ALK Capital or Farnell/Elkashashy takeover

[Big Vinny K]

Most of "other creditors" is believed to be income for 2023-24 received in advance before the end of July 2023. It's fair to include it in net creditors, at least, because if we hadn't got it the £20m bank balance would have been a long way overdrawn.

Technically yes but if you were a long way overdrawn you would not have the factoring debt…..hence why the £230m number is never going to be a true reflection of our overall debt whatever way you choose to cut it. The £230m is simply a sub total of one side of a balance sheet.

[roperclaret]

Most of "other creditors" is believed to be income for 2023-24 received in advance before the end of July 2023. It's fair to include it in net creditors, at least, because if we hadn't got it the £20m bank balance would have been a long way overdrawn.

So if we ignore the cash in bank it’s actually income?

[Big Vinny K]

The amount owed by other clubs is £40m but that is mostly offset by the amount we owe on factoring. Basically we got a factoring company to give us £30m up front and when the £40m comes in, we will pay £30m plus interest and charges to the factor company, leaving us with net £5m-£7m as a rough guess.

Again you can’t have it both ways. The factoring debt is included in the overall £230m so the money owed by other clubs has to be deducted from this number. It only “offsets” it as you say if you reduce the overall debt number by £30m and then deduct the remaining £10m of payments due from other clubs from the £200m.
Any interest and commission charged from the factoring company is deducted from the P & L.

[dsr]

But as I’ve just posted on the transfer spend £230m as our “overall debt” number is a headline type number which in isolation is meaningless.
Under the previous owners people always talk about us never having any debt - they never quoted our creditors figures in that context.

Which is why I have quoted the detail. So that people can look at the full figures and make interpretations.

We can, for example, know that in July 2023 we had net liabilities of £165m that could not be covered by liquid assets and would need to be repaid out of some sort of profits. (Or by the owners repaying the £125m they have "borrowed", or by winning the Euromillions lottery. The latter being perhaps more likely!)

And we know that since we owed that £165m, we signed another £40 in summer 2023 and another £40m since, or perhaps a bit less depending how they treated Tresor's fee in the accounts. And we know we have sold about £100m this summer, so that leaves (at a rough ballpark figure) somewhere like £100m - £150m still outstanding. Money that we owe, and will be paying 10% or so interest on (perhaps more), and that's why we're selling like fury.

At least, that's my interpretation of the facts that we know.

[dsr]

So if we ignore the cash in bank it’s actually income?

That's so far of accuracy that I don't know what the question is, sorry.

The point of money received in July 2023 to cover the 2023-24 TV money is that it will become income, for accounts purposes, in 2023-24. It is not income in 2022-23.

So if the balance sheet the day before we received (random number) £50, shows Debtors £60m, Creditors £180m, overdraft £30m, we have a net liability (creditors in excess of liquid assets) of £150m.

Then we receive £50m of next year's money and put it in the bank. We now have Bank £20m, Debtors £60m, Creditors £230m, no overdraft. Net liability (creditors in excess of liquid assets) of £150m. The receipt of next year's income does not affect the overall position of the company.

[Big Vinny K]

Which is why I have quoted the detail. So that people can look at the full figures and make interpretations.

We can, for example, know that in July 2023 we had net liabilities of £165m that could not be covered by liquid assets and would need to be repaid out of some sort of profits. (Or by the owners repaying the £125m they have "borrowed", or by winning the Euromillions lottery. The latter being perhaps more likely!)

And we know that since we owed that £165m, we signed another £40 in summer 2023 and another £40m since, or perhaps a bit less depending how they treated Tresor's fee in the accounts. And we know we have sold about £100m this summer, so that leaves (at a rough ballpark figure) somewhere like £100m - £150m still outstanding. Money that we owe, and will be paying 10% or so interest on (perhaps more), and that's why we're selling like fury.

At least, that's my interpretation of the facts that we know.

We don’t know the terms of the loan in relation to whether any of the capital needs to be repaid if we get relegated etc. In terms of interest on that loan then a figure around £10m a year will not be far off. Unless there is some relegation clause then I doubt whether that kind of number is why we are ‘selling like fury”.

I agree that the reasons we are selling all these players is because there is a significant short fall somewhere and the owners are not prepared to cover any losses (again not surprising given the way they bought the club)

All I am saying is that the debt was never really £230m - and that’s not open to interpretation of the facts we know. It’s simply a case of apples and apples rather than apples and pears !

[aggi]

That's so far of accuracy that I don't know what the question is, sorry.

The point of money received in July 2023 to cover the 2023-24 TV money is that it will become income, for accounts purposes, in 2023-24. It is not income in 2022-23.

So if the balance sheet the day before we received (random number) £50, shows Debtors £60m, Creditors £180m, overdraft £30m, we have a net liability (creditors in excess of liquid assets) of £150m.

Then we receive £50m of next year's money and put it in the bank. We now have Bank £20m, Debtors £60m, Creditors £230m, no overdraft. Net liability (creditors in excess of liquid assets) of £150m. The receipt of next year's income does not affect the overall position of the company.

I can see what you're trying to show but I'm not convinced by including Creditors greater than one year in the "liquid" net liabilities position.

