ccfc92
Well-Known Member
what's the difference between the two?
So what do you get for £6.5 million? (8 Viewers)
- Thread starter Grendel
- Start date
what's the difference between the two?
Terry Gibson's perm
Well-Known Member
I would hope they would bring in people to run it can't think of much worse than Fisher running it
skybluetony176
Well-Known Member
ML running it?
ccfc92
Well-Known Member
I'd rather have Fisher :facepalm:
chiefdave
Well-Known Member
The freehold is the building itself. Currently owned by CCC. The only revenue this brings is from the sale of the lease. This was done as a one of payment and isn't due for renewal for 40+ years so a long time until this brings you any income. The exception is if ACLs profits reach a certain level at which point a 'super rent' payment is triggered.
The leasehold gives you the right to operate the area. Currently owned by ACL. This gives you access to the revenues generated by all events.
By retaining the freehold CCC can put security in place such as tying the lease to the club, not allowing any loans against the lease, things like that.
What I don't understand is why SISU say they will bring AEG in. At the moment the owners of the lease gain from the revenues, if AEG come in to run the complex they aren't going to be doing it for free. Seems odd to complain about the joint venture between ACL and Compass yet suggest a similar deal for the whole complex.
ccfc92
Well-Known Member
Key point agreed. But who are AEG? I assume an entertainment company, but could you expand further?
Terry Gibson's perm
Well-Known Member
They could run it together.
chiefdave
Well-Known Member
ccfc92
Well-Known Member
so basically SISU want a USA franchise-specialist to run the ricoh
chiefdave
Well-Known Member
Make no mistake AEG are a very good company and huge but to me the Ricoh doesn't fit at all in their portfolio in the UK, or even Europe as a whole for that matter.
They don't operate any stadiums over here, nor do they operate any conference facilities. They do operate a handful of (indoor) arenas but these are all much bigger arenas than the Jag Hall in big markets.
Also worth noting that if AEG were that keen on the Ricoh then the cost of buying the whole thing would be fairly insignificant to them, in fact they could quite easily buy the club if they wished.
Doesn't seem to make sense. SISU / CCFC would lose access to revenue streams and AEG could just do it by themselves if they wanted the venue.
A much more likely target for AEG if they do want a venue in the midlands is to be for the NEC which fits perfectly with their existing portfolio.
Rusty Trombone
Well-Known Member
Grendel, genuine question. Seeing as the subject has been on your mind for a while, presumably you asked ML, what was his response?
RegTheDonk
Well-Known Member
Well, I believe Brum council are looking to sell that off (or part of it) due to having to find money for an equal pay claim, so you never know.
Grendel
Well-Known Member
I fail to see why the need to dodge a legitimate question.
After all if it is worth £6.5 million now that is without even the club being there.
It is nothing to do with £40 million debt is it? Odd certain posters are trying to sidetrack these legitimate questions. I don't know why.
Grendel
Well-Known Member
We don't I wouldn't think. Don't think you have don't say in policy either.
Would a buyer get shackled with half the mortgage?
Rusty Trombone
Well-Known Member
Any buyer is purchasing the 50% of the shares in ACL, they would take the loan (not sure why we keep calling it a mortgage), and everything else. Being a shareholder in a company I suspect you already know this, so where are you going with this line of enquiry?
Grendel
Well-Known Member
A common statement issue that the club should buy the shares. As the catering contract is separate and the board of directors make policy not the shareholders I'm struggling to see any value in these shares from a commercial or strategic perspective.
Rusty Trombone
Well-Known Member
In the case of ACL the shareholders also have Directors on the Board. ACL own 77% (this specific % may be slightly out) of the catering (part of IEC Experience), and the income is included in the accounts of ACL.
If the club had plenty of money buying the shares may be a good long term option, but as we haven't I agree with you, we should agree a rental deal.
Grendel
Well-Known Member
In the case of ACL the shareholders also have Directors on the Board. ACL own 77% (this specific % may be slightly out) of the catering (part of IEC Experience), and the income is included in the accounts of ACL.
If the club had plenty of money buying the shares may be a good long term option, but as we haven't I agree with you, we should agree a rental deal.
