Pace/ALK set to buy Espanyol?

[Paul Waine]

I don't get why they invest but as you'll know there are LOTS of folks in America that can find 200 million down the back of their sofa and not miss it one bit.

I suspect minimum investment is of the order of $5 million or $10 million per individual (or family). So far as I understand, none will be in the public domain - and visible to others to see unless the individuals announce themselves.

[Vegas Claret]

I suspect minimum investment is of the order of $5 million or $10 million per individual (or family). So far as I understand, none will be in the public domain - and visible to others to see unless the individuals announce themselves.

which is like 2 quid to the rest of us. The money floating around with these guys is unimaginable for most of us.

[ClaretPete001]

Hi Pete, I don't think you should look at ALK/VSP as a "private equity" investor. It's just a simple investor in football clubs. Their aim is to achieve capital growth as the gap in valuations of English and other European football clubs and USA sports clubs narrows.

I wasn't suggesting they are I think others were suggesting PE money was behind the Espanyol deal

[ClaretPete001]

I don't get why they invest but as you'll know there are LOTS of folks in America that can find 200 million down the back of their sofa and not miss it one bit.

My experience of US PE companies are hour long lunchtime Powerpoint presentations about double digit growth, exposure to risk, percentage number of customers signed onto disruptive technologies, ARR, the US market, the Indian market, the _________ (add market) and so on and so on UNTIL....zzzzzzzz wake me up when it's over...!

I've never met one prepared to chuck away £200 million - Quite the opposite in fact they hire myriads of accountants while outsourcing tech function to India, then Bulgaria and then Romania and so on and so forth as unforeseen problems arise..

But there are probably people as you describe.

[Vegas Claret]

My experience of US PE companies are hour long lunchtime Powerpoint presentations about double digit growth, exposure to risk, percentage number of customers signed onto disruptive technologies, ARR, the US market, the Indian market, the _________ (add market) and so on and so on UNTIL....zzzzzzzz wake me up when it's over...!

I've never met one prepared to chuck away £200 million - Quite the opposite in fact they hire myriads of accountants while outsourcing tech function to India, then Bulgaria and then Romania and so on and so forth as unforeseen problems arise..

But there are probably people as you describe.

There has to be a reason all the Americans are investing in football - look at the money in US sport, they'll do the same over the next decade I reckon (or at least try to). Nice problem to have though, "what shall I do with my spare 200 million" !

[CoolClaret]

There has to be a reason all the Americans are investing in football - look at the money in US sport, they'll do the same over the next decade I reckon (or at least try to). Nice problem to have though, "what shall I do with my spare 200 million" !

....and that's a perfect example as to why the rich should pay more tax.

[Corway]

(I don't know if we will see any legal entities in UK Companies House records for the appropriate links to Espanyol in Spain. Similarly, I don't know if any Jersey entity will be part of the USA to Europe link).

Hi Paul
There is only one legal entity for Burnley in Companies House with a total value of £10.00p I presume to satisfy some rule maybe ownership requirements so I doubt Espanyol will feature here. There will be some requirement to be registered in Spains equivalent as Jersey is part of the UK.

Our ownership is all smoke and mirrors. I thought our type of takeover using clubs assets was subsequently banned by the FA.
This was seems to legitimately backed by US capitalists.

[Chester Perry]

(I don't know if we will see any legal entities in UK Companies House records for the appropriate links to Espanyol in Spain. Similarly, I don't know if any Jersey entity will be part of the USA to Europe link).

Hi Paul
There is only one legal entity for Burnley in Companies House with a total value of £10.00p I presume to satisfy some rule maybe ownership requirements so I doubt Espanyol will feature here. There will be some requirement to be registered in Spains equivalent as Jersey is part of the UK.

Our ownership is all smoke and mirrors. I thought our type of takeover using clubs assets was subsequently banned by the FA.
This was seems to legitimately backed by US capitalists.

