New buyers put off by £20 million hole in accounts

[Deleted User 18963]

He hasn't cast doubt onthem, merely done what any good accountant / auditor should do and declined to add his weight to anything without seeing the actual figures.

TBF, I genuinely think the guy is very knowledgeable however, seems to be very pro Donald and his posts are always skirting round the issue. Would make a good PR political aid

Has @fyl2u and @Mary Hinge commented yet? Stewies fluffers

No one reads posts from fly2u anymore mate.

 

[Gazoliver]

I wonder if the final accounts may not look the same as the draft? Until there's been an AGM to approve them they can be changed.

End of June is it they're due to be published?

 

[Honess10]

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?

Exactly. It would need a billionaire to come in who fancies chucking one of his billions at us to get us established at the top end of the premier league.

 

[hank williams]

How’s that saying go..............there’s no smoke without fire, I personally wouldn’t trust Stewart Donald with a load of coal.

Daily mail Most sued newspaper in Britain I rest my case

 

[Deleted member 27897]

"The piss taking party ends here"

Surely now a quote that will go down in infamy in SAFC's history.

 

[WildinHetton]

I thought all deadlines were cancelled due to situation

Couldn't find anything on the SAFC website to say that so went ahead and paid for my seats. Like where I sit and the people around me but would have enjoyed the delayed payment if it was still available.

 

[sinner]

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?

Sounds about right to me, although I think, not sure, 5m of the 25m been paid off. I'm no accountant mind.

 

[Safc1987]

The scariest part for me is ultimately the future of our great club is in their hands, their next move(s) could well determine whether we have an SAFC to support.

Awful position for us fans to be in, do we stick or twist?, Twist we cancel season cards, protest, etc and try and force their hand, whereby they sell to the first bidder some Steve dale out of spite.
Alternatively do we sit and just hope and pray that somebody out there can save us.

We are still Sunderland at the end of the day , investors will always be attracted, please see FPP while we are in 3rd division for gods sake.

This pandemic will hopefully force them to lower their asking price, the longer there here the longer they are losing out at the end of the day.

Worrying time for us all, keep the faith

 

[Deleted member 42657]

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.

All very well made points, that really are unquestionably correct.

My only contention is that the catalyst for this recession is a pandemic that immobilised society and economy. The furlough scheme is providing that same life raft to many businesses (both failing and viable) because the government need to preserve some status quo.

Ordinarily the “survival of the fittest” should prevail and your argument about lower tier teams being aggrieved as they are well run is very true. However, regardless of how well their finances are nobody is viable in a near zero revenue scenario we may have for a further 12 months.

 

[Grumpy Old Man]

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.

Ellis is owed nothing. We know that because the charges he had over Sunderland were lifted last April. We also know that SBC are owed nothing, because they lifted their charges over Short's assets at the same time. The simple fact is that, entirely in accordance with the terms of the contract, £25m of the 2018/19 parachute payment was paid from SAFC to Drumaville, with the money going via Madrox (which created this balance in the first place), to clear the final part of the SBC loan to Sunderland, which Short had moved into Drumaville. To that extent, it can be argued that this payment was using club money to pay off a club debt (even though it had been moved off balance sheet). All of the problems arise from the need (because the contract including this was between Drumaville and Madrox) for that £25m to go through Madrox on its way to Short. The original contract envisaged the parachute going direct to Drumaville, and never coming into the club, but that would have breached PL regulations (an inexcusable oversight by all parties to the deal, to be blunt). The argument for the write-off will undoubtedly be that it's just a correction of an accounting anomaly (I've flip-flopped so many times trying to work out whether it could be legally enforceable, and I'm still not sure) which is true at a technical level. But that's certainly not how it comes across to a layman,

 

[The Beautiful Game]

TBF, I genuinely think the guy is very knowledgeable however, seems to be very pro Donald and his posts are always skirting round the issue. Would make a good PR political aid


No one reads posts from fly2u anymore mate.

