Ethics Commitee Meeting Tomorrow (33 Viewers)

[italiahorse]

That's not what the documents released suggests. Have you read them? I thought sisu had no money - yet could take the loan over?

The loan was one of several criteria to take place before Higgs Sisu had a deal. The loan needed to be agreed and Sisu financing the purchase were two that come to mind.
It would be unlikely that YB would agree the value of the loan takeover. In addition the payment would be a deposit with Sisu then unable to provide proof of funds for the rest. To be honest 'a SISU joke'

 

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[Nick]

The loan was one of several criteria to take place before Higgs Sisu had a deal. The loan needed to be agreed and Sisu financing the purchase were two that come to mind.
It would be unlikely that YB would agree the value of the loan takeover. In addition the payment would be a deposit with Sisu then unable to provide proof of funds for the rest. To be honest 'a SISU joke'

Wasn't the 5 million offer a "payment plan" but the 2 million one up front? Could well be wrong.

 

[Astute]

That wasn't "operation premiership" though.

Operation Premiership mark 2

 

[Astute]

Wasn't the 5 million offer a "payment plan" but the 2 million one up front? Could well be wrong.

Agreed on 5.5m but when Higgs agreed they said they wanted to pay over 10 years. When Higgs asked for proof of payment SISU refused.

 

[Nick]

Agreed on 5.5m but when Higgs agreed they said they wanted to pay over 10 years. When Higgs asked for proof of payment SISU refused.

Thats what I thought, then the lower bid was up front.

 

[Astute]

Thats what I thought, then the lower bid was up front.

Yes when SISU refused to give proof of payment they then offered 2m saying the Ricoh was valueless but would give them 2m as they are a charity.

 

[Grendel]

Wasn't the 5 million offer a "payment plan" but the 2 million one up front? Could well be wrong.

Correct. The documents released also suggested sisu would have discharged the loan. The only reason according to one of the e mails that the council purchased the loan was that they were concerned sisu would attempt to buy it. It was acknowledged as high risk as ACL were not financially self suffucient without the club.

This to me adds further to the belief that the council wanted to sell to derek Richardson a long time before the club left to Northampton.

The evidence of the documents is certainly adding fuel to that fire.

 

[Grendel]

Yes when SISU refused to give proof of payment they then offered 2m saying the Ricoh was valueless but would give them 2m as they are a charity.

Have you read the documented evidence? Sisu never said it was a donation. It couldn't be by the way as that would breach taxation law.

 

[Deleted member 5849]

I know nothing about SISU being skint. They administer other people's money as far as I understand it.

TF told a journalist from the Guardian that SISU would not have accepted the Wasps' deal ( which included a 250 year lease ) because of the 14,4m debt.

I am not peddling a line. If anyone is, it is TF for whatever reason. Ask him, not me.

He might yet be right of course.

Am still not convinced Wasps got a good deal... but only time will tell, as ever.

 

[Deleted member 5849]

Hedge funds don't need ethics. Local politicians do.

Indeed.

And this is the crux of the matter, and a problem which is not local government's problem, but the national one imposing certain limitations on the local.

SISU absolutely should never, ever be allowed to own a football club, because ethics are not, well... in their DNA. SISU are ruthless, profit driven... not in it for the love of the game.

The problem is, a council should be in it for the service. The problem has *always* been that ACL was set up as a commercial entity, in a way that meant one side or the other would take a hit... which meant both sides would end up butting heads at some point.

So then it becomes a commercial dispute. And commercial disputes get bloody.

And that's... where a PR battle is handy, to deflect from the reality of that. Personally, given we have a left wing council, I wish they'd focussed more on the fact they were and are compelled to run things on commercial, profit-driven lines. To disguise that and claim all is as it was ends up with the same issues repeating themselves.

 

[Sick Boy]

Even more reason that we should have bought the Higgs share at the first opportunity..
That way we have a say on what rent we pay and access to incomes and 'profits'

Interesting to know what Sisu would do if they could rewind.

I believe it was actually Ranson's policy not to buy the stadium. The money they wasted hiring Coleman and the players he signed could have bought the Ricoh based on what Wasps paid.

 

[italiahorse]

Wasn't the 5 million offer a "payment plan" but the 2 million one up front? Could well be wrong.

The initial offer was £5.5M with £1.5M upfront and the rest in payments that were linked to CCFC income streams.
After due diligence the offer was reduced to £2M.

 

[Grendel]

The initial offer was £5.5M with £1.5M upfront and the rest in payments that were linked to CCFC income streams.
After due diligence the offer was reduced to £2M.