Not banned by the FA and the Premier League's much vaunted ban introduced a couple of years back is in reality only on very high leverage deals - it is at a % level that would not have prevented the leveraged takeovers at Manchester United or Burnley.

The reason for that is simple - Owners want to be able to sell their clubs at some point in the future and want to put as few restrictions on their ability to do so as possible

[Claretnick]

There will be some requirement to be registered in Spains equivalent as Jersey is part of the UK.

Just a small point, you may have missed a word. Jersey is not part of the UK and is not represented in the UK Parliament.

[northeastclaret]

Are you sure? Their football team plays in the England non league pyramid.

[Corway]

Not banned by the FA and the Premier League's much vaunted ban introduced a couple of years back is in reality only on very high leverage deals - it is at a % level that would not have prevented the leveraged takeovers at Manchester United or Burnley.

The reason for that is simple - Owners want to be able to sell their clubs at some point in the future and want to put as few restrictions on their ability to do so as possible

Interesting Chester
What % level applies and what level do you believe Burnleys takeover was. It looked like almost 100% to me.

[Corway]

Are you sure? Their football team plays in the England non league pyramid.

Yes for Football their football association is treated as a county and regulated by the FA.they are not part of UEFA but have applied
But for business they are not part of the UK so I was wrong with that part of my comment

If the FAs rules on leverage don’t work maybe UEFA could get involved as they have recently shown with Chelsea Villa and others their rules are stricter.

[Claretfanatic1982]

Just a small point, you may have missed a word. Jersey is not part of the UK and is not represented in the UK Parliament.

That's spot on.
Jersey is not part of the UK. It's a crown dependency and self governing. The UK is just responsible for it's defence and international relations.

[NewClaret]

Because ... and it's a sad confession, I have been writing business-related words for decades. Think it was 1986 when I saw my first instance of hyperbolic corporate PR, and it probably came from North Sea Ferries. Or maybe it was P and O.
When I first saw fellow fans talking about the Checketts-Eccles JV on X, I looked at multiple articles on the topic, and of course, read the original PR release.
IF (and it's an extremely large IF) the £150m does exist - and isn't, for example, based on what ALK might put into Espanyol over several seasons - my first thought was that they'd borrowed against the value of their holding in BFC, given that they'd get a higher valuation after promotion.

I don’t doubt that some of it may be PR, and I’ve read it back and Checketts actually says they’re looking to fund raise quickly but over the next 12 months so you’re probably right, but equally, a quick google of the Eccles family suggests they are very rich:

The Eccles family in Utah has a net worth estimated to be in the billions, primarily due to their diverse business ventures and philanthropic foundations. Their wealth stems from a history of coal mining, lumberyards, banking (First Security Corporation), and construction companies, including a significant role in building the Hoover Dam. Several family foundations, like the George S. and Dolores Doré Eccles Foundation, have contributed over $1 billion to Utah causes

What I particularly like about this is that it’s wealth apparently formed in what I would call proper businesses - coal, lumber, construction. Not crypto trading or some nonsense.

Cynosure Group has $8bn assets under management.

I don’t think it’s really that unbelievable that a family of such means could find £150m pretty quickly. Or whatever was needed to make the initial payment. I agree with you it will be in instalments.

I’m also unconvinced there’s any capacity to raise more debt against BFC, even with promotion. Time will tell, I suppose, but my money is 100% on a Cynosure x Checketts investment in ALK, but in any event, interesting times.

[NewClaret]

Interesting Chester
What % level applies and what level do you believe Burnleys takeover was. It looked like almost 100% to me.

CP will confirm the figures, but it would have been about 38% leverage - £65m of the £170m was debt.

I think there was £15m of new money and the rest was effectively the clubs cash transferred to Mike Garlick.

[NewClaret]

I know he’s answered your question himself but I can assure you, having known claretextile (posting wise) for a lot of years, that I wouldn’t be questioning him.

I wasn’t questioning that his information was correct, just how he knew and how it was otherwise being funded, but thank you for confirming he’s a legitimate poster.

