Burnley's MSD loan reduction essentially confirmed

[Chester Perry]

You’re assuming there that the terms of those sales were not cash up front. Lots of speculation that Cornet’s at least was, and given he was signed at the same time at Collins, could quite possibly have had a similar clause.

And also, of course, that any future stage payments were not a) contingent on survival, b) negotiable in respect to timing. With respect, CP, you’re presenting matters subject to confidential agreement as fact when I think they’re more likely opinion (albeit well-researched opinion).

I have been through this a number of times

my key supporting evidence that suggests no sale price reduction on relegation is the Offer Letter to the small shareholders - potential for price increase discussed nothing about price decrease. The key one though is John B's company Freight Investor Holdings Limited last set of accounts - which reported the sale (that entity held most of his shareholding in the club) with no statement on price flexibility on relegation.

Some may choose to cling to the notion that FIH indicated that they would receive all their monies in the following financial period so would not be subject to a relegation induced price reduction - I do not (and yes I could be wrong)

[Chester Perry]

Dyche’s pay off will depend on the specifics of his contract, for example if he gets a job tomorrow, the pay off would be substantially less than if his next job is in 3 years - unlikely.

They could have all been Guaranteed 1 years wages too hence the wide range in the estimate - I think a minimum of £10m is a reasonable estimation

[ClaretPete001]

Nobody thought we would be in trouble in Year 1 because there was always the option of selling PL playing assets and using cash reserves to fund year 1.

Fundamentally only an idiot or someone who wants a football club and can’t afford it thinks spending £80 million on shares as opposed to playing assets is a good thing.

I don’t think we are any further down the road of knowing how this will all pan out until we see whether VK can enhance the value of the players we have purchased.

Personally, I don’t think it will end happily but VK and his PL loanees may prove me wrong: hope he does...!

[forzagranata]

Look, people need to stop this

We've been relegated, and we had a debt to pay off

We've managed to pay half of it off, vastly reduce the wage bill and rebuild the team in about two months

That deserves praise

Half of the debt Pace imposed on the club has been paid off - not by Pace or by new revenue business, but simply by flogging of our best players. There is nothing to celebrate about that.

Wage bill reduced - no doubt.

Team rebuilt? Pace outsourced the football recruitment to Kompany (thank goodness because I shudder to think what we would be like if we had stayed with his 'data-led recruitment' plan...). Kompany has had to scramble around Belgium trying to put together a side out of bargain buys. Unplanned, rushed, recruitment - nothing like how succesful clubs plan and operate.

The only good news is that there are signs that Kompany might just have pulled it off.

ALK and Pace have been an unmitigated disaster for this club but the one smart move they have made - hiring Kompany - might just save it all.

[Stockbrokerbelt]

I'm on record on here with my opinions on the buying of the club and how bad it is

But I'm also a realist, no one else wanted it and Garlick wasn't interested

I'm pleasantly surprised that we paid off a huge chunk of the debt, built a new team and attracted a high profile manager who can clearly attract players

What they have done this summer deserves praise

Great post, pretty sums up my feelings & something I don’t think would have happened if we had not been relegated & changed our manager.

[daveisaclaret]

I'm on record on here with my opinions on the buying of the club and how bad it is

But I'm also a realist, no one else wanted it and Garlick wasn't interested

I'm pleasantly surprised that we paid off a huge chunk of the debt, built a new team and attracted a high profile manager who can clearly attract players

What they have done this summer deserves praise

Not sure if I'm more shocked by the "pleasantly" or by the "surprised" in terms of the football club paying off the debt imposed on it.

They've (imo) earned a lot of praise this summer by getting a good manager in and letting him sign players. That doesn't spill over to this absolutely dreadful takeover.

I don't think rugsweeping all the bad they've done, in their own interest with little regard for the football club, is being a realist at all.

[Jambo]

There are a lot of eggs in the Kompany basket, to be fair. Maybe these Belgian buys will pay off, but if they don't and we want to replace VK at some point, that strategy will rightly be questioned. Not many clubs give their manager so much control over transfers these days, purely because the managers are often replaced within a couple of years anyway.