[Row x]

We don’t know the terms of the loan in relation to whether any of the capital needs to be repaid if we get relegated etc. In terms of interest on that loan then a figure around £10m a year will not be far off. Unless there is some relegation clause then I doubt whether that kind of number is why we are ‘selling like fury”.

I agree that the reasons we are selling all these players is because there is a significant short fall somewhere and the owners are not prepared to cover any losses (again not surprising given the way they bought the club)

All I am saying is that the debt was never really £230m - and that’s not open to interpretation of the facts we know. It’s simply a case of apples and apples rather than apples and pears !

I'm not an accountant, but the 100 million owed in interest alone, quoted by davethevicar yesterday, is, like I thought, way off the mark?

[dsr]

I can see what you're trying to show but I'm not convinced by including Creditors greater than one year in the "liquid" net liabilities position.

They're a lot more liquid than the £125m owed by ALK which I have left out! For these purposes, the fact that £165m of our liabilities are not due until next year or the year after does not make them a non-problem.

[CrosspoolClarets]

Interesting discussion.

For a non financial audience I like to keep things simple.

There are of course loads of debits and credits of all types, agent fees etc. But very simplistically, with a few exceptions ALK appear to have generated a profit on each individual player’s transfer, if we ignore wages etc (I’m ignoring here true “in year” profit, I’m talking looser than that). Odobert and Berge being two big examples.

The ones remaining are still likely to generate a profit - e.g. Koleosho. The ones who may not (e.g. Amdouni, Weghorst) don’t really offset this by a huge margin.

So, simplistically, even when allowing for factoring fees, interest etc I don’t view the financial pressure as being worse than 2 years ago. I simply don’t see how it can be. So these sales (above a certain level) seem more likely to have come from poor squad management decision making or player pressure after a naff season, rather than a genuine necessity. I think that its important and in truth the club should be briefing us about this in that broad context, as reassurance.

[Row x]

Interesting discussion.

For a non financial audience I like to keep things simple.

There are of course loads of debits and credits of all types, agent fees etc. But very simplistically, with a few exceptions ALK appear to have generated a profit on each individual player’s transfer, if we ignore wages etc (I’m ignoring here true “in year” profit, I’m talking looser than that). Odobert and Berge being two big examples.

The ones remaining are still likely to generate a profit - e.g. Koleosho. The ones who may not (e.g. Amdouni, Weghorst) don’t really offset this by a huge margin.

So, simplistically, even when allowing for factoring fees, interest etc I don’t view the financial pressure as being worse than 2 years ago. I simply don’t see how it can be. So these sales (above a certain level) seem more likely to have come from poor squad management decision making or player pressure after a naff season, rather than a genuine necessity. I think that its important and in truth the club should be briefing us about this in that broad context, as reassurance.

Cheers for that, but has any club ever come out with a briefing such as you suggest? It just doesn't seem the type of things football clubs do, I don't think the fans of any club understand the financial situation 100% at their club

[Big Vinny K]

I'm not an accountant, but the 100 million owed in interest alone, quoted by davethevicar yesterday, is, like I thought, way off the mark?

It sounds way off the mark - but we don’t know the terms or length of the loans.
I worked in commercial finance for years including dealing with a number of football clubs - but that was for a major bank when banks were interested lending to the sector. Banks pretty much pulled out of the sector more than a decade ago and now it’s much more specialist lenders with much higher interest rates and different terms of conditions.
But from experience personal I think the loan will be over a relatively short term (rather than the 10 years it would need to be to equate to £100m interest - rough figures of course)

[Big Vinny K]

Interesting discussion.

For a non financial audience I like to keep things simple.

There are of course loads of debits and credits of all types, agent fees etc. But very simplistically, with a few exceptions ALK appear to have generated a profit on each individual player’s transfer, if we ignore wages etc (I’m ignoring here true “in year” profit, I’m talking looser than that). Odobert and Berge being two big examples.

The ones remaining are still likely to generate a profit - e.g. Koleosho. The ones who may not (e.g. Amdouni, Weghorst) don’t really offset this by a huge margin.

So, simplistically, even when allowing for factoring fees, interest etc I don’t view the financial pressure as being worse than 2 years ago. I simply don’t see how it can be. So these sales (above a certain level) seem more likely to have come from poor squad management decision making or player pressure after a naff season, rather than a genuine necessity. I think that its important and in truth the club should be briefing us about this in that broad context, as reassurance.

I think the financial pressure is worse than 2 years ago.
1. We’ve been relegated (I know we were relegated 2 years ago but see below !!)
2. The debt has increased
3. The interest rate on the loans are higher
4, We spent more more than £100m in the transfer market.
5. The increase in non match day commercial revenue they talked about have not materialised
6. The number of senior management type staff (and overall staffing) has increased.
7. Probably other stuff we do not know about that we’ll see in the next accounts (there were a few things emerging in the last set of accounts around dividends and remuneration that did not look great)


For me there is just no other reason to sell the number of players we have unless there was more financial pressure now. This kind of strategy is not going to help them sell the club at any kind of profit so what other reason is there other than ensuring that they do not have to subsidise huge losses which I do not believe these owners have ever had the means or inclination to ever do.