[forzagranata]

The new sports investment fund is a joint venture between Checketts and the Cynosure Group. Here is a bit on that group from their own mouths:

"The Cynosure Group is an innovative private investment firm founded in 2013 by senior investment professionals from some of the country’s leading asset managers to take a new approach to a range of investment challenges. The firm manages billions of dollars for over 100 family offices, university endowments, and institutional investors, and across multiple private investment funds with a global investor base. With offices in Salt Lake City and New York, Cynosure operates across four major disciplines – private equity and debt, foundation and endowment management, ultra-high net worth wealth advice, and quantitative liquid asset strategies – and was listed 4th in Newsweek’s 2024 ranking of 15,000 investment firms across the United States."

Not short of a bob or two.....

[ClaretPete001]

....and that's a perfect example as to why the rich should pay more tax.

The rich don't have anything to tax - that's why almost every attempt to tax them fails. Take an Alan Pace type figure - not Alan himself I have no idea of his tax situation - but for sake of argument let's take Alanis Pace who could now be argued to be worth in excess of a £100 million if you include the ownership of a football club - what aspect of it are you going to tax? Her salary is paid as management charges into a company in Delaware.

Her house is probably rented from some property company registered in Jersey. Her other properties are in the US or in states like Monaco. Her wealth is tied up in Shares in a company that are not yet realised. Her share portfolio is run from by a tax company in a tax haven in the Indian Ocean

What are you going to tax?

[ClaretPete001]

There has to be a reason all the Americans are investing in football - look at the money in US sport, they'll do the same over the next decade I reckon (or at least try to). Nice problem to have though, "what shall I do with my spare 200 million" !

I think a number will get burned. The big players will buy the top clubs in Europe who are immune from relegation in the hope they can push towards a super league, which will create huge sporting empires without relegation and probably with salary caps etc. like the US model. If they can do that growth would be global and exponential

Of course in that scenario feeder clubs can become useful but I see little point for a Private Equity company paying to buy smaller clubs that don't get into Europe, could suffer relegation and don't really grow outside of TV revenues.

I think the .com bubble and the 2008 crash suggest private equity and banking in general is also susceptible to fads and fashions.

[NewClaret]

The new sports investment fund is a joint venture between Checketts and the Cynosure Group. Here is a bit on that group from their own mouths:

"The Cynosure Group is an innovative private investment firm founded in 2013 by senior investment professionals from some of the country’s leading asset managers to take a new approach to a range of investment challenges. The firm manages billions of dollars for over 100 family offices, university endowments, and institutional investors, and across multiple private investment funds with a global investor base. With offices in Salt Lake City and New York, Cynosure operates across four major disciplines – private equity and debt, foundation and endowment management, ultra-high net worth wealth advice, and quantitative liquid asset strategies – and was listed 4th in Newsweek’s 2024 ranking of 15,000 investment firms across the United States."

Not short of a bob or two.....

That was my take from a brief bit of research.

I’d be most interested to know if the Dell family were one of those ‘family offices’.

[ClaretPete001]

I tend to think that people who think Private Equity companies are going to behave like Russian Oligarchs, brand washing Middle Eastern states or billionaire fan owners like Tony Bloom are going to be disappointed.

[forzagranata]

I tend to think that people who think Private Equity companies are going to behave like Russian Oligarchs, brand washing Middle Eastern states or billionaire fan owners like Tony Bloom are going to be disappointed.

Indeed.

But likewise, those who think PE investors are simply interested in buying and then 'flipping' in five years time at a profit, could also be surprised.

[aggi]

We know the way that Velocity is structured and how the shareholdings are managed up through the group Velocity in effect control a fraction over 90% of the shares with Vlad Torgovnik the next biggest shareholder before the rest of minor shareholders

We will never get to know who all the members of Velocity Sports Partners LLC are (I have identified over 20 mainly via their own contributions to social media - but believe there are quite a few more)

As for transparency - it would be helpful if the UK authorities such as Companies House actually enforced their own rules. I learned recently that they don't even fine companies for late filings (of accounts) until a filing has been made, even though the law states that a filing not made on time is a criminal act at the moment it becomes overdue.

