ALK Capital or Farnell/Elkashashy takeover

[aggi]

Particularly given the speed in which it has been shut down this time

Incidentally the appeals process around the FOI requests on Companies House Actions re this entity and Calder Vale Holdings is still unfinished.

What I do know is that a compulsory strike off at this moment is not in our interest because we first want to see the filings - not that they are likely to reveal too much (if anything)

Obviously the assumption has been that the owners had been the ones providing evidence to halt the compulsory strike offs. It is possible that it is a third party had been appealing them instead. The most common cause is a creditor who doesn't want a company wound up because they are owed money.

[Chester Perry]

Obviously the assumption has been that the owners had been the ones providing evidence to halt the compulsory strike offs. It is possible that it is a third party had been appealing them instead. The most common cause is a creditor who doesn't want a company wound up because they are owed money.

I have actually been wondering about this myself after the last such example - I do know that is is not the person who has been pursuing the FOI requests (and subsequent appeals) - That person believes that this will help the next appeal, the details and information/case bundle for which arrived with them today - some coincidence.

[Paul Waine]

And so it comes to pass

Calder Vale Holdings Limited joins the Voluntary winding up party

https://find-and-update.company-informa ... ng-history

The declaration of solvency will be interesting - just what will be happening with that £124.1m of debt owed to the club

Calder Vale transferred 100% of share ownership in BFCHL to Velocity Capital (UK) Holdings Ltd in October 2023. Isn't it logical that the £124.1m debt was also transferred to VC(UK)HL at this time? I'd expect anything else would have required disclosure in the Events after the reporting period note in BFCHL accounts.

[Paul Waine]

I have actually been wondering about this myself after the last such example - I do know that is is not the person who has been pursuing the FOI requests (and subsequent appeals) - That person believes that this will help the next appeal, the details and information/case bundle for which arrived with them today - some coincidence.

Hi CP, is there any data in the public domain about these FOI requests to Companies House and, I assume, appeals to the Information Commissioner?

[Chester Perry]

Calder Vale transferred 100% of share ownership in BFCHL to Velocity Capital (UK) Holdings Ltd in October 2023. Isn't it logical that the £124.1m debt was also transferred to VC(UK)HL at this time? I'd expect anything else would have required disclosure in the Events after the reporting period note in BFCHL accounts.

except that the accounts signed off on December 19 2023 said the debt was still with Calder Vale Holdings

Recoverability of group balances
The Group has an outstanding debtor balance of £124,076,000 (2022 - £114,765,000) due from the
undertaking of Calder Vale Holdings Limited, which arose in relation to the acquisition of Burnley FC
Holdings Limited during the year. Of this balance £65,000,000 (2022 - £45,000,000) is a payable to
Burnley FC Holdings Limited, with £59,076,000 (2022 - £69,765,000) payable to The Burnley Football &
Athletic Company Limited. This balance is unsecured, and is by default, treated as being repayable on
demand, although the directors do not anticipate recovery in the form of cash within twelve months of the reporting date.

[Chester Perry]

Hi CP, is there any data in the public domain about these FOI requests to Companies House and, I assume, appeals to the Information Commissioner?

nothing that you can tie to the companies I have named

[Paul Waine]

except that the accounts signed off on December 19 2023 said the debt was still with Calder Vale Holdings

Recoverability of group balances
The Group has an outstanding debtor balance of £124,076,000 (2022 - £114,765,000) due from the
undertaking of Calder Vale Holdings Limited, which arose in relation to the acquisition of Burnley FC
Holdings Limited during the year. Of this balance £65,000,000 (2022 - £45,000,000) is a payable to
Burnley FC Holdings Limited, with £59,076,000 (2022 - £69,765,000) payable to The Burnley Football &
Athletic Company Limited. This balance is unsecured, and is by default, treated as being repayable on
demand, although the directors do not anticipate recovery in the form of cash within twelve months of the reporting date.

Hi CP, "the reporting date" is 31st July 2023 - not 19 December 2023 when the accounts were signed off.

