Who will own the new stadium? (6 Viewers)

[Nick]

Maybe they would, but they can't just take over any company they want.

The thing is, if they can legally then they will probably try their best. I am no law expert but if they have broken any laws why are they still trading? I think they work very close to the line and know how to play the game.

 

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[Godiva]

So it's about cashflow, in that case we can go back to saying that we should rent the Ricoh from ACL at the cheap rent (plus match day costs), that will generate a lot of positive cashflow, especially compared to Sixfields. Excellent.

Unless of course it's got nothing to do with cashflow. Damn.

I do try to have a serious debate with you. Please leave out the cheap wise cracks and sarcasm.

Cashflow is relevant if the investors is to see a return on their investments. The only other possibility is selling the investment with a profit.

Returning to the Ricoh as tenant seems very unlikely as that constellation has already shown its weaknesses. Its impossible to have a meaningful and successful construction involving politicians, a charity and a failing football club owned by investors. It all has to be under the same owner to really work.

You cannot compare rent at the Ricoh with rent at sixfields. It is clearly more expensive for the cub overall to be playing at sixfields, but the owners seem happy to pay that price.

I wonder what would have happened if ACL had accepted the clubs asking for new rent terms first time asked?

 

[Sky Blue Kid]

hill83......It is a ridiculous amount on management fees, and It's annoying that it isn't disclosed exactly what they are for..................................................................................................On my behalf there is NO sarcasm here.....My stance on why I hate SISU with a passion, is as follows. Well over £2.6m pa. in "Management charges" alone, is a sickeningly huge amount. I don't want them owning my Club when they're bleeding it in this way. I, nor anybody, knows if CCFC would own the stadium. History shows that the Football Club "Rents". The previous owners have "Run up Debt" for many, many, years, but with one "Massive" difference to SISU. They have tried to "Buy" success, and to the majority have had success(Keeping City) in the Top Flight for nearly 40 years. On the other hand, however, SISU have "All but killed this Football Club" by going the "Opposite way" with finances. Lo and behold, also claim The Football Club to be further in debt than any other previous regime, after the previous regimes spending Millions on players and very high wages. How can that be?.....Answers on a postcard to...J. Seppalla, and Timothy Fisher.

 

[skybluesam66]

losses (proper trading losses ) for the time SISU have been in charge - have remained at 50k per week more or less throughout
This was both when we had higher Championship revenues with a higher cost base - and now

thats 2.5m per year

The rest is smoke and mirrors

As advised by a club executive

 

[dongonzalos]

I do try to have a serious debate with you. Please leave out the cheap wise cracks and sarcasm.

Cashflow is relevant if the investors is to see a return on their investments. The only other possibility is selling the investment with a profit.

Returning to the Ricoh as tenant seems very unlikely as that constellation has already shown its weaknesses. Its impossible to have a meaningful and successful construction involving politicians, a charity and a failing football club owned by investors. It all has to be under the same owner to really work.

You cannot compare rent at the Ricoh with rent at sixfields. It is clearly more expensive for the cub overall to be playing at sixfields, but the owners seem happy to pay that price.

I wonder what would have happened if ACL had accepted the clubs asking for new rent terms first time asked?

Selling the investment with a profit, interesting point

Please explain how SISU will do this in order to recoup some 80 million with the new stadium?

 

[Godiva]

Selling the investment with a profit, interesting point

Please explain how SISU will do this in order to recoup some 80 million with the new stadium?

You assume a new stadium will load another £40m of net debts?
They have invested some £40m at this point - the rest of the current debt is 'old heritage'. It's what they can get above that 40m that can be labelled as return of their investment.
If a new stadium cost £20m to build it will also provide about £20m assets, so net debts wont increase (much).

Assuming they can run the stadium and club with a small overall profit it won't be too hard to find a buyer.

 

[Rusty Trombone]

The thing is, if they can legally then they will probably try their best. I am no law expert but if they have broken any laws why are they still trading? I think they work very close to the line and know how to play the game.

I'm not sure where your response has come from, I haven't talked about laws being broken.

 

[Como]

A stadium would cost more than 20m plus of course the land.

Any commercial rent would be unaffordable by the Club. No calculator needed to work that one out.

 

[Godiva]

A stadium would cost more than 20m plus of course the land.

Any commercial rent would be unaffordable by the Club. No calculator needed to work that one out.

If you by 'commercial rent' mean like £1m+ per year, then you are right. That's why they broke up with ACL.

But if the money to buy and build a new stadium mostly comes from interest free investments then a peppercorn rent (match day cost) is likely.

 

[chiefdave]

if the money to buy and build a new stadium mostly comes from interest free investments then a peppercorn rent (match day cost) is likely.

So the business plan for the new stadium is SISU use investors money, the investors get no short term return at all, SISU take no rental payment and all the club pays is match day costs (although why we'd be paying those when Fisher keeps moaning about it being unreasonable to have to pay them at the Ricoh I'm not sure). Then at some point in the future a L1 club with a cheap 12K capacity stadium in the middle of nowhere is going to be sold for £60m plus to make the investors their money back?

