Ricoh Lease... (4 Viewers)

[higgs]

One way or the other you can't play good passing football on a rugby pitch there needs to be a long term solution where we either get back the Ricoh or build our own stadium. Ground sharing with wasps won't work. It was a sorry day when they were allowed play a few Heineken cup games at the Ricoh it opened the door to this situation that we are in now

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[CCFC54321]

One way or the other you can't play good passing football on a rugby pitch there needs to be a long term solution where we either get back the Ricoh or build our own stadium. Ground sharing with wasps won't work. It was a sorry day when they were allowed play a few Heineken cup games at the Ricoh it opened the door to this situation that we are in now

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It is possible to play both sports on that pitch but the issue was w**** can’t afford to maintain the pitch to a high standard. That pitch would have been treated better by the council ground staff at the memorial park.

It was embarrassing and heard first hand the players don’t want to play on that surface.

 

[higgs]

It is possible to play both sports on that pitch but the issue was w**** can’t afford to maintain the pitch to a high standard. That pitch would have been treated better by the council ground staff at the memorial park.

It was embarrassing and heard first hand the players don’t want to play on that surface.

That's the problem being the tenant the landlord won't spend money on the pitch when it doesnt affect their game/performances if any changes are made the cost would be passed onto us the tenant. We wouldn't have played the style of football we played this season at the Ricoh. It would suit hoof ball tactics if Tony Pulis was our manager the Ricoh would be perfect

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[Sky_Blue_Dreamer]

That's the problem being the tenant the landlord won't spend money on the pitch when it doesnt affect their game/performances if any changes are made the cost would be passed onto us the tenant. We wouldn't have played the style of football we played this season at the Ricoh. It would suit hoof ball tactics if Tony Pulis was our manager the Ricoh would be perfect

So the question to ask is IF we took over pitch maintenance as part of a deal in exchange for lower rent would the number of extra fans we got in by being back in Coventry compared to Brum make it worthwhile financially?

 

[Warwickhunt]

I would think the lease could be sold. It would have to be sold at market value. They could for example sell in a lease back arrangement, often done by selling to a pension scheme.

Last valuation was £51m 31/03/2019. I wouldn't think that in current circumstances it is still worth as much

The Rugby club has a 50 year lease i believe on the 250 year lease owned by ACL. so they probably dont need a lease back arrangement

What they originally paid for it is irrelevant.

They would need to clear the bond debt of £35m if it was sold.

CCC would have to give their permission but that can not be unreasonably with held.

A third party owning the stadium would not necessarily mean a cheap deal for CCFC if they decided to come back. Wasps rugby already have their lease.

Hi Oldskyblue! been a while since you posted! so good to get some financial logical input. Stay safe my old friend

 

[oldskyblue58]

Wasps paid 5.77m for acl group. As said above they moved the loan liability included on acl from ccc to the bond that is not an purchase cost as it was already within acl and still is

The 5.77m was not the value of the lease or stadium it was the sale of the shares of acl. They acquired all assets (including the lease)and all liabilities (including the ccc loan) of acl and the 5.77m is in effect the net difference between assets less liabilities at October 2014. The 5.77m was the only cash they paid out.

The lease they purchased was included in the deal at a value of 18m. The value of the lease as it stood the day before they took over. To this they added an extension to 250 years at a cost of 1m.

What they effectively paid for the lease without a long term key tenant and currently valued at 51m was 19m.

Part of the increase in value is down to acl granting wasps rugby a 50 year lease i believe. It is a use of the group situation to create worth. Having a longer term tenant in wasps creates value in the lease owned by acl & acl2006

Saying they paid 5.77m for the lease or stadium I am afraid is a nonsense.

 

[oldskyblue58]

Hi Oldskyblue! been a while since you posted! so good to get some financial logical input. Stay safe my old friend

Cheers you stay safe too

 

[Sky Blue Pete]

So the question to ask is IF we took over pitch maintenance as part of a deal in exchange for lower rent would the number of extra fans we got in by being back in Coventry compared to Brum make it worthwhile financially?

Course but there’s so much more involved

 

[Sky Blue Pete]

Wasps paid 5.77m for acl group. As said above they moved the loan liability included on acl from ccc to the bond that is not an purchase cost as it was already within acl and still is

The 5.77m was not the value of the lease or stadium it was the sale of the shares of acl. They acquired all assets (including the lease)and all liabilities (including the ccc loan) of acl and the 5.77m is in effect the net difference between assets less liabilities at October 2014. The 5.77m was the only cash they paid out.