We wouldn't expect Calder Vale to transfer the shares to Velocity Capital (UK) Holdings Ltd without receiving something of equivalent value in return. That "equivalent value" could be the taking on of the £124m owed by Calder Vale to BFCHL. It could also be £124m cash - and prior to winding up Calder Vale the debts to BFCHL and BF&ACL could be paid with this cash... However, I'm more inclined to the debt also being transferred to Velocity.

[Chester Perry]

Hi CP, "the reporting date" is 31st July 2023 - not 19 December 2023 when the accounts were signed off.

We wouldn't expect Calder Vale to transfer the shares to Velocity Capital (UK) Holdings Ltd without receiving something of equivalent value in return. That "equivalent value" could be the taking on of the £124m owed by Calder Vale to BFCHL. It could also be £124m cash - and prior to winding up Calder Vale the debts to BFCHL and BF&ACL could be paid with this cash... However, I'm more inclined to the debt also being transferred to Velocity.

I have held the same expectation of the 'logical transfer' to Velocity Capital (UK) Holdings Ltd, I just do not believe it happened on October 6 2023, or that it happened before the accounts were signed off - mainly because I believe such a significant change should be declared in the post date events.

ALK/VSL have given us previous cause to not to be complacent about their likely actions, so I am awaiting confirmation of what I think will happen or otherwise.

[Paul Waine]

I have held the same expectation of the 'logical transfer' to Velocity Capital (UK) Holdings Ltd, I just do not believe it happened on October 6 2023, or that it happened before the accounts were signed off - mainly because I believe such a significant change should be declared in the post date events.

ALK/VSL have given us previous cause to not to be complacent about their likely actions, so I am awaiting confirmation of what I think will happen or otherwise.

Directors of Calder Vale can't give the shares away. They've also got to consider their obligations.

Directors of BFCHL have to consider their obligations.

Auditors of BFCHL know about the transfer of the shares by Calder Vale because it's mentioned in the accounts. They will equally be aware of the £124m and, amongst other things, be sure to ensure the correct disclosures are made. Note, also, Companies House filing was later than 6th October.

[aggi]

Directors of Calder Vale can't give the shares away. They've also got to consider their obligations.

Directors of BFCHL have to consider their obligations.

Auditors of BFCHL know about the transfer of the shares by Calder Vale because it's mentioned in the accounts. They will equally be aware of the £124m and, amongst other things, be sure to ensure the correct disclosures are made. Note, also, Companies House filing was later than 6th October.

Calder Vale is in a group for CGT purposes with Velocity. There wouldn't be any implications in them giving the shares to Velocity for zero consideration that I can see.

[Paul Waine]

Calder Vale is in a group for CGT purposes with Velocity. There wouldn't be any implications in them giving the shares to Velocity for zero consideration that I can see.

I wasn't thinking of tax issues. What about the responsibility of directors not to trade while insolvent? Don't you think that would be a consideration for the directors of Calder Vale?

[Chester Perry]

The Solvency statement is now available to view - it just says that Calder Vale Holdings is not carrying any debt of more than £1.00 - so while we may all assume that it has been transferred to Velocity Capital (UK) Holdings Ltd - there is no firm evidence of that being available at this time.

https://find-and-update.company-informa ... ng-history

[Paul Waine]

The Solvency statement is now available to view - it just says that Calder Vale Holdings is not carrying any debt of more than £1.00 - so while we may all assume that it has been transferred to Velocity Capital (UK) Holdings Ltd - there is no firm evidence of that being available at this time.

https://find-and-update.company-informa ... ng-history

Was this what you expected, CP?

I have held the same expectation of the 'logical transfer' to Velocity Capital (UK) Holdings Ltd, I just do not believe it happened on October 6 2023, or that it happened before the accounts were signed off - mainly because I believe such a significant change should be declared in the post date events.

ALK/VSL have given us previous cause to not to be complacent about their likely actions, so I am awaiting confirmation of what I think will happen or otherwise.

[Chester Perry]

Was this what you expected, CP?

yes, though I am yet to be convinced that it happened prior to December 19 2023

I do think, it is an issue that needs to be declared though, not least because of the the 2nd share auction on Asset Match, where the Admission Statement shows no changes to the issues I posted about previously.

