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Loans/ Debt to the owners

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Hep said:
so you don't want them to loan the club money? I'm confused?
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Sorry for coming to this late but I am trying to get clarity. Madrox used the parachute payments to buy the club which was certainly not the intention of those payments from the EPL. They then said they would pay these payments back to the club but have not done so in full. The inference of the recent tweet is that the payments to date are loans rather than re-payments. Are you suggesting this is not the case?
 
Hep said:
That's not correct, Short had lots of money owing to him and wrote it off as part of the sale.

The club's full balance sheet is always factored in during any sale.

But if they capitalise the loans into shares, the club is worth more, so they'll get more when they sell it.

e.g. if the club is worth £50 today

Directors lend club £5, Club is worth £50 + the £5 of loans it has in the bank, but owes £5, so it's worth £50. The directors get £50 + their £5 loan back.

Directors lend club £5, Club is worth £50 + the £5 of loans it has in the bank, directors convert loans to shares, club is worth £55 when it's sold. Directors get £55 (e.g. the £50 + the £5 they invested)

Directors don't lend club £5, Club is worth £50 when it's sold. (Directors get £50)

Short wanted the parachute payment money as part of the deal, in exchange for writing all the other loans off. They haven't 'trousered' anything.
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So, to try and make sense of the argument. Are you saying (rounded figures for ease) :
-They buy a club worth £37m
-To do it they take £25m from the club, but there's now a debt owing from them to the club of the same amount, so despite taking £25m the club is still worth £37m - if they sell it they'd get £37m but have to pay the £25m back so they'd break even (which I'd agree with)
-They remove the legal obligation to pay it back so now the value of the club has dropped to £12m on the strength of it not having £25m to come in
- Your argument seems to be that if they then, over time, put £25m in, the value of the club increases back to the £37m, so they can sell it and effectively still break even

The issues I can see here is that, even when they hadn't paid all the money back, they were telling fans and others that the value was still £37m.

Equally you seem to be assuming that if they put money in, it automatically adds to the value of the club. Let's just say Donald had to find £5m to cover the Grigg signing. That hasn't added £5m to the value of the club. That's money he's put in to run it which, ultimately, he's pissed away. If the value of the club, when it suddenly didn't have £25m to come back in, shrank to £12m, then I fail to see how that value has done anything but drop. When they came in it still had the third parachute payment to come for starters. That's been pretty much wasted as far as I can tell given the lack of progress.

So if the club was worth circa £12m once the £25m was officially written off, it certainly shouldn't be any higher now. So would you agree that, regardless of how much Donald may have put in to keep the lights on, his 34% should be about £4m? Because I don't see how anyone could argue for it to be more. At which point why the fuck doesn't KLD just buy him out.

It's like if I've got a shit old car worth £1500. Doesn't matter if I spend £3k to keep the thing road worthy, it doesn't suddenly become a £4500 car
 
BumbleBee said:
Donald said the money would be drip fed back in. Intimating it would be repaid - no mention of loans at all.
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By any normal definition giving a loan does not equate to repayment. This latest revelation seems almost bizarre. It seems too blatant to be true - say you are re-paying the parachute payments but in reality only loan the money back. I keep repeating this because I can't get my head around this happening.
 
Hep said:
What GOM says is exactly correct and completely relevant.

The problem is it makes it look like there was a big issue when in reality there wasn’t, other than the optics.

If the other bids had been lower without using the pp cash, how was short getting the last £25m he wanted?
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According the the lads at WMS a deal had been agreed with other parties. Short probably would have had to take on more of the burden himself. But due to them parasites that you disgustingly support they jumped in with an offer which made the club considerably worse off.
 
Botchie said:
Defoe injured? Grabbed his hamstring the other night.
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Define and Stewart clash of heads in training. Both sparked out so protocols mean they need a month off. Meanwhile Clarke did his back in bending down to help.
 
