Yo-yo yes please

[adropofclaret]

Just thinking about the season so far, last season and previous in the Prem and I've got to say that Iam finding it far more engaging and nailbiting already in the Championship.
I'm leaning to being in favour of becoming a yo-yo club for a few seasons, raiding the Prem for financial gain but visiting the Championship for enjoyment and interest.
I wrote a piece a while ago saying I was looking forward to a spell in the Championship for a change and a breath of fresh air from the Prem and I stand by my words.
Let's do a Fulham if we can.

[GodIsADeeJay81]

We've as much chance of doing a Fulham as we have of doing a Rovers.

[RVclaret]

We've as much chance of doing a Fulham as we have of doing a Rovers.

Really? I think we are in a far better position than Rovers were when they came down. They made a right mess of it, awful squad building and managerial appointments, we’ve done the opposite.

[GodIsADeeJay81]

Really? I think we are in a far better position than Rovers were when they came down. They made a right mess of it, awful squad building and managerial appointments, we’ve done the opposite.

We might not be so so lucky if we were to come down again, that's the point.

People talk about being a yo yo club but it only takes a couple of poor decisions for us to end up like Rovers, stuck in the championship or league 1 for 10yrs.

[jen1066]

We might not be so so lucky if we were to come down again, that's the point.

I agree with this. It only takes a bit of bad luck and you get the yo, without the second one.

[RVclaret]

We might not be so so lucky if we were to come down again, that's the point.

People talk about being a yo yo club but it only takes a couple of poor decisions for us to end up like Rovers, stuck in the championship or league 1 for 10yrs.

Yeah, fair point.

[CaptJohn]

I agree with this. It only takes a bit of bad luck and you get the yo, without the second one.

So true.

[Down_Rover]

Being a yo-yo club is a slow death

Each relegation means you are raped of your best players and unless you spend the parachute money wisely it will end in tears

I strongly suspect the yo-yo process has already ground down Norwich and Fulham are in danger of going the same way

We have 30 or so games to turn this squad, with a couple of additions, into a squad that can survive in the PL. not impossible but a big ask

[NewClaret]

Bit early to be talking about this. Going up again is a long long way away.

Taking the positives, we’re not losing, but not winning enough either. And single points will leave us very much mid-table unless we improve and win more consistently than we have been doing so far.

Right now I’d snap your hand of for a yo-yo back to the PL, potentially with limited / intelligent investment, full debt repayment and then go again in terms of really solid squad/finances.

[jen1066]

Bit early to be talking about this. Going up again is a long long way away.

Taking the positives, we’re not losing, but not winning enough either. And single points will leave us very much mid-table unless we improve and win more consistently than we have been doing so far.

Right now I’d snap your hand of for a yo-yo back to the PL, potentially with limited / intelligent investment, full debt repayment and then go again in terms of really solid squad/finances.

So going up is a long long way away.
We're not winning enough.
Single points will leave us very much mid-table

I'd hate to see you to take the negatives!

[NewClaret]

So going up is a long long way away.
We're not winning enough.
Single points will leave us very much mid-table

I'd hate to see you to take the negatives!

I think it’s fair to say I’m never as happy with a point as some others are. I’m greedy in that respect

Overall I’m loving the season though, the style, watching the new players and being more competitive though.

But I’m nowhere near as confident as other that we’ll go up atm and I do fear a bit that this year will be our best chance, which is why I’d like to see us learn to lock in the 3 points when we have them in our grasp.

[TheFamilyCat]

I think it’s fair to say I’m never as happy with a point as some others are. I’m greedy in that respect

Overall I’m loving the season though, the style, watching the new players and being more competitive though.

But I’m nowhere near as confident as other that we’ll go up atm and I do fear a bit that this year will be our best chance, which is why I’d like to see us learn to lock in the 3 points when we have them in our grasp.

Feel exactly the same. Have to be honest, after Saturday I’ve had zero enthusiasm for this match all day. I’m going Coventry at the weekend and likewise can’t get excited about it.

Passing the ball backwards is as anti-football as hoofing it in my opinion. VK says he wants us to be entertained but we’re creating very few goal scoring opportunities and I’m
struggling to find it entertaining.

Lovin' it, lovin' it, lovin' it!