I don’t think he is. I’ve butted heads with him a couple times during the whole reiver thing but I don’t think he’s pro Donald particularly. I’m very much anti Donald but would say this report changes very little. As soon as this news came out I said we’d never see the money paid back in by them. Methven, even when the party line was “well drip feed it back in”, was coming out with the club money to pay a club debt comments and it’s technically true.

 

[SVU]

Daily mail Most sued newspaper in Britain I rest my case

It originated in The Times.

Maybe you should’ve read the thread properly.

 

[chunkyshanhawk53]

A stupid question perhaps @Grumpy Old Man

What would even be the point of this? The owners fully own the club anyway, so they’re just reducing the value of their asset by taking the cash now?

Unless they intend to default the club (which given it has value would seem odd), what does this achieve?

thanking you

 

[Deleted member 39436]

In fairness to the Mail they did an expose on the initial takeover deal too when no-one else was interested. Sadly at the time the vast majority of supporters were completely taken in by their bluster andeasily taken in fans

What's plan A?

Buy a club for next to nothing using other people's money, give it a lick of paint and flip for a profit.

Donald is a chancer and so are Methven and Sartori. They don't care about the club. They took us all in with their sitting in with the fans and traveling on supporter buses have pints. All the while they were conning us to deflect attention from what they were doing. They conned us all but after a while the majority of us saw through it. RAWA and the fanzines saw him for he is. A chancer and a charlatan.

From late 2018 I and close mates were seeing through these chancers and were blasted in here for daring to criticise the chairman and pal.I queried where the parachute payment not going directly into the club account , a straight forward way I thought but again was told by certain posters that was ok to go not another company’s account , Eh I thought why do this ? Then when it was told Madrox was this new company set up by Donald again was informed its normal practice, for me it confirmed his true intentions. How many clues did fans want in seeing their plans from day one, Methven the minister of propaganda with all his bluster and attitude, then when knowing he’s getting sussed does a runner. They bring a mate in for a £1 again lies from them on his cash injection and again fans are still believing in them.Theres still much more i would like to say day but it’s boiling me up on this fine morning, it was always simple for them get the daft bastards to believe in us, form a new company to put the parachute money in and then take it out for our own purposes and sell up, not even thinking anyone buying wouldn’t want to find this out. I wanted to believe in them but as time went on it came all to clear, they give the Oystons and Venkys credence.

 

[hank williams]

It originated in The Times.

Maybe you should’ve read the thread properly.

The article I saw in here was from the fail


It's on the first post on here

 

[TravellingMackem]

Breaking news: Donald is corrupt. Nothing to see here people

 

[KittenMittens]

I kinda agree, but if we default aren't FPP lumbered with the club rather than actively wanting and buying it? Therefore not bothered what they do with it?

Seems like every negative possibility is a lot more realistic.

It's worse than that - FPP have to actively pursue that option. There is a possibility that if we were fucked enough to look like a bad investment at that point, they could just walk away rather than get involved. That's because if they took us on to recover the debt, they'd have to either sell our assets (which is a PR disaster) or commit to running us in L1 (which they clearly weren't overly keen on).

I am beginning to think FPP may be dead and that Donald is throwing them under the bus now to

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.

Are you going to apologise for questioning my motives last year when I pointed out this was a possibility?

He hasn't cast doubt on them, merely done what any good accountant / auditor should do and declined to add his weight to anything without seeing the actual figures.

He has though. He's taken the path of benefit of the doubt at all times. That's still a decision, not a no-comment.

 

[Grumpy Old Man]

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?