Hep said:
so you don't want them to loan the club money? I'm confused?
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I honestly don’t know what’s going on because I’ve missed loads of bits but isn't the issue more than the fact they've loaned money ? Isn't the issue that they are potentially marking down the money they have committed to pay back from their dodgy dealing/accounting as loaned money, so not really paying it back?
 
10 Gary Rowells said:
Sorry for coming to this late but I am trying to get clarity. Madrox used the parachute payments to buy the club which was certainly not the intention of those payments from the EPL. They then said they would pay these payments back to the club but have not done so in full. The inference of the recent tweet is that the payments to date are loans rather than re-payments. Are you suggesting this is not the case?
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There is nothing to suggest that the loans are in relation to paying the equivalent of the PP money back to the club.
 
isn't it that they wanted to buy the club but didn't have the money to do so. So they approached an ever desperate Short who thought about a way they could do it and himself rid himself of the club. You can pay me the parachute money that the club will receive (which of course meant we had little money to build the team back with, for which it is meant for partly) and pay it back as and when you can? in a nutshell or am i wrong?
 
stevo said:
Well done mate,I wish there was another way but there isnt.Money is their god and as you say we must hold off putting money in their devious pockets.Some posters are making out they are good supporters by turning up when in reality their actions are gonna keep us in this torture for ever.
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My only worry is they’d simply sell Stewart, Neil, Embleton and hawk the academy around again. We’d end up with more crap coming in. We’ll run out of players to sell soon mind. We’re almost there

3 windows in out of the 4 they’ve mentioned and our squad is built on quick sand. Stewart last 12 months, a load on loan/out of contract and a few decent prospects
 
Guinness Guzzler said:
So, to try and make sense of the argument. Are you saying (rounded figures for ease) :
-They buy a club worth £37m
-To do it they take £25m from the club, but there's now a debt owing from them to the club of the same amount, so despite taking £25m the club is still worth £37m - if they sell it they'd get £37m but have to pay the £25m back so they'd break even (which I'd agree with)
-They remove the legal obligation to pay it back so now the value of the club has dropped to £12m on the strength of it not having £25m to come in
- Your argument seems to be that if they then, over time, put £25m in, the value of the club increases back to the £37m, so they can sell it and effectively still break even

The issues I can see here is that, even when they hadn't paid all the money back, they were telling fans and others that the value was still £37m.

Equally you seem to be assuming that if they put money in, it automatically adds to the value of the club. Let's just say Donald had to find £5m to cover the Grigg signing. That hasn't added £5m to the value of the club. That's money he's put in to run it which, ultimately, he's pissed away. If the value of the club, when it suddenly didn't have £25m to come back in, shrank to £12m, then I fail to see how that value has done anything but drop. When they came in it still had the third parachute payment to come for starters. That's been pretty much wasted as far as I can tell given the lack of progress.

So if the club was worth circa £12m once the £25m was officially written off, it certainly shouldn't be any higher now. So would you agree that, regardless of how much Donald may have put in to keep the lights on, his 34% should be about £4m? Because I don't see how anyone could argue for it to be more. At which point why the fuck doesn't KLD just buy him out.

It's like if I've got a shit old car worth £1500. Doesn't matter if I spend £3k to keep the thing road worthy, it doesn't suddenly become a £4500 car
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I agree, the decision on what to invest the money on will have a massive impact, but that's a different question.

If we buy the next Ronaldo and sell him for £100m, it's been a great investment, Grigg, not so much.

But they are two very separate things, the raw capital invested, and the return on that investment.

Loaning the club money isn't a bad thing. Spending it on Grigg is.
 
Guinness Guzzler said:
My main question about it, however, is whether the £25m was always meant to be paid through the parachute payments, or whether it was part of the price Short wanted for safc with parachute payments still to come, and donald decided the only way he could afford it was to pay £12m and give Short the parachute payment (through the badly managed process you mentioned).