It is highly questionable that it is not declared who holds that debt to the club, in this latest auction.

[Paul Waine]

yes, though I am yet to be convinced that it happened prior to December 19 2023

I do think, it is an issue that needs to be declared though, not least because of the the 2nd share auction on Asset Match, where the Admission Statement shows no changes to the issues I posted about previously.

It is highly questionable that it is not declared who holds that debt to the club, in this latest auction.

I think you are expecting too much of the private company, i.e. unlisted, share trading facility. All private companies have much lower levels of disclosure requirements than publicly listed entities. That's the risk of being a minority shareholder in an unlisted entity.

[aggi]

I wasn't thinking of tax issues. What about the responsibility of directors not to trade while insolvent? Don't you think that would be a consideration for the directors of Calder Vale?

I don't think they are trading are they? Obviously hard to tell due to them not following the law and filing accounts but I would suspect not.

[aggi]

yes, though I am yet to be convinced that it happened prior to December 19 2023

I do think, it is an issue that needs to be declared though, not least because of the the 2nd share auction on Asset Match, where the Admission Statement shows no changes to the issues I posted about previously.

It is highly questionable that it is not declared who holds that debt to the club, in this latest auction.

I think you are expecting too much of the private company, i.e. unlisted, share trading facility. All private companies have much lower levels of disclosure requirements than publicly listed entities. That's the risk of being a minority shareholder in an unlisted entity.

I'd agree with Paul here. Obviously the documents should be correct but it's a private marketplace selling very low volume and value of shares in the case of BFC with substantially lower disclosure requirements than a PLC.

It's also worth bearing in mind that for auditors the duty of care is to the shareholders. Not investors or other interested third parties.

[Paul Waine]

It's also worth bearing in mind that for auditors the duty of care is to the shareholders. Not investors or other interested third parties.

Excellent point about who the auditors have duty of care to.

[Paul Waine]

I don't think they are trading are they? Obviously hard to tell due to them not following the law and filing accounts but I would suspect not.

I wondered about "trading" but I think it can have a very broad meaning. Having a debtor of £124 million and transferring the shares to another entity, even one in the same group, which would provide the means of settling the debt probably falls within the scope.

[ClaretPete001]

Excellent point about who the auditors have duty of care to.

I wonder if CP was making more of a point about the ethical obligations of the club as opposed to the contractual disclaimer used by accountants to cover their backs.

Even so, the effectiveness of disclaimers like these can be tested in courts. Not that anyone would in this case.

[bumba]

‘Fire Sale
a sale of goods or assets at a very low price, typically when the seller is facing bankruptcy.’

We had to allow players of high value to leave for free, we also sold players such as Pope on the cheap

[Bordeauxclaret]

Pope went cheaply but we don’t know what agreement he had.
The rest went for decent fees.

Tarky made it clear he wasn’t staying regardless.
Mee was the only other free transfer anyone cared about.

[Paul Waine]

I wonder if CP was making more of a point about the ethical obligations of the club as opposed to the contractual disclaimer used by accountants to cover their backs.

Even so, the effectiveness of disclaimers like these can be tested in courts. Not that anyone would in this case.

All ethical obligations are to do what the law requires. The law is extensive on these matters. Auditors (not accountants) state that they conduct their audit and deliver their audit report to the shareholders of the entity they audit because that's what auditors exist for. There have been cases brought to court in earlier years by people who weren't shareholders and therefore had no claims on the auditor's actions - they lost.

[ClaretPete001]

All ethical obligations are to do what the law requires. The law is extensive on these matters. Auditors (not accountants) state that they conduct their audit and deliver their audit report to the shareholders of the entity they audit because that's what auditors exist for. There have been cases brought to court in earlier years by people who weren't shareholders and therefore had no claims on the auditor's actions - they lost.

All ethical obligations are decided by the law? Did you come to that conclusion before or after we stopped convicting women of witchcraft? Not as long ago as some might think.

The disclaimer is to stop third parties from suing auditors and it can be challenged in court. How successful those challenges are not that important when considering ethics because the law is not the sole arbitor of ethical considerations. Those who object to the flights to Rwanda might consider it to be unethical.