[Chester Perry]

It sounds way off the mark - but we don’t know the terms or length of the loans.
I worked in commercial finance for years including dealing with a number of football clubs - but that was for a major bank when banks were interested lending to the sector. Banks pretty much pulled out of the sector more than a decade ago and now it’s much more specialist lenders with much higher interest rates and different terms of conditions.
But from experience personal I think the loan will be over a relatively short term (rather than the 10 years it would need to be to equate to £100m interest - rough figures of course)

By way of example the first loan - the one from MSD was over a period of 5 years

also by way of example of how such terms are relatively meaningless given how the club is currently operating, that MSD loan was refinanced after 22 months with the details of the new creditors never being announced publicly. The next 13 months saw a further 2 refinancing deals first with Macquarie in June 2023 and then with MGG Investments in Jan 2024.

[aggi]

...

For me there is just no other reason to sell the number of players we have unless there was more financial pressure now. This kind of strategy is not going to help them sell the club at any kind of profit so what other reason is there other than ensuring that they do not have to subsidise huge losses which I do not believe these owners have ever had the means or inclination to ever do.

There is one other obvious explanation. Parker wants his own players and we need to raise funds for that. We should know whether that is likely within the week.

[Paul Waine]

The club has only one interest bearing loan, MGG. We don't know the amount, but as it "follows on" from the original MSD £65 million, with 2 steps in between, I'd estimate that MGG haven't lent the club more than £80 million (this based on the club putting up assets as security. Annual cost of interest on MGG loan around £10 million (assuming it was drawn in full).

The club borrowed from Macquarie against Premier League tv money in June 2023. In June 2024 this loan has been satisfied. Interest on this loan would have been paid as a discount against the tv money due to BFC. It's unlikely that the amount of this advance from Macquarie would have been more than 60% of the tv money - and possibly it would be a much smaller percentage, as the tv money is also required to pay player wages.

The club has 2 factored advances against the sale of (1) Nick Pope to Newcastle and (2) Nathan Collins to Wolves. (Full documents are available to read on Companies House filings of charges against BFACL.

(1) NUFC had to pay £2,334,000 on 15th July 2023, £2,333,000 on 15th July 2024 and £2,333,000 on 15th July 2025. Each of these payment had to be paid directly to Macquarie. At 31st July 2023 (the accounts year end date). NUFC owed to BFC £4.7 million. At 31st July 2024 the balance outstanding should be £2,333,000.

(2) Wolves had to pay £5,000,000 on 31st August 2023, £5,000,000 on 31st August 2024 and £5,000,000 on 31st August 2025. Each of these payment had to be paid directly to Macquarie. At 31st July 2023 Wolves owed to BFC £15 million. At 31st July 2024 the balance outstanding should be £10 million - with £5 million being paid to Macquarie on 31st August 2024 - 5 days time.

The Wolves situation is interesting. Wolves transferred Nathan Collins to Brentford at the beginning of July 2023. (They appear to have sold him for £23m compared with £20m paid to BFC 12 months earlier). According to common understanding on this mb, if an English club (Wolves) sells a player to another club (Brentford in this example) and has any amount outstanding re buying the player to another English club (Burnley) then Wolves must immediately pay all amounts due to Burnley. Both BFC's accounts and the Macquarie security charge filing at Companies House suggests that this common understanding isn't correct.

[Big Vinny K]

There is one other obvious explanation. Parker wants his own players and we need to raise funds for that. We should know whether that is likely within the week.

Do you believe that ?

IMHO I think he will have wanted some of his own players in - most managers would. But I do not think he wanted to sell all the players we have for one minute.

[Paul Waine]

I think the financial pressure is worse than 2 years ago.
1. We’ve been relegated (I know we were relegated 2 years ago but see below !!)
2. The debt has increased
3. The interest rate on the loans are higher
4, We spent more more than £100m in the transfer market.
5. The increase in non match day commercial revenue they talked about have not materialised
6. The number of senior management type staff (and overall staffing) has increased.
7. Probably other stuff we do not know about that we’ll see in the next accounts (there were a few things emerging in the last set of accounts around dividends and remuneration that did not look great)


For me there is just no other reason to sell the number of players we have unless there was more financial pressure now. This kind of strategy is not going to help them sell the club at any kind of profit so what other reason is there other than ensuring that they do not have to subsidise huge losses which I do not believe these owners have ever had the means or inclination to ever do.

If we look at 2022/23 accounts (Championship) and compare with the previous season 2021/22 (relegated from Premier League) the two big figures are:
1) £55 million difference in tv money; (2) staff costs £38 million difference.

Let's assume tv money last season, back in the Premier League was the same as the previous Premier League season, so £55 million higher than 2022/23. Let's also make a guestimate that staff costs (player wages) is £20 million lower than the previous Premier League staff costs - or, roughly £20 million higher than the Championship winning season. (Promotion bonuses aren't split out - they will be part of the 2022/23 staff cost figures). Last season the club had one of the youngest in the Premier League, for many players it was their first season in the Premier League, so staff costs £20 million lower than the previous Premier League season I feel is reasonable.

So, last season the club had £30 million net more income to spend. That's not a bad figure.

Yes, still a learning curve for everyone, but I don't think we need to be too concerned with the club's finances.

UTC

[Big Vinny K]

If we look at 2022/23 accounts (Championship) and compare with the previous season 2021/22 (relegated from Premier League) the two big figures are:
1) £55 million difference in tv money; (2) staff costs £38 million difference.

