

UTC

[ClaretPete001]

But why? It all seems unnecessarily complicated and I'm not sure what is the upshot that wouldn't happen anyway. Paying loads of interest on private loans just so they can do what they'd do anyway seems strange. And obviously we all know that there haven't been dividend payments.

It all sounds a bit conspiracy theory.

Because what is the alternative? There has been £80 million of external investment into a business like Burnley with no equity, publicity or anything?

There are mystery individuals who lend tens of millions to pay off loans when required?

ALK couldn't find enough money to pay the former owners up front but they found a way to make scheduled payments of £68 million over a couple of years?

Many businesses in the tech industry live on millions and millions of VC money - existing hand to mouth from one month to the next. Why would you not do it that way?

None of it makes sense.

[ClaretPete001]

Has anyone ever said you have an active imagination ClaretPete?

No I've worked in the tech industry....

[ClaretPete001]

Hi Pete, what are you seeking to say? ALK borrowed £65 million from MSD secured against Kettering Capital - that owned shares in Calder Vale - Calder Vale that owned shares in Burnley FC Holdings Limited - and owned shares in Burnley Football & Athletic and Longside Properties and other subsids - and secured against all the assets of Burnley FC Holdings Limited, plus all property and all shares in the subsidiaries etc. My point is ALK were able to borrow money provided they could provide security for that borrowing.

What other assets has ALK got that can be pledged as security for borrowings in addition to the existing borrowings secured against the club assets?

ALK's "clever financial management" is to understand what they can do by carefully planning the club's cashflows, including the timing of those cashflows, plus the scenario analysis to consider "what if" analysis that plans for different cashflows. Planning, for example, how loan obligations would change in the event of relegation - or promotion - and transfer commitments, both incoming and outgoing, change with add-ons, depending on results. So, relegation in May 2022 required some of the £65 million MSD loan to be repaid - and, we saw evidence of cashflow planning by factoring the Chris Wood transfer to Newcastle in April/May 2022 to prepare for this obligation. Similarly, promotion in May 2023 enabled the club to borrow against Premier League (and parachute payments) for up to 3 years.

I don't understand what you are saying with "make a killing in terms of divis, inter company loans and give handsome returns..." Similarly, what are you saying with "selling key assets for £70 million, forwarding PL broadcast revenue and squeezing both creditors and debtors ALK could generate hundreds of million..." And, again "with the help of private bridging loans..."

What is a "private bridging loan?" Who would make such a loan to ALK? What assets would ALK provide to any such lender to be able to secure such a loan? What conditions would the lender impose to ensure that ALK repay a "private bridging loan?"

If the loans ALK has arranged by offering all the available assets/property the club has have already "exhausted" all the borrowing capacity of those assets, where is ALK get additional assets from that they would be able to offer as security for the "private bridging loans" you imagine ALK could obtain?

It's a lot easier to imagine that ALK/VSP have brought in other investors, people like JJ Watt and others - and some of these others have remained "private" so we don't know any names. So, it's money from the additional investors that if "bridging" the gap between what we know about the club's finances and what we don't (yet) know. Of course, if there are other investors, they will also expect their share of the returns that ALK will achieve by successfully running Burnley Football Club. That's "ALK's Strategy" run, Burnley Football Club successfully.

Yes, as we've seen, it has always been challenging to be a successful football club. This season, so far, hasn't got a great deal in the "success" column. We should give the club, the coaching staff, the players, the owners and Alan Pace time to create their success. To borrow a phrase that the club used a few seasons back, we should "Dare to Dream."

UTC

The private bridging loan is the one CP describes above.

I don't think it is easier to think that the club could attract £80 million worth of external investment offering no equity and generating no publicity. That is my problem...!

[ClaretPete001]

Why would anyone be surprised that Wall Street financiers behave like Wall Street Financiers.

We lived through the worst crash ever because they were rolling up bad debt and sold it to each other.

There are literally 100s of AI companies that produce nothing and live on millions of VC money.

Amazon and Facebook made nothing for years and are now potentially the biggest companies in the world.

This is how these people roll. We aren't talking about Farquart and Hegginbotham High Street Accountants to Mill Owners and Shoe Makers. This is the 21st century people!

[dsr]

Because what is the alternative? There has been £80 million of external investment into a business like Burnley with no equity, publicity or anything?

There are mystery individuals who lend tens of millions to pay off loans when required?

ALK couldn't find enough money to pay the former owners up front but they found a way to make scheduled payments of £68 million over a couple of years?

Many businesses in the tech industry live on millions and millions of VC money - existing hand to mouth from one month to the next. Why would you not do it that way?

None of it makes sense.

I don't follow you.

There hasn't been any investment in Burnley FC. None. all the money that ALK have spent has gone to Mike Garlick and other shareholders; none of it has come into the club. Quite the reverse - they have taken £115m out of the club.