Still can't see what you get for £6.5 million - other than ££7 million more debt - can you?
chiefdave
Well-Known Member
The mortgage is with ACL so it would stay with ACL until it had been paid, don't see how new ownership of ACL will change that.
In terms of not receiving any revenue as owners are you referring to the fact that ACL have not paid a dividend as they have used all profits either for work on the Arena or overpayments on the debt.
Not sure why the club or SISU would have no say in how ACL is run if they owned 50%, what makes you say that?
Rusty Trombone
Well-Known Member
Well the offer that was accepted was £5.5m, but lets not argue over a million. You get access to 50% of the revenues of the arena, but clearly buying them at £5.5m should be viewed as a long term investment. I seem to recall that assets were more than liabilities, so you do get more than £7m of debt, you get assets as well
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chiefdave
Well-Known Member
Wouldn't those directors be appointed by the shareholders to work on their behalf and in line with their policies?
Of course if it is the case that ownership brings no advantage then the obvious answer is to rent.
Grendel
Well-Known Member
Policy is decided by the directors and there has to be casting vote so that must be the council.
I'm theory I would suggest the club could own half of ACL and still pay £1.3 million rent and no revenues.
skybluetony176
Well-Known Member
ACL moved on from that a long time ago as well you know and besides Sisu could own a ground outright and the club could still pay £1.3m rent and no revenues.
shy_tall_knight
Well-Known Member
Grendel whilst I respect your often provocative posts I genuinely believe you are a SISU plant, very emotive words about being held to hostage and talking about playing in Coventry as optional - as a Sixfielder you clearly support SISU moving the team to Northampton.
Your question is thought provoking but is a hard nosed business approach (SISU's approach) but fails to reflect on the history attached to the situation. CCFC sold their shares in ACL for £6m to Higgs, whether the Higgs speculated to make millions from this investment I doubt it but the decent fans of Coventry believe that a charity helped out the club and doesn't deserve to be ripped off.
Why are SISU still here, its not a love of the club they won't sell as they are trying to recoup their investment - this is ok with you for a faceless hedge fund to get their money back but not a local charity.
Grendel
Well-Known Member
Grendel
Well-Known Member
Sisu plant is so lame and ridiculous.
Are you seriously telling me any potential buyer would just write a cheque for £6.5 million with no business justification?
Wouldn't that hold directors of that company to account from their shareholders. That's where the primary duty lies isn't it?
Rusty Trombone
Well-Known Member
I think Higgs and the Council have equal directors, and the chairman is independent.
In theory the rent could be £2m, but I'm sure any rent agreement would form part of any share purchase. The no revenues bit could only happen if SISU decided not to pass them on. If SISU pass the revenue on we would effectively get half the rent back.
skybluetony176
Well-Known Member
Not only have I answered it more than once I've also just given you an example of a scenario that anyone who is championing sisu ownership could possibly be sleep walking the club into. What's in it for the club? Whatever sisu decides the club can have. Try asking ML next time you speak to him, he's better placed than anyone on here to answer and I bet he side steps it's or tells you what's in it for sisu. You keep saying that you support the club not the regime yet you seem to struggle with separating the two.
shy_tall_knight
Well-Known Member
Being a SISU plant may sound lame but you actively promote their cause and rarely criticise the debacle that is 1,600 home fans in northampton.
SISU had their chance in their initial due diligence to understand the position and renegotiate, they bought the club made a pig's ear of the it and then start renegotiating. Love to know what their investors think of the job that they have done so far and what's £6.5m on top of the supposed £50m they have spent already.
SISU had their chance in their initial due diligence to understand the position and renegotiate, they bought the club made a pig's ear of the it and then start renegotiating. Love to know what their investors think of the job that they have done so far and what's £6.5m on top of the supposed £50m they have spent already.
ccfcway
Well-Known Member
NOOOOOOOOOOOOOOOO!!!!!!!!!!!!!!!!!!!!!!!!
the only way it would work is if there's contracts binding SISU to use the Ricoh to primarily help CCFC.
Like the rent contract