I'm a bit baffled people want to praise ALK for clearing some of the vast debt that was loaded on the club...by... ALK. It's a bit like if I did a massive dump on the carpet in your front room but scooped half of it up afterwards. Presumably folk would think I was great for doing that.

[Swizzlestick]

Team rebuilt? Pace outsourced the football recruitment to Kompany (thank goodness because I shudder to think what we would be like if we had stayed with his 'data-led recruitment' plan...). Kompany has had to scramble around Belgium trying to put together a side out of bargain buys. Unplanned, rushed, recruitment - nothing like how succesful clubs plan and operate.

Yeah, Cornet and Collins were real shockers weren’t they? I presume you’re referencing Weghorst (and decided to extrapolate that as being the entire transfer policy) but he was a Dutch international scoring regularly in the Bundesliga. Hardly some weird, stats driven, punt.

[DCWat]

There are a lot of eggs in the Kompany basket, to be fair. Maybe these Belgian buys will pay off, but if they don't and we want to replace VK at some point, that strategy will rightly be questioned. Not many clubs give their manager so much control over transfers these days, purely because the managers are often replaced within a couple of years anyway.

I'm a bit baffled people want to praise ALK for clearing some of the vast debt that was loaded on the club...by... ALK. It's a bit like if I did a massive dump on the carpet in your front room but scooped half of it up afterwards. Presumably folk would think I was great for doing that.

Up there with the most bizarre analogies I’ve read on here, but it works and made me laugh

[ClaretPete001]

Wouldn't say I was a doom merchant

I have just wondered aloud as to how all the outgoings could be serviced, because whatever the protestations I have seen absolutely zero evidence of a reduced sale price on relegation

this year we know

- £10m was "advanced" to VSL - in all probability to help pay for supporters shares
- there were circa £37m in stage payments due (and another £21m - the final element - due in 2023)
- We sacked Sean Dyche and his team - all thought to be on new 4 year contracts - which will demand some form of payoff (my guess is anywhere between £10m - £25m)
- returned £32.2m to MSD possibly/probably with an attached penalty fee (is this all of the relegation penalty or is there still more due? We know it could be halved again if we do not get promoted)
- will pay MSD in excess of £4m in interest payments

VSL will still want to buy the remaining shares of the sellers - currently subject to an exclusivity option expiring in October 2024 and of the agreed price is the same as the original sale price that will require an additional £20m and the residue of the MSD sum will have to be paid on December 2025 - though that could be rolled over if a lender is willing

I acknowledge that wages will be cut substantially - maybe to the £30m - £35m mark and certain 1 off player trading revenues have been incoming, and that matchday revenues (for now at least) look to be very strong this season (a new experience and positive for the club following relegation) though operational revenues are unlikely to exceed £60m even if the parachute payment has been increased (we still do not know)

There are financial challenges in both staying down and being promoted, though it is better to have the boost in revenues that promotion offers and one wonders if next summer could generate enough operational and player trading profit to meet the expected costs if we do not get promoted.

For what it is worth - it has all been fairly predictable so far.

That some are still making a virtue of spending tens of millions on shares is a bit depressing but I agree with you it remains a challenge to see how this will pan out positively.

VK now has the unenviable challenge of turning a group of players of variable quality into meaningful saleable assets to PL clubs because there is no real market in the Championship.

After 5 games I think it is fairly clear there is a huge difference between the likes of Cornet and Maatsen and the players we have bought but as others have pointed out it is early days of the project.

[Swizzlestick]

It could be argued that somebody was going to take a bigger dump in our house if we’d not allowed ALK to have the smaller dump though.

Garlick was persona non grata with Dyche so we had that situation - with Dyche probably quitting (unthinkable at the time) and fan hostility) or that Egyptian guy who made Bernie Madoff look a reasonable businessman.

[ClaretAndJew]

I also think the way Kompany is moulding the players is so that they are "playing the way" the top teams play in hopes of attracting them to those players.

Keepers that play out at the back, players that can pass etc.

[ClaretMat]

Completely in agreement with Lancaster on this.

I think the way in which the club was purchased by ALK was at best uncomfortable for most fans, myself very much included.

However credit has to go to Pace and his team this summer. Many of the players which we have sold would likely have wanted to leave in any event after relegation. Debt or no debt, we would have sold. To rebuild a squad in this time and bring in a high profile manager also does deserve praise.