Paid upfront.

 

[Deleted member 5849]

I believe it was actually Ranson's policy not to buy the stadium. The money they wasted hiring Coleman and the players he signed could have bought the Ricoh based on what Wasps paid.

Yup, and it was a fine example of how SISU were in it for a quick buck rather than laying the foundations.

Although, of course, absolutely nobody thought the ground worth buying for the deal on offer!

 

[italiahorse]

Correct. The documents released also suggested sisu would have discharged the loan. The only reason according to one of the e mails that the council purchased the loan was that they were concerned sisu would attempt to buy it. It was acknowledged as high risk as ACL were not financially self suffucient without the club.

This to me adds further to the belief that the council wanted to sell to derek Richardson a long time before the club left to Northampton.

The evidence of the documents is certainly adding fuel to that fire.

Sisu thought they could purchase the loan between £2M and £5M. The council thought if they did they could use it to apply pressure to ACL.

 

[italiahorse]

Paid upfront.

I guess so

 

[Grendel]

Sisu thought they could purchase the loan between £2M and £5M. The council thought if they did they could use it to apply pressure to ACL.

Why then in the documentation did the council initially bid much much more?

I assume you have some documentation to back up this claim that I have overlooked - there are 75 pages after all.

Where is that element?

 

[chiefdave]

In addition the payment would be a deposit with Sisu then unable to provide proof of funds for the rest. To be honest 'a SISU joke'

They might have done something unthinkable like raise millions against the stadium to pay the rest and pay themselves back :thinking about:

 

[italiahorse]

Why then in the documentation did the council initially bid much much more?

I assume you have some documentation to back up this claim that I have overlooked - there are 75 pages after all.

Where is that element?

Negotiations for the Restructuring or Purchase of the Bank Debt

1. As I have indicated, SISU were of the view that there was no commercial rationale fora deal with the Bank over purchase of the ACL debt, without agreement on thepurchase of a share in ACL. However, SISU’s aspirations for the debt purchase toowere unrealistic.
   
2. SISU considered that the Bank debt could be purchased for £2m-5m. It was part oftheir plan that the debt be purchased – in whole, or at least as to 50%, by them – forthat sum. They were not prepared to offer more. The Heads of Terms supposed that,the debt having been purchased, it would be entirely written off; although the Councilwas sensible to the possibility that SISU might purchase the debt from the Bank(which had no constraints on the person to whom the loan and mortgage might betransferred) and use their position as creditor to put further pressure on ACL and thusthe Council.
   
3. So far as the Heads of Terms were concerned, shortly after 2 August 2012, it becameclear there was another showstopper to the overall plan: given its fears, the Councilwas not prepared to agree to SISU buying out 50% or more of the Bank loan, whilstSISU were not prepared to allow the Council to buy out more than 50% of the loan.The Council had no confidence in CCFC’s ability to put forward and implement asustainable plan for the Football Club, and became increasingly concerned that SISUintended to purchase the Bank loan with a view to taking over ACL. Thus, theCouncil were only prepared to consider the SISU plan on the basis that all of the otherelements were in place, before SISU bought and discharged the loan.
   

 

[italiahorse]

They might have done something unthinkable like raise millions against the stadium to pay the rest and pay themselves back :thinking about:

Based on their status as a top team in their sport :thinking about:

 

[Grendel]

Negotiations for the Restructuring or Purchase of the Bank Debt

1. As I have indicated, SISU were of the view that there was no commercial rationale fora deal with the Bank over purchase of the ACL debt, without agreement on thepurchase of a share in ACL. However, SISU’s aspirations for the debt purchase toowere unrealistic.
   
2. SISU considered that the Bank debt could be purchased for £2m-5m. It was part oftheir plan that the debt be purchased – in whole, or at least as to 50%, by them – forthat sum. They were not prepared to offer more. The Heads of Terms supposed that,the debt having been purchased, it would be entirely written off; although the Councilwas sensible to the possibility that SISU might purchase the debt from the Bank(which had no constraints on the person to whom the loan and mortgage might betransferred) and use their position as creditor to put further pressure on ACL and thusthe Council.
   
3. So far as the Heads of Terms were concerned, shortly after 2 August 2012, it becameclear there was another showstopper to the overall plan: given its fears, the Councilwas not prepared to agree to SISU buying out 50% or more of the Bank loan, whilstSISU were not prepared to allow the Council to buy out more than 50% of the loan.The Council had no confidence in CCFC’s ability to put forward and implement asustainable plan for the Football Club, and became increasingly concerned that SISUintended to purchase the Bank loan with a view to taking over ACL. Thus, theCouncil were only prepared to consider the SISU plan on the basis that all of the otherelements were in place, before SISU bought and discharged the loan.
   