Let's assume tv money last season, back in the Premier League was the same as the previous Premier League season, so £55 million higher than 2022/23. Let's also make a guestimate that staff costs (player wages) is £20 million lower than the previous Premier League staff costs - or, roughly £20 million higher than the Championship winning season. (Promotion bonuses aren't split out - they will be part of the 2022/23 staff cost figures). Last season the club had one of the youngest in the Premier League, for many players it was their first season in the Premier League, so staff costs £20 million lower than the previous Premier League season I feel is reasonable.

So, last season the club had £30 million net more income to spend. That's not a bad figure.

Yes, still a learning curve for everyone, but I don't think we need to be too concerned with the club's finances.

UTC

Hi Paul
Plenty of assumptions there - but you may not be wide off the mark with some of the numbers.
Personally I believe we are under more financial pressure than what you are suggesting - but it’s all based on opinions as like you say there are a number of unknowns.

Why do you believe we have sold the players we have if it’s not financial pressures ?
I’m struggling to understand why you would do this when you would think the longer term “out” for the owners is a sustained period in the EPL and then sell the club at a return (or at least what they paid whilst earning remuneration / dividends during their tenure).
On a purely football basis decimating the team like they have would not seem the best way to achieve this which leads me back to the conclusion of “needs must” in terms of the finances.

[Paul Waine]

Hi Paul
Plenty of assumptions there - but you may not be wide off the mark with some of the numbers.
Personally I believe we are under more financial pressure than what you are suggesting - but it’s all based on opinions as like you say there are a number of unknowns.

Why do you believe we have sold the players we have if it’s not financial pressures ?
I’m struggling to understand why you would do this when you would think the longer term “out” for the owners is a sustained period in the EPL and then sell the club at a return (or at least what they paid whilst earning remuneration / dividends during their tenure).
On a purely football basis decimating the team like they have would not seem the best way to achieve this which leads me back to the conclusion of “needs must” in terms of the finances.

No one seems to be talking about the impact of Vincent Kompany moving to Bayern Munich. Almost all the players that have been sold were bought when Kompany was the club's manager. Whether Kompany has put a player in his "£100 million" category, or "develop and improve" or his "this one isn't working out" group, many of the players - Berger, Odobert - will be ready to step up to the Premier League, or welcome their chance - O'Shea, Muric - to show that they can perform in the Premier League, or another top division and other players will know that they have to leave the club to progress their football career and get game time. We all know that the club had too many players on the books.

Then Scott Parker is the club's new Head Coach and that brings a new dynamic into the squad.

I don't go with the idea that Alan Pace is in it for a "quick flip." I think he'd be happy to be the club's Chairman for at least 10 years. Of course, he'd want it all to work out for the club, the fans and the ALK/VSL investors.

Do you really think I had "plenty of assumptions" in my post? I only estimated 2 figures, delta on tv revenue and delta on staff costs and then put the two together. Yes, there will be things we didn't expect when we finally see the accounts for year ending 31st July 2024, but I don't think my two "broad brush" estimates will be a long way out.

[Big Vinny K]

No one seems to be talking about the impact of Vincent Kompany moving to Bayern Munich. Almost all the players that have been sold were bought when Kompany was the club's manager. Whether Kompany has put a player in his "£100 million" category, or "develop and improve" or his "this one isn't working out" group, many of the players - Berger, Odobert - will be ready to step up to the Premier League, or welcome their chance - O'Shea, Muric - to show that they can perform in the Premier League, or another top division and other players will know that they have to leave the club to progress their football career and get game time. We all know that the club had too many players on the books.

Then Scott Parker is the club's new Head Coach and that brings a new dynamic into the squad.

Do you really think I had "plenty of assumptions" in my post? I only estimated 2 figures, delta on tv revenue and delta on staff costs and then put the two together. Yes, there will be things we didn't expect when we finally see the accounts for year ending 31st July 2024, but I don't think my two "broad brush" estimates will be a long way out.

Maybe not lots - but one is the wages figure which I think is really difficult to estimate.
Personally I think our commitments in the transfer market with last summers spend are the main reason we are selling the number of players we are.
Of course some would have wanted to test themselves at an higher level (Berge, Odobert etc) but lots of others have been sold who have not gone to a higher level and if we are not under the financial pressure as you are suggesting it’s hard to see why.
And in terms of the influence of VK given the way some of those who left were treated by him you would think that some would be happy to stay under a new manager.

Whatever way you look at it what has happened these last few weeks is not normal and whatever the reason is - financial or non financial it’s hard to see this as positive news or that everything is ok or on plan

[Paul Waine]

Maybe not lots - but one is the wages figure which I think is really difficult to estimate.
Personally I think our commitments in the transfer market with last summers spend are the main reason we are selling the number of players we are.
Of course some would have wanted to test themselves at an higher level (Berge, Odobert etc) but lots of others have been sold who have not gone to a higher level and if we are not under the financial pressure as you are suggesting it’s hard to see why.
And in terms of the influence of VK given the way some of those who left were treated by him you would think that some would be happy to stay under a new manager.

Whatever way you look at it what has happened these last few weeks is not normal and whatever the reason is - financial or non financial it’s hard to see this as positive news or that everything is ok or on plan

I've estimated staff costs/player wages from (i) £90 million last time in Premier League - less all the senior players leaving, Tarks, Mee, Pope, Cornet, Collins, (even) McNeil, and (ii) £50 million Championship, including promotion bonuses, with lots of new signings, youngsters, mostly first time in the Premier League. Not aiming to be within £5 million. Just going on what we can all see.