Very reassuring to see ALK reducing the debt in an attempt to make us again a sustainable and healthy club. It's clear this is something which Kompany is also hugely bought into and seemingly wants to help deliver.

We can't change what's already happened and although the purchase may have been extrmely questionable, I think fingers should be pointed at regulatory bodies, rather than ALK.

[RVclaret]

Completely in agreement with Lancaster on this.

I think the way in which the club was purchased by ALK was at best uncomfortable for most fans, myself very much included.

However credit has to go to Pace and his team this summer. Many of the players which we have sold would likely have wanted to leave in any event after relegation. Debt or no debt, we would have sold. To rebuild a squad in this time and bring in a high profile manager also does deserve praise.

Very reassuring to see ALK reducing the debt in an attempt to make us again a sustainable and healthy club. It's clear this is something which Kompany is also hugely bought into and seemingly wants to help deliver.

We can't change what's already happened and although the purchase may have been extrmely questionable, I think fingers should be pointed at regulatory bodies, rather than ALK.

Great post and I’m in complete agreement with this last part - something I’ve said myself previously.

ALK made a legal, above board offer to buy the club. This offer was approved by all relevant regulatory bodies and importantly by the previous owners. I don’t like the acquisition method and it does hurt that some of the funds from player sales are purely going to pay debt, which wasn’t there before.

However I refer, albeit not the perfect comparison, to the GFC of 2007-2009 - was it the fault of the public buying houses they were entitled to buy or was it the greedy mortgage lenders, banks, regulatory bodies and ratings agencies?

It was clear at the time Garlick wanted to sell, most of us were keen to see new ownership, he chose to sell using this acquisition method, yet people are intent on blaming Pace et al for that? It doesn’t make sense to me. It’s like blaming the public for buying houses which led to the housing market crashing.

If ALK had shown little intent to move the club forward Eg no spend on transfers, go with a cheap manager when relegated etc and were paying themselves millions, fair enough, but I don’t believe that is the case.

[agreenwood]

The way the club was purchased was ****. It shouldn’t be allowed. Shame on Garlick et al for selling the club knowing how it was being funded. Shame on ALK for loading the club with the debt and shame on the FA and Government for not regulating against it.

At this point though, paying off the debt is better than not paying off the debt.

I’m not sure there’s anything more to say.

[Lancasterclaret]

Half of the debt Pace imposed on the club has been paid off - not by Pace or by new revenue business, but simply by flogging of our best players. There is nothing to celebrate about that.

Wage bill reduced - no doubt.

Team rebuilt? Pace outsourced the football recruitment to Kompany (thank goodness because I shudder to think what we would be like if we had stayed with his 'data-led recruitment' plan...). Kompany has had to scramble around Belgium trying to put together a side out of bargain buys. Unplanned, rushed, recruitment - nothing like how succesful clubs plan and operate.

The only good news is that there are signs that Kompany might just have pulled it off.

ALK and Pace have been an unmitigated disaster for this club but the one smart move they have made - hiring Kompany - might just save it all.

We got relegated last year on the last game of the season

A team like ours in the premier league is always going to go down at some stage

Dyche, Garlick, Pace, the players all bear some responsibility for us going down btw

But people keep forgetting that no one else wanted the club

No one

It is what it is sadly, and its done

[clarethomer]

Half of the debt Pace imposed on the club has been paid off - not by Pace or by new revenue business, but simply by flogging of our best players. There is nothing to celebrate about that.

I think you are being a little narrow in your thought process here in terms of that MG wanted out.

He made the business really healthy and gave a lot of comfort to fans that we were a prudent and well run club. The other benefit of being a prudent, well run club is that it maximised his ability to get his money out.

Whether it was Pace or anyone else you would have been saying the same thing- i.e. it’s only Pace because he was the one who could do the deal.

The club had been up for sale for a few years and even after that time and years of being open to being bought, the leveraged buyout was the only way buying us made sense and allowed MG the exit he wanted.

The recruitment side of things have impressed me to be honest in that the overall situation made it what it was and what VK and AP have done is impressive this summer and whilst it will always be a question mark in sacking Dyche, it’s one that had to be made and he made it. Whether it was the right one, will be others to take a view on over the coming years.