Fascinating. Which document is that from?

 

[duffer]

Christ, it's hard to know where to start with all this.

For what it's worth I think SISU substantially overplayed their hand in the initial negotiations to purchase a share in ACL, and if they did go to YB behind the back of the other parties then I can understand why the deal unravelled. In the light of what's gone on though, I am no longer certain that SISU really did do this in truth.

However the Council/ACL also massively overplayed their hand in terms of the true value of ACL, and then continued that over-reaction with a hugely unbecoming and unnecessarily personal PR war to try to justify their stance.

Then when it came to the initial bailout of ACL for £14.4m, it seems the Council connived with or pressured the CET into witholding a story that would have at least exposed the deal to critical scrutiny. Ultimately this, in my opinion, cost a decent, honest journalist (Les Reid) his job.

(In truth this winds me up more than anything else in this whole sorry saga. When you've got the council officers and elected representatives doing deals with the local media to squash awkward stories, then the whole democratic process is put at risk. Frankly, I'd like to see the bastards behind this sacked and/or thrown out of office - this goes way beyond the ethics committee.)

Moving on, CCC then did everything in their power to sell ACL to a franchise rugby club behind CCFC's back. In the process they blatantly lied to everyone, and gave absolutely no regard to the well-being of either CCFC or CRFC. And some of the people responsible for this claim to be fans!

I'm not anti-council, never have been. I know a few councillors, and more than a few people who work for the council, and in my opinion they do a difficult job as well as they can.

However the leadership of Coventry City Council is another matter entirely, and what this all shows to me is a pattern of behaviour that is entirely unacceptable in elected representatives and their senior officers. We don't need an ethics committee to draw our own conclusions on this - and the more evidence that comes out the better.

 

[chiefdave]

For what it's worth I think SISU substantially overplayed their hand in the initial negotiations to purchase a share in ACL, and if they did go to YB behind the back of the other parties then I can understand why the deal unravelled. In the light of what's gone on though, I am no longer certain that SISU really did do this in truth.

Interesting idea. When the JR case was going on I did wonder why CCC didn't get someone from YB to come and give evidence. Say that SISU approached them about a lo-ball offer they would never have accepted. All seemed a bit tin foil hat but it would have been an obvious thing to do in my opinion.

 

[martcov]

Interesting idea. When the JR case was going on I did wonder why CCC didn't get someone from YB to come and give evidence. Say that SISU approached them about a lo-ball offer they would never have accepted. All seemed a bit tin foil hat but it would have been an obvious thing to do in my opinion.

The Bank cannot disclose such details,

 

[James Smith]

CCC could veto that sale couldn't they?

Yes I think so although had we bought it before the decline in relations they might not have said no. Maybe we'll never know or it might come up/out in JR2.

 

[James Smith]

Wasn't the 5 million offer a "payment plan" but the 2 million one up front? Could well be wrong.

Memory a bit fuzzy but something like that sounds right.

Yes when SISU refused to give proof of payment they then offered 2m saying the Ricoh was valueless but would give them 2m as they are a charity.

Have you read the documented evidence? Sisu never said it was a donation. It couldn't be by the way as that would breach taxation law.

Think it was (Lana, Laura, Linda whoever) Joy's right hand woman was who said something like that in the Higgs case. It was something about Sisu saying the Higgs share was worthless and when asked why they had in that case offered £2m said something like they're a charity but you'd have to ask Joy about the amount.

I'm paraphrasing and would welcome corrections.

 

[chiefdave]

The Bank cannot disclose such details,

They can if the court requests the information or the bank feels they have a public duty to release the information.

 

[Rusty Trombone]

The 'donation' was proposed at £5.5m according to Deering.

4 MR JUSTICE LEGGATT: But she wasn't going to pay 5.5 million
5 is the point for a company worth nothing.
6 A. I don't think she ever said that she wouldn't pay that
7 money if the original deal was still on the table.
8 MR JUSTICE LEGGATT: Sorry, you're suggesting she thought
9 the company was worth nothing, but still would pay
10 5.5 million for it?
11 A. She recognised that they were a charity, yes.
12 MR JUSTICE LEGGATT: You're not a charity, are you?
13 A. No.
14 MR JUSTICE LEGGATT: Why would she pay 5.5 million for
15 something worth nothing?
16 A. I don't know. I don't make the final decision. I can
17 only --
18 MR JUSTICE LEGGATT: Okay.