The lease they purchased was included in the deal at a value of 18m. The value of the lease as it stood the day before they took over. To this they added an extension to 250 years at a cost of 1m.

What they effectively paid for the lease without a long term key tenant and currently valued at 51m was 19m.

Part of the increase in value is down to acl granting wasps rugby a 50 year lease i believe. It is a use of the group situation to create worth. Having a longer term tenant in wasps creates value in the lease owned by acl & acl2006

Saying they paid 5.77m for the lease or stadium I am afraid is a nonsense.

Certainly looks like they received state aid to the tune of £22m

 

[oldskyblue58]

Valuation for bond purposes was 49m. That value included any new tenants including wasps rugby and forecasted improvements in turnover of the site. If the rent wasps rugby pay to acl was 500k pa on a 50 year lease for example then most of the increase in valuation could be accounted for depending on the discounting assumptions used. Of course what wasps purchased in 2014 would not include that increase. The clever thing is that increase value doesn't cost wasps group anything. It all remains in the group

If at October 2014 there was state aid at 22m that would value the lease at 41m meaning the value of wasps being there and on a 50 year lease of 500k pa would be under 8m by the 2015 bond Valuation. That values the 50 year wasps rugby lease at well below the rents receivable if it was 500k pa

So i think it is not so clear it is state aid. Hence why there has been no quick decision that we know of i would guess

 

[shmmeee]

So the question to ask is IF we took over pitch maintenance as part of a deal in exchange for lower rent would the number of extra fans we got in by being back in Coventry compared to Brum make it worthwhile financially?

Yes.

At £10/ticket (poss more in Championship) on a 7k drop in attendance (low estimate) you’re talking 230*7000 = £1.61m, easily enough to pay any rent or extras for revenue.

 

[mark_ccfc]

Valuation for bond purposes was 49m. That value included any new tenants including wasps rugby and forecasted improvements in turnover of the site. If the rent wasps rugby pay to acl was 500k pa on a 50 year lease for example then most of the increase in valuation could be accounted for depending on the discounting assumptions used. Of course what wasps purchased in 2014 would not include that increase. The clever thing is that increase value doesn't cost wasps group anything. It all remains in the group

If at October 2014 there was state aid at 22m that would value the lease at 41m meaning the value of wasps being there and on a 50 year lease of 500k pa would be under 8m by the 2015 bond Valuation. That values the 50 year wasps rugby lease at well below the rents receivable if it was 500k pa

So i think it is not so clear it is state aid. Hence why there has been no quick decision that we know of i would guess

Do you think the EC complaint will result in any action against the council?

 

[oldskyblue58]

You would think the odds are in favour of ccc. They knew there was a high probability of challenge when the deal was done so should have acted to mitigate every risk of that. A referral to EU was always a possibility.

So the chance of action against ccc should be significantly less than 50:50.

Kind of depends as to what the purpose of the complaint was as to whether it is a success for sisu. Doing their civic duty to report something or was it to distress wasps and frustrate the refinance they need. No doubt that the complaint has made refinancing harder and time is running out. All done with minimum effort.

Sisu also got lucky on two other fronts. The success of the club on the pitch which increases public pressure on wasps for a homecoming deal. Secondly the economic damage being done by the current health crisis.

If ccc were wrong so be it they should be held to account. I just think the purpose of the complaint is more nuanced and that sisu are comfortable with a large risk of the complaint failing. To some degree sisu benefit either way and wasps are under pressure in both scenarios

 

[mark_ccfc]

You would think the odds are in favour of ccc. They knew there was a high probability of challenge when the deal was done so should have acted to mitigate every risk of that. A referral to EU was always a possibility.

So the chance of action against ccc should be significantly less than 50:50.

Kind of depends as to what the purpose of the complaint was as to whether it is a success for sisu. Doing their civic duty to report something or was it to distress wasps and frustrate the refinance they need. No doubt that the complaint has made refinancing harder and time is running out. All done with minimum effort.

Sisu also got lucky on two other fronts. The success of the club on the pitch which increases public pressure on wasps for a homecoming deal. Secondly the economic damage being done by the current health crisis.

If ccc were wrong so be it they should be held to account. I just think the purpose of the complaint is more nuanced and that sisu are comfortable with a large risk of the complaint failing. To some degree sisu benefit either way and wasps are under pressure in both scenarios

Sisu are certainly crafty sons of guns, not costing them anything and nothing to lose either way.
Can't stand them, but you have got to hand it to them.

