WMS Who Owns Sunderland AFC?

[Sea to Shining Sea]

Why? surely all the matters is how much is invested and if it is well invested, not from whom.

If KLD puts in £10m then the others with 50% would also have to put in £10m to keep their 50%

Aha, perhaps therein lies a problem!

 

[samaistonsrightfoot]

I'm only worried about that because early in the KLD takeover talks all the rumours were that Juan Sartori and KLD were gonna combine for a majority stake. Which would have left the original 3 in a majority, and since they've failed to disclose it I'm anxious about it.

I think it will probably be more than we've been led to believe but I'd be extremely shocked if its over half between them.

 

[scott934]

Why? surely all the matters is how much is invested and if it is well invested, not from whom.

If KLD puts in £10m then the others with 50% would also have to put in £10m to keep their 50%

Someone might need to educate me here, but what percentage would KLD need to have to execute a share issue like this?

 

[stevo]

It's about their lingering presence being a drag on SAFC progress. We know they don't have money to invest, we know they don't have capability to contribute. Depending on the size of their ongoing concern in SAFC, all they do is provide a barrier to KLD investing (as his investment results in benefit going to others). I don't think this is going to be a good news story, but I kinda expect it. We've got to hope that they are finally removed as soon as possible. Please God the suggestions of an agreed price on promotion are actually true - even if their presence makes promotion that bit harder.

Is your last sentence fact or hearsay mate ,because if true there wont be a rush from KLD for promotion .

 

[samaistonsrightfoot]

I'm only worried about that because early in the KLD takeover talks all the rumours were that Juan Sartori and KLD were gonna combine for a majority stake. Which would have left the original 3 in a majority, and since they've failed to disclose it I'm anxious about it.

Aye I remember that rumour. Just can't see how KLD would go along with it if they were in terms of doing press releases etc.

They have absolutely failed to disclose it, which has of course instigated the thread, but susoext ir's more down to them having a higher share than let on, rather than them having the majoriry between them.

Either that are its all hidden in this offshore company thats been set up and they won't give any other info.

I'm hoping something is in the process of being implemented and its news of something good which mitigates why everything around the club has been so half arsed lately.

 

[DonaldDownTheWing]

If the 3 stooges still have anything significant, even if it’s a minority, then we’re going nowhere fast. They’re just a complete drag on the whole club with no ambition.

 

[Grumpy Old Man]

Someone might need to educate me here, but what percentage would KLD need to have to execute a share issue like this?

50%+1

 

[Hep]

It's about their lingering presence being a drag on SAFC progress. We know they don't have money to invest, we know they don't have capability to contribute. Depending on the size of their ongoing concern in SAFC, all they do is provide a barrier to KLD investing (as his investment results in benefit going to others). I don't think this is going to be a good news story, but I kinda expect it. We've got to hope that they are finally removed as soon as possible. Please God the suggestions of an agreed price on promotion are actually true - even if their presence makes promotion that bit harder.

As it's been explained many times, it not a barrier to KLD investing.

For example.

If the club has net assets of £20m and say KLD owns 60%, SD 20%, JS 15% and CM 5%... so

KLD - 60% or £12m
SD - 20% or £4m
JS - 15% or £3m
CM - 5% or £1m

If KLD invests £10m by means of a share issue and the others don't match the investment, the club now has net assets of £30 and it will change the shares as follows.

KLD - 73% or £22m
SD - 13% or £4m
JS - 10% or £3m
CM - 3% or £1m

Aha, perhaps therein lies a problem!

what problem?

 

[The Cabbage]

Is your last sentence fact or hearsay mate ,because if true there wont be a rush from KLD for promotion .

Hearsay from here. Not sure why KLD wouldn't want promotion, though. My expectation is that he would want to be free of the dead weight before being a bit more ambitious. No point in growing something for someone else after all.

As it's been explained many times, it not a barrier to KLD investing.

For example.

If the club has net assets of £20m and say KLD owns 60%, SD 20%, JS 15% and CM 5%... so

KLD - 60% or £12m
SD - 20% or £4m
JS - 15% or £3m
CM - 5% or £1m

If KLD invests £10m by means of a share issue and the others don't match the investment, the club now has net assets of £30 and it will change the shares as follows.

KLD - 73% or £22m
SD - 13% or £4m
JS - 10% or £3m
CM - 3% or £1m

what problem?

I understand how that is meant to work. I also note that some have said that there is no obligation whatsoever for them to match an investment. Can KLD unilaterally create a share issue?

 

[Hep]

I am struggling to comprehend what you're trying to defend thats for sure.