I think in this case, most Burnley fans would agree that it is not unreasonable to know where the debt of £124 million lies within the business structure and the extent to which the auditors sought to find out whether the group can meet the obligations of the debt in a reasonable time frame.

[aggi]

All ethical obligations are decided by the law? Did you come to that conclusion before or after we stopped convicting women of witchcraft? Not as long ago as some might think.

The disclaimer is to stop third parties from suing auditors and it can be challenged in court. How successful those challenges are not that important when considering ethics because the law is not the sole arbitor of ethical considerations. Those who object to the flights to Rwanda might consider it to be unethical.

I think in this case, most Burnley fans would agree that it is not unreasonable to know where the debt of £124 million lies within the business structure and the extent to which the auditors sought to find out whether the group can meet the obligations of the debt in a reasonable time frame.

I'd say Paul is wrong there. There are ethical considerations above and beyond what is required by law. I have to sit through training courses on it and the ICAEW Code of Ethics is extensive. Accounts must give a true and fair reflection of the financial position but realistically you're going to rely on Companies Act and financial regulations rather than what may be of interest to some third parties.

But, your point of wanting to know where the debt lies is fairly irrelevant, you really want to know how recoverable it is and the auditors have given an opinion on that.

In terms of auditors being sued by third parties, that has been tested in court and the current disclaimer in the audit report is very specific in order to be legally sound.

[Paul Waine]

All ethical obligations are decided by the law?

In the context of financial accounts, yes, including following appropriate accounting standards and auditing standards.

I'm pretty sure, aggi agrees with me.

[ClaretPete001]

I'd say Paul is wrong there. There are ethical considerations above and beyond what is required by law. I have to sit through training courses on it and the ICAEW Code of Ethics is extensive. Accounts must give a true and fair reflection of the financial position but realistically you're going to rely on Companies Act and financial regulations rather than what may be of interest to some third parties.

But, your point of wanting to know where the debt lies is fairly irrelevant, you really want to know how recoverable it is and the auditors have given an opinion on that.

In terms of auditors being sued by third parties, that has been tested in court and the current disclaimer in the audit report is very specific in order to be legally sound.

I can't see where the auditors have given an opinion on the ability of the club to repay the £124 million and I doubt anyone on here knows as a consequence of reading the accounts. As I say above I don't know how you going about passing an opinion on a debt with no terms attached to it.

[Tall Paul]

I can't see where the auditors have given an opinion on the ability of the club to repay the £124 million and I doubt anyone on here knows as a consequence of reading the accounts. As I say above I don't know how you going about passing an opinion on a debt with no terms attached to it.

Not sure how many times this needs to be said to you:

If the auditors aren't satisfied that the intercompany debt is recoverable they are required to qualify their report. The auditors' opinion is that the financial statements give a true a fair view, therefore they are satisfied that the debt is recoverable.

[claretonthecoast1882]

Pete's contributions are a brilliant read on this thread. It makes you glad that those with no knowledge continue to stumble through threads.

It is like being in the shallow end with a life jacket & armbands, still way out of your depth but begging to be let in the deep end.

[aggi]

I can't see where the auditors have given an opinion on the ability of the club to repay the £124 million and I doubt anyone on here knows as a consequence of reading the accounts. As I say above I don't know how you going about passing an opinion on a debt with no terms attached to it.

Screenshot 2024-05-10 154049.jpg (98.03 KiB) Viewed 2827 times

[ClaretPete001]

Pete's contributions are a brilliant read on this thread. It makes you glad that those with no knowledge continue to stumble through threads.

It is like being in the shallow end with a life jacket & armbands, still way out of your depth but begging to be let in the deep end.

And that is where we differ, because I'm only a Kn*bhead 'sometimes'!

[ClaretPete001]

Screenshot 2024-05-10 154049.jpg

Fair enough and I appreciate the patience but I'm sure there are others on here a re a bit mystified by this...

That has been on the accounts since 21 and as far as I understood it was a mechanism to resolve the issue of the debt in terms of the books dependent upon when the company could declare dividends.

And I go back to my usual theme of - what does it mean to the business and not what it means in accounting terms because I'm not an accountant and most people on here aren't accountants.