If the price was meant to be £37m for safc with parachutes still to come, then there's no argument, donald should be paying it back and he shouldn't be getting any of it back again when he sells.

If it was only meant to be £12m for safc without the second parachute payment then it's different. But if that's the case why did Donald specifically say he wanted over £30m when suggesting the fans could buy it from him? And why would he even talk about paying it back if he was never supposed to

Basically I don't believe it was all because Short "wanted it to look like he left the club debt free". I think Short wanted £37m, Donald couldn't afford it, so he paid a hefty chunk of it out of the clubs money and would now love nothing more than to avoid paying it back
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I can only go on what I was told at the liaison meeting in June 2019 by Methven. He even said that the original plan was for that £25m to go straight to Short from the PL, which changed only when Angela Lowes pointed out that PL regulations only allow payment into an account in the club's name (pretty obvious when you think about it). The evidence is there that the last £25m of the debt was moved. Drumaville took out a £25m loan from SBC shortly before the completion (I stumbled on the charge document at the CH page for the Hilton). This charge, and the ones over the club, were not lifted until April 2019, on the same date. It's pretty clear that the £25m was the club debt. Short wanted £37m because he didn't want to clear any more of the debt personally (he'd already paid £45m of it via his loans to the club, which were capitalised). All the evidence points to £15m for the shares (reduced to £12.7m when N'Dong's move to Watford fell through) and £25m loan repayment, The only argument is who was intended to pay the £25m, Madrox or the club. Methven, in a minuted meeting, clearly said the latter.
 
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North Yorks Mackem said:
According the the lads at WMS a deal had been agreed with other parties. Short probably would have had to take on more of the burden himself. But due to them parasites that you disgustingly support they jumped in with an offer which made the club considerably worse off.
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Short didn't have to do anything with the burden. He had no obligation to take any of it on.

The club was worth about £12m as short either wanted to leave £25m in debt or take the PP money. If there was anyone willing to pay more, Short would have accepted.
sir rowell cummins said:
I honestly don’t know what’s going on because I’ve missed loads of bits but isn't the issue more than the fact they've loaned money ? Isn't the issue that they are potentially marking down the money they have committed to pay back from their dodgy dealing/accounting as loaned money, so not really paying it back?
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They've never claimed that these loans relate to paying back that money.
 
Guinness Guzzler said:
So, to try and make sense of the argument. Are you saying (rounded figures for ease) :
-They buy a club worth £37m
-To do it they take £25m from the club, but there's now a debt owing from them to the club of the same amount, so despite taking £25m the club is still worth £37m - if they sell it they'd get £37m but have to pay the £25m back so they'd break even (which I'd agree with)
-They remove the legal obligation to pay it back so now the value of the club has dropped to £12m on the strength of it not having £25m to come in
- Your argument seems to be that if they then, over time, put £25m in, the value of the club increases back to the £37m, so they can sell it and effectively still break even

The issues I can see here is that, even when they hadn't paid all the money back, they were telling fans and others that the value was still £37m.

Equally you seem to be assuming that if they put money in, it automatically adds to the value of the club. Let's just say Donald had to find £5m to cover the Grigg signing. That hasn't added £5m to the value of the club. That's money he's put in to run it which, ultimately, he's pissed away. If the value of the club, when it suddenly didn't have £25m to come back in, shrank to £12m, then I fail to see how that value has done anything but drop. When they came in it still had the third parachute payment to come for starters. That's been pretty much wasted as far as I can tell given the lack of progress.

So if the club was worth circa £12m once the £25m was officially written off, it certainly shouldn't be any higher now. So would you agree that, regardless of how much Donald may have put in to keep the lights on, his 34% should be about £4m? Because I don't see how anyone could argue for it to be more. At which point why the fuck doesn't KLD just buy him out.

It's like if I've got a shit old car worth £1500. Doesn't matter if I spend £3k to keep the thing road worthy, it doesn't suddenly become a £4500 car
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Well Said mate.
 
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