Good luck with that.

 

[Como]

Why would anyone invest anything on that basis or one close to it?

 

[Godiva]

So the business plan for the new stadium is SISU use investors money, the investors get no short term return at all, SISU take no rental payment and all the club pays is match day costs (although why we'd be paying those when Fisher keeps moaning about it being unreasonable to have to pay them at the Ricoh I'm not sure). Then at some point in the future a L1 club with a cheap 12K capacity stadium in the middle of nowhere is going to be sold for £60m plus to make the investors their money back?

Good luck with that.

Well - anytime you invest in a company you 'hope' to get a return at some point in the future. It's up to sisu to get the best terms for the cub and best terms would be equity capital. If they can't get that then a loan with low interest (not from banks) convertible to equity will have to do.

Why do you assume we will stay in League 1? I thought the general consensus was we are now competing for promotion? Maybe next season starting on equal points to the rest?

 

[Como]

If you invest you are looking for a return, one better than you could get elsewhere.

Why would someone want to invest in such a dodgy proposition? Where is the pay off?

Every team wants to get promoted. Much easier to get demoted.

 

[Cheshire Sky Blue]

If a new stadium is build we should at least pressure sisu to keep ownership within the SBS&L umbrella ... but I would imagine that is their plan anyway.
I see no problem in having a seperate prop-co but it makes no sense to have it outside the group.

I would be interested what sort of pressure you think will influence SISU? Fans turning away from Sixfields, Open hatred towards Fisher et al, Protests in the City centre.......

Nothing influences SISU other than the going for the kill, and they are happy to kill any business.

 

[letsallsingtogether]

Nor do I sisu said CCFC need to own their own stadium and then they want to build one for us that we don't own???

Hypocritical but hey some will say that is the only way we can survive!!!

It's not about us surviving as I see it, it is about how Sisu will survive.

We didn't own it before? People want us to go back and rent it from the council and that is ok but to rent it from anywhere else?

I don't understand

 

[letsallsingtogether]

So we can't afford to rent a ground that is already there and will cost us nothing to move in, we can afford to pay 25 million to build one and then rent it?

 

[Cheshire Sky Blue]

Who will actually own the new stadium? Will it be Otium Entertainment Group, SBS&L or some other SISU company and then SISU charge the club a rent but do allow the club access to the other revenue streams?

This is surely a question that needs to be asked at the open forum or for the media to pose this question directly to the club.

I won't be allowed to the forum as I was the (now ex) employee who challenged the PAYE arrangements at the club.

I think that no matter who owns CCFC, the club will not own the stadium. That is in itself not really a problem as over 70% of league clubs do not own their stadium. The problem is that SISU own CCFC and in my view they can not be trusted do the right thing for the Football club

 

[Stafford_SkBlue]

It's all about making the Club sustainable - better to have within the Club group of companies then elsewhere.
Yes you can spend a fortune and try to get promoted like Bristol City a few years ago, now they are paying the penalty, and Bolton will go the same way in the future.

 

[letsallsingtogether]

so what will happen to us? if they build new ground we could be 100 million in debt in the same division having lost thousands of supporters for ever... Do you call that sustainable? all the other clubs that are struggling mostly own their own grounds take all the pie and parking money.

It's all about making the Club sustainable - better to have within the Club group of companies then elsewhere.
Yes you can spend a fortune and try to get promoted like Bristol City a few years ago, now they are paying the penalty, and Bolton will go the same way in the future.

 

[shmmeee]

And who would own the Ricoh say if we moved back there and were bought out by someone else? Would CCFC own it?

Nope same issues apply with a freehold sale as a new ground, except the debt should be smaller.

 

[Como]

Like all other teams we need a benefactor.

 

[Como]

so what will happen to us? if they build new ground we could be 100 million in debt in the same division having lost thousands of supporters for ever... Do you call that sustainable? all the other clubs that are struggling mostly own their own grounds take all the pie and parking money.

That has always been my question.

 

[chiefdave]

Well - anytime you invest in a company you 'hope' to get a return at some point in the future. It's up to sisu to get the best terms for the cub and best terms would be equity capital. If they can't get that then a loan with low interest (not from banks) convertible to equity will have to do.

Why do you assume we will stay in League 1? I thought the general consensus was we are now competing for promotion? Maybe next season starting on equal points to the rest?

But you would assess the risk and how much chance you have of a) not losing your money and b) making a profit, preferably one greater than you could make from investing elsewhere. Who is going to look at CCFC and think there's a business that will be worth £60+ million in a few years?

Assuming we will be promoted is surely not a good business plan. Yes we may well be promoted and I hope we are but equally look at Northampton, in the play offs last year and this year battling relegation. Even if we were in the championship would we be worth enough for investors to get a return? We'd need to be in the perm (and even then it might be a hard sell) and does anyone have confidence in SISUs ability to make us a prem club?

