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Man U £100M operating profit, Overall Loss £80M
Comments
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lemonjelly wrote: »Man Yoo are also paying interest at circa 17.5% IIRC.
The Glazers have a bond known as a PIK (Payment in Kind). Instead of paying interest in cash it pays it in bonds and so is very high risk. According to the terms of the bonds, the interest rate recently rose from about 14.5% to about 16.5%. This only finances a small part of the debt underlying the purchase of Man Utd, perhaps 1/4, something like that I think.lemonjelly wrote: »In response to Liam above, I am referring to risdale era Leeds (he went on to pretty much ruin cardiff too...)
Some people do seem to have a habit of breaking up football clubs. My thoughts on arry "envelope" redknapp are pretty well known, but you can't trust him. Hopefully Levy has a simiar stance to other chairmen, like Steve Morgan...
From what I've seen of 'Arry at Spurs, if he's given money then he'll spend it and if he's not then he gets on with it. I can't speak for other clubs as I've not followed their fortunes closely.
To be flippant, in most companies it is the CFO not the Operations Manager that signs off on the accounts. Any company that is run differently deserves to go bust.0 -
This legal expert does not seem to think under UK law it is H&G first. RBS first (creditors) shareholders next H&G
The fiduciary duty is to enrich H&G, there is also a contractual obligation to repay RBS AIUI.
It's interesting watching the whole thing blow up. The lawyers will make a killing.0 -
The fiduciary duty is to enrich H&G, there is also a contractual obligation to repay RBS AIUI.
It's interesting watching the whole thing blow up. The lawyers will make a killing.
6 months of selling two offers, 1 recomended.
or lose the asset on the 15th
It is hard not to agree this is to enrich H&G as they lose everything in a few days.
If H&G value the club more because they lost money is neither here nor there. It is their own fault they lost the money, the asset is only worth what it can be sold for.
Open market rules, they were given an extention to either repay or sell.
It has been on the open market, if a £600M bid has not been tabled the board cant sell it for that.
The other option is for the board to let the club to go into administration. That would not be in H&G's interest and would fail on the previous points also.
This guy seems confident it will go our way. I am happy with that.
Yes a lawyers field day again. 0 -
6 months of selling two offers, 1 recomended.
or lose the asset on the 15th
It is hard not to agree this is to enrich H&G as they lose everything in a few days.
If H&G value the club more because they lost money is neither here nor there. It is their own fault they lost the money, the asset is only worth what it can be sold for.
Open market rules, they were given an extention to either repay or sell.
It has been on the open market, if a £600M bid has not been tabled the board cant sell it for that.
The other option is for the board to let the club to go into administration. That would not be in H&G's interest and would fail on the previous points also.
This guy seems confident it will go our way. I am happy with that.
Yes a lawyers field day again.
I've never understood where Hicks has got his £600m value from. They paid £220m for the club and took on £40m debt so £260m would be a reasonable value for the club just 3 years later.
In terms of assets i.e. player values, is the current squad worth more than the 2007 squad? I very much doubt it is.
If Hicks believes that they've put £140m into the club, well, tough! They've wasted it either planning the new stadium or letting Rafa waste their money on poor players. Personally, my opinion is that Rafa was only ever allowed to buy average players. Hicks never provided the funds for £30m players - but when he realised that the last £10m that Rafa spent didn't bring success he gave him another £10m. I am sure that this is the case - why would Rafa choose to buy so many low valued players if he's had hundreds of millions spend?
Hicks believe that the £300m bid under-values the club and that's his reasoning for removing Purslow and Ayres...The judge will laugh Hicks out of court.0 -
Most companies run with a constant level of debt. I'm not sure why people think football companies would be any different.
I'm surprised you are so sanguine.
Man United are not operating with a constant level of debt. The debt has increased year by year and its not that mark of a normal business to by paying 16.25% on almost a third of its debt.
It has always seemed to me that the Glazers are intent on extracting as much cash out of the business as possible before selling it on.
I find it curious (to say the least) that the PIK loans have never been paid down and wonder who the beneficial owners of this debt is.
If they continue to roll the PIK up, then they will be paying £50m per year interest on the PIK debt alone by 2012.
However, the great thing is that the debt structure at both Liverpool & United has created a more level playing field than may have been the case under a more conventional ownership structure0 -
The PIK loans are the sole responsibility of the Glazer family, they are tied in no way to Red Football Joint Ventures Ltd or held against any of it's assets (Manchester United Ltd, Carrington training ground or Old Trafford)I'm surprised you are so sanguine.
Man United are not operating with a constant level of debt. The debt has increased year by year and its not that mark of a normal business to by paying 16.25% on almost a third of its debt.
It has always seemed to me that the Glazers are intent on extracting as much cash out of the business as possible before selling it on.
I find it curious (to say the least) that the PIK loans have never been paid down and wonder who the beneficial owners of this debt is.
If they continue to roll the PIK up, then they will be paying £50m per year interest on the PIK debt alone by 2012.