[Chester Perry]

It is not unreasonable to think that the yo-yo scenario is our likely immediate future - at least until the finances are more settled.

If all payments are made this calendar year (we are assuming the September 30th stage payment has been made at this time) the club's contribution to the takeover in the year will have been in excess of £85m which comprises of:

- £37m in stage payments
- £10m in buying shares from the small shareholders (there is likely to be £2m or so more for the club credit required in the future)
- £35m+ including penalties to MSD of which £32,237,986.25 was in capital repayment
- £4.5m+ in interest payments to MSD

That still leaves around £83m - £84m to complete the takeover payments and get to 99% or so of ownership as per the VSL plan:
- £21m in Stage Payments due in 2023
- £2m or so for club credit payments (if as many sold their shares as we think, and Pace hasn't given himself a discount at the club)
- £20m to buy the remainder of the original seller's shares that are currently ringfenced until October 2024
- £7m or so in interest to MSD by December 30 2025
- £32,762,013.75 in capital repayments due to MSD December 30 2025

Of course, if we do go up this season there will be additional costs:
- £8m - £13m in bonuses
- £5m - £10m in conditional payments on those players signed over the summer (I got the impression fees were heavily stacked on this condition)
- £?m on obligations to buy loan players, it may be nothing, certainly nothing reported beyond the option to buy Beyer, but that may actually be an obligation give the secrecy around Turf Moor
- £? on squad strengthening, at the very least the loan players will need either tying down or replacing.

In the boardroom it will be more of the same, frenetic efforts around cash flow management with little assistance from outstanding transfer payments - only the Dwight McNeil one has not yet been factored - with as little as £1m or so in add ons/conditional payments if Wolves and Everton are relegated (not beyond the realms of possibility but unlikely for both at once), £3m - £4m if they are not.

Even with all this, it is not impossible to get promoted and stay there for another season, which would effectively seal the deal for Pace and Co and their £10m of probable investment in the takeover. Then for them, the hard work really begins, getting the club to a valuation they find acceptable to sell, while giving themselves enough dividends to pay back the club's loans to them.

[jen1066]

Chester Perry, once all debt is paid off, do you think Pace and Co will take their money and run? Or will it be the club's money and not theirs?

[Chester Perry]

Chester Perry, once all debt is paid off, do you think Pace and Co will take their money and run? Or will it be the club's money and not theirs?

They first need to replay the club's loans or get an absolutely huge offer for the club to cover that debt.

My assumption is they will use dividends to repay the loans post 2025 over 5 years or so - it means the club will not lose any more money post 2025 until the loans have been repaid but will have contributed around £200m to the takeover.

By then, if we are back to being a stable member of the Premier League and the expectations of American Owners have come to fruition, particularly on media and commercial revenues) then the club could be worth anything from £500m - £1bn. It is a big ask though. My view is that VSL have a 10year plan in which to both cover the costs of the takeover and grow the asset value then they will look at selling for a huge profit, particularly when you consider their £10m initial stake and ignore the £170m initial takeover price. The scenario I describe is a 50times + return. Their ownership may last longer if they sell shareholdings in VSL, as per the original takeover plan and the club are firmly established as a Premier League Member.

There are still a few potential spanners that could clog up the works, Super League has not gone away and neither has the Independent Football Regulator. UEFA and FIFA could further push their own interests to reduce the Premier League to 18 clubs, which is an already stated target by them for all top-flight domestic leagues.

[houseboy]

Being a yo-yo club is a slow death

Each relegation means you are raped of your best players and unless you spend the parachute money wisely it will end in tears

I strongly suspect the yo-yo process has already ground down Norwich and Fulham are in danger of going the same way

We have 30 or so games to turn this squad, with a couple of additions, into a squad that can survive in the PL. not impossible but a big ask

Good points but it depends if what you are looking for is just survival. I know the money is in the PL but for us the enjoyment is elsewhere. Unless you can find a passing billionaire with a few quid they want to throw away all you get in the PL is a turgid round of scraping away at the bottom hoping to finish 17th. That, at least to me, is not enjoyment it is simply painful. And I think many feel the same. If money wasn’t an issue I wouldn’t care if we never saw the PL again.
The PL is an overhyped, tired, predictable league that is drowning in its own hyper inflated belief that it is the best league in the world. In terms of excitement, competition and unpredictability it isn’t even the best league in England.