Velocity have 3 current UK companies that have never filed accounts and another that has since been dissolved that also never filed accounts. We do know (thanks to Liquidators filings at Companies House) that for two of those three that Accounts have been prepared because there have been payments by them to HMRC (some of which were late and resulted in fines having to be paid).

Not sure who told you that but I've seen plenty of late filing penalties and even prosecutions of directors for late filing of accounts before accounts have been filed.

The main issue with the fines is that they are pretty small in the scheme of things.

[Big Vinny K]

Yes, UK and US owned 2 billion dollar tech company but I have nothing to do with them other than they look to grow businesses by investing in future technologies like SAAS (in the past) or AI currently because that's how you raise the value of your products and compete in the marketplace..

As I think Chester says, I see little growth in buying these smaller clubs other than TV broadcast revenue but the amounts required to invest are frightening.

Burnley's growth will come solely from collective bargaining of TV revenue. I see little point to it from a PE perspective and I think a lot of them will get burned. Espanyol may have more potential but we haven't grown the turnover since 2019 and commercial revenues are stagnant. And Espanyol have been relegated in the recent past.

But clearly you, and they know better than me so perhaps you could point out how they are going to significantly grow financially two mid table clubs and how it would benefit Burnley?

I’m with you completely about the commercial rationale - I can’t see them either. And money aside I just do not believe in the whole concept of multi club ownerships and in particular the feeder club scenarios.

My point was really more about your description of these types of investors !!

[Paul Waine]

Not sure who told you that but I've seen plenty of late filing penalties and even prosecutions of directors for late filing of accounts before accounts have been filed.

The main issue with the fines is that they are pretty small in the scheme of things.

A few years ago I was fined £100 by Companies House for late filing of my small consultancy company's accounts. I submitted the accounts and paid the fine immediately. It was all a misunderstanding on my part. I'd closed the company down, settled all tax due with HMRC and asked them if anything else was required. I was specifically thinking about submitting the liquidated company's accounts to Companies House. HMRC said, no, nothing else required. Somewhere in the "how to close your company" instructions, I think I'd read that HMRC and Companies House linked together. If so, it's not with regard to filing copies of the closed company's accounts. Not a big issue and, of course, not a big fine.

[Chester Perry]

Not sure who told you that but I've seen plenty of late filing penalties and even prosecutions of directors for late filing of accounts before accounts have been filed.

The main issue with the fines is that they are pretty small in the scheme of things.

Interestingly enough it was Companies House themselves - unsolicited as part of a response to a separate enquiry. I have to say I was surprised by it

[Paul Waine]

That was my take from a brief bit of research.

I’d be most interested to know if the Dell family were one of those ‘family offices’.

I doubt Dell family are connected with Eccles family and Cynosure. There's nothing showing up on "search" that connects the two.

Eccles family converted to Church of Latter Day Saints before emigrating from Scotland to Utah in 19th century. LDS is the strong link between Eccles family and Dave Checketts.

[aggi]

Interestingly enough it was Companies House themselves - unsolicited as part of a response to a separate enquiry. I have to say I was surprised by it

I suspect there were some crossed wires somewhere because I'm aware of plenty of recent examples where that hasn't been the case (we're a registered office for 1,000s of companies so see plenty of penalties coming in).

[NewClaret]

I’m with you completely about the commercial rationale - I can’t see them either. And money aside I just do not believe in the whole concept of multi club ownerships and in particular the feeder club scenarios.

My point was really more about your description of these types of investors !!

I think the commercial rationale is built on UK and EU sports teams being valued at far lower multiples than US teams. I think they expect those valuations to catch up at some point. Logic would suggest they might in a more buoyant M&A market.

