Grounds for the Judicial Review (8 Viewers)

[oldskyblue58]

As I understand it one of the grounds for (or at least reasoning) for the JR is that the Council paid out 14.4m to settle Yorkshire bank but the value of assets it secured on was only valued by Yorkshire Bank at a worst case scenario of £6.4m. That it was uncommercial and no one would do it.

We are told that there is little value in the assets of the club. The two main assets are the players contracts and Ryton. Lets call it £10m (but is that a worst case scenario). Against that are secured at least £9.1m from ARVO loans to Otium and there is an additional unsecured loans of £28m sitting SBS&L all related to CCFC. Just how commercial is that and why would anyone do it ? :thinking about:

As for value we are told in a recent CT article

Mr Fisher said there was no such value in the assets moved between companies which shared a parent company, and it was part of arrangements over debt. Holdings owed money to Otium lent to the club by Sisu-related hedge fund Arvo Master Fund. There is no suggestion of any wrongdoing.



I agree I do not see any wrong doing in what has been done. However the assets that sat in CCFC H had no value on the balance sheet until they were used to settle out the Otium loans to CCFC H. By accepting the assets of CCFC H as settlement then those assets are given a value equal to the loans they paid off, (unless the loans were written off which would surprise me). It does not matter they are in the same group with same parent company as we know for example a group company is treated entirely seperately in say insolvency.

just find it all inconsistent

 

---

[James Smith]

As I understand it one of the grounds for (or at least reasoning) for the JR is that the Council paid out 14.4m to settle Yorkshire bank but the value of assets it secured on was only valued by Yorkshire Bank at a worst case scenario of £6.4m. That it was uncommercial and no one would do it.

We are told that there is little value in the assets of the club. The two main assets are the players contracts and Ryton. Lets call it £10m (but is that a worst case scenario). Against that are secured at least £9.1m from ARVO loans to Otium and there is an additional unsecured loans of £28m sitting SBS&L all related to CCFC. Just how commercial is that and why would anyone do it ? :thinking about:

As for value we are told in a recent CT article

Mr Fisher said there was no such value in the assets moved between companies which shared a parent company, and it was part of arrangements over debt. Holdings owed money to Otium lent to the club by Sisu-related hedge fund Arvo Master Fund. There is no suggestion of any wrongdoing.



I agree I do not see any wrong doing in what has been done. However the assets that sat in CCFC H had no value on the balance sheet until they were used to settle out the Otium loans to CCFC H. By accepting the assets of CCFC H as settlement then those assets are given a value equal to the loans they paid off, (unless the loans were written off which would surprise me). It does not matter they are in the same group with same parent company as we know for example a group company is treated entirely seperately in say insolvency.

just find it all inconsistent

Think I understood all of that, and as such I agree with your conclusion.

 

[AJB1983]

Fisher is banking on the majority of fans not understanding what he is saying and hoping we buy it....I.e "it's all standard business practice etc"
Trouble is not all of us are mugs like he thinks we are

 

[blueflint]

i would hope that now with our current education system that most of us understand a balance sheet.
so we should all be able to see that assets have a value and debts are treated in a different way
you can pay off a debt with an asset but that asset then becomes equal to the debt

 

[jimmyhillsfanclub]

i would hope that now with our current education system that most of us understand a balance sheet.
so we should all be able to see that assets have a value and debts are treated in a different way
you can pay off a debt with an asset but that asset then becomes equal to the debt

You're joking right....

With our current education system & consumer-led society, most don't appear to even know the difference between credit & debt.....

 

[Captain Dart]

This is the age of Wonga.

 

[dongonzalos]

Fisher is banking on the majority of fans not understanding what he is saying and hoping we buy it....I.e "it's all standard business practice etc"
Trouble is not all of us are mugs like he thinks we are

Not sure what your issue is?

Mr Fisher said the JR is a hedge-fund taking a moral stance and there is no financial gain for SISU.

What makes you think, he thinks we are a bit thick and will believe anything?

 

[Godiva]

OSB - you are hinting at double standards, and I agree.
But the different standards are caused by different rules and legislations. A public body - like CCC - is not allowed to spend the taxpayers money in a way that is commercial unfair. A private company on the other hand is not restricted in the same way.

 

[oldskyblue58]

kind of depends on what valuation is used by the council really though doesnt it. They would have a duty to obtain a valuation on a basis suitable to their decision making purposes and would not be able to rely on the Yorkshire Bank valuation that was done prior to any reorganisation. It is also likely that the YB valuation contained several different valuations and the £6.4 was the lowest showing the worst case scenario, ie break up value.