Yes, last summer the club bought a lot of new players and some "top end" (for BFC) transfer commitments. But, the outgoing transfer values - as best we are hearing - are bettering many of the fees the club paid, so I don't see that these are "financially forced" sales.

With the benefit of hindsight, we may view the club as the victim of too much success in 2022/23. Winning the Championship with several games remaining, 101 points etc probably gave everyone, Vincent Kompany, Alan Pace, the players, the fans too much confidence for the Premier League season. (Ok, the fans don't really matter. We don't kick any footballs and aren't the ones who write the cheques to sign footballers and pay their wages). Of course, it didn't continue in 2023/24, but by then the club had signed too many players the squad was too big. Possibly too much belief in the ability to flip players to finance the club's growth. On one side it does look like the flipping is successful and many players are being sold for more than they were bought for, but.. there's too much "noise in the system." Double figure incomings every summer is a big challenge. It had to be done in 2022. But, many players were Championship players and not Premier League ready, so in 2023 the club needed another busy window. Then relegated again, the better players move on, other players are sold to reduce squad size and we are again busy rebuilding another Championship squad. Somehow the club needs to get out of this cycle, while still building to get back to the Premier League with ability to remain there. It's tough.

[Wembley09]

Exactly we spent extraordinary amounts last season (for us) going up towards £100 million, not to mention wages.

Maybe Pace and Co are taking all the money for players they can get now, 'incase' the sh*t was to hit the fan.
Imagine if we didn't sell and fell away or even did a recent Wolves/Sunderland and suffered back to back relegation.

They're probably taking the money they can get for player's while they're still at an high. The value would drop if we struggled, and we'd be in a pinch financially if we did struggle.

But the appointment of Parker does go against this, they obviously wanted a man who could take us back up (he's got that experience) so why would they panic and sell player's on a thought in the back of the head of what if the worst was to happen.

Most likely players wanted out and Parker said since day one he didn't want players here that didn't want to be here. But I'd like to think we'd sign replacements first before selling.. to avoid a scenario like the Sunderland squad.

[Big Vinny K]

Yes, last summer the club bought a lot of new players and some "top end" (for BFC) transfer commitments. But, the outgoing transfer values - as best we are hearing - are bettering many of the fees the club paid, so I don't see that these are "financially forced" sales.

And this is where we differ in opinion I think.
I believe that the relegation has meant that without selling the players there would be financial pressure on meeting the transfer payments / commitments that are due this year.

[ClaretPete001]

And this is where we differ in opinion I think.
I believe that the relegation has meant that without selling the players there would be financial pressure on meeting the transfer payments / commitments that are due this year.

Indeed, we have a number of accountants on here who all seem to ignore the fact that the club had prepared a cash flow for the Auditors including a schedule of player sales, which the auditors did not feel was sufficient and consequently regarded the Accounts to the Y/E July 31 as having a material uncertainty.

The club has no obligation to prepare a player schedule and then stick to it. Few would regard it as possible given it was prepared 9 months to a year prior to the end of last season. So, they would always throw the kitchen sink at it and yet it still wasn't sufficient

Of course, Parker would want his own players and some of the players would want to leave but fundamentally the club has to sell players.

[ClaretPete001]

I've estimated staff costs/player wages from (i) £90 million last time in Premier League - less all the senior players leaving, Tarks, Mee, Pope, Cornet, Collins, (even) McNeil, and (ii) £50 million Championship, including promotion bonuses, with lots of new signings, youngsters, mostly first time in the Premier League. Not aiming to be within £5 million. Just going on what we can all see.

Yes, last summer the club bought a lot of new players and some "top end" (for BFC) transfer commitments. But, the outgoing transfer values - as best we are hearing - are bettering many of the fees the club paid, so I don't see that these are "financially forced" sales.

With the benefit of hindsight, we may view the club as the victim of too much success in 2022/23. Winning the Championship with several games remaining, 101 points etc probably gave everyone, Vincent Kompany, Alan Pace, the players, the fans too much confidence for the Premier League season. (Ok, the fans don't really matter. We don't kick any footballs and aren't the ones who write the cheques to sign footballers and pay their wages). Of course, it didn't continue in 2023/24, but by then the club had signed too many players the squad was too big. Possibly too much belief in the ability to flip players to finance the club's growth. On one side it does look like the flipping is successful and many players are being sold for more than they were bought for, but.. there's too much "noise in the system." Double figure incomings every summer is a big challenge. It had to be done in 2022. But, many players were Championship players and not Premier League ready, so in 2023 the club needed another busy window. Then relegated again, the better players move on, other players are sold to reduce squad size and we are again busy rebuilding another Championship squad. Somehow the club needs to get out of this cycle, while still building to get back to the Premier League with ability to remain there. It's tough.

At what point, did you think it was going to be any different? Spending £100 million with owners with no money and organic revenue of £20 million is going to result in a great deal of risk.

[ClaretPete001]

If you accept at face value the Creditors was something like £270 million at the end of August 23 ( £230m plus £40m we spent in August 23) I think you could make a case for reducing that figure to around the money ALK spend on buying shares - maybe slightly less a £100 million or so - maybe taking some player profit as well if you take off debtors, player sales, money in the bank, current player trading and profit in the PL season.