I dare say they’d love revenue growth if they can deliver it, but I think they expect that to come from player trading than the TV or commercial revenue growth Pete mentions. I think they’re essentially trying to perfect a tech/data-based talent ID, recruitment and platform (the team) conveyor belt that they can generate big and quick profits from. Having more teams provides more platforms (teams) to allow them to do that. And in all likelihood, player fees are only going in one direction.

Just my guess, but I think ALK want the scale of multiple clubs and then may list the group, transferring investors equity/units in to shares so they can sell at their leisure.

[NewClaret]

I doubt Dell family are connected with Eccles family and Cynosure. There's nothing showing up on "search" that connects the two.

Eccles family converted to Church of Latter Day Saints before emigrating from Scotland to Utah in 19th century. LDS is the strong link between Eccles family and Dave Checketts.

Thanks for doing a search Paul, much appreciated. Maybe not then, for some reason I thought Micheal Dell was part of the LDS but he’s not so maybe that was the guy running MSD at the time of the purchase.

Anyway, the report I read said they’re connected to “100’s” of family offices so who knows?

[Chester Perry]

Interesting Chester
What % level applies and what level do you believe Burnley's takeover was. It looked like almost 100% to me.

The Premier Leagues threshold for Leveraged buyouts is now 65%

At the time the takeover was approved the deal was £170m for 83.97% of the shareholding (with up to a further £20m to be paid based upon performance. The trick here, and it can still be used was that payment was to be staggered following the initial down payment of £98m of which just £10m came from ALK, £65m from the MSD loan which was immediately transferred onto the club (for the week before it was held at Kettering Capital Limited - which allowed the then board to be duped into believing that Michael Dell was directly involved in the takeover) and £23m cash from the club - giving a then leverage of 51.76% on the acquisition or around 43.8% of the valuation the deal placed on the club.

Also at the time of the takeover there were noises about trying to recoup some/all £23m sum borrowed from the club with a quick flip of shares (which failed). The deal presented to the previous board also never mentioned that subsequent stage payments would be covered in significant proportion by the club - the idea was that incoming new investors to Velocity (as we now hear them refer to themselves) - that plan largely failed too at least within the timeframe of the stage payments.

That said - at no time has the contributions from the club (£124.07m at peak) exceeded the 65% of the value of the club under the takeover deal

[aggi]

I’m with you completely about the commercial rationale - I can’t see them either. And money aside I just do not believe in the whole concept of multi club ownerships and in particular the feeder club scenarios.

My point was really more about your description of these types of investors !!

I suspect the plan with buying clubs like Burnley is the hope that we'll get dragged along with increasing premier league revenues rather than our commercial revenue is going to shoot up many multiples (although there is certainly some scope there for increase).

There's still areas of growth around digital distribution, overseas games, restricting relegation, etc to suggest there's more that can be squeezed from the league.

MLS teams have big values, NFL teams have huge values, so you can see why they're looking for value elsewhere.

[Chester Perry]

I suspect the plan with buying clubs like Burnley is the hope that we'll get dragged along with increasing premier league revenues rather than our commercial revenue is going to shoot up many multiples (although there is certainly some scope there for increase).

There's still areas of growth around digital distribution, overseas games, restricting relegation, etc to suggest there's more that can be squeezed from the league.

MLS teams have big values, NFL teams have huge values, so you can see why they're looking for value elsewhere.

Indeed - Overseas broadcast revenues for the Premier League (already greater than domestic ones by a margin) have increased by 27% for the coming season and there is a belief thattheir is a long way for them to go particularly in the US

[NewClaret]

I suspect the plan with buying clubs like Burnley is the hope that we'll get dragged along with increasing premier league revenues rather than our commercial revenue is going to shoot up many multiples (although there is certainly some scope there for increase).

There's still areas of growth around digital distribution, overseas games, restricting relegation, etc to suggest there's more that can be squeezed from the league.

MLS teams have big values, NFL teams have huge values, so you can see why they're looking for value elsewhere.

I agree with this. Your last paragraph relates to my first above, and I agree with your points where opportunities exist. To add to your list, Checketts also mentioned women’s sport as areas they expected to provide growth opportunities, which may explain why Alan Pace takes our women’s team so seriously.