 

[ccfcway]

Sisu are certainly crafty sons of guns, not costing them anything and nothing to lose either way.
Can't stand them, but you have got to hand it to them.

Surely there are legal costs ?.

 

[MalcSB]

Surely there are legal costs ?.

Not beyond any cost of submitting the complaint. This isn’t legal action by sisu, and if any action is taken it will be by the EU or European court. There could be further action by sisu if the complaint was upheld, perhaps for damages.

 

[ccfcway]

Not beyond any cost of submitting the complaint. This isn’t legal action by sisu, and if any action is taken it will be by the EU or European court. There could be further action by sisu if the complaint was upheld, perhaps for damages.

if your right (and no reason to doubt you), make perfect sense how a headge fund can tie someone up for year in legal wranglings if there is no costs in some cases.

best case they get a result, worst case, it serves to sow even the mimimum seed of doubt and doesnt let anyone persue their business without it sitting in the background as a black cloud.

The only obvious downside is the fact that the defendent has been alienated by the claimant, but in some cases, i suspect that wont matter.

 

[ccfcway]

So the question to ask is IF we took over pitch maintenance as part of a deal in exchange for lower rent would the number of extra fans we got in by being back in Coventry compared to Brum make it worthwhile financially?

the other question would be.....why would wasps reduce the rent to enable the football club to pay for a football quality pitch when wasps dont need it ?

Surely it would be on top of standard rent ?

 

[ccfcway]

Sisu also got lucky on two other fronts. The success of the club on the pitch which increases public pressure on wasps for a homecoming deal.

I would love you to be right on this, but sadly, dont think you are.

Be interesting to see the post bag the council gets with people saying they wont vote for them again if they dont do all they can to get ccfc back to coventry etc.

The city isn't united again the council on this one, which is a tragic shame. Said it before, but if i was a an independent candidate in Coventry, it would be my number one policy to make a point. Its not even on most (if not all) manifestos. Only a small % of the city cares

 

[Sky_Blue_Dreamer]

the other question would be.....why would wasps reduce the rent to enable the football club to pay for a football quality pitch when wasps dont need it ?

Surely it would be on top of standard rent ?

Because if they needed the money and the deal hung on getting the quality of the pitch we needed so we agreed to take on pitch maintenance that's a cost Wasps won't be paying for and a service we wouldn't be receiving from them. So it should be that we shouuld be reimbursed on the costs they would've incurred maintaining the pitch to their standard while we absorb the extra cost of keeping the pitch to a higher standard.

So our costs would increase due to the extra work (offset with extra revenue), but we'd also be' reimbursed' for the service the landlord wouldn't be providing.

 

[ccfcway]

Because if they needed the money and the deal hung on getting the quality of the pitch we needed so we agreed to take on pitch maintenance that's a cost Wasps won't be paying for and a service we wouldn't be receiving from them. So it should be that we shouuld be reimbursed on the costs they would've incurred maintaining the pitch to their standard while we absorb the extra cost of keeping the pitch to a higher standard.

So our costs would increase due to the extra work (offset with extra revenue), but we'd also be' reimbursed' for the service the landlord wouldn't be providing.

Surely it just devalues the rent we would pay, despite the same overheads, ie police, match day costs etc ?

 

[CCFC54321]

Sisu are certainly crafty sons of guns, not costing them anything and nothing to lose either way.
Can't stand them, but you have got to hand it to them.

I have a little feeling that SISU might just win this state aid case....

 

[Magwitch]

I would love you to be right on this, but sadly, dont think you are.

Be interesting to see the post bag the council gets with people saying they wont vote for them again if they dont do all they can to get ccfc back to coventry etc.

Don’t know how many times this has been said this issue is not party political both political parties are together and unanimous on this subject. If anyone wanted to make a protest then stand as an independent against the leader of the council (Longford) and/or the Tory leader.

 

[Gynnsthetonic]

Cant understand the Tories on this, if they had a manifesto to try to sort this mess out they may have a chance of gaining power, Sisu and our Council run 'Socialist' party are never going to agree on anything with too much bad blood between them.

 

[oldfiver]

You would think the odds are in favour of ccc. They knew there was a high probability of challenge when the deal was done so should have acted to mitigate every risk of that. A referral to EU was always a possibility.

So the chance of action against ccc should be significantly less than 50:50.

Kind of depends as to what the purpose of the complaint was as to whether it is a success for sisu. Doing their civic duty to report something or was it to distress wasps and frustrate the refinance they need. No doubt that the complaint has made refinancing harder and time is running out. All done with minimum effort.