Very manageable in the PL but not sustainable in the Championship.

Fundamentally, nothing has changed. If you spend a £100 million in the PL you have to get it back in the Championship or get promotion again. It was always going to be thus....!

[Big Vinny K]

Good way of analysing the situation Pete.
Maybe we (me included) have been guilty of looking at this into too much detail and technicalities in debating where we are financially.
When really all we needed to do was have a walk round Gawthorpe this morning and look at all the empty spaces in the players car park !!

[ClaretPete001]

Good way of analysing the situation Pete.
Maybe we (me included) have been guilty of looking at this into too much detail and technicalities in debating where we are financially.
When really all we needed to do was have a walk round Gawthorpe this morning and look at all the empty spaces in the players car park !!

Indeed. If you take a £124 million out of a small club like Burnley you have to get it right. You can't afford mistakes like Tresor or allow VK to basically wreck a season on a whim...!

The consequence is that in a season where you start off with a talented PL centre mid-quartet of Odobert, Berge, Brownhill and Cullen ends up in the second half of the third game of the season as Brownhill and kind of Jay Rod and well who knows.

Such are the details ,which result in a play off place and not a 103 point Championship winning season.

Time will tell if Scott Parker can turn it around....

[dsr]

I wonder if perhaps the plan is to generate so much profit on player sales that the club can legally declare a dividend to be paid by eliminating the £124m+ that ALK owe the club. This would perhaps make it more attractive to investors for a sale of a championship club.

Or worse, are they going to declare a dividend greater than the £124m and take out a further lump of cash?

(I think they would have to buy out the minority shareholders first, but as they are less than 10% I think they could do a forced purchase.)

[Rileybobs]

I wonder if perhaps the plan is to generate so much profit on player sales that the club can legally declare a dividend to be paid by eliminating the £124m+ that ALK owe the club. This would perhaps make it more attractive to investors for a sale of a championship club.

Or worse, are they going to declare a dividend greater than the £124m and take out a further lump of cash?

(I think they would have to buy out the minority shareholders first, but as they are less than 10% I think they could do a forced purchase.)

I just intimated the same on the transfer thread. I can’t honestly believe that anyone would change their business strategy on such a whim…but if for example ALK realised that without VK their long term ‘project’ was less likely to come to fruition and they had become over exposed with loans and ‘assets’ (we used to call them players) - they may take a view that in one foul swoop they could sell anything that moves, repay the debt, post a profit, take their divvies and they’ve made a good few quid regardless of what the club sells for.

As you say, minority shareholders are an issue, and I’ve not really thought this through much so there’s probably other reasons why this isn’t the case. But food for thought.

[Rileybobs]

Just going to pop onto Rightmove to see if the Turf has been listed yet…

[Chester Perry]

I wonder if perhaps the plan is to generate so much profit on player sales that the club can legally declare a dividend to be paid by eliminating the £124m+ that ALK owe the club. This would perhaps make it more attractive to investors for a sale of a championship club.

Or worse, are they going to declare a dividend greater than the £124m and take out a further lump of cash?

(I think they would have to buy out the minority shareholders first, but as they are less than 10% I think they could do a forced purchase.)

I had briefly flirted with this notion earlier, but it still leaves the outstanding debt to MGG, the size of which is unknown.

That debt may consist of two separate loans if the registrations of MGG LUX SV1 Compartment Claret SARL and MGG LUX SV2 Compartment Claret SARL are indictive. They would cover the refinancing of the Macquarie loan and the playing off of the Macquarie factoring deal for Premier League revenues - likely the year 2 and 3 parachute elements (year 1 being the Premier League income from last season).

One of the things about that the MGG refinance that occurred to me was that given ALK/VSL entities had around £88m last October it would have been very easy for them to invest those funds into a loan for the club and provide themselves with a strong income stream over which they had control - I am still suspicious of where the non-secured loan of November 2022 came from.

You are right to mention that ALK/VSL now own over 90% of shares (90.04% to be exact), when they flipped 6,128 shares to Vlad Torgovnik (which I understand they had paid a nominal price for) it was an exact number that ensured that they still retained this capability.

There are still five former board members who hold shares which are locked in a fixed price (at £1,652.86 the original sale price, though not with the bonus that was paid out last summer) ringfenced option agreement until October this year. My understanding is that those shareholders are not expecting the option to be exercised, but are expecting much reduced bids for their shareholdings down the line.

[aggi]

Do you believe that ?

IMHO I think he will have wanted some of his own players in - most managers would. But I do not think he wanted to sell all the players we have for one minute.

I think it is probably more complicated than "sell, sell, sell, we need to pay everyone off" (and I appreciate that you probably think that too but some posts on here have been very extreme).

I suspect the players he probably really wanted to keep were the ones attracting interest from Premier League clubs where they could head off and double their wages (at least) which are difficult to keep.

Then an array of fringe players where it would be nice to keep them but the squad needed trimming and they may have wanted out anyway (Zaroury not starting may have influenced him for instance).

We shall have to wait and see but plenty of players who were rumoured to leave are still here and rumours are fading out a bit. If a few more players come in then losing 3 starters to Premier League clubs isn't as extreme as some of the reactions on here warrant.