When I see people saying we have sold our best assets and put this blame on the owners, what often gets forgotten is that this is what happens when you are keeping high cash reserves in the PL and don’t spend it.

So as an example, we should have taken £35/40m for Tarks when we had the benefit to demand that and couldn’t get a new contract in place before going into the last year.

If someone is on a 4 yr contract you want to be offering a new contract in year 3 or flogging them.

We are having to go through an off and on the field transformation which puts the club back in a healthy position. The only way we do this without the debt was for MG to have not sold but he wanted out.

Gets tiring that people are blind to the fact that Pace and his team have presented a deal that MG thought was acceptable.

He would have seen enough detail to understand the risk that the club was being put at. The only question you need to ask yourself is - was MG doing the deal to maximise his return, or has he done a deal that allows the best success for the longer term running of the club?

[Lancasterclaret]

Not sure if I'm more shocked by the "pleasantly" or by the "surprised" in terms of the football club paying off the debt imposed on it.

They've (imo) earned a lot of praise this summer by getting a good manager in and letting him sign players. That doesn't spill over to this absolutely dreadful takeover.

I don't think rugsweeping all the bad they've done, in their own interest with little regard for the football club, is being a realist at all.

Whose rugsweeping it?

You reading what you want to see, rather than what I've said

We could have been in real ****, totally, utterly in real ****, and even if it their take over that caused it, the fact they have dealt with it fairly well so far is deserving of praise

I don't know how many ways I can put the same thing mate tbf

[CoolClaret]

There are a lot of eggs in the Kompany basket, to be fair. Maybe these Belgian buys will pay off, but if they don't and we want to replace VK at some point, that strategy will rightly be questioned. Not many clubs give their manager so much control over transfers these days, purely because the managers are often replaced within a couple of years anyway.

I'm a bit baffled people want to praise ALK for clearing some of the vast debt that was loaded on the club...by... ALK. It's a bit like if I did a massive dump on the carpet in your front room but scooped half of it up afterwards. Presumably folk would think I was great for doing that.

I have the exact same sentiments

[daveisaclaret]

Whose rugsweeping it?

You reading what you want to see, rather than what I've said

We could have been in real ****, totally, utterly in real ****, and even if it their take over that caused it, the fact they have dealt with it fairly well so far is deserving of praise

I don't know how many ways I can put the same thing mate tbf

I think you are rugsweeping it. Your first post in this discussion literally said "people need to stop this"

They are the cause of our problems, praising them for paying off some of the debt they've brought the club (through parachute payments and unsustainable player sales) is ignoring their culpability.

If the club ever gets into as good a position as the day they took over, praise them. As it is we're in a worse league with a worse team and a worse financial position.

[jedi_master]

The way the club was purchased was ****. It shouldn’t be allowed. Shame on Garlick et al for selling the club knowing how it was being funded. Shame on ALK for loading the club with the debt and shame on the FA and Government for not regulating against it.

At this point though, paying off the debt is better than not paying off the debt.

I’m not sure there’s anything more to say.

Nail on head as far as I’m concerned.

I was concerned that Pace would go all for a return this season and just leave us to be annihilated financially if we failed, he has not.

Does that make me trust him? Not in the slightest - and his manner of taking over the club will never be acceptable/forgivable to me but at least he’s been responsible upon relegation by not plunging us into further debt, and trying to get us back to a sustainable existence.

[agreenwood]

I think you are being a little narrow in your thought process here in terms of that MG wanted out.

He made the business really healthy and gave a lot of comfort to fans that we were a prudent and well run club. The other benefit of being a prudent, well run club is that it maximised his ability to get his money out.

Whether it was Pace or anyone else you would have been saying the same thing- i.e. it’s only Pace because he was the one who could do the deal.

The club had been up for sale for a few years and even after that time and years of being open to being bought, the leveraged buyout was the only way buying us made sense and allowed MG the exit he wanted.

The recruitment side of things have impressed me to be honest in that the overall situation made it what it was and what VK and AP have done is impressive this summer and whilst it will always be a question mark in sacking Dyche, it’s one that had to be made and he made it. Whether it was the right one, will be others to take a view on over the coming years.

