WMS Who Owns Sunderland AFC?

[Alfies Hat]

Perfectly put. Their plan was clearly to market the club as worth the £37m they "paid" when in fact it was closer to £12m. I fell for it as much as anyone, but how can people still be falling for it to this day?

There are none so blind as those who will not see.
Closing their eyes to the truth

 

[Hep]

If that money was repaid to the club we would have more to invest in players.

The requirement to repay the club that money was removed from the accounts by Stewart donald so your para about KLD is a nonsense.

You've spent 4 paragraphs trying to say that our previous majority owner refusing to pay a sum which could be as great as 20 million is not having a negative impact on the club.

It defies genuine belief and if you are a lads fan it is truly depressing you'd accept it.

No, we would have no extra money at all, if that money was repaid SD would have wanted more for the club when he sold it to KLD. When SD owned the club, only SD could sanction money being spent on players. If he used money from SAFC or another company makes no difference. Ellis Short often funded players with money outside of SAFC.

When he sold the club to KLD, it would have been £28m cheaper than it would have been that if the money was left in. Either way, SD ended up with the money.

Here's and example to demonstrate with example figures. I've also not included any residual shares SD owns to keep it simple.

Scenario A. Parachute payment £28m money moved by SD

• SD ends up not having to pay the £28m to Ellis short, as the parachute money is used
• Club is worth £28m less, say £10m
• KLD pays £10m for club to SD.
• SD ends up with £10m

Scenario B. Parachute payment £28m money remained in SAFC Ltd

• SD ends up having to pay the £28m to Ellis short from his own money.
• Club is worth £28m more as it has kept the parachute money, so £10m + £28m = £38m
• KLD pays £38m for club to SD.
• SD ends up with £38m less the £28m he paid Short = £10m

SD had the full and final say on investing in players whilst he owned the club, so if he decided to do that, he would have. The only difference between the two scenarios is that in scenario B, SAFC Ltd has more money in the back IF KLD decides he wants to invest that in players, but remember he's paid £38m in scenario B. In scenario A, he's only paid £10m, so can easily invest more if he wants to.

I hear you use the phrase echo-chamber a lot and if I'm honest thought you were a troll or WUM, deliberately taking the opposite view for attention.

However that does you a disservice as I can see you are sincere so you have my apologies for that. My issue is the specious and spurious arguments you pass on as indisputable fact.

For example, "What difference would it make if the payments were still in the accounts of SAFC? The answer is none at all". I find comments like this utterly bizarre. Look at the situation at Derby or the sad demise of Bury. Do you really believe this as a legitimate observation or are you just trying to provoke the alternative view you enjoy so much.

Football owners cannot just put money in as you suggest in your post. I thought this had been done to death.

Incidentally, if it doesn't make a difference that the parachute payments are still in the accounts of SAFC, why don't all clubs just take them out and give them to someone else? As far as I can see, many of our problems began when we started signing parasite footballers and had key administrative staff who despite their atrocious professional performance refused to leave one penny behind on their departure.

Clubs such as Norwich, Watford, West Brom and Fulham have reinvested the Parachute payments back into their squads and have reaped the appropriate rewards. They do not seem to share your view that it doesn't matter where the money goes.

Finally, you say "Now KLD owns the club, nothing changes". Unfortunately the situation is nowhere near as simple as that (as I guess you know). KLD apparently owns a small majority and Donald/Methven still have a substantial minority. This may mean they have more influence behind the scenes than we know. More undeniably, it means they will need to be paid off to leave at some point in the future.

This may all seem irrelevant to you but it seems extremely significant to me.

The truth of course is apart from a poster who joined this board at the same time as Methven joined the club and a bloke who was Methven's compere at the Queen Vic talk-in and a self-confessed "good friend" who perhaps understandably won't have a bad word said against CM, nobody has any real accurate understanding of the financial situation at the club.


That's not the same as saying it's irrelevant though or a "net-zero argument" (I am aware of zero-sum games but never heard your term before).

Have a look at my above post. It all boils down to how much of the personal wealth of the owner is willing to invest. The parachute payment is a distraction. The owner can invest money by a share issue quite easily.

We can still invest in players. When short bought players at lot were funded by him loaning the club the money, it wasn't in the SAFC accounts. This is the point, where the money is doesn't matter, all the matters is how much money is the owner willing to risk/invest.

Did you miss the point of Donald actually saying (on record) that he still owes the club £20m?
Of course it would make a difference.

I've explained how it doesn't. This is basic business.

If I sell you a car with £100 in the glove, it's worth a £100 more. If I take it out, it's worth a £100 less.