We shall see by the end of the week.

[aggi]

I wonder if perhaps the plan is to generate so much profit on player sales that the club can legally declare a dividend to be paid by eliminating the £124m+ that ALK owe the club. This would perhaps make it more attractive to investors for a sale of a championship club.

Or worse, are they going to declare a dividend greater than the £124m and take out a further lump of cash?

(I think they would have to buy out the minority shareholders first, but as they are less than 10% I think they could do a forced purchase.)

This strikes me as very unlikely for a few reasons:

You can only perform a squeeze out and acquire the minority shares as part of a takeover so they would be paying dividends to minority shareholders.

I can't see enough transactions to realise enough profit on disposal to get near the amount needed.

A buyer isn't going to look favourably on the club being gutted with no chance of getting back into the Premier League. If they want to maximise sale value (which would arguably be much higher than the £124m dividend) then getting back into the Premier League, which means keeping assets in the club, is key.

[ClaretPete001]

I think it is probably more complicated than "sell, sell, sell, we need to pay everyone off" (and I appreciate that you probably think that too but some posts on here have been very extreme).

I suspect the players he probably really wanted to keep were the ones attracting interest from Premier League clubs where they could head off and double their wages (at least) which are difficult to keep.

Then an array of fringe players where it would be nice to keep them but the squad needed trimming and they may have wanted out anyway (Zaroury not starting may have influenced him for instance).

We shall have to wait and see but plenty of players who were rumoured to leave are still here and rumours are fading out a bit. If a few more players come in then losing 3 starters to Premier League clubs isn't as extreme as some of the reactions on here warrant.

We shall see by the end of the week.

As far as it goes I can count 6-7 players who featured heavily or fairly heavily last season (first list) and two you would have thought would be good squad players (second list).

Charlie Taylor, Arijanet Muric, Wilson Odobert, Sander Berge, Jóhann Berg Gudmundsson, Dara O'Shea, and Zeki Amdouni (it sounds like he is on his way)

Anass Zaroury, Ameen Al-Dakhil

Most would likely have gone anyway but I don't see Parker driving this nor do I think it is solely what the club would want at any given moment in time. It is a consequence of the clubs business model and, of course, relegation.

It didn't happen when Dyche got relegated and promoted because Dyche didn't spend a £100 million on players with a view to selling them...!

I'm not saying one way is better than the other but the current situation is not much of a surprise it happened the last time we went down and as I say above I think the club operates on the basis of saleable assets when required.

[ClaretPete001]

Just as a matter of interest, if Amdouni leaves; the team that played so poorly against Everton in April (a little over 5 months ago) featured 16 players of which 10 have left or been sold this summer.

Clearly this is not entirely finance related but it relates to how the club operates.

The facts can't be extreme; can they?

A. Murić (Gone)
C. Taylor 84' (Gone), substituted for Z. Amdouni (Gone) at 84 minutes
M. Estève
D. O'Shea (Gone)
L. Assignon 84' (Gone), substituted for J. Rodríguez at 84 minutes
J. Bruun Larson (Gone), substituted for J. Brownhill at 69 minutes
S. Berge (Gone)
J. Cullen (c), Captain
L. Foster
D. Fofana (Gone), substituted for Vitinho at 61 minutes
W. Odobert (J Gone). Guðmunds­son 84' (Gone)

[ClaretAndJew]

Just as a matter of interest, if Amdouni leaves; the team that played so poorly against Everton in April (a little over 5 months ago) featured 16 players of which 10 have left or been sold this summer.

Clearly this is not entirely finance related but it relates to how the club operates.

The facts can't be extreme; can they?

A. Murić (Gone)
C. Taylor 84' (Gone), substituted for Z. Amdouni (Gone) at 84 minutes
M. Estève
D. O'Shea (Gone)
L. Assignon 84' (Gone), substituted for J. Rodríguez at 84 minutes
J. Bruun Larson (Gone), substituted for J. Brownhill at 69 minutes
S. Berge (Gone)
J. Cullen (c), Captain
L. Foster
D. Fofana (Gone), substituted for Vitinho at 61 minutes
W. Odobert (J Gone). Guðmunds­son 84' (Gone)

Vitinho also practically gone.

[ClaretPete001]

Vitinho also practically gone.

And according to Fabrizio Romano there is a bid in for Esteve..! Oh well, 3 more days to go.

[Spike]

The club was extremely foolish to “ buy” so many players last season.
The promoted players who weren’t used were devalued and we are seeing that in the fees we are getting now
The selling process seems to be similar to DFS . Everything is permanently in the Sale
The last 15 months have been a disaster. The next documentary has a working title of Mission to Misery
The main fact we all need to know is has the amount borrowed to take control of the club gone up year on year . If it had then ALK aren’t doing very well are they
I would be interested to know if catering now makes us more money. It should do with Bene having gone up 37.5% alone
The current arrangements with Ticketmaster is proving to be much less than masterful. Senior season ticket increases of 37% over two years haven’t been matched by “ the investors “ putting in anything less than the minimum they can get away with. Or do it appears
Player sales continue to leave us with an unbalanced side and the logic behind that needs to be addressed. To continually oversee this is downright stupid
If after “ losing “ the equivalent of two full teams this window we aren’t left with much less debt and a balanced competitive team then the project has failed

[clarethomer]

I'm just curious with all of these "loan with obligation to buy" deals that are taking place.