When I see people saying we have sold our best assets and put this blame on the owners, what often gets forgotten is that this is what happens when you are keeping high cash reserves in the PL and don’t spend it.

So as an example, we should have taken £35/40m for Tarks when we had the benefit to demand that and couldn’t get a new contract in place before going into the last year.

If someone is on a 4 yr contract you want to be offering a new contract in year 3 or flogging them.

We are having to go through an off and on the field transformation which puts the club back in a healthy position. The only way we do this without the debt was for MG to have not sold but he wanted out.

Gets tiring that people are blind to the fact that Pace and his team have presented a deal that MG thought was acceptable.

He would have seen enough detail to understand the risk that the club was being put at. The only question you need to ask yourself is - was MG doing the deal to maximise his return, or has he done a deal that allows the best success for the longer term running of the club?

The club was healthy in terms of bank balance, but as we saw last season, far too many of the squad were coming to the end of the road with us at the same time. You only need to look at the spending levels in the PL this summer to realise how much it would have cost to make us competitive in that league again.

[Lancasterclaret]

I think you are rugsweeping it. Your first post in this discussion literally said "people need to stop this"

They are the cause of our problems, praising them for paying off some of the debt they've brought the club (through parachute payments and unsustainable player sales) is ignoring their culpability.

If the club ever gets into as good a position as the day they took over, praise them. As it is we're in a worse league with a worse team and a worse financial position.

Of course they are responsible, no one has suggested otherwise

But its done mate

Any moves to bring us back to where we were deserve praise

IMHO

[daveisaclaret]

Of course they are responsible, no one has suggested otherwise

But its done mate

Any moves to bring us back to where we were deserve praise

IMHO

It's only a move to bring us back where we were in a very, very narrow context.

In the big picture, it's tens of millions of pounds going out of BFC in exchange for nothing.

[Enola Gay]

Team rebuilt? Pace outsourced the football recruitment to Kompany (thank goodness because I shudder to think what we would be like if we had stayed with his 'data-led recruitment' plan...). Kompany has had to scramble around Belgium trying to put together a side out of bargain buys. Unplanned, rushed, recruitment - nothing like how succesful clubs plan and operate.

[citation needed]

[Paul Waine]

In the big picture, it's tens of millions of pounds going out of BFC in exchange for nothing.

Everyone wants to blame everyone, it seems. This bit "tens of millions of pounds going out of BFC..." makes me think of the £80 million and more spent over the past few seasons on players wages.

Anyone think that we should be blaming all the footballers - and their agents - across all the major leagues for how much money is required to run a football club? Yes, there are a few billionaires involved as well and some sports media businesses.

We either accept that it is what it is, that footballers get paid fantastic money and everything else flows from that. Do we want every club to be owned by billionaire owners, or do we want others who aren't billionaires also to be involved? If it's the latter, then Alan Pace and ALK and Mike Garlick and John B are as good as any other football club owners.

UTC

[daveisaclaret]

Everyone wants to blame everyone, it seems. This bit "tens of millions of pounds going out of BFC..." makes me think of the £80 million and more spent over the past few seasons on players wages.

Anyone think that we should be blaming all the footballers - and their agents - across all the major leagues for how much money is required to run a football club? Yes, there are a few billionaires involved as well and some sports media businesses.

We either accept that it is what it is, that footballers get paid fantastic money and everything else flows from that. Do we want every club to be owned by billionaire owners, or do we want others who aren't billionaires also to be involved? If it's the latter, then Alan Pace and ALK and Mike Garlick and John B are as good as any other football club owners.

UTC

Sorry, this is ridiculous. I don't like how much money is involved in football, nobody does. But the money that is involved should be paid to the footballers. They're the ones who generate the income.

[Elbarad]

It's only a move to bring us back where we were in a very, very narrow context.

In the big picture, it's tens of millions of pounds going out of BFC in exchange for nothing.

Yes, that's true as far as we know.

But can you change it??

If it was an event you were trying to change in the future, never letting anyone forget an event in the past is great. I don't know, like discrimination or something. But the only event in the future that's happening is paying off a debt that would sink the club if it wasn't paid off.