And as I asked above (albeit not to you): Is that saying that the company has £124 million cash reserves to repay the debt? If the cash reserves are there - why the cash warning?

These seem to me to be reasonable questions anyone would ask reading the accounts...

[Jakubclaret]

Fair enough and I appreciate the patience but I'm sure there are others on here a re a bit mystified by this...

That has been on the accounts since 21 and as far as I understood it was a mechanism to resolve the issue of the debt in terms of the books dependent upon when the company could declare dividends.

And I go back to my usual theme of - what does it mean to the business and not what it means in accounting terms because I'm not an accountant and most people on here aren't accountants.

And as I asked above (albeit not to you): Is that saying that the company has £124 million cash reserves to repay the debt? If the cash reserves are there - why the cash warning?

These seem to me to be reasonable questions anyone would ask reading the accounts...

Reasonable questions deserve reasonable answers. It does appear extremely odd issuing a warning if all was well that's the last thing that would be happening.

[dsr]

Fair enough and I appreciate the patience but I'm sure there are others on here a re a bit mystified by this...

That has been on the accounts since 21 and as far as I understood it was a mechanism to resolve the issue of the debt in terms of the books dependent upon when the company could declare dividends.

And I go back to my usual theme of - what does it mean to the business and not what it means in accounting terms because I'm not an accountant and most people on here aren't accountants.

And as I asked above (albeit not to you): Is that saying that the company has £124 million cash reserves to repay the debt? If the cash reserves are there - why the cash warning?

These seem to me to be reasonable questions anyone would ask reading the accounts...

The debt is owed by Alan Pace to Burnley FC. Burnley FC has given Alan Pace the cash,and the question is whether Alan Pace will ever give it back.

The accounts have stated twice that there is a plan for Burnley FC to declare a dividend, which means that Alan Pace would officially become entitled to the club's accumulated profits and the debt would disappear. In a legal sense that would count as repaying the debt, but in practical cash terms, it would mean that the money had gone and would never come back.

Other tricks might be possible such as converting share capital to share premium account and using that to declare a dividend.

When the auditors are confirming that the debt is probably recoverable, that method is included. The auditors are not confirming that the cash will come in.

The other thing the auditors are confirming is that the company remains a going concern. This is what they qualified with that much-discussed note in the audit report. What they have confirmed with that is that the directors have plans that will keep the club running until at least December this year, and they (they auditors) say we'll be in trouble if the directors are wrong.

What the accounts do not say is that Alan Pace would repay the £124m if the club was strapped for cash. If he promised that, then the audit going concern note would not be needed, and nor would the debtor recoverability note referred to above.

Note - all the references to Alan Pace actually refer to the complex and secretive group of companies that own BFC. He is the figurehead and ultimate controller of the group, but he personally won't be carrying the can if it goes pear-shaped.

[ClaretPete001]

The debt is owed by Alan Pace to Burnley FC. Burnley FC has given Alan Pace the cash,and the question is whether Alan Pace will ever give it back.

The accounts have stated twice that there is a plan for Burnley FC to declare a dividend, which means that Alan Pace would officially become entitled to the club's accumulated profits and the debt would disappear. In a legal sense that would count as repaying the debt, but in practical cash terms, it would mean that the money had gone and would never come back.

Other tricks might be possible such as converting share capital to share premium account and using that to declare a dividend.

When the auditors are confirming that the debt is probably recoverable, that method is included. The auditors are not confirming that the cash will come in.

The other thing the auditors are confirming is that the company remains a going concern. This is what they qualified with that much-discussed note in the audit report. What they have confirmed with that is that the directors have plans that will keep the club running until at least December this year, and they (they auditors) say we'll be in trouble if the directors are wrong.

What the accounts do not say is that Alan Pace would repay the £124m if the club was strapped for cash. If he promised that, then the audit going concern note would not be needed, and nor would the debtor recoverability note referred to above.

Note - all the references to Alan Pace actually refer to the complex and secretive group of companies that own BFC. He is the figurehead and ultimate controller of the group, but he personally won't be carrying the can if it goes pear-shaped.