There are none so blind as those who will not see.
Closing their eyes to the truth

Do you not think anyone with enough money to buy the club would be able to correctly value it through due diligence done prior to any sale?

 

[scott934]

No, we would have no extra money at all, if that money was repaid SD would have wanted more for the club when he sold it to KLD. When SD owned the club, only SD could sanction money being spent on players. If he used money from SAFC or another company makes no difference. Ellis Short often funded players with money outside of SAFC.

When he sold the club to KLD, it would have been £28m cheaper than it would have been that if the money was left in. Either way, SD ended up with the money.

Here's and example to demonstrate with example figures. I've also not included any residual shares SD owns to keep it simple.

Scenario A. Parachute payment £28m money moved by SD

• SD ends up not having to pay the £28m to Ellis short, as the parachute money is used
• Club is worth £28m less, say £10m
• KLD pays £10m for club to SD.
• SD ends up with £10m

Scenario B. Parachute payment £28m money remained in SAFC Ltd

• SD ends up having to pay the £28m to Ellis short from his own money.
• Club is worth £28m more as it has kept the parachute money, so £10m + £28m = £38m
• KLD pays £38m for club to SD.
• SD ends up with £38m less the £28m he paid Short = £10m

SD had the full and final say on investing in players whilst he owned the club, so if he decided to do that, he would have. The only difference between the two scenarios is that in scenario B, SAFC Ltd has more money in the back IF KLD decides he wants to invest that in players, but remember he's paid £38m in scenario B. In scenario A, he's only paid £10m, so can easily invest more if he wants to.

Madrox paid ~£12m for the club and £25m went from the parachute payments to Short and then to paying the SBC loan. This was described to us as Madrox giving £40m (later revised to £37m) to Short.

Then when it all came out Madrox said they'd pay the club that money back, therefore making the purchase price the full £37m. After a short while they wrote the debt off, claiming that FPP had insisted they do it as part of FPP's "investment" (loan).

So now they still want the asset value to be seen as £37m, despite coming nowhere near paying that for the club. That's where their profit will come from, nevermind the fact that they're hanging on (like parasites, ironically) to a stake for when someone else (hopefully KLD) does the business and takes us up.

On top of that they've talked shite about fans scaring off investors, wanting Murray out after finishing 7th, acting like a pissed women with mascara running down her face, being clueless about business in the north east.

 

[Hep]

Madrox paid ~£12m for the club and £25m went from the parachute payments to Short and then to paying the SBC loan. This was described to us as Madrox giving £40m (later revised to £37m) to Short.

Then when it all came out Madrox said they'd pay the club that money back, therefore making the purchase price the full £37m. After a short while they wrote the debt off, claiming that FPP had insisted they do it as part of FPP's "investment" (loan).

So now they still want the asset value to be seen as £37m, despite coming nowhere near paying that for the club. That's where there profit will come from, nevermind the fact that they're hanging on (like parasites, ironically) to a stake for when someone else (hopefully KLD) does the business and takes us up.

On top of that they've talked shite about fans scaring off investors, wanting Murray out after finishing 7th, acting like a pissed women with mascara running down her face, being clueless about business in the north east.

Where have they said they want to value the club at £37m? If you take £28m out of a company it's worth £28m less.

I doubt KLD or anyone with anyone who would buy the club wouldn't be aware of this. The price KLD paid will have absolutely factored in all the assets on the balance sheet, including the absence of £28m. Any sale of a business of this size will go through detailed due diligence.

I'll not defend how they've handled things publicly, but the idea that they'll somehow manage to fool buyers is just ludicrous.

 

[North Yorks Mackem]

No, we would have no extra money at all, if that money was repaid SD would have wanted more for the club when he sold it to KLD. When SD owned the club, only SD could sanction money being spent on players. If he used money from SAFC or another company makes no difference. Ellis Short often funded players with money outside of SAFC.

When he sold the club to KLD, it would have been £28m cheaper than it would have been that if the money was left in. Either way, SD ended up with the money.

Here's and example to demonstrate with example figures. I've also not included any residual shares SD owns to keep it simple.

Scenario A. Parachute payment £28m money moved by SD

• SD ends up not having to pay the £28m to Ellis short, as the parachute money is used
• Club is worth £28m less, say £10m
• KLD pays £10m for club to SD.
• SD ends up with £10m

Scenario B. Parachute payment £28m money remained in SAFC Ltd

• SD ends up having to pay the £28m to Ellis short from his own money.
• Club is worth £28m more as it has kept the parachute money, so £10m + £28m = £38m
• KLD pays £38m for club to SD.
• SD ends up with £38m less the £28m he paid Short = £10m

SD had the full and final say on investing in players whilst he owned the club, so if he decided to do that, he would have. The only difference between the two scenarios is that in scenario B, SAFC Ltd has more money in the back IF KLD decides he wants to invest that in players, but remember he's paid £38m in scenario B. In scenario A, he's only paid £10m, so can easily invest more if he wants to.