Sunderland has been factually debt-free (other than the short-term quasi-overdraft this time last year) from the moment the parachute payments left the club. At the point Donald bought it, it was only cosmetically debt-free. The debt free thing had to have started with Short - he was the one who was able to move it off the Sunderland balance sheet. I think most people agree that Donald would have been better off having that debt left in the club to be dealt with internally, but that's in the past now. Madrox wil have debts to FPP and also to one or more of its shareholders (mainly Donald in the form of SJD Leisure Holdings, which has his shares in Madrox). It's impossible to know precisely what's happening until I've seen the accounts of all four companies (SAFC, Sunderland, Madrox and SJD). You really can't get the full picture looking at only one of the four in isolation.

It's worse than that - FPP have to actively pursue that option. There is a possibility that if we were fucked enough to look like a bad investment at that point, they could just walk away rather than get involved. That's because if they took us on to recover the debt, they'd have to either sell our assets (which is a PR disaster) or commit to running us in L1 (which they clearly weren't overly keen on).

I am beginning to think FPP may be dead and that Donald is throwing them under the bus now to


Are you going to apologise for questioning my motives last year when I pointed out this was a possibility?


He has though. He's taken the path of benefit of the doubt at all times. That's still a decision, not a no-comment.

Apology given. But if you're gong to have a user name and standpoint that renders you easily confused with Chris Weatherspoon that's going to happen.

 

[Guinness Guzzler]

Ellis is owed nothing. We know that because the charges he had over Sunderland were lifted last April. We also know that SBC are owed nothing, because they lifted their charges over Short's assets at the same time. The simple fact is that, entirely in accordance with the terms of the contract, £25m of the 2018/19 parachute payment was paid from SAFC to Drumaville, with the money going via Madrox (which created this balance in the first place), to clear the final part of the SBC loan to Sunderland, which Short had moved into Drumaville. To that extent, it can be argued that this payment was using club money to pay off a club debt (even though it had been moved off balance sheet). All of the problems arise from the need (because the contract including this was between Drumaville and Madrox) for that £25m to go through Madrox on its way to Short. The original contract envisaged the parachute going direct to Drumaville, and never coming into the club, but that would have breached PL regulations (an inexcusable oversight by all parties to the deal, to be blunt). The argument for the write-off will undoubtedly be that it's just a correction of an accounting anomaly (I've flip-flopped so many times trying to work out whether it could be legally enforceable, and I'm still not sure) which is true at a technical level. But that's certainly not how it comes across to a layman,

I'm a layman and it all makes sense to me. Certainly seems like the issue now will be the selling price. Someone looking to buy SAFC would see theres £20m to come back in, so if Donald says his price is £35m it seems fair enough. If Donald then says that money isn't coming back in, or there's no guarantee of it, then £35m looks an absolute rip off given the price of the shares last time the club was sold and the lack of any progress aside from cost cutting.

If someone would rather just buy Madrox then I suppose they'd see it as a good thing that they aren't obligated to pay £20m back, but I don't see why anyone would do that rather than just buying the club companies.

It seems obvious that selling price has been an issue though, and this suggests Donald might be asking for more than the club is worth with this £20m not coming back in. The FPP loan certainly looks that way, almost as if they got involved but not in the way they were going to, instead giving a down payment and saying "prove you can progress the club so that it's worth what you're asking". That would be my take on it anyway. It currently hasn't progressed so either he'd need to lower his price to sell, or FPP would have to bide their time

 

[bowers2]

The whole outrage isn’t because of any monies owed or any debt left.

The outrage comes because these two came bounding in, criticises the whole of the running of the club, sold a dream and vision, lapped up the praise and fabricated a vision that they are so e sort of magical genius that deserve the worship (we’ve given the imbeciles their club back) when in reality they had no cash, employed complete idiots on the cheap at every level and were equally poor at running a club as the previous regime they criticised and it is argued that they are equally as poor as every other clown who have destroyed good clubs with massive fan bases including Bolton, Portsmouth, Leeds and Blackburn.

Now Donald is in hiding, like a little school boy bogging it up and the class have turned.
Blaming the fans
Metvan jumped earlier.

Two of the biggest clowns in our history, on a bigger level than mcmememy and hill.