But I still think their absolute main strategy for revenue growth is around player trading.

[taio]

I agree with this. Your last paragraph relates to my first above, and I agree with your points where opportunities exist. To add to your list, Checketts also mentioned women’s sport as areas they expected to provide growth opportunities, which may explain why Alan Pace takes our women’s team so seriously.

But I still think their absolute main strategy for revenue growth is around player trading.

Chelsea are using women's football to act as a work around to comply with PSR by transferring ownership to a parent company. There are other PL clubs doing, or are exploring doing, similar to transact an (un)fair market value for their women's team. Chelsea used a valuation of circa £200m.

[NewClaret]

Chelsea are using women's football to act as a work around to comply with PSR by transferring ownership to a parent company. There are other PL clubs doing, or are exploring doing, similar to transact an (un)fair market value for their women's team. Chelsea used a valuation of circa £200m.

Yes, I think don’t think Checketts meant it in a way to cheat though He was discussing how women are developing athletically and how the standard is improving. I think they may think that’s a whole new avenue of TV and player trading revenue in future.

[taio]

Yes, I think don’t think Checketts meant it in a way to cheat though He was discussing how women are developing athletically and how the standard is improving. I think they may think that’s a whole new avenue of TV and player trading revenue in future.

I was offering another possibility of why Alan Pace may be taking women’s football seriously.

[Chester Perry]

I think a number will get burned. The big players will buy the top clubs in Europe who are immune from relegation in the hope they can push towards a super league, which will create huge sporting empires without relegation and probably with salary caps etc. like the US model. If they can do that growth would be global and exponential

Of course in that scenario feeder clubs can become useful but I see little point for a Private Equity company paying to buy smaller clubs that don't get into Europe, could suffer relegation and don't really grow outside of TV revenues.

I think the .com bubble and the 2008 crash suggest private equity and banking in general is also susceptible to fads and fashions.

The proposed new IFR will theoretically have explicit powers to prevent that - at least for English clubs - as outlined in the latest factsheet
https://www.gov.uk/government/publicati ... ulator-ifr

Prevent English clubs from joining breakaway or unlicensed leagues.

Fans will no longer face the prospect of their clubs signing up to damaging breakaway competitions such as the European Super League, which several Premier League clubs tried to join in 2021. The proposals for the new competition were not meritocratic, did not have the support of the fans, and threatened the heritage and financial stability of English football. The IFR will be able to prohibit such competitions.

[ClaretPete001]

Indeed.

But likewise, those who think PE investors are simply interested in buying and then 'flipping' in five years time at a profit, could also be surprised.

PE investors don't always do that but essentially they behave like professional business people so they are looking to invest in growth,

Garlick could have borrowed money and so could any of the other owners of the club. At various times we have sold the ground to secure funding.

It's about the level of risk the various owners are prepared to take and their distance from the asset. If you are managing hundreds of billions worth of assets - a couple of hundred million becomes relatively meaningless if that couple of hundred is not generating decent growth.

[ClaretPete001]

I’m with you completely about the commercial rationale - I can’t see them either. And money aside I just do not believe in the whole concept of multi club ownerships and in particular the feeder club scenarios.

My point was really more about your description of these types of investors !!

I wasn't being entirely serious. My point was that bandying around figures of billions when referring to PE companies is not the same as when you talk about Tony Bloom or the Saudis. It isn't cash floating around and you have to work hard to make a case for the investment. So, it's no different to any other business scenario regardless of the billions

[Chester Perry]

PE investors don't always do that but essentially they behave like professional business people so they are looking to invest in growth,

Garlick could have borrowed money and so could any of the other owners of the club. At various times we have sold the ground to secure funding.

It's about the level of risk the various owners are prepared to take and their distance from the asset. If you are managing hundreds of billions worth of assets - a couple of hundred million becomes relatively meaningless if that couple of hundred is not generating decent growth.