Thanks dsr, I think I've made it pretty clear I'm talking about cash debt and not an auditors view of whether there are sufficient distributable profits to issue a dividend to offset the debt.

Unless I'm still misunderstanding it.

[dsr]

Thanks dsr, I think I've made it pretty clear I'm talking about cash debt and not an auditors view of whether there are sufficient distributable profits to issue a dividend to offset the debt.

Unless I'm still misunderstanding it.

No, that's right. There is no reason to believe that the cash is coming back.

[ClaretPete001]

No, that's right. There is no reason to believe that the cash is coming back.

indeed, like I say, I don't think I could have been any clearer. And it's not as if a non-accountant Burnley fan on a Burnley fan football forum is going to be discussing the technical ability of Alan Pace to offset intercompany debt with dividends based upon distributable revenue as opposed just giving us our money back.

[roperclaret]

indeed, like I say, I don't think I could have been any clearer. And it's not as if a non-accountant Burnley fan on a Burnley fan football forum is going to be discussing the technical ability of Alan Pace to offset intercompany debt with dividends based upon distributable revenue as opposed just giving us our money back.

It’s not ‘our’ money. The previous owners took the money.

[Jakubclaret]

It’s not ‘our’ money. The previous owners took the money.

I might be wrong here but wasn't that there's to take. I think the money being mentioned is after the purchase & separate from the previous owners.

[dsr]

I might be wrong here but wasn't that there's to take. I think the money being mentioned is after the purchase & separate from the previous owners.

The deal was arranged between both the former owners and the present ones. The cash wasn't withdrawn until after the new owners took charge, but it was done with full knowledge and agreement by Garlick and John B.

[Jakubclaret]

The deal was arranged between both the former owners and the present ones. The cash wasn't withdrawn until after the new owners took charge, but it was done with full knowledge and agreement by Garlick and John B.

Surely looking ahead a certain points got to be reached where the present owners are responsible for everything ceasing harping back to something that's long gone. All this was meant to be a new beginning.

[Chester Perry]

The deal was arranged between both the former owners and the present ones. The cash wasn't withdrawn until after the new owners took charge, but it was done with full knowledge and agreement by Garlick and John B.

That would be very difficult to prove - I don't believe the other members of the board at the time are absolutely certain about that.

The only monies I would accredit to such a claim with any degree of certainty, and even then it is marginal, is the circa £23m for the down payment on the takeover deal. It is not even certain if Mike Garlick let alone John Banaszkiewicz knew that that the claim that ALK had billionaire backer in Michael Dell was false and actually a loan arranged by partners in is external finance business.

It is not a popular view, people like to think the worst, but that is the impression my sources have given me.

Surely looking ahead a certain points got to be reached where the present owners are responsible for everything ceasing harping back to something that's long gone. All this was meant to be a new beginning.

This is an interesting one when you consider the above, we know that the cast majority of the £124.1m had been committed to the original takeover transaction - but it also appears that some was committed to the buying of shares from the small shareholders/fans and it is entirely possible that the club credit element of that transaction has been paid for by the club, we just do not know as there is no reporting of related party transactions. what we do know, because it has been confirmed by Barry Kilby is that the final payment for the initial takeover was made last summer and that fits with the reported increase in debt of Calder Vale Holdings to Burnley FC Holdings and it's group entities. so any further loans to ALK/VSL via Velocity Capital (UK) Holdings Ltd (or any of that groups other business entities) is not takeover related.

One final consideration - it will be interesting that now ALK/VSL have passed the threshold of 90% ownership (courtesy of an amazing deal with Mike Garlick and John Banaszkiewicz that also allowed them to flip 6,128 shares to Vlad Torgovnik for a likely huge profit) if they take up the ringfence option of the remaining shares held by the original sellers before it ends in October this year or if they let it expire and try to buy them on the cheap like they appear to be doing with the small shareholders on Asset Match.

[ClaretPete001]

It’s not ‘our’ money. The previous owners took the money.

I was trying to make a point about the relative sentiment of a Burnley fan being more interested in the cash debt and what it means to the business as opposed the blah blah technical aspects of writing off intercompany debts using dividends based upon the available distributable profits blah blah without having to say it all again.