Sisu also got lucky on two other fronts. The success of the club on the pitch which increases public pressure on wasps for a homecoming deal. Secondly the economic damage being done by the current health crisis.

If ccc were wrong so be it they should be held to account. I just think the purpose of the complaint is more nuanced and that sisu are comfortable with a large risk of the complaint failing. To some degree sisu benefit either way and wasps are under pressure in both scenarios

There is no direct complaint against WASPS and they will not be involved unless they have contrived with CCC to do something wrong
Clearly there must be something to investigate otherwise why have WASPS indemnifed CCC
One should also ask why CCC are entering in to agreements that require underpinning by WASPS and presumably benefitted the the latter

 

[ccfcway]

Don’t know how many times this has been said this issue is not party political both political parties are together and unanimous on this subject. If anyone wanted to make a protest then stand as an independent against the leader of the council (Longford) and/or the Tory leader.

this is what needs to happen. An independent stand and get the fans behind them

 

[oldskyblue58]

There is no direct complaint against WASPS and they will not be involved unless they have contrived with CCC to do something wrong
Clearly there must be something to investigate otherwise why have WASPS indemnifed CCC
One should also ask why CCC are entering in to agreements that require underpinning by WASPS and presumably benefitted the the latter

I know there isnt a direct complaint against wasps holdings

SISU think there is something to complain about CCC, have via associated/subsidiary entities made a complaint that the EU are duty bound to investigate. That doesnt mean there is something actually wrong, or that there isnt a valid complaint - we do not know.

Clearly anyone looking to provide finance to wasps holdings to repay the bond in 18 months time would look at the risk that there is a case to answer by CCC because the remedies directly affect wasps holdings. It would go to the heart of the financing in terms of rates of interest, security of finance, payment terms etc all of which would factor in the perceived risk whether the state aid complaint is thrown out or not. Considering how long it can take to put financing in place then there is a current effect, to think otherwise is wrong.

You keep referring to an indemnity given by wasps to CCC regarding the deal. Where has that been mentioned or confirmed? have done a quick google search and found nothing. Can you provide better details. If there is then any potential lender to repay the bond would need details to assess the risk to their security etc and therefore wasps are affected by the complaint even if CCC come out clean at some unknown point in the future (could easily be years away from conclusion). What is it wasps have indemnified? Some indemnity on the deal itself or is it on the lease extension? Quite often leasees need to provide indemnity to lessors of some kind.

 

[Sky_Blue_Dreamer]

Surely it just devalues the rent we would pay, despite the same overheads, ie police, match day costs etc ?

Hence why I said originally we'd get a lower rent. In the follow up I explained it by saying we'd have the rent cost less the 'rebate' for pitch maintenance = lower rent.

But the 'rebate' would be for the amount Wasps would pay to maintain the pitch to their required standard. As we'd need a better surface it'd be a more expensive surface and take longer to maintain, therefore costing more so our costs would increase by a bit more than the reduction in rent.

 

[Sky_Blue_Dreamer]

I have a little feeling that SISU might just win this state aid case....

TBH in the current climate I'm not betting on anything.

But it would have to be a major change in current thinking on the case. Every court that has heard it before has dismissed it and been pretty scornful on SISU in the process.

How do you argue state aid and undervaluing when the same company was arguing that the place was worthless and they should be given it for nothing? So even taking into account the longer lease anyone that agreed to pay anything more than taking on the debt overpaid. Plus you have to add in that if Wasps weren't interested and SISU had been the only potential purchaser the lack of competition drives the price down, not up.

If SISU had been willing to make the same or higher offer yes it'd be an issue - they weren't. Would they have offered it had the lease been extended - almost certainly not. They stated they wanted the freehold and weren't willing to pay as much as Wasps did for a leasehold. It's the bare faced cheek that they spent years deliberatly stressing ACL to get the purchase price down, then when someone else buys it complain the price is low. This is what they wanted and were aiming for, but because someone else was able to take advantage of it they cry and whinge about it.

Of course the current valuation of it does add in questions, but realistically it's not worth anything near that.

 

[oldfiver]

I know there isnt a direct complaint against wasps holdings

SISU think there is something to complain about CCC, have via associated/subsidiary entities made a complaint that the EU are duty bound to investigate. That doesnt mean there is something actually wrong, or that there isnt a valid complaint - we do not know.