Many forget just how much the board were affected by the itv digital collapse and possibly more so the the first post experience of being in the Premier League - Kilby and Sullivan bought the fixed assets to keep the club free of administration (as much as to ensure that local suppliers were paid in full (if a little late as anything) Kilby felt responsible and took action to get through the mess.

The experience had consequences which where re-enforced by returning to debt after the the first Premier League season. Under Garlick and with the boards full support the club took on debts (including transfer debt) for which it had solid finances to pay for it. This never really changed even as the asset base was strengthened. It contributed much to Garlick's -'we could lose £50m' in the summer of 2020 - as it was only the lack of broadcaster rebate in the 2020-21 season prevented that total being reached or even surpassed

[ClaretPete001]

Indeed - Overseas broadcast revenues for the Premier League (already greater than domestic ones by a margin) have increased by 27% for the coming season and there is a belief thattheir is a long way for them to go particularly in the US

Revenue from broadcast rights was not as high in 2024 as in 2018. And while I have no doubt that broadcast revenue will see incremental increases for the bigger clubs it's not clear whether it will be the case for the smaller clubs particularly if they get relegated.

Again Espanyol may provide a more stable investment opportunity because they are comfortably LA Liga size but I don't see how that helps us.

[ClaretPete001]

Many forget just how much the board were affected by the itv digital collapse and possibly more so the the first post experience of being in the Premier League - Kilby and Sullivan bought the fixed assets to keep the club free of administration (as much as to ensure that local suppliers were paid in full (if a little late as anything) Kilby felt responsible and took action to get through the mess.

The experience had consequences which where re-enforced by returning to debt after the the first Premier League season. Under Garlick and with the boards full support the club took on debts (including transfer debt) for which it had solid finances to pay for it. This never really changed even as the asset base was strengthened. It contributed much to Garlick's -'we could lose £50m' in the summer of 2020 - as it was only the lack of broadcaster rebate in the 2020-21 season prevented that total being reached or even surpassed

And that is the point I am making. Local business people and fans of the club (some disagree in one case) are much more sensitive to risk. The financial situation now is arguably more precarious than it was under Garlick and Kilby but the the people in charge are used to dealing with that level of debt and to some extent are looking to use the club as a springboard to a bigger business.

I doubt the few million ITV Digital collapse would have worried Alan Pace too much. What I am trying to get across is that 'private equity is a thing in itself' it doesn't obey the rules of local business or those that have governed football finances for over 100 years. It doesn't care a great deal.

[Chester Perry]

Revenue from broadcast rights was not as high in 2024 as in 2018. And while I have no doubt that broadcast revenue will see incremental increases for the bigger clubs it's not clear whether it will be the case for the smaller clubs particularly if they get relegated.

Again Espanyol may provide a more stable investment opportunity because they are comfortably LA Liga size but I don't see how that helps us.

A lot of that is down to league position - 18th place this coming season will get £120m - £125m and possibly even more

[ClaretPete001]

A lot of that is down to league position - 18th place this coming season will get £120m - £125m and possibly even more

It's a bit of a mute point. 18th place will see us relegated and that is the issue.

Both ourselves and Espanyol have been relegated twice in the last 5 seasons.

Let's see how this pans out because I think there are also issues about the dilution of shareholding if PE money is involved, which has not been discussed and to be honest none of us know where the money is coming from or what kind of deal this is...!

We are already, Eur 70 million in this summer and not resolved the real issues of the squad. I expect to see a lot more on the transfer front and it may give us some insight into how ALK are going to operate going forward.

[NewClaret]

Revenue from broadcast rights was not as high in 2024 as in 2018. And while I have no doubt that broadcast revenue will see incremental increases for the bigger clubs it's not clear whether it will be the case for the smaller clubs particularly if they get relegated.

Again Espanyol may provide a more stable investment opportunity because they are comfortably LA Liga size but I don't see how that helps us.

Setting aside morality of MCOs, think there are loads of benefits for us, probably more pronounced if we remain a team bouncing between the Premier League and Championship.