I get it, MG sold the club with it's own money. I wish he hadn't. But he did.

[Paul Waine]

Sorry, this is ridiculous. I don't like how much money is involved in football, nobody does. But the money that is involved should be paid to the footballers. They're the ones who generate the income.

My point is, dave, that if we are happy with this, then we have got to understand everything else that goes with it. As for "generate the income" no club would be running up debts if all the wages that were paid out were covered by the revenue generated by the clubs. Lots of clubs owned by billionaires are running at a loss, Chelsea took on debt of £1.5 billion in the time that they were owned by the Russian oligarch.

[Chester Perry]

My point is, dave, that if we are happy with this, then we have got to understand everything else that goes with it. As for "generate the income" no club would be running up debts if all the wages that were paid out were covered by the revenue generated by the clubs. Lots of clubs owned by billionaires are running at a loss, Chelsea took on debt of £1.5 billion in the time that they were owned by the Russian oligarch.

tbf Paul it took Roman 19 years (and Covid) to loan that money interest free (and he will not see any of it back even though it was covered in the sale price) - it has taken the new ownership group comprising of at least 5 billionaires 2 months to put £800m of commercial debt against the club, a chunk of it to be spent on transfers rather than on revenue building infrastructure/business development

[Paul Waine]

tbf Paul it took Roman 19 years (and Covid) to loan that money interest free (and he will not see any of it back even though it was covered in the sale price) - it has taken the new ownership group comprising of at least 5 billionaires 2 months to put £800m of commercial debt against the club, a chunk of it to be spent on transfers rather than on revenue building infrastructure/business development

Russian guy was adding on average (roughly) £100 million a year to Chelsea's debt - and everyone seems fine with it. That's the source of all the inflation in players' wages.

Yes, if you want to be an owner of a "top 6 club" that's the price new owners now need to pay. And, it all flows down to the smaller clubs.

Don't you think it puts Alan Pace and ALK into context. The wonderful thing about football is even the small towns can aspire to have a club playing in the top division. Or, the choice is not to aim to high and play football in and around the lower leagues.

UTC

[gawthorpe_view]

So can some please, in plain figures, tell me how much we owed, how much has been repaid, and the balance outstanding and to whom.
For us non finance types.
TIA.

[RVclaret]

So can some please, in plain figures, tell me how much we owed, how much has been repaid, and the balance outstanding and to whom.
For us non finance types.
TIA.

32.7m still owed to a third party (MSD) - original was 65m

X amount to previous owners*

*X could be anywhere from 0-40m, as it’s a private agreement no one knows

[gawthorpe_view]

Thanks RV,

[Chester Perry]

So can some please, in plain figures, tell me how much we owed, how much has been repaid, and the balance outstanding and to whom.
For us non finance types.
TIA.

Unfortunately it depends which way you face

VSL bought circa 84% of the club for a fee scheduled to be £170m

VSL put in £10m (that can be tracked) borrowed £65m from Burnley FC Holdings (the same money that entity borrowed from MSD) and £23m from Burnley Football and Athletic Club - which we can assume formed a £98m down payment on the £170m - leaving £72m outstanding

Stage payments of £14m in Sept 2021 (loaned to VSL from Burnley Football and Athletic Club) and £11m+ in April 2022 (again probably loaned form to VSL from Burnley Football and Athletic Club, but awaiting confirmation) reduce the outstanding to the sellers £40m-£47m - that should be reduced to £21m after the next stage payment in September that is likely to be covered with another loan to VSL from Burnley Football and Athletic Club.

We know VSL were advanced £10m from Burnley Football and Athletic Club which is likely to have been used to buy supporters shares

Burnley FC Holdings have paid MSD £32.3m this summer leaving that debt at £32.7m

VSL still owe Burnley FC Holdings £65m unless they have put impairments on that loan to maintain parity with the MSD debt

By the End of September it is likely that VSL will owe Burnley Football and Athletic Club £83m (£37m +£10m + £36m the 2022 stage payments)

Interest payments paid to MSD by Burnley Football and Athletic Club are not debts but the cost of servicing debts

[Chester Perry]

Burnley FC Holdings have paid MSD £32.3m this summer leaving that debt at £32.7m

This money was paid by Burnley Football and Athletic Club on its parents behalf

[KRBFC]

Great news.