 

[James Smith]

The 'donation' was proposed at £5.5m according to Deering.

4 MR JUSTICE LEGGATT: But she wasn't going to pay 5.5 million
5 is the point for a company worth nothing.
6 A. I don't think she ever said that she wouldn't pay that
7 money if the original deal was still on the table.
8 MR JUSTICE LEGGATT: Sorry, you're suggesting she thought
9 the company was worth nothing, but still would pay
10 5.5 million for it?
11 A. She recognised that they were a charity, yes.
12 MR JUSTICE LEGGATT: You're not a charity, are you?
13 A. No.
14 MR JUSTICE LEGGATT: Why would she pay 5.5 million for
15 something worth nothing?
16 A. I don't know. I don't make the final decision. I can
17 only --
18 MR JUSTICE LEGGATT: Okay.

Thanks for taking the time to look that up.

 

[SkyBlueZack]

Was the purchase of the YB loan not first discussed between SISU and the council? I'm sure I read at some point that they were in cahoots with each other over the loan. I might be wrong tho.

 

[Sick Boy]

Was the purchase of the YB loan not first discussed between SISU and the council? I'm sure I read at some point that they were in cahoots with each other over the loan. I might be wrong tho.

I remember that as well

 

[martcov]

They can if the court requests the information or the bank feels they have a public duty to release the information.

It is a JR and not a criminal court. It is not a public duty. On what grounds should a bank volunteer such information? To do CCC a favour?

 

[Rusty Trombone]

Extract from JR about the initial loan discussions.

So far as negotiations were concerned, a document was prepared by Mr Reeves,
headed “Areas of agreement”, which was informed by the principles to which I have
referred and which was discussed (and apparently agreed) at a meeting on 19 April
2012 between representatives of the Council, the Higgs Charity, CCFC and SISU.

The note states that all parties acknowledged that “the Football Club has been
extremely poorly managed in the recent past and... it remains a commercial
nightmare”. Given the £5m loss on turnover of £15m in 2011-12, the imminent
relegation to League One, and the absence of any plan for a sustainable Football Club,
that acknowledgment seems to have been fully justified, the £1.3m rent being only
one of the many problems the Football Club faced and arguably not the worst.

At that meeting, Mr Tim Fisher (the Chief Executive of CCFC) confirmed that CCFC was
balance sheet insolvent; and Ms Seppala confirmed that no more cash would be
forthcoming from SISU, that liquidation of CCFC was “a viable option for ARVO”,
which was by now a creditor of CCFC. SISU proposed having discussions with the
Bank with a view to the ACL debt being purchased, and there appears to have been
consideration at that meeting as to who should in fact attend any discussions with the
Bank.

Relegation to League One was confirmed two days later. Mr West was still
concerned that no business plan had been seen for either the following season in
League One, or how SISU proposed to buy out the Higgs Charity.

 

[stupot07]

Extract from JR about the initial loan discussions.

So far as negotiations were concerned, a document was prepared by Mr Reeves,
headed “Areas of agreement”, which was informed by the principles to which I have
referred and which was discussed (and apparently agreed) at a meeting on 19 April
2012 between representatives of the Council, the Higgs Charity, CCFC and SISU.

The note states that all parties acknowledged that “the Football Club has been
extremely poorly managed in the recent past and... it remains a commercial
nightmare”. Given the £5m loss on turnover of £15m in 2011-12, the imminent
relegation to League One, and the absence of any plan for a sustainable Football Club,
that acknowledgment seems to have been fully justified, the £1.3m rent being only
one of the many problems the Football Club faced and arguably not the worst.

At that meeting, Mr Tim Fisher (the Chief Executive of CCFC) confirmed that CCFC was
balance sheet insolvent; and Ms Seppala confirmed that no more cash would be
forthcoming from SISU, that liquidation of CCFC was “a viable option for ARVO”,
which was by now a creditor of CCFC. SISU proposed having discussions with the
Bank with a view to the ACL debt being purchased, and there appears to have been
consideration at that meeting as to who should in fact attend any discussions with the
Bank.

Relegation to League One was confirmed two days later. Mr West was still
concerned that no business plan had been seen for either the following season in
League One, or how SISU proposed to buy out the Higgs Charity.

Where's that info from? The turnover in 11/12 was £10.7m not £15m. Also why should the council see the business plan for football operations in league one?


Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors

 

[James Smith]

Where's that info from? The turnover in 11/12 was £10.7m not £15m. Also why should the council see the business plan for football operations in league one?


Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors

JR1 I think, it's written at the top of the post.