As for commercially unfair ........... councils all over the UK spend money to subsidise all sorts of entities that could be classed as "commercially unfair" if they didnt a whole lot of people would be unemployed.

Another point was that CCC has a social responsibility away from CCFC that a private company does not. The project wasnt to build a football stadium it was to regenerate the north of Coventry so other factors come in to play that counter the commercial arguement.

Would be interesting to see what the actual criteria for investment or reinvestment is for councils. I think that the "big Society" rules are a little more wide ranging than we think. As the loans to SBS&L and Otium are referred to investment would a loan to ACL be different? Particularly if it protected original investments and aims?

 

[RFC]

OSB - you are hinting at double standards, and I agree.
But the different standards are caused by different rules and legislations. A public body - like CCC - is not allowed to spend the taxpayers money in a way that is commercial unfair. A private company on the other hand is not restricted in the same way.

CCC appear to make a regular habit of it, haven't they also recently bailed-out Coombe Abbey Hotel by the tune of another £6:5 million??????????

 

[oldskyblue58]

Plenty of councils do it RFC, it isnt unusual, even Northampton Council have.

 

[dongonzalos]

CCC appear to make a regular habit of it, haven't they also recently bailed-out Coombe Abbey Hotel by the tune of another £6:5 million??????????

I think formula one should latch onto this request a JR and attempt to buy Coombe Abbey for 60k

 

[dongonzalos]

Plenty of councils do it RFC, it isnt unusual, even Northampton Council have.

I presume they have not done it with Sixfields, otherwise you would have question anyone who has problem with this. Helping to give it some credence by attending Sixfields.

 

[Broken Hearted Sky Blue]

CCC appear to make a regular habit of it, haven't they also recently bailed-out Coombe Abbey Hotel by the tune of another £6:5 million??????????

How much were the banks bailed-out for? What about companies who use foreign tax havens???????????????????

 

[dongonzalos]

http://www.warringtonguardian.co.uk/news/10362026.Bus_company_given_council_bailout/

 

[dongonzalos]

http://www.dailyecho.co.uk/news/dis..._Bowl_could_be_bailed_out_by_council/?ref=arc

 

[dongonzalos]

http://www.indymediascotland.org/node/15775

 

[dongonzalos]

And so on and so on and so on

Luckily the moral police more commonly known as hedge funds are out there. They are watching and at their own expense with no personal gain challenging such erroneous unscrupulous council behaviour.

Hoorah for our heroes the hedge funds

 

[martcov]

Would it justify a JR to let SISU ( or their companies ) have an "unencumbered freehold" of the Ricoh in order to get the City football team back to Coventry?

Should CCFC end up outside of the city boundary is there a case to insist on a rebranding of CCFC? The owners seem to be maligning the City Council in public e.g "not able to work with them", their subsidiary (ACL) is "rapacious" etc. at the moment. This may be having a negative effect on business decisions taken by investors who may have invested in Coventry.
Could the council argue that the association with SISU is creating a negative image for Coventry and demand that SISU remove the words "Coventry City" from their trading name? The people who founded this club did not do so knowing nothing about football and not being interested in football ( as Joy admits she is ), but took the name Coventry City to represent the city in an attempt to acheive sporting success as Football club - not just to make a quick buck and go. I think it is wrong to use the name CCFC for a team not playing in Coventry, bringing negative headlines for Coventry and not fulfilling the original ideals of CCFC.

The City should have a say in who uses it's name in the sporting world.

 

[RPHunt]

News today makes it probable that any giveaway of the stadium, or sale at less than a fair price, is likely to be investigated by the European Commission:

http://www.bbc.co.uk/sport/0/football/25410320

It would seem that the EU are determined to punish what they see as state aid to football clubs in Spain.

It is difficult to see what deal Coventry City Council could now offer SISU that would avoid the attention of the EU if it is over generous - SISU's antics surely mean that any quiet deal would now be impossible.

 

[dongonzalos]

And so on and so on and so on

Luckily the moral police more commonly known as hedge funds are out there. They are watching and at their own expense with no personal gain challenging such erroneous unscrupulous council behaviour.

Hoorah for our heroes the hedge funds

I don't know where we would be without them.