I am somewhat minded of the old story about the folk lost in a helicopter, who in desperation flew over a tall building in a City that they had blundered into, shouting to an assembled group on its roof.

'Pray tell good fellows we are lost could you tell us where we are?'

Unfortunately the building belonged to a top 5 accountancy firm and the response was.. 'you are in a helicopter and the invoice is in the post?'.

[NewClaret]

It is not even certain if Mike Garlick let alone John Banaszkiewicz knew that that the claim that ALK had billionaire backer in Michael Dell was false and actually a loan arranged by partners in is external finance business.

It is not a popular view, people like to think the worst, but that is the impression my sources have given me.

One final consideration - it will be interesting that now ALK/VSL have passed the threshold of 90% ownership (courtesy of an amazing deal with Mike Garlick and John Banaszkiewicz that also allowed them to flip 6,128 shares to Vlad Torgovnik for a likely huge profit) if they take up the ringfence option of the remaining shares held by the original sellers before it ends in October this year or if they let it expire and try to buy them on the cheap like they appear to be doing with the small shareholders on Asset Match.

I find it absolutely incomprehensible that MG and JB did not know the source of the funds. Not least because ALK would have had to declare them as part of the premier league ownership tests.

I do not believe that at all and never will. But assuming for a moment they didn’t know, they failed completely in their duty to complete proper due diligence on the buyers, whilst publicly claiming to be custodians of the club. Which is equally unforgivable in my eyes.

If MG or JB did know and misled others, that’s frankly an abhorrent way to operate and highly unethical in its own right.

I’ll add here that I retain some hope that the ‘beautiful’ structure of the deal and our general lack of knowledge on the group structure means it’s not really as bad as it looks on the surface. In which case I’ll be elated and gladly beg forgiveness for my ill feelings towards the previous owners.

In your point about shares, you could argue they are paying their new market value (an auction determines the market value) and they are cheap(er) simply because the club has reduced in value since it was taken over.

[Vegas Claret]

Do we know if anyone is behind ALK and Pace and Co are just effectively running the show for a much larger group ?

nobody able to offer an educated guess to this ?

[dsr]

I find it absolutely incomprehensible that MG and JB did not know the source of the funds. Not least because ALK would have had to declare them as part of the premier league ownership tests.

I do not believe that at all and never will. But assuming for a moment they didn’t know, they failed completely in their duty to complete proper due diligence on the buyers, whilst publicly claiming to be custodians of the club. Which is equally unforgivable in my eyes.

If MG or JB did know and misled others, that’s frankly an abhorrent way to operate and highly unethical in its own right.

I agree. No-one would agree to sell £100m of assets without knowing that the money was available. Whether it was an agreed and documented loan, or cash in the bank, or cash placed with a solicitor as a secure third party, the money source would have been known to the seller. Just like if any of us were to sell a house - we wouldn't sign the sale contract unless we had assurance from the buyer's solicitor that funding was in place.

Besides, Garlick and John B were both still on the board when the cash was removed and when the new loan was taken out, and they didn't resign - so they supported the decision then, even if they had forgotten to ask about it earlier.

[ClaretPete001]

I think the fact that MG made such a song and dance about Covid and the damage £50 million could do to the club only to agree a deal whereby £50 million was taken out of the club to be given to MG and the former shareholders says it all.

It is not possible that the previous owners did not know the nature of ALK. Alan Pace was an employee of a bank when the deal was struck not a billionaire owner of a global sporting conglomerate.

[Jakubclaret]

That would be very difficult to prove - I don't believe the other members of the board at the time are absolutely certain about that.

The only monies I would accredit to such a claim with any degree of certainty, and even then it is marginal, is the circa £23m for the down payment on the takeover deal. It is not even certain if Mike Garlick let alone John Banaszkiewicz knew that that the claim that ALK had billionaire backer in Michael Dell was false and actually a loan arranged by partners in is external finance business.

It is not a popular view, people like to think the worst, but that is the impression my sources have given me.