Not that I’ll ever come to terms with this being necessary to fund Mr Garlick’s retirement, but good news for the club nevertheless.

Notice how this made its way in to part of an article in the Mail. Given how that newspaper was prophesying doom, you’d have thought they’d make this a back page headline

Great news? we're selling our best players to pay for ALK shares? How tf is that great news?

[Paul Waine]

Unfortunately it depends which way you face

VSL bought circa 84% of the club for a fee scheduled to be £170m

VSL put in £10m (that can be tracked) borrowed £65m from Burnley FC Holdings (the same money that entity borrowed from MSD) and £23m from Burnley Football and Athletic Club - which we can assume formed a £98m down payment on the £170m - leaving £72m outstanding

Stage payments of £14m in Sept 2021 (loaned to VSL from Burnley Football and Athletic Club) and £11m+ in April 2022 (again probably loaned form to VSL from Burnley Football and Athletic Club, but awaiting confirmation) reduce the outstanding to the sellers £40m-£47m - that should be reduced to £21m after the next stage payment in September that is likely to be covered with another loan to VSL from Burnley Football and Athletic Club.

We know VSL were advanced £10m from Burnley Football and Athletic Club which is likely to have been used to buy supporters shares

Burnley FC Holdings have paid MSD £32.3m this summer leaving that debt at £32.7m

VSL still owe Burnley FC Holdings £65m unless they have put impairments on that loan to maintain parity with the MSD debt

By the End of September it is likely that VSL will owe Burnley Football and Athletic Club £83m (£37m +£10m + £36m the 2022 stage payments)

Interest payments paid to MSD by Burnley Football and Athletic Club are not debts but the cost of servicing debts

Hi CP, firstly, a great result this afternoon. We can all enjoy that.

A couple of questions re your post, above.

1) Where are you getting all the stage payment information from? Is there anything in the public domain that suggests the amounts and the dates?

2) Why do you suggest that there will be impairment of the money owed to BFC by VSL? I get the "balancing" but, this doesn't make an argument that VSL won't be able to repay the money they owe BFC. I'm sure you are familiar with directors' legal duties to act in the fiduciary interests of the company that they are a director of. How does BFC directors deciding to reduce the amount owed to the club by VSL fit in with their fiduciary duties?

[Paul Waine]

Great news? we're selling our best players to pay for ALK shares? How tf is that great news?

"We" KRBFC? The guys that own the club are selling players that have played for the club in the Premier League and want to continue playing in the Premier League. They own the club. They make the decisions. It's their money at risk... just as it was the previous owners' money at risk before they sold their shares.

UTC

[KRBFC]

"We" KRBFC? The guys that own the club are selling players that have played for the club in the Premier League and want to continue playing in the Premier League. They own the club. They make the decisions. It's their money at risk... just as it was the previous owners' money at risk before they sold their shares.

UTC

You were making excuses for ALK from the start and nothing has changed. You know the difference between selling players to pay for ALK shares and selling players to benefit the clubs finances, you're just acting naive to it all. As for ALK's money at risk? What money? The entire £170m reported takeover has meant the club is £170m worse off.

[ClaretPete001]

Hi CP, firstly, a great result this afternoon. We can all enjoy that.

2) Why do you suggest that there will be impairment of the money owed to BFC by VSL? I get the "balancing" but, this doesn't make an argument that VSL won't be able to repay the money they owe BFC. I'm sure you are familiar with directors' legal duties to act in the fiduciary interests of the company that they are a director of. How does BFC directors deciding to reduce the amount owed to the club by VSL fit in with their fiduciary duties?

A this point the group still has to pay £35 million to MSD and find £68 million for the former owners. Thus far you have been unable to point out any other means of revenue other than BFC so it seems unlikely the group will be making inter-company payments against inter-company loans of £112 million.

At this point we have used up all the PL cash and sold most of the playing assets to pay off £30 million to MSD. I think CPs assumption is based on a modicum of common sense based upon what we know.

[Paul Waine]

A this point the group still has to pay £35 million to MSD and find £68 million for the former owners. Thus far you have been unable to point out any other means of revenue other than BFC so it seems unlikely the group will be making inter-company payments against inter-company loans of £112 million.