Clearly anyone looking to provide finance to wasps holdings to repay the bond in 18 months time would look at the risk that there is a case to answer by CCC because the remedies directly affect wasps holdings. It would go to the heart of the financing in terms of rates of interest, security of finance, payment terms etc all of which would factor in the perceived risk whether the state aid complaint is thrown out or not. Considering how long it can take to put financing in place then there is a current effect, to think otherwise is wrong.

You keep referring to an indemnity given by wasps to CCC regarding the deal. Where has that been mentioned or confirmed? have done a quick google search and found nothing. Can you provide better details. If there is then any potential lender to repay the bond would need details to assess the risk to their security etc and therefore wasps are affected by the complaint even if CCC come out clean at some unknown point in the future (could easily be years away from conclusion). What is it wasps have indemnified? Some indemnity on the deal itself or is it on the lease extension? Quite often leasees need to provide indemnity to lessors of some kind.

You need to change your search engine as the "indemnity" appears in many places. Even the Skybluestrust refer to it "These obstacles include, but are not limited to any unreasonable demands and requirements from Wasps (including the indemnity clause, whatever that may entail) and the continuing pursuit of legal actions concerning ground ownership by SISU.
Trust Statement

The original requirement from WASPS was SISU et al drop all legals against them. From published statements it seems SISU signed that document .
What SISU did do was make a complaint against CCC but WASPS seem to feel that could prejudice them in some way
What they will not say is how they could be affected. If they acted properly in the transaction what is their concern?
It would seem to me that WASPS should be seeking an indemnity from CCC as it was with them they transacted not SISU/CCFC

 

[shmmeee]

You need to change your search engine as the "indemnity" appears in many places. Even the Skybluestrust refer to it "These obstacles include, but are not limited to any unreasonable demands and requirements from Wasps (including the indemnity clause, whatever that may entail) and the continuing pursuit of legal actions concerning ground ownership by SISU.
Trust Statement

The original requirement from WASPS was SISU et al drop all legals against them. From published statements it seems SISU signed that document .
What SISU did do was make a complaint against CCC but WASPS seem to feel that could prejudice them in some way
What they will not say is how they could be affected. If they acted properly in the transaction what is their concern?
It would seem to me that WASPS should be seeking an indemnity from CCC as it was with them they transacted not SISU/CCFC

You said “One should also ask why CCC are entering in to agreements that require underpinning by WASPS“ implying there was indemnity between CCC and Wasps, not Sisu and Wasps, that’s what OSB was asking about.

He also answered the questions you ask about why Wasps have a stake in the complaint in the post you quoted in some detail.

 

[oldfiver]

You said “One should also ask why CCC are entering in to agreements that require underpinning by WASPS“ implying there was indemnity between CCC and Wasps, not Sisu and Wasps, that’s what OSB was asking about.

He also answered the questions you ask about why Wasps have a stake in the complaint in the post you quoted in some detail.

What I was trying to say was :

WASPS want CCFC to indemnfify them against any fall out from the CCFC complaint to the EU
What we do not know and WASPS will not tell is - why should a complaint against CCC affect them
It would appear there is some agreement ( aka underpinning ) between WASPS & CCC otherwise why are they concerned?

I understand tenants enter in to undertakings and indemnities with their landlord. However, that would be a normal risk transaction that I doubt would be worthy of a complaint to the EU.

 

[Nick]

Ohhh something negative about Wasps? Clockwork.

No fucks given about how blatant any more.

 

[shmmeee]

What I was trying to say was :

WASPS want CCFC to indemnfify them against any fall out from the CCFC complaint to the EU
What we do not know and WASPS will not tell is - why should a complaint against CCC affect them
It would appear there is some agreement ( aka underpinning ) between WASPS & CCC otherwise why are they concerned?

I understand tenants enter in to undertakings and indemnities with their landlord. However, that would be a normal risk transaction that I doubt would be worthy of a complaint to the EU.

Just clearing up the confusion. I assumed you’d mistyped and OSB had therefore misunderstood.

Similarly he’s explained how the complaint could be seen as a drag on financing, I won’t pretend to understand but that’s his answer.

It’s just two sides repeating the same things now.

“Why do Wasps care?”

“Because it’ll effect their financing going forward as an uncertainty”

“Why can no one tell me why Wasps care, must be something untoward”

“I literally just told you”

“LOLz you work for the council”

What’s even the point? I mean if you disagree fair enough state your reasoning but just outright ignoring answers to your questions is just silly.

 

[Nick]

I mean the financing was uncertain anyway which is why they needed bonds.

Not too sure there being no case against CCC would make much difference to their troubles.