This is an interesting one when you consider the above, we know that the cast majority of the £124.1m had been committed to the original takeover transaction - but it also appears that some was committed to the buying of shares from the small shareholders/fans and it is entirely possible that the club credit element of that transaction has been paid for by the club, we just do not know as there is no reporting of related party transactions. what we do know, because it has been confirmed by Barry Kilby is that the final payment for the initial takeover was made last summer and that fits with the reported increase in debt of Calder Vale Holdings to Burnley FC Holdings and it's group entities. so any further loans to ALK/VSL via Velocity Capital (UK) Holdings Ltd (or any of that groups other business entities) is not takeover related.

One final consideration - it will be interesting that now ALK/VSL have passed the threshold of 90% ownership (courtesy of an amazing deal with Mike Garlick and John Banaszkiewicz that also allowed them to flip 6,128 shares to Vlad Torgovnik for a likely huge profit) if they take up the ringfence option of the remaining shares held by the original sellers before it ends in October this year or if they let it expire and try to buy them on the cheap like they appear to be doing with the small shareholders on Asset Match.

Like I said there has to be a point where the new owner are exactly that & the old owners are exactly that. For me after the deal/purchase was completed the old owners no longer was responsible going forwards. The business was there's to sell as they saw fit utilizing whatever methods they took the risk investing in the first place so you could argue the slice of pie was well earned. As soon as the deal was agreed & shook upon that responsibility & control switched from 1 to the other.

[NewClaret]

nobody able to offer an educated guess to this ?

You ask a good question Vegas, so I’ll have a go at answering…

I’m convinced that there’s more to it than we know. I say that on the basis that I really thought Garlick was a good man at the time with the best intentions of the club at heart, even if massively risk averse. So it’s somewhat of a massive shift to become a greedy **** whose risk aversion was actually motivated by personal greed and he gradually stuffed his pockets with club cash and rode off in to the sunset.

I’m not convinced there’s a ‘big backer’ behind ALK though. The Dell link is interesting. Obviously the initial loan, I seem to recall some other ex-Dell folk being involved early doors and the author last week was ex-Dell. May be nothing there but appears some form of link.

Now we have the Kwok family invested, albeit the younger members who may not control as much wealth but will certainly have influence with very wealthy individuals. Plus other Asian smaller private investors.

Then there’s Vlad who’s interesting in that he’s held very senior roles at BoA, JPM and now an investment house with $63bn assets under management.

Plus some ex sports stars like JJ, Malcolm Jenkins, CJ Uzmoah. And then Dude Perfect. This bit I find most intriguing and frustrating because when JJ came on board he said part of his role was to attract other investors. Then DP came along and all was looking really interesting. Thats all gone quiet now, Jenkins and Uzmoah do very little to promote the club and DP have gone much quieter too. JJ is obviously excellent, but feels like we have a group of influencers there who could be better utilised.

In short there seems to be no strategy or consistency within the investor base so I can only conclude there’s no big backer, but lots of very high net worth individuals who want some involvement in elite level sport/the premier league, but don’t have the money to buy a club themselves or inclination to operate it.

So I don’t have the confidence we have one big financial backer, and obviously the question that raises is will they be able/willing to fund the club for a period if we don’t get promoted, but also have no doubt that there’s some seriously well connected people now involved and think we’d find that opens doors if we find ourselves in a sticky situation.

I also think there’s a very real option for ALK to IPO at some point, although that would need to be timed during a successful period and not in a distressed situation.

What is certainly true is that that there’s a lot more to our position than one set of accounts that a few of us on here pour over and draw conclusions about… I am interested in the subject generally but find it hard to get worked up about parts of the jigsaw absent so many other pieces.

[NewClaret]

I think the fact that MG made such a song and dance about Covid and the damage £50 million could do to the club only to agree a deal whereby £50 million was taken out of the club to be given to MG and the former shareholders says it all.

It is not possible that the previous owners did not know the nature of ALK. Alan Pace was an employee of a bank when the deal was struck not a billionaire owner of a global sporting conglomerate.

Spot on.

Per my post above, It’s such an unbelievable departure from what appeared to be a risk averse, true custodian of the club, that I still hold out a sinew of hope he didn’t shaft us in the way it looks. But whatever he did, he did it knowingly.