[superdimitri]

I'd rather the big spenders would have their own league. They wreck the premier league experience for smaller clubs like us.

[Chester Perry]

I'd rather the big spenders would have their own league. They wreck the premier league experience for smaller clubs like us.

They could take as much as 90% of Premier League media revenues with them, which would leave many clubs in a huge financial hole

[superdimitri]

They could take as much as 90% of Premier League media revenues with them, which would leave many clubs in a huge financial hole

Sure but it would make for a much more even playing field which makes for more entertainment for us. We're always going to struggle to consistently do well with other teams spending so much. In fact it was probably other teams spending too much that committed is to our downfall since some clubs that previously didn't recently started to spend lots of money.
Aston Villa, Brighten, Wolves, Leeds etc

[Chester Perry]

Sure but it would make for a much more even playing field which makes for more entertainment for us. We're always going to struggle to consistently do well with other teams spending so much. In fact it was probably other teams spending too much that committed is to our downfall since some clubs that previously didn't recently started to spend lots of money.
Aston Villa, Brighten, Wolves, Leeds etc

you are talking of around 20 - 25 clubs who have spending commitments and debt (not forgetting losses on investment as club values collapse) into the billions, a swift transition would leave most in administration at best and no doubt a few in the Bury scenario - and we would be part of that

[AfloatinClaret]

I'd rather the big spenders would have their own league. They wreck the premier league experience for smaller clubs like us.

But without them sadly, there is no 'premier league'; the money will follow those half dozen big spending clubs to whatever league they join.

[superdimitri]

But without them sadly, there is no 'premier league'; the money will follow those half dozen big spending clubs to whatever league they join.

Sure, but if they buggered off we could at least have a league like we used to before the premier league. Sure the quality would drop but entertainment would be better because it would be more even.

Sure a sudden transition would hurt us but I'm sure there's a way you could gradually lean into it without adminstration.

[Chester Perry]

Sure, but if they buggered off we could at least have a league like we used to before the premier league. Sure the quality would drop but entertainment would be better because it would be more even.

Sure a sudden transition would hurt us but I'm sure there's a way you could gradually lean into it without adminstration.

I do not see how a 3 to 5year transition would be possible, there would be a whole media cycle were broadcasters know it is coming to an end and would therefore want to put money aside for the new set-up of the big league and the rest to lower expectations

[ClaretPete001]

With my BTEC L1 in Yo-Yo instructing, I can apply science to this debate. which for a forum that struggles with facts or even a vague notion of reality is pretty good.

Any my view is that regardless of Newton's third law what comes down doesn't necessarily go up again.

Like Trussonomics, some things things have an effect without an equal and opposite one because those who are the cause are ousted and cannot therefore have an anymore effects. Unless of course you are a Boris in which case bizarrely all laws of reality do not apply.

Ergo, the Boris exception apart just because you get relegated doesn't mean you get promoted again because unlike gravity football is not governed by natural laws.

Rather, it is governed by FIFA, which is as rational as Trussonomics on a good day.

My view therefore is that once up you should not prat around making grandiose statement about Covid instead get the check book out, otherwise, you never know and you may go down and never go back up.

Thank you and good night ClaretPete has left the building....!

[AfloatinClaret]

Sure, but if they buggered off we could at least have a league like we used to before the premier league. Sure the quality would drop but entertainment would be better because it would be more even...

Something like the EFL Championship perhaps?

[Vegas Claret]

unless Pace can get some serious investment on promotion there would be little point get promoted

[Chester Perry]

unless Pace can get some serious investment on promotion there would be little point get promoted

If we do not get promoted there is a different picture of costs to face

The final stage payment of £23m still needs to be paid in 2023

Next summer would see a further capital reduction payment to MSD with penalties - my guess is a payment of circa £20m - £26m to bring the capital balance down to circa £15m - £10m. If MSD may want to take that down to £10m because of the value of the final parachute payment.

Players will have to be sold (who is likely to offer a substantial profit is a very good question, probably Brownhill) and new ones brought in. Cork and Jay-rod would be in the final years of their contract, and we would have a squad with very limited experience in a promotion winning campaign or of playing at a higher level.

