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New buyers put off by £20 million hole in accounts

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KittenMittens said:
The idea that taking £20m+ out of the club that may well be written off and sent into the financial ether (ie: used to fund a takeover and never paid back), at a time when we could have used that money to get back to the Championship at very least, is farcical. If they write the £20.5m off, it is a f***ing disaster to never have the use of that money over the last 2 years, and nobody objective would say otherwise. They committed to paying it back, and now it appears that they may well be trying to renege on that commitment.

And why am I so angry at your defence of them trying to write off £20.5m that they took out of SAFC? Because I told you they might do that as early as July last year when you were swooning over 'Charlie' and his platitudes, and you played down that risk, and even worse, made me out to be a fifth column just for suggesting it. You could have just said you didn't agree, but you went so hard that it made me wonder why on earth you are so utterly incapable of seeing what these people are clearly trying to do to our club.
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Writing off this balance doesn't affect the situation now. The cash flow was nearly two years ago. Nor does it preclude them or any other owner injecting cash into the business. The only difference is that it will now crate a balance owed to the owners, rather than clearing a balance due to the club. Don't get me wrong; it's a bloody stupid thing to do. But it was even more stupid to set up a deal which led to the creation of the balance in the first. But Ellis couldn't swallow his pride and leave the last £25m where it should have stayed - on the books of Sunderland to be dealt with by Sunderland.
 

Stormo said:
Wish he would just sell up and fuck off.
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But if GOM is right, they need £30m just to cover costs.
Who exactly is chomping at the bit to spend £30m on a club with no immediate prospects of income to help pay back your investment?
Have you got that kind of cash down the back of your sofa?
 
DJM said:
But if GOM is right, they need £30m just to cover costs.
Who exactly is chomping at the bit to spend £30m on a club with no immediate prospects of income to help pay back your investment?
Have you got that kind of cash down the back of your sofa?
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Wish I had, and if I did I wouldn’t be buying a football club.
I just hope he’s actively trying to sell, as in contacting potential investors etc (I don’t know how it works). I get the impression that he’s one of these who will just wait until someone comes to him.
 
Father Jack Hackett said:
Just let this sink in lads and lasses. We're at out lowest ever ebb, we're potless and, if this is true, these fellas have taken £20m of our club's money, sold anything that isn't screwed down, have scared away potentially our biggest chance of really doing something in a lifetime and are wanting a king's ransom for the club.
All whilst spending £100k trying to get us out of this God forsaken league, having failed last season.
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It is confusing but they haven't taken 20m out. There was a 25m loan outstanding to ES which SD stated at the time would be paid over time. The parachute payments were a guarantee to ES but not a preferred option. The have paid 5m off the loan, so now owe 20m to ES.
If we had got promoted the rest would have been paid off no problem, but that is what guarantees are for.
 
In other circumstances I think we’d now be at the point of demonstrations, walkouts, staying away from games. We really are in the perfect shitstorm.

The only thing I can do is cancel my season ticket, even then it scares me what a slighted Donald would do in terms of selling the club on to another shyster.

What an almighty mess.
 
Grumpy Old Man said:
Writing off this balance doesn't affect the situation now. The cash flow was nearly two years ago. Nor does it preclude them or any other owner injecting cash into the business. The only difference is that it will now crate a balance owed to the owners, rather than clearing a balance due to the club. Don't get me wrong; it's a bloody stupid thing to do. But it was even more stupid to set up a deal which led to the creation of the balance in the first. But Ellis couldn't swallow his pride and leave the last £25m where it should have stayed - on the books of Sunderland to be dealt with by Sunderland.
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I think I just about get the fact that SD and his sideckick swallowed Ellis' £25 debt into Madrox to help spin the yarn that the club has no debts.
Technically Sunderland is now debt-free but its parent club Madrox has a hole in the accounts so any purchser has to find that money for starters.
Is that how it is?
 
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sinner said:
It is confusing but they haven't taken 20m out. There was a 25m loan outstanding to ES which SD stated at the time would be paid over time. The parachute payments were a guarantee to ES but not a preferred option. The have paid 5m off the loan, so now owe 20m to ES.
If we had got promoted the rest would have been paid off no problem, but that is what guarantees are for.
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So theretically ES could buy the club for £10m if he takes back on board the £20m Madrox debt?
 
Ericsgate said:
m just imagining a scenario, say that 30 clubs file for administration due to insolvency. They cannot all be deducted points and relegated. Relegated to what?
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There are scores of well run clubs in the pyramid system, if you were the chairman of a decent Conference club that had been well run for years I fancy you would not take kindly to any financial skulduggery that would give clubs in the league above you a financial advantage. In effect the league pyramid system makes all football clubs "financial competitors" of each other. Must therefor be a level playing field. Its a fact of financial life that recessions weed out poor underperforming companies and open the market place to more efficiently run competitors. The same rules should apply to sports clubs. Bottom line is professional football has been run in this country for decades is scandalous and is drastically in need of changes.
 
Ericsgate said:
“they’ve used the clubs money to pay back a loan the club had taken out”

Succinct and accurate summary.
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Which would have caused no problems in most people’s minds, if they hadn’t relentlessly told everyone that this 25m was to be paid back into the club in full and under no circumstances would be used to pay off the loan without repayment.
 
Ashley In!! said:
Because Donald said they'd pay it back.
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Yeah which no doubt they will continue to say. They won’t of course. But they aren’t any less likely today than they were at the end of last season when they said it.

Also they’re clearly trying to build it into any asking price which no doubt any prospective buyers are seeing / will see straight through
 
rocky said:
Has @fyl2u and @Mary Hinge commented yet? Stewies fluffers
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Bacon sarnie the birds are singing, the "fans" groups are spewing.......
You virtual, wannabe business owners should be able hoi ya ket money in the middle, waltz in and just take it off him now eh?

Holes in the balance sheet, whee knew?
 
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