Cynicism about Donald et al?

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Grumpy Old Man said:
Step by step I think it looks something like this:

1. Short agrees to sell the shares in Sunderland then owned by Drumaville to Madrox for £15m, with an additional obligation on Madrox to repay to SAFC Ltd the £25m of parachute payments used to clear part of the SBC loan. This gives a total cost of investment of £40m.

2. Donald puts £5m into Madrox, which is paid over to Short as a first instalment.

3. A £10m loan is created between Madrox and SAFC to ease cash flow.

4. The Ndong complications emerge, and Short agrees to reduce the amount payable directly to him to £12m, and the total cost to Madrox to £37m.

This is the situation at the year end. It looks messier than it should because the creditors note in the Madrox accounts are misleading. As Madrox filed small company accounts, they aren't obliged to give a very detailed breakdown. A guess at a breakdown of the creditors number of £37m would be £10m owed to SAFC, £5m shareholder loan from Donald, £7m owing to Short (the balance of the £12m due to him, and £15m other creditors, being the balance of the £25m parachute not disclosed as an intercompany debt at this stage (not something I'd agree with).

After the year end, we get:

5. Short receives £7m in cash to complete the share purchase.

6. Donald advances another £7m to Madrox.

7. The intercompany position is resolved.

The should leave Madrox with a balance sheet showing an investment asset of £37m, balanced by a £12m loan from Donald, and a £25m intercompany debt to SAFC for the parachute payments. It is this £25m balance which we should see reduced over time as it's repaid to provide working capital in SAFC. This process could already have begun; we won't know until the next set of accounts are filed next year.
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Donald suggested it hasn’t on the latest podcast as he said it would go in when needed. He didn’t say it hadn’t either and for me this is when he doesn’t help because he isn’t clear . This payment will be the acid test. If he sells and makes money without that going in then he hasn’t been the custodian that he suggests he is . I imagine we won’t know until the accounts are next filed
 


seanwharton said:
Donald suggested it hasn’t on the latest podcast as he said it would go in when needed. He didn’t say it hadn’t either and for me this is when he doesn’t help because he isn’t clear . This payment will be the acid test. If he sells and makes money without that going in then he hasn’t been the custodian that he suggests he is . I imagine we won’t know until the accounts are next filed
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The debt's Madrox's, not Donald's personally. If the money ends up back at the club from him, Sartori, or a new investor is immaterial, though if it came from a new investor, I'd expect the price Donald gets for his shares to be reduced accordingly.
 
I don't understand what is wrong with cynicism, there should be, especially if they leave after less than a year

Bring Back Prica said:
They were always taking a gamble at day one. It could’ve gone the other way and they would’ve lost everything.

Thank God they’ve done the job they’ve done.

Can’t believe anyone would be annoyed at them helping us get to a better investment opportunity for the club.
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Long as they pay back the parachute money back into the club before they leave like they say they will
 
Grumpy Old Man said:
The debt's Madrox's, not Donald's personally. If the money ends up back at the club from him, Sartori, or a new investor is immaterial, though if it came from a new investor, I'd expect the price Donald gets for his shares to be reduced accordingly.
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So what is Donald’s relationship to Madrox?
 
I’m No expert. However on last years podcast and when the the club got sold wasn’t there a big thing made of the fact the club was “ debt free” and the parachute payment was just a security for Ellis.

Then apparently we still owe SBC loan and it appears the parachute payment appears to be used and there’s a debt against the club.

I’m not against any of it but it looks different to the picture we were painted.

If I’m wrong then fair enough, just looks a bit ropey in my opinion.
 
BumbleBee said:
So Donald and his associates via Madrox owe SAFC £25 mill?



Why does that not surprise me :)
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As would any new investor in Madrox. That's the point. The dent between Madrox and SAFC is unaffected by changes in Madrox's ownership. Whoever owns Madrox, the debt is payable by Madrox. The agreement for the shore purchase, in legal terms, wasn't between Donald and Short; it was between Madrox and Drumaville. That's the entire point of separate legal personalities.

seanwharton said:
So he will have benefited indirectly or directly from the PP if he sells at a profit and that money doesn’t go back into the club ?
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The money has to go back into the club. If Donald sold all of the shares he owns, Madrox still owes SAFC that money. In law, Madrox and Donald are two separate persons. Madrox owes SAFC that debt, irrespective of who owns the Madrox shares. The new owner can't simply repudiate the debt, especially, as seems likely (because it's the only logical reason why the debt is there in the first place), if the repayment of the parachute is part of the purchase agreement between Madrox and Drumaville.
 
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Randy Savage said:
Anyone else as cynical about Donald et al as my old man?

Seen him yesterday and his opening gambit to me was “have you seen what those two spivs, Donald and slicked back, are up to now. Using the parachute money to buy the club and flipping it for a hefty profit within a year when they knew they never had the money to run it long term.”

Now, let it be said I like SD and I think there is a genuineness to him. I take what he says at face value. However, I’m a fairly trusting person for the most part.

Does anyone share my old man’s view, or is he just a cynical old Sunderland supporter worn down by six decades of largely shite?
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Your old man needs to get with the times tbh mate
 
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