There would still be (much reduced) interest payments to MSD and there would still be the issue of the huge debt VSL owe the club

the original sellers would also still hold a little over 10% of the shares, which creates difficulties for Pace and co in repaying their huge debt via dividend.

[Vegas Claret]

If we do not get promoted there is a different picture of costs to face

The final stage payment of £23m still needs to be paid in 2023

Next summer would see a further capital reduction payment to MSD with penalties - my guess is a payment of circa £20m - £26m to bring the capital balance down to circa £15m - £10m. If MSD may want to take that down to £10m because of the value of the final parachute payment.

Players will have to be sold (who is likely to offer a substantial profit is a very good question, probably Brownhill) and new ones brought in. Cork and Jay-rod would be in the final years of their contract, and we would have a squad with very limited experience in a promotion winning campaign or of playing at a higher level.

There would still be (much reduced) interest payments to MSD and there would still be the issue of the huge debt VSL owe the club

the original sellers would also still hold a little over 10% of the shares, which creates difficulties for Pace and co in repaying their huge debt via dividend.

so get promoted to pay off the debt

[Carwin261]

Cheer us up won’t you,can’t we just enjoy the ride ,& see where it takes us,it’s no good worrying about what might happen,& what you can’t control.

[RVclaret]

I think CP should apply to be Pace’s personal adviser. Knows more ins and outs than the man himself!

[Chester Perry]

I think CP should apply to be Pace’s personal adviser. Knows more ins and outs than the man himself!

I very much doubt that, and there is also the issue that in no way I would want anything to do with him,

[Chester Perry]

Cheer us up won’t you,can’t we just enjoy the ride ,& see where it takes us,it’s no good worrying about what might happen,& what you can’t control.

Because I am an adult and I like to understand what may be coming. The last decade in this country has shown exactly what happens when the majority play a game of wait and see because the person/persons they want to support tell them that all will be wonderful if they are allowed to do what they want.

[taio]

Because I am an adult and I like to understand what may be coming. The last decade in this country has shown exactly what happens when the majority play a game of wait and see because the person/persons they want to support tell them that all will be wonderful if they are allowed to do what they want.

Please continue - your knowledge and insights are excellent.

[Winstonswhite]

Cheer us up won’t you,can’t we just enjoy the ride ,& see where it takes us,it’s no good worrying about what might happen,& what you can’t control.

I’ve supported us for 32 years and we’ve been on the verge of bankruptcy for around 29 of those years and the 3 we weren’t, we hardly signed anyone anyway!

Like you say, what’s the point in worrying about things you can’t control- Nothing ever changes so I’m just enjoying what happens on the pitch.

[DCWat]

If we do not get promoted there is a different picture of costs to face

The final stage payment of £23m still needs to be paid in 2023

Next summer would see a further capital reduction payment to MSD with penalties - my guess is a payment of circa £20m - £26m to bring the capital balance down to circa £15m - £10m. If MSD may want to take that down to £10m because of the value of the final parachute payment.

Players will have to be sold (who is likely to offer a substantial profit is a very good question, probably Brownhill) and new ones brought in. Cork and Jay-rod would be in the final years of their contract, and we would have a squad with very limited experience in a promotion winning campaign or of playing at a higher level.

There would still be (much reduced) interest payments to MSD and there would still be the issue of the huge debt VSL owe the club

the original sellers would also still hold a little over 10% of the shares, which creates difficulties for Pace and co in repaying their huge debt via dividend.

Do you think stadium development might be a part of their plans or would the costs be difficult to recoup in a future sale?

The debt placed on the club was always a concern with the takeover. I think though that my biggest concern is actually who they might sell to, down the line. They’ve no ties to Burnley and their only concern will likely be the best price, not what is best for the club.

I suppose though the argument could be made that someone with ties to Burnley wasn’t that bothered about who they sold to!

[DCWat]

I’ve supported us for 32 years and we’ve been on the verge of bankruptcy for around 29 of those years and the 3 we weren’t, we hardly signed anyone anyway!

Like you say, what’s the point in worrying about things you can’t control- Nothing ever changes so I’m just enjoying what happens on the pitch.

If only worry was something that could be turned off like a tap.