The bit in bold quite frankly is staggering. Its like you ignored what's happened at the club during his time on charge. We sold off (and plenty of anecdotal evidence to suggest this was pushed by the club) an extremely talented group of kids to keep the lights on. Some of whom could be helping us out now.

After the grigg signing we barely spent a penny and we all witnessed the squad getting weaker and weaker season after season.

He had to take out a high interest loan to keep the club ticking over. The club was stripped to a shell. It was barely functioning.

In the summer just gone we barely had a sellable asset in our whole squad.

His actions are indefensible and if you are a lads fan I just dont understand how you can't see how much damage he's done.

I not defending how we invested any money. I'm explaining that by SD not returning the parachute payments, it didn't really change things. A lot of people are under the impression he's taken £28m and is personally £28m better off, that is not the case.

The club had to stop spending as much as its costs exceeded its normal revenues by some amount. We couldn't keep losing £25m a year.

The only way to keep the lights on without cutting back, was to keep losing £25m, but we no longer had Ellis short willing to give that money to us, nor anyone else.

I think they made loads of mistakes and telling the fans one thing and then another didn't help, but that's just talk. I've no idea why they did that. If I owned the club, I would not engage in any conversations about the detailed running of the club as it just creates a perfect environment for misunderstanding and conjecture.

The upshot was, they didn't have enough personal wealth to keep us running at a loss and there wasn't any other buyer willing to do that either, so stuff had to be sold and cut, otherwise it was just a matter of time before the administrators came in and forced that.

So, yes it's a bad situation, but what was the alternative?

Hearsay from here. Not sure why KLD wouldn't want promotion, though. My expectation is that he would want to be free of the dead weight before being a bit more ambitious. No point in growing something for someone else after all.

I understand how that is meant to work. I also note that some have said that there is no obligation whatsoever for them to match an investment. Can KLD unilaterally create a share issue?

If KLD owns 50%+1 share, then yes, he can create a share issue, and whilst there is no obligation for them to match the investment if they don't their % ownership goes down.

 

[The Cabbage]

I not defending how we invested any money. I'm explaining that by SD not returning the parachute payments, it didn't really change things. A lot of people are under the impression he's taken £28m and is personally £28m better off, that is not the case.

The club had to stop spending as much as its costs exceeded its normal revenues by some amount. We couldn't keep losing £25m a year.

The only way to keep the lights on without cutting back, was to keep losing £25m, but we no longer had Ellis short willing to give that money to us, nor anyone else.

I think they made loads of mistakes and telling the fans one thing and then another didn't help, but that's just talk. I've no idea why they did that. If I owned the club, I would not engage in any conversations about the detailed running of the club as it just creates a perfect environment for misunderstanding and conjecture.

The upshot was, they didn't have enough personal wealth to keep us running at a loss and there wasn't any other buyer willing to do that either, so stuff had to be sold and cut, otherwise it was just a matter of time before the administrators came in and forced that.

So, yes it's a bad situation, but what was the alternative?

If they'd done no transfer business whatsoever (either ins of the likes of Grigg or outs with the youth) we'd have been better off. The football side was universally terrible.

I not defending how we invested any money. I'm explaining that by SD not returning the parachute payments, it didn't really change things. A lot of people are under the impression he's taken £28m and is personally £28m better off, that is not the case.

The club had to stop spending as much as its costs exceeded its normal revenues by some amount. We couldn't keep losing £25m a year.

The only way to keep the lights on without cutting back, was to keep losing £25m, but we no longer had Ellis short willing to give that money to us, nor anyone else.

I think they made loads of mistakes and telling the fans one thing and then another didn't help, but that's just talk. I've no idea why they did that. If I owned the club, I would not engage in any conversations about the detailed running of the club as it just creates a perfect environment for misunderstanding and conjecture.

The upshot was, they didn't have enough personal wealth to keep us running at a loss and there wasn't any other buyer willing to do that either, so stuff had to be sold and cut, otherwise it was just a matter of time before the administrators came in and forced that.

So, yes it's a bad situation, but what was the alternative?

If KLD owns 50%+1 share, then yes, he can create a share issue, and whilst there is no obligation for them to match the investment if they don't their % ownership goes down.

Okay if that is the case I'm less concerned. How is the value of a share defined though? All adds up to them being a hindrance in some form. I don't see how there is anything positive about their lingering presence in truth.

 

[Sea to Shining Sea]

As it's been explained many times, it not a barrier to KLD investing.

For example.

If the club has net assets of £20m and say KLD owns 60%, SD 20%, JS 15% and CM 5%... so

KLD - 60% or £12m
SD - 20% or £4m
JS - 15% or £3m
CM - 5% or £1m

If KLD invests £10m by means of a share issue and the others don't match the investment, the club now has net assets of £30 and it will change the shares as follows.