At this point we have used up all the PL cash and sold most of the playing assets to pay off £30 million to MSD. I think CPs assumption is based on a modicum of common sense based upon what we know.

Hi Pete, have I ever tried to point to "any other means of revenue," I don't recall? I'm asking CP what he knows and how he knows it. Is this public domain information, rather than "a modicum of common sense," as you express it?

[NewClaret]

I have been through this a number of times

my key supporting evidence that suggests no sale price reduction on relegation is the Offer Letter to the small shareholders - potential for price increase discussed nothing about price decrease. The key one though is John B's company Freight Investor Holdings Limited last set of accounts - which reported the sale (that entity held most of his shareholding in the club) with no statement on price flexibility on relegation.

Some may choose to cling to the notion that FIH indicated that they would receive all their monies in the following financial period so would not be subject to a relegation induced price reduction - I do not (and yes I could be wrong)

Neither of these pieces of supporting evidence are really conclusive though. Good dots to join, I agree, but nevertheless inconclusive.

I personally would be amazed if a very astute businessman, which Pace undoubtedly is, agreed to buy a club without any future performance clauses. But even if he did and the amount is fixed, it doesn’t mean the timing is.

There’s two possibilities: your information is spot on, in which case someone has broken the confidentiality of private business agreement for you to be aware of the precise details (poor form on their behalf, if you don’t mind me saying it) or your information is incorrect - either partially, fully, knowing or unknowingly.

I don’t really know. I just think unless it’s fact it should be presented as opinion. There are things you know for certain and things you’ve concluded. I say this because your undoubtedly hugely better informed than the majority on here but that can sometimes mislead and cause miss information amongst supporters.

[Nonayforever]

Financial threads such as this one is essential reading for any concerned fan of any club.
It's OK to say , yes, we have accrued debt & have / are dealing with it, but that doesn't and hasn't solved the longer term financial future of the club .
Yes, it's fine to say just enjoy the ride, but that is burrowing ones head in the sand. Where is this ride going to take us in, say 3 yrs time ? VK will almost certainly will not be here.
We don't want to be the next Bury or Derby, so to show concern is necessary in my view when we have an owner ( who is not a fan ) who's plan A has failed, his Plan B has failed and is now on plan C which , financially can't succeed.

[KRBFC]

Imagine giving credit to Alan Pace for selling our best players and using the money to pay for his shares lmaooo

[Big Vinny K]

Imagine giving credit to Alan Pace for selling our best players and using the money to pay for his shares lmaooo

Is that the extent of your financial understanding as to what has happened ?
You repeat this a hell of a lot but display the financial acumen of Katy Price

[KRBFC]

Is that the extent of your financial understanding as to what has happened ?
You repeat this a hell of a lot but display the financial acumen of Katy Price

It's factual

[burnleytom]

The way transfers are going in the Premier League, an argument could be made that not going straight back up and giving some of these new lads time to develop would be beneficial. Even with a new set of TV money, we’d be unlikely to be able to go on a spree like Forest have, and we do have a lot of loans that would need replacing.

My concern with regards to staying down is that we won’t have established the new model well enough to help pay off the loan that would be due. We’d need to make significant profit on one or two of the new signings and fetch in more than £10 million for a couple of them. Beyond Brownhill, it would be quite a stretch for any of the lads in the starting 11 yesterday to achieve that. I presume the gap would then be bridged by using season two parachute payments to service the debt repayment, which would then significantly hinder our ability to do anything in the market.

[Big Vinny K]

It's factual

Please elaborate Katy.

Tell us all what is factual and don’t forget to include the link(s) as evidence (after you’ve made breakfast for Harvey)

[Bertie2015]

Please elaborate Katy.

Tell us all what is factual and don’t forget to include the link(s) as evidence (after you’ve made breakfast for Harvey)

Now now, let’s keep it civil.
From reading this thread and the great work CP has done, it’s clear that ALK have done a great job from a purely business/financing point of view. But no new money has come into the club from ALK. We could very well have sold the same players had we been under the previous ownership but those proceeds would most likely have stayed in the club; that doesn’t seem to be the case now.