It’s like saying don’t get nervous or excited before a huge game. You can’t control the outcome but the nervousness, excitement and a myriad of other emotions are still at play, like it or not.

[Milltown1882]

If we do not get promoted there is a different picture of costs to face

The final stage payment of £23m still needs to be paid in 2023

Next summer would see a further capital reduction payment to MSD with penalties - my guess is a payment of circa £20m - £26m to bring the capital balance down to circa £15m - £10m. If MSD may want to take that down to £10m because of the value of the final parachute payment.

Players will have to be sold (who is likely to offer a substantial profit is a very good question, probably Brownhill) and new ones brought in. Cork and Jay-rod would be in the final years of their contract, and we would have a squad with very limited experience in a promotion winning campaign or of playing at a higher level.

There would still be (much reduced) interest payments to MSD and there would still be the issue of the huge debt VSL owe the club

the original sellers would also still hold a little over 10% of the shares, which creates difficulties for Pace and co in repaying their huge debt via dividend.

Absolute grim reaper on this forum. Just enjoy the season for what it is.

[Chester Perry]

Do you think stadium development might be a part of their plans or would the costs be difficult to recoup in a future sale?

The debt placed on the club was always a concern with the takeover. I think though that my biggest concern is actually who they might sell to, down the line. They’ve no ties to Burnley and their only concern will likely be the best price, not what is best for the club.

I suppose though the argument could be made that someone with ties to Burnley wasn’t that bothered about who they sold to!

No doubt improvements will be needed given that the Cricket Field and Bob Lord are around 50years old now, how that can be achieved given the limitations that have been apparent on the number of hospitality customers (there have been large swathes of empty seats in the Bob Lord corporate seats since the takeover) - most new stands are financed based on hospitality and tourist rate revenues and not season tickets.

We just do not have that kind of attraction so we would be looking at ways of generating a much greater amount of non-matchday revenues (a la Spurs and Fletchers bread bin and that required the Cricket club to give up its financial life blood, which could be suicidal for them, and their revamped constitutional structure would make it almost impossible (as it was designed to do).

[Chester Perry]

Absolute grim reaper on this forum. Just enjoy the season for what it is.

And what is that exactly? in your perspective

[NRC]

this has been entirely a financial strategy conversation. What has happened to the purported macro motivations to buy Burnley FC in the first instance? Societal development in the area? And then the micro synergies with respect to their software? Where does any of that come into this? Or was all that for the prospectus, and to heck with it now?

[Chester Perry]

this has been entirely a financial strategy conversation. What has happened to the purported macro motivations to buy Burnley FC in the first instance? Societal development in the area? And then the micro synergies with respect to their software? Where does any of that come into this? Or was all that for the prospectus, and to heck with it now?

If that really was a feature of the takeover, then it has probably gone the way of the general investment picture in this country in the last few years - we are way, way down the international lists on that front.

[Chester Perry]

If that really was a feature of the takeover, then it has probably gone the way of the general investment picture in this country in the last few years - we are way, way down the international lists on that front.

and not forgetting that Pace and co have failed to bring in investment to their own project let alone finding some for other investment initiatives in the area. I fail to see where they would have found the time for such initiatives given that they have been constantly searching for funds/cash flow to maintain their takeover related payment commitments. The next accounts will be interesting to see how they have managed to grow non tv revenues to help on this front.

[boatshed bill]

If only worry was something that could be turned off like a tap.

It’s like saying don’t get nervous or excited before a huge game. You can’t control the outcome but the nervousness, excitement and a myriad of other emotions are still at play, like it or not.

Being nervous (excited) before a game is not the same as worry.
Worry is a condition which can be dealt with through positive thought.

[superdimitri]

Something like the EFL Championship perhaps?

Like that but without promotion. The old division one.

[Quicknick]

It would be better than never going up, but I'd prefer to qualify for Europe again.

[Claretforever]

Unfortunately you can’t plan to be a yo-yo club, that label is only attached when looking back in history. As nice as it sounds - 2 years up, 1 year back to get max parachutes - it’s a huge risk.

I too love the Championship more than the Premier League, but the latter is where all clubs strive to be and where the money is to be able to move the club on, develop players, improve facilities for future generations. Right now we need a few seasons of PL money to wipe debt and get ourselves back on the front foot.