KLD - 73% or £22m
SD - 13% or £4m
JS - 10% or £3m
CM - 3% or £1m

what problem?

The willingness of all parties to fund their share

 

[Hep]

If they'd done no transfer business whatsoever (either ins of the likes of Grigg or outs with the youth) we'd have been better off. The football side was universally terrible.

Okay if that is the case I'm less concerned. How is the value of a share defined though? All adds up to them being a hindrance in some form. I don't see how there is anything positive about their lingering presence in truth.

I agree, the football side was poor. I'm not defending that. Why we paid over the odds for Grigg baffles me.

A share issue can sometimes be quite complex, but most companies will have the basis defined in their articles of association.

The willingness of all parties to fund their share

They don't have to agree or be willing. The choice is simple, either fund your share or your shares in the club will reduce to a lower %. They can't stop an issue.

 

[The Cabbage]

I agree, the football side was poor. I'm not defending that. Why we paid over the odds for Grigg baffles me.

A share issue can sometimes be quite complex, but most companies will have the basis defined in their articles of association.

I'm not hugely bothered about the parachute payments in truth. The dishonesty from the Donald regime was inexcusable of course. And the knock-on effect of them actively touting talented young players out to PL clubs was an entirely corrosive act designed to benefit them and them alone - which their abject lack of talent led to them squandering anyway. I give them very little credit for their tenure as the swingeing cuts they made could have been achieved by anyone in reality - while the incompetence of their football decisions took a particularly inept bunch of chancers.

I don't want to overreact to whatever we hear this evening as it is unlikely to change what I knew beforehand - the worst, most incompetent owners in SAFCs history still retain a stake in the club (and provide a barrier to progress of undetermined scale as a result). While CM is swanning around purporting to be on club business the majority of the fanbase will be rightly uneasy. They remain hanging over us like a cloud. The only way to know for sure that they have zero influence on the club - something that any right-thinking SAFC should want as a result of their staggering incompetence - is when we finally get to the day when their remaining ownership is removed.

 

[North Yorks Mackem]

I not defending how we invested any money. I'm explaining that by SD not returning the parachute payments, it didn't really change things. A lot of people are under the impression he's taken £28m and is personally £28m better off, that is not the case.

The club had to stop spending as much as its costs exceeded its normal revenues by some amount. We couldn't keep losing £25m a year.

The only way to keep the lights on without cutting back, was to keep losing £25m, but we no longer had Ellis short willing to give that money to us, nor anyone else.

I think they made loads of mistakes and telling the fans one thing and then another didn't help, but that's just talk. I've no idea why they did that. If I owned the club, I would not engage in any conversations about the detailed running of the club as it just creates a perfect environment for misunderstanding and conjecture.

The upshot was, they didn't have enough personal wealth to keep us running at a loss and there wasn't any other buyer willing to do that either, so stuff had to be sold and cut, otherwise it was just a matter of time before the administrators came in and forced that.

So, yes it's a bad situation, but what was the alternative?

If KLD owns 50%+1 share, then yes, he can create a share issue, and whilst there is no obligation for them to match the investment if they don't their % ownership goes down.

Do you not see your contradicting yourself here? See bits in bold. On one hand your saying not returning 20 million didn't change things, then you're saying due to us being in such financial peril that we had to sell things off to just to keep going.

That included a generation of youth that if allowed to mature he could have made us some serious money.

Costs needed to be cut, we needed to stop losing so much cash. But it shouldn't have included the above.

Parachute money provides clubs each year in the championship a ridiculously unfair advantage over the competition. Its why we see west brom, Fulham, Norwich swapping places all the time.

Of course not being able to use it on the team has changed things man.

 

[Guinness Guzzler]

I'm not hugely bothered about the parachute payments in truth. The dishonesty from the Donald regime was inexcusable of course. And the knock-on effect of them actively touting talented young players out to PL clubs was an entirely corrosive act designed to benefit them and them alone - which their abject lack of talent led to them squandering anyway. I give them very little credit for their tenure as the swingeing cuts they made could have been achieved by anyone in reality - while the incompetence of their football decisions took a particularly inept bunch of chancers.

I don't want to overreact to whatever we hear this evening as it is unlikely to change what I knew beforehand - the worst, most incompetent owners in SAFCs history still retain a stake in the club (and provide a barrier to progress of undetermined scale as a result). While CM is swanning around purporting to be on club business the majority of the fanbase will be rightly uneasy. They remain hanging over us like a cloud. The only way to know for sure that they have zero influence on the club - something that any right-thinking SAFC should want as a result of their staggering incompetence - is when we finally get to the day when their remaining ownership is removed.