Well actually I do Coventry

 

[tisza]

I still query somebody taking a moral stance on behalf of the taxpayers when they are using money from a company based in the Cayman Islands for tax purposes.

 

[James Smith]

CCC appear to make a regular habit of it, haven't they also recently bailed-out Coombe Abbey Hotel by the tune of another £6:5 million??????????

Are you allegeding that the council just gave the hotel £6.5m or was it a loan, secured or otherwise? Swansea Council loaned the Liberty Stadium Management Company over £2.5million which the council later wrote off.

 

[blueflint]

You're joking right....

With our current education system & consumer-led society, most don't appear to even know the difference between credit & debt.....

you may be right there but i hope not

 

[Godiva]

The issue is not about CCC providing ACL with a loan (even on sub-market interest).
The issue is they bought the Yorkshire mortgage for more than its market value.

 

[Godiva]

The issue is not about CCC providing ACL with a loan (even on sub-market interest).
The issue is they bought the Yorkshire mortgage for more than its market value.

... and when people say it's ok to spend public money to save employment, that may be true. But paying too much for the mortgage didn't save any jobs - it only saved the shareholders at YB for a loss of some £8m.

 

[dongonzalos]

The issue is not about CCC providing ACL with a loan (even on sub-market interest).
The issue is they bought the Yorkshire mortgage for more than its market value.

They bought it for its true value
Who is not to say SISU were going to try and under value it.
Who is to say the bank would have accepted that

 

[martcov]

What was the market value? The monies owed plus interest? Or the value of ACL when pushed to the abys of insolvency by a rapacious hedge fund? Should the council have assisted ACL's downfall to force the YB to take what they could get and not what they were owed, therefore deliberately ripping off the shareholders of the YB? Ok for a hedge fund? Yes - standard business practice, but for an elected body? Genulnely interested in how you decided market value.

 

[Grendel]

They bought it for its true value
Who is not to say SISU were going to try and under value it.
Who is to say the bank would have accepted that

Stop boring everyone. It's worth what anyone pays for it - from £1 to £100 million. No buyers are banging on the door are there?

 

[martcov]

Stop boring everyone. It's worth what anyone pays for it - from £1 to £100 million. No buyers are banging on the door are there?

Are we talking about the lohn of GBP 14m? I didn't know it was for sale.

 

[Grendel]

Are we talking about the lohn of GBP 14m? I didn't know it was for sale.

No the ground. The loan is debt and if ACL go belly up the good old taxpayer is picking up that tab.

 

[skybluetony176]

CCC appear to make a regular habit of it, haven't they also recently bailed-out Coombe Abbey Hotel by the tune of another £6:5 million??????????

Northampton Council have recently bailed out NTFC by way of a lone to expand sixfields. but i'm guessing that's different, or is it that all councils nationwide do this type of thing legitimately and rightly but you think CCC responsibilities should include helping hedge funds, that keep the majority of money they make in offshore accounts and get big tax breaks from the government, make profit at the Tax payers expense.

 

[martcov]

I thought the thread was about the judicial review. The lohn is debt and is being repaid. So we can only deal with the facts of today. There is - apparently - no sign of imminent collapse. The good old taxpayer, however, would pick up the bill - or rather lose an asset - if the Ricoh were to be given away at a low price.

The only people who are obliged to think about the taxpayer are the council. SISU has free reign to do as it pleases. So my money would be on the council trying to save ACL or at least sell it at the best price possible, rather than SISU worrying about ACL going belly up.

 

[skybluetony176]

And so on and so on and so on

Luckily the moral police more commonly known as hedge funds are out there. They are watching and at their own expense with no personal gain challenging such erroneous unscrupulous council behaviour.

Hoorah for our heroes the hedge funds

and to think they are referred to as the ugly face of capitalism. there's some very narrow minded people out there who really should learn what hero's of the working class they are before they judge.

 

[Grendel]

I thought the thread was about the judicial review. The lohn is debt and is being repaid. So we can only deal with the facts of today. There is - apparently - no sign of imminent collapse. The good old taxpayer, however, would pick up the bill - or rather lose an asset - if the Ricoh were to be given away at a low price.

The only people who are obliged to think about the taxpayer are the council. SISU has free reign to do as it pleases. So my money would be on the council trying to save ACL or at least sell it at the best price possible, rather than SISU worrying about ACL going belly up.

The taxpayer will be more impacted by the £14 million loan than the sale of a commercial property. If its given away - no impact if its sold for £60 million - no impact