Structuring deals in this way - does it have any real benefit to the either club in the transaction. I assume so rather than it being a move of desperation to reduce the wage bill alone?

What box is it ticking? Is it just pure accounts/profitability/taxation reasons, or does it help from a regulatory perspective in meeting profit/sustainability side of the business? Mixture of the 2?

[BleedingClaret]

I'm just curious with all of these "loan with obligation to buy" deals that are taking place.

Structuring deals in this way - does it have any real benefit to the either club in the transaction. I assume so rather than it being a move of desperation to reduce the wage bill alone?

What box is it ticking? Is it just pure accounts/profitability/taxation reasons, or does it help from a regulatory perspective in meeting profit/sustainability side of the business? Mixture of the 2?

to be able to a pay a dividend in a particular period, is my pessimistic guess

[BleedingClaret]

The club was extremely foolish to “ buy” so many players last season.
The promoted players who weren’t used were devalued and we are seeing that in the fees we are getting now
The selling process seems to be similar to DFS . Everything is permanently in the Sale
The last 15 months have been a disaster. The next documentary has a working title of Mission to Misery
The main fact we all need to know is has the amount borrowed to take control of the club gone up year on year . If it had then ALK aren’t doing very well are they
I would be interested to know if catering now makes us more money. It should do with Bene having gone up 37.5% alone
The current arrangements with Ticketmaster is proving to be much less than masterful. Senior season ticket increases of 37% over two years haven’t been matched by “ the investors “ putting in anything less than the minimum they can get away with. Or do it appears
Player sales continue to leave us with an unbalanced side and the logic behind that needs to be addressed. To continually oversee this is downright stupid
If after “ losing “ the equivalent of two full teams this window we aren’t left with much less debt and a balanced competitive team then the project has failed

Damn I was backing myself with:
Mission to the Old Division 3

But
MISSION TO MISERY

So apt Pal

[Quickenthetempo]

I'm just curious with all of these "loan with obligation to buy" deals that are taking place.

Structuring deals in this way - does it have any real benefit to the either club in the transaction. I assume so rather than it being a move of desperation to reduce the wage bill alone?

What box is it ticking? Is it just pure accounts/profitability/taxation reasons, or does it help from a regulatory perspective in meeting profit/sustainability side of the business? Mixture of the 2?

It just means they start paying the fee a year later and the payment will be deferred onto the next year's accounts.
Helps any club close to the limit and if the transfer doesn't work out he could be sold before it gets recorded.

[Chester Perry]

Anniversary time

two years ago today Calder Vale Holdings Limited were due to present their first accounts, this having successfully applied to delay them by 3 months under Covid regulations - they have still to be posted a full 27months after they were originally due. Just for good measure the second set of accounts are 15 months late and the 3rd set are 3 months late.

https://find-and-update.company-informa ... y/12919689

so much for the claim made by an ALK Capital spokesman of December 1st 2022 that “This is an administrative error that has come to our attention and is being addressed and resolved with immediacy."

similar bilge was re-iterated on February 11th 2023 https://www.lancs.live/sport/football/f ... e-26206840 though it must be said that the claim that the owners had "no concerns' over Companies House issues" has proved to be correct. Which probably says more about Companies House and their activities than the ALK trio. That said I am aware that different submissions from Alan Pace, Morgan Edwards and a Sundeep Athwal (who can be traced to Oakwood Corporate Services Ltd., Altrincham) have led to the rescinding of First Gazette Notices against Calder Vale Holdings (twice) and Kettering Capital (three times).

As a side note, yesterday was the final due date for the third set of Accounts of ALK Capital Limited - having changed the year end date to December 31st

so we have another of these to add to our seemingly ever-growing collection

ALK Capital Ltd CH 2024 10 01.jpg (92.18 KiB) Viewed 2348 times

I should add that the Voluntary Liquidation of Calder Vale Holdings and Kettering Capital is still ongoing

[claretonthecoast1882]

FOI incoming

[Chester Perry]

FOI incoming

A previous request was refused after several appeals because it may interfere with the legal process and investigations undertaken by Companies House, the claim by CH counsel during the latest appeal was that such activities were in play

it is worth noting that a FOI request can only be considered for the period up to the date of the initial request - subsequent activities (or none activities) can not be considered in any judgement of the specific request including an appeal - the process in general is very restrictive and in my view not worth the effort and expense for the average member of the public

[Devils_Advocate]

A previous request was refused after several appeals because it may interfere with the legal process and investigations undertaken by Companies House, the claim by CH counsel during the latest appeal was that such activities were in play

it is worth noting that a FOI request can only be considered for the period up to the date of the initial request - subsequent activities (or none activities) can not be considered in any judgement of the specific request including an appeal - the process in general is very restrictive and in my view not worth the effort and expense for the average member of the public

Im in Leeds city centre on Friday so if you want me to nip down to their offices on Park Row and check whats going on just say the word.

[Burnley1989]

Im in Leeds city centre on Friday so if you want me to nip down to their offices on Park Row and check whats going on just say the word.

[Vegas Claret]

Anniversary time

It was only yesterday I wondered where you had gone and hoped you hadn't bailed in the forum. Glad to see you back CP