However, the great thing is that the debt structure at both Liverpool & United has created a more level playing field than may have been the case under a more conventional ownership structure
This however does not mean that United are not paying the intrest paymentsw due on this debt, but are doing so in the way of a 3rd party.
Glazer can withdraw money from United in the form of management fees, and various other fees as per the Bond agreement. Therefore he can use United money to pay HIS debts, both related to the PIK and also his various failing shopping malls in the US.
This news today is actually great news for United fans, although suprisingly some are still too blind to admit there is a problem. The longer this goes on, the less stable Glazers position will be. He can't keep taking money out of the club where no money exists. Soonetr or later he is going to have to sell something, either his retail businesses, the Buccs or United. Also,the less money United make in profits, the less valueable the club becomes and the more likely serious investors will be willing to buy the club.
As a lifelong United fan and prior to this season a season ticket holder for some 20+ years, I have said before that dropping out of the champions league, or even being relegated, would not bother me one bit, IF it meant we were rid of that horrible leprechaun.
As it stands now United are not even close to winning anything this season, the squad is terrible.
Once the club is back into a secure ownership situation, whether or not that be a Barcelona style fans ownership scheme, or just an owner who is willing to pay off the debt (we don't want a sugar daddy, our income without having to pay stupid amounts on interest, penalties and fees, is high enough to compete with any club in the world) then we can rebuild. It may take 5 years, it may take 25, but I'd happily take another 26 years wait for a league title, as long as the Glazers were a distant memory.[SIZE=-1]To equate judgement and wisdom with occupation is at best . . . insulting.
[/SIZE]0 -
The PIK loans are the sole responsibility of the Glazer family, they are tied in no way to Red Football Joint Ventures Ltd or held against any of it's assets (Manchester United Ltd, Carrington training ground or Old Trafford)
This however does not mean that United are not paying the intrest paymentsw due on this debt, but are doing so in the way of a 3rd party.
Glazer can withdraw money from United in the form of management fees, and various other fees as per the Bond agreement. Therefore he can use United money to pay HIS debts, both related to the PIK and also his various failing shopping malls in the US.
This news today is actually great news for United fans, although suprisingly some are still too blind to admit there is a problem. The longer this goes on, the less stable Glazers position will be. He can't keep taking money out of the club where no money exists. Soonetr or later he is going to have to sell something, either his retail businesses, the Buccs or United. Also,the less money United make in profits, the less valueable the club becomes and the more likely serious investors will be willing to buy the club.
As a lifelong United fan and prior to this season a season ticket holder for some 20+ years, I have said before that dropping out of the champions league, or even being relegated, would not bother me one bit, IF it meant we were rid of that horrible leprechaun.
As it stands now United are not even close to winning anything this season, the squad is terrible.
Once the club is back into a secure ownership situation, whether or not that be a Barcelona style fans ownership scheme, or just an owner who is willing to pay off the debt (we don't want a sugar daddy, our income without having to pay stupid amounts on interest, penalties and fees, is high enough to compete with any club in the world) then we can rebuild. It may take 5 years, it may take 25, but I'd happily take another 26 years wait for a league title, as long as the Glazers were a distant memory.
IIRC, the hedge fund that ponied up a big chunk of the money for the PIK can put someone on the board of Man Utd if the Glazers fail to pay.0 -
GHOULES_ARE_BACK_IN_TOWN wrote: »football. yawn!!
It's not just football though...
Interesting how British banks can loan money to American "business men", (when they basically have no security to back up the loans), to buy PL football clubs, and use the football club as the security.
^ a messy sentence, but explains some of the reasons behind the banking collapse.
As previously stated, H&G have a massive over valuation of Liverpool, this seems to be a recurring problem with Americans over valuing, just as they did with the mortgage portfolios.
Why didn't a British person go to America, walk into a bank and ask for a loan to buy the NY Yankees, Chicago Bulls, LA Galaxy.... (my American sports knowledge is very limited), with no intention of paying the loan out of their own pocket, but out of the asset they were buying.0 -
It's not just football though...
Interesting how British banks can loan money to American "business men", (when they basically have no security to back up the loans), to buy PL football clubs, and use the football club as the security.
^ a messy sentence, but explains some of the reasons behind the banking collapse.
As previously stated, H&G have a massive over valuation of Liverpool, this seems to be a recurring problem with Americans over valuing, just as they did with the mortgage portfolios.
Why didn't a British person go to America, walk into a bank and ask for a loan to buy the NY Yankees, Chicago Bulls, LA Galaxy.... (my American sports knowledge is very limited), with no intention of paying the loan out of their own pocket, but out of the asset they were buying.
Securing debt against the asset being acquired is a pretty normal way to buy assets. It's no different to getting a mortgage.0 -
Securing debt against the asset being acquired is a pretty normal way to buy assets. It's no different to getting a mortgage.
Yes but that is one of the main reasons for the banking collapse wasn't it?
People securing mortgages that they couldn't afford to repay, against assets that were over valued.0
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