Have a look at my above post. It all boils down to how much of the personal wealth of the owner is willing to invest. The parachute payment is a distraction. The owner can invest money by a share issue quite easily.

We can still invest in players. When short bought players at lot were funded by him loaning the club the money, it wasn't in the SAFC accounts. This is the point, where the money is doesn't matter, all the matters is how much money is the owner willing to risk/invest.

I've explained how it doesn't. This is basic business.

If I sell you a car with £100 in the glove, it's worth a £100 more. If I take it out, it's worth a £100 less.

Do you not think anyone with enough money to buy the club would be able to correctly value it through due diligence done prior to any sale?

Stewart donald has paid about 12 million out of his own money for the club.

And also Stewart donald...

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So scenario A occurred but the outcome of scenario B was closer to the outcome. I suspect none of the parachute payment element was taken into account when KLD bought it.

 

[Hep]

Stewart donald has paid about 12 million out of his own money for the club.

And also Stewart donald...

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So scenario A occurred but the outcome of scenario B was closer to the outcome. I suspect none of the parachute payment element was taken into account when KLD bought it.

Of course it was taken into account.

If SAFC has £28m more in the bank, KLD would have had to pay £28m more would he not?

 

[scott934]

Where have they said they want to value the club at £37m? If you take £28m out of a company it's worth £28m less.

I doubt KLD or anyone with anyone who would buy the club wouldn't be aware of this. The price KLD paid will have absolutely factored in all the assets on the balance sheet, including the absence of £28m. Any sale of a business of this size will go through detailed due diligence.

I'll not defend how they've handled things publicly, but the idea that they'll somehow manage to fool buyers is just ludicrous.

I'm fully aware KLD will know this, as did FPP which is obviously what cost us that takeover. It's not about fooling buyers but once Madrox have the shares it's theirs to sell, hence why KLD hasn't managed to acquire 100%, because the 3 stooges still want their pound of flesh.

 

[samaistonsrightfoot]

" Ellis short is enabling us to pay for the club over a period of time. If we had to pay him the full 40 million up front and then have to cover everything in the mean time then not many people would be able to do that. When somebody is owed that sort of money then they need to take some sort of security to cover the eventuality we turn around one day and say we are not going to pay you, and the thing that is most easy to put that security against is the parachute payments. So it's security for Ellis to make sure he does get paid out his 40 million but it's not like he's going to be here and the day the para payment arrives with a big sack over his shoulder. That's not the way it's going to be."

 

[G Force]

Mental how some fans are so happy to accept SD & CM lies

 

[Safc88]

Where have they said they want to value the club at £37m? If you take £28m out of a company it's worth £28m less.

I doubt KLD or anyone with anyone who would buy the club wouldn't be aware of this. The price KLD paid will have absolutely factored in all the assets on the balance sheet, including the absence of £28m. Any sale of a business of this size will go through detailed due diligence.

I'll not defend how they've handled things publicly, but the idea that they'll somehow manage to fool buyers is just ludicrous.

Donald said it in meeting minutes with rawa im positive

 

[samaistonsrightfoot]

Still possibly my favourite quote of all time


"He's been talking to Paul Reid primarily at the moment looking at getting some south American talent into the academy because I think we see a gap in the market there, and we are well on the way with that process. So I think that he will feed in a lot of South American players to the academy that we can have a look at. Some will work, some won't, but if the ones that work, Erm, it will be a great financial arrangement for us so in the short term on the footballing side it helps. "

Although the time he said he would build some hotels to increase revenue runs it close.

 

[G Force]

Madrox paid ~£12m for the club and £25m went from the parachute payments to Short and then to paying the SBC loan. This was described to us as Madrox giving £40m (later revised to £37m) to Short.

Then when it all came out Madrox said they'd pay the club that money back, therefore making the purchase price the full £37m. After a short while they wrote the debt off, claiming that FPP had insisted they do it as part of FPP's "investment" (loan).

So now they still want the asset value to be seen as £37m, despite coming nowhere near paying that for the club. That's where their profit will come from, nevermind the fact that they're hanging on (like parasites, ironically) to a stake for when someone else (hopefully KLD) does the business and takes us up.