 

[Godiva]

so what will happen to us? if they build new ground we could be 100 million in debt in the same division having lost thousands of supporters for ever... Do you call that sustainable? all the other clubs that are struggling mostly own their own grounds take all the pie and parking money.

I addressed this in another thead.
The current investment is around £40m.
A new stadium would cost around £20m but also add the same amount of assets, so the net debt would not increase.
But club and stadium combined stand a much better chance of generating a profit and would eventually be easier to sell on with a return for the investors.

 

[Jack Griffin]

I addressed this in another thead.
The current investment is around £40m.
A new stadium would cost around £20m but also add the same amount of assets, so the net debt would not increase.
But club and stadium combined stand a much better chance of generating a profit and would eventually be easier to sell on with a return for the investors.

So if the new stadium is worth £20M then what is the Ricoh worth?

 

[chiefdave]

A new stadium would cost around £20m but also add the same amount of assets, so the net debt would not increase.

The Ricoh cost £113m to build, by that logic is it still worth at least that much?

 

[Godiva]

So if the new stadium is worth £20M then what is the Ricoh worth?

I don't know - is it relevant?
It's not for sale and is said to do better now we've left.

 

[Como]

20m is for the construction, and sounds low.

Then there is the land etc etc.

40m may be the investment sic, how much is that investment worth now?

 

[bigfatronssba]

I don't know - is it relevant?
It's not for sale and is said to do better now we've left.

Its relevant in that a certain sisu inspired newspaper reporter suggested the Ricoh is now worth around £6-£8m, around 7% of its build cost.

If the Ricoh has lost roughly 93% of its build value, why would a new ground be any different?

Also you forget that any new stadium wont be appearing on a CCFC asset register.

 

[shmmeee]

I addressed this in another thead.
The current investment is around £40m.
A new stadium would cost around £20m but also add the same amount of assets, so the net debt would not increase.
But club and stadium combined stand a much better chance of generating a profit and would eventually be easier to sell on with a return for the investors.

But the debt would be running up interest, that we wouldn't be paying off. So surely the net debt would increase? Unless it's increasing in value at the same rate.

 

[Godiva]

As said by many in many differenbt threads - the £6m valuation is NOT for the Ricoh. It's a valuation based on ACL being distressed without ccfc playing there - and that valuation is outdated as ACL says they have improved their business and is doing better than when we were a tenant.

A new stadium will (I am certain) be placed in a prop-co under SBS&L, so the assets will be there and the money to fund the stadium will be channelled through SBS&L. All income streams will benefit the club.

 

[Godiva]

But the debt would be running up interest, that we wouldn't be paying off. So surely the net debt would increase? Unless it's increasing in value at the same rate.

Maybe - TF said at the fans forum financing will be a mix of equity and loans and selling off leases to other businesses.
Only loans will carry interest and the rate depends on the soundness of the company.

 

[Jack Griffin]

20m is for the construction, and sounds low.

Then there is the land etc etc.

40m may be the investment sic, how much is that investment worth now?

£20M or £40M it is a huge amount of money to sink into an enterprise with a history of loss making.

 

[martcov]

Well - anytime you invest in a company you 'hope' to get a return at some point in the future. It's up to sisu to get the best terms for the cub and best terms would be equity capital. If they can't get that then a loan with low interest (not from banks) convertible to equity will have to do.

Why do you assume we will stay in League 1? I thought the general consensus was we are now competing for promotion? Maybe next season starting on equal points to the rest?

Question: do the Investors in ARVO actually know about the risks here? If it is a "wealthbuilder fund" controlled, in effect by JS, they just put their money in the fund based on past results and whatever Joy tells them about great investments. They may be hoping for a return from ARVO without knowing anything about Coventry City, Northampton or the "pie in the sky" arena.

 

[Rusty Trombone]

I do try to have a serious debate with you. Please leave out the cheap wise cracks and sarcasm.

Cashflow is relevant if the investors is to see a return on their investments. The only other possibility is selling the investment with a profit.

Returning to the Ricoh as tenant seems very unlikely as that constellation has already shown its weaknesses. Its impossible to have a meaningful and successful construction involving politicians, a charity and a failing football club owned by investors. It all has to be under the same owner to really work.

You cannot compare rent at the Ricoh with rent at sixfields. It is clearly more expensive for the cub overall to be playing at sixfields, but the owners seem happy to pay that price.

I wonder what would have happened if ACL had accepted the clubs asking for new rent terms first time asked?

Cheap wise cracks, that's a low blow. I guess if ACL could go back in time they would accept lowering the rent, it would be good to see how it would have played out.

I think the only option SISU are chasing is the sale of an asset, all their eggs are in the JR case, they need to get hold of something cheap to generate some profit. Playing the long game building a ground and slowly turning around the fortunes of the club isn't their thing as far as I can see. This is a waiting game, as long as SISU can kid their investors that the prize is still available, then the investors will keep paying their management fees, and the clubs debt will keep increasing.

As the chap in 'The Office' said there's no good news, just bad news and irrelevant news.