Spot on. One of the best things that can come from it is that, regardless of the percentage they've got, KLD will be under no illusions (if he ever was) about how much unease there is, and will continue to be, until they're gone. If true they've got some shares but no say in anything at all I'm not personally that arsed that they're still shareholders, but I don't think the fan base will really be able to look ahead until we know they've been fully bought out. Mind, once the Donald and Methven bogeyman have gone, kld will really need to show that he can get us going the right way. I'm sure that'll happen, but if we end up with another season at this level there'll be a drop in ticket sales and the first real discontent he'll have had to experience

 

[Grumpy Old Man]

Hearsay from here. Not sure why KLD wouldn't want promotion, though. My expectation is that he would want to be free of the dead weight before being a bit more ambitious. No point in growing something for someone else after all.

I understand how that is meant to work. I also note that some have said that there is no obligation whatsoever for them to match an investment. Can KLD unilaterally create a share issue?

Yes, so long as he owns more than 50% of the shares in the issuing company, as it only requires an ordinary resolution. The only caveat would be if there was a clause to the contrary in the purchase agreement.

 

[The Cabbage]

Yes, so long as he owns more than 50% of the shares in the issuing company, as it only requires an ordinary resolution. The only caveat would be if there was a clause to the contrary in the purchase agreement.

Best hope they didn't make that a condition of sale to lock in the best price then!

 

[Hep]

Do you not see your contradicting yourself here? See bits in bold. On one hand your saying not returning 20 million didn't change things, then you're saying due to us being in such financial peril that we had to sell things off to just to keep going.

That included a generation of youth that if allowed to mature he could have made us some serious money.

Costs needed to be cut, we needed to stop losing so much cash. But it shouldn't have included the above.

Parachute money provides clubs each year in the championship a ridiculously unfair advantage over the competition. Its why we see west brom, Fulham, Norwich swapping places all the time.

Of course not being able to use it on the team has changed things man.

The club needed to change its operating costs to match its operating revenues. What is the point of spending the parachute payments to keep things going for another year? You're just delaying the inevitable. What you're actually saying is you wanted SD to fund another year of £25m losses using the parachute money, or maybes 3 years of funding a large youth set-up... and then what? It's a gamble that a few players would come good and we'd sell them. At which point we'd be unhappy about the sale.

If SD had kept the parachute payment money in SAFC, that doesn't mean he was going to use it to fund more players. He couldn't have done that as after that money had gone, how would he have paid them?? You have to live within your operating revenues.

 

[The Cabbage]

Spot on. One of the best things that can come from it is that, regardless of the percentage they've got, KLD will be under no illusions (if he ever was) about how much unease there is, and will continue to be, until they're gone. If true they've got some shares but no say in anything at all I'm not personally that arsed that they're still shareholders, but I don't think the fan base will really be able to look ahead until we know they've been fully bought out. Mind, once the Donald and Methven bogeyman have gone, kld will really need to show that he can get us going the right way. I'm sure that'll happen, but if we end up with another season at this level there'll be a drop in ticket sales and the first real discontent he'll have had to experience

Yup. I have my own opinion of whether that is 'fair and reasonable' tbh, but it is what it is. The patience of the fanbase has been exhausted by the 2.5 seasons we wasted under the control of the chancers

The club needed to change its operating costs to match its operating revenues. What is the point of spending the parachute payments to keep things going for another year? You're just delaying the inevitable. What you're actually saying is you wanted SD to fund another year of £25m losses using the parachute money, or maybes 3 years of funding a large youth set-up... and then what? It's a gamble that a few players would come good and we'd sell them. At which point we'd be unhappy about the sale.

If SD had kept the parachute payment money in SAFC, that doesn't mean he was going to use it to fund more players. He couldn't have done that as after that money had gone, how would he have paid them?? You have to live within your operating revenues.

Hang on. Lets not pretend that SAFC didn't spend in that first season down here. He squandered plenty in that first season - mostly generated from the sale of assets he inherited. That's before we consider that he told us time and again that he would put the money back in. The Donald era was the worst of both worlds. They took the parachute payments out and sold everything that wasn't nailed down to limit their personal liability while completely wasting what chances they were afforded through their rank incompetence. We were left with a worse squad than they had on day one with less of a foundation than they had inherited. It was 2.5 years of pantomime - playing at being a football owner. They fouled it all up due to ego and hubris and then shat one when their talent levels inevitably ran out too quickly to keep the exit strategy open to them. The unconfirmed notion that there was no alternative is weak sauce that allows them to be absolved of a hell of an act of vandalism (whether it was intentional or not).