[Vegas Claret]

8. For the penalty to be deducted by FORTY percent the initial hearing massively ****ed up. You have to draw the conclusion that was either incompetent or this whole thing has been stage managed to look like they were taking tough action. Or the media reaction panicked them.

Are you saying the PL screwed up ? They didn't, it was the independent commission that screwed the pooch on this.

[ClaretPete001]

I don't follow you.

There hasn't been any investment in Burnley FC. None. all the money that ALK have spent has gone to Mike Garlick and other shareholders; none of it has come into the club. Quite the reverse - they have taken £115m out of the club.

How can you read that from what I have written dsr? I've said exactly the opposite.

What is being posited is that there has been a mysterious investment of £80 million without equity, publicity or any public notification into the club because of notifications at companies house that are hard to explain away..

The bridging loan is the one CP refers to above that allowed us to pay off MSD early. I have at no point said ALK has invested in the club.

What I am trying to say is that whatever explanation you come up with is equally implausible because I don't believe that anyone has invested £80 million into the club.

On the one hand you have a somewhat fanciful notion that ALK can take a £114 million out of the club and replace it with external investment and on the other there has to be some plausible explanation as to what is going on.

That's what I am trying to get at. If you find it hard to believe that ALK can take a £114 million out of the club and replace it with external investment then is there another plausible explanation?

I can see that there would be enough cash for ALK to make everything work in the short term what I cannot find is a technical argument from an accounting perspective that makes it work such that no one would know about it.

[ClaretPete001]

And again just to add further complexity to it. If we are relegated from the PL not only do we lose something like £20 - £30 million of Broadcast revenue but there is a clause in the 21/22 accounts that says we have to repay the current loan back up to 75 per cent of the parachute money limited to £25 million. We are currently only paying interest with the capital due for repayment in 2025.

Again I go back to my point above the modus operandi is to forward income and push back debt...! A very typical strategy of savvy players in high growth industries because you need cash to fund growth and that growth then repays the debt down the line. It's not a conspiracy theory - it is a very smart strategy.

So, the £80 million external investment starts to look very important.

[bfc8]

Reminds me of the Beatles, The Inner Light, the farther one travels the less one knows.

[Chester Perry]

Reminds me of the Beatles, The Inner Light, the farther one travels the less one knows.

yes, but we only become knowledgeable when we start to understand what it is that we don't know - and we are only at the beginning of that journey in regards to ALK/VSL - i.e. we are now starting to define what it is that we do not know about them and what they are doing. At anytime there actions tend to be at least 21 months (or more) ahead of our understanding, and even then they only make public what they have to for the most part.

Not that I begrudge the idea of privacy per se, it is something I actively pursue, but then I have not chosen to take control of and profit from what even our government has come to recognise is in essence a significant community asset, with a 142 years of a communities emotional bonding attached to it.

[Orangebernard]

Thanks everyone for your contributions to this thread, it's helping me to get to grips with the off-field tactics whilst trying to decipher the on-field tactics. A few things have jumped out to me which i think we all already knew but reading them on here it heightens my sense of risk:

1. Aggi mentioned that the strategy of running on debt in the Championship is unsustainable. We all know the Championship is a basket case when it comes to finances. Pretty much all or maybe even all Championship clubs run at a loss. When your wages outstrip your income the money to pay the day-today bills has to come from somewhere. Where would it come from if we couldn't gain promotion over the next 2 seasons, i'll stick my neck out and say it's highly unlikely that ALK will be able or even want to to put any money into the club to keep the power on. I know i'm making a huge leap there but its a concern.

2. Whilst there are folks on this board keeping a close eye on the finances i'm sure we will all learn something but there is definitely obfuscation from ALK to prevent too many details entering the public domain. I'm sure this is nothing underhand, as i've said before, but it does lead to rumour that could get out of hand. It's credit to everyone that people are able to express their theories about the finances and discuss it like adults for once, well done folks, keep it up.

3. Obviously, league football is a sporting competition and how i miss the days of being young and daft enough to believe that it was an even playing field and Burnley could actually win the league or a cup. Of course the illusion is still there but in reality, what we all know that a handful of clubs spend every waking hour ensuring that subtle and not so subtle rule changes are implemented to ensure that they are never challenged and they will always win both on and off the field. Sad but a reality. Blimey i'm depressing myself whilst typing!

4. Whilst i hope and pray that ALK and VK come good over the next few seasons until one or both exit, i can't help feeling that the jeopardy and risk of what they are doing off the pitch is far, far greater than losing on the pitch. If they get it wrong we could be in for a rocky ride, lets hope its my natural pessimism and just being a Burnley fan coming out.

5. I'm sort of over the Arsenal and Palace results and looking forward to it clicking on Sunday, surviving relegation by means of an amazing run and points deductions for Everton and Forest all capped off by winning the Lottery on Saturday!

Up the Clarets!