On top of that they've talked shite about fans scaring off investors, wanting Murray out after finishing 7th, acting like a pissed women with mascara running down her face, being clueless about business in the north east.

And don’t forget the kidnapping

How any Sunderland fan can’t see why we don’t want them at the club is utterly mental. There’s not many of them mind, but the way they defend so “valiantly” is almost cult like long post after long post…

Still possibly my favourite quote of all time


"He's been talking to Paul Reid primarily at the moment looking at getting some south American talent into the academy because I think we see a gap in the market there, and we are well on the way with that process. So I think that he will feed in a lot of South American players to the academy that we can have a look at. Some will work, some won't, but if the ones that work, Erm, it will be a great financial arrangement for us so in the short term on the footballing side it helps. "

Although the time he said he would build some hotels to increase revenue runs it close.

CM also claimed we were going to bully other academies and be aggressive. That went well

 

[North Yorks Mackem]

Of course it was taken into account.

If SAFC has £28m more in the bank, KLD would have had to pay £28m more would he not?

That money would never have just stayed in the bank though so its a false point to make.

It is perfectly reasonable to say it would have been worth more had it been invested into the side as we probably have been in a higher league.

However, I dont think any of us know how much club was valued at the point of sale but I bet its closer to 37 million than 12. And I bet there is zero obligation on KLD to feed that parachute money into the club.

Donald fucked the club over and it will potentially take years to recover from if we ever fully do. Hes used that parachute money for personal financial gain and it absolutely stinks.

 

[Confucius]

CM also claimed we were going to bully other academies and be aggressive. That went well

To be fair, he was bang on with this. "Look you either take Greenwood or we will sell him to someone else. You have until close of business tomorrow, I'm not messing around"

 

[Steeeeed]

Donald said it in meeting minutes with rawa im positive

He did. Then said the fans should buy it.

 

[Grumpy Old Man]

Donald said it in meeting minutes with rawa im positive

And then Methven gave an entirely different one at the meeting I attended, where it came out that £25m of the parachute was always going to end up with SBC via Drumaville, and that the club's debt-free status was so much window dressing. This is backed up by the timing of creation and releases of charges in both Sunderland and various Short-owned entities (including the Hilton Garden). It ended up being a cost of investment of £27m by a quirk of accounting, because it all ended up routed through Madrox. The part that I strongly disagree with was the taking of the writing off of the credit balance as profit in Madrox. It should really have been taken as a reduction in the cost of investment in the Sunderland shares. That would have resulted in a tricky little bit of consolidation when putting the group accounts together, but nothing that couldn't have been worked out.

 

[CissesUnderpants9]

He did. Then said the fans should buy it.

Yeah, I seem to remember that was when he got angry with CW for calling him out or was that later he suggested CW get his facts right ?

 

[scott934]

And then Methven gave an entirely different one at the meeting I attended, where it came out that £25m of the parachute was always going to end up with SBC via Drumaville, and that the club's debt-free status was so much window dressing. This is backed up by the timing of creation and releases of charges in both Sunderland and various Short-owned entities (including the Hilton Garden). It ended up being a cost of investment of £27m by a quirk of accounting, because it all ended up routed through Madrox. The part that I strongly disagree with was the taking of the writing off of the credit balance as profit in Madrox. It should really have been taken as a reduction in the cost of investment in the Sunderland shares. That would have resulted in a tricky little bit of consolidation when putting the group accounts together, but nothing that couldn't have been worked out.

Why do you think they never openly outlined the payment structure when buying the club? I can guarantee the parachute payment going to pay the SBC loan would have been seen as ok by all of us if they'd said that from the start. There can be nobody else to blame for that, it was blatant.

 

[Ashley In!!]

And then Methven gave an entirely different one at the meeting I attended, where it came out that £25m of the parachute was always going to end up with SBC via Drumaville, and that the club's debt-free status was so much window dressing. This is backed up by the timing of creation and releases of charges in both Sunderland and various Short-owned entities (including the Hilton Garden). It ended up being a cost of investment of £27m by a quirk of accounting, because it all ended up routed through Madrox. The part that I strongly disagree with was the taking of the writing off of the credit balance as profit in Madrox. It should really have been taken as a reduction in the cost of investment in the Sunderland shares. That would have resulted in a tricky little bit of consolidation when putting the group accounts together, but nothing that couldn't have been worked out.

Mental how some fans are so happy to accept SD & CM lies

 

[Steeeeed]

Yeah, I seem to remember that was when he got angry with CW for calling him out or was that later he suggested CW get his facts right ?

Yes. Was this meeting.

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