Our MO seems to be to try to identify young talent very cheaply that we hope to gain big profits on in future and I think they see this very much as part of the pathway for young player development.

That’s a long term view though, I don’t think it’ll make any major differences to either club over night.

[ClaretPete001]

Setting aside morality of MCOs, think there are loads of benefits for us, probably more pronounced if we remain a team bouncing between the Premier League and Championship.

Our MO seems to be to try to identify young talent very cheaply that we hope to gain big profits on in future and I think they see this very much as part of the pathway for young player development.

That’s a long term view though, I don’t think it’ll make any major differences to either club over night.

Like what....? How is buying a club that gets relegated from La Liga going to help with player development? They need their players as much as we need ours.

Chelsea can buy lots of young players and develop them using an Espanyol because young Chelsea players may not be good enough for Chelsea but could be developed in La Liga or La Liga 2 and sold for a decent profit or indeed develop into Chelsea players.

The relative worth of Chelsea runs into billions so £200 million is nothing if Espanyol get relegated. And with a healthy crop of Chelsea youngster to help them back to La Liga the risk is relatively minimal.

But that is not the case with a Burnley - Espanyol tie up because both clubs are vulnerable to relegation and operating at a similar level both financially and in terms of football.

[Chester Perry]

Setting aside morality of MCOs, think there are loads of benefits for us, probably more pronounced if we remain a team bouncing between the Premier League and Championship.

Our MO seems to be to try to identify young talent very cheaply that we hope to gain big profits on in future and I think they see this very much as part of the pathway for young player development.

That’s a long term view though, I don’t think it’ll make any major differences to either club over night.

the thing is we are doing what everyone else is doing - and not doing it in a way that is different to others it seems

While Espanyol can gain greater access to young players on the continent and from South America in particular I still think they are overpriced given the returns in la liga. T

he only difference I note is that the stadium is more easily available for concerts and such like for those acts not quite big enough to fill mega stadiums - it's location helps on that front too - it is a good niche level size and the relationship with Ticketmaster could help on that front

[123EasyasBFC]

the thing is we are doing what everyone else is doing - and not doing it in a way that is different to others it seems

While Espanyol can gain greater access to young players on the continent and from South America in particular I still think they are overpriced given the returns in la liga. T

he only difference I note is that the stadium is more easily available for concerts and such like for those acts not quite big enough to fill mega stadiums - it's location helps on that front too - it is a good niche level size and the relationship with Ticketmaster could help on that front

Do you think the location and stadium is a big reason for the reported fee being around 180m. To me that seems very high for a lower laliga team

[NewClaret]

Like what....? How is buying a club that gets relegated from La Liga going to help with player development? They need their players as much as we need ours.

Chelsea can buy lots of young players and develop them using an Espanyol because young Chelsea players may not be good enough for Chelsea but could be developed in La Liga or La Liga 2 and sold for a decent profit or indeed develop into Chelsea players.

The relative worth of Chelsea runs into billions so £200 million is nothing if Espanyol get relegated. And with a healthy crop of Chelsea youngster to help them back to La Liga the risk is relatively minimal.

But that is not the case with a Burnley - Espanyol tie up because both clubs are vulnerable to relegation and operating at a similar level both financially and in terms of football.

I thought the whole discussion here was that Espanyol are an established La Liga side? Sure I read somewhere that they’ve been relegated four times in their history or something?

My assumption is that we’re much the more likely side to be relegated and I think if we are there’s some quite significant advantages (assuming they are not in the same year) in terms of how we shape our squads, offload players on high salaries that can’t find other moves, maybe bring players back from loan who would help us get back up and so on.

Clearly the double relegation scenario is the worst possible case scenario, but while one remains in a top division, I think relegations for the other may be possible to better manage. I actually think Espanyol face to benefit more from the ALK acquisition than than we did when first purchased though. I can imagine two or three players in our current squad players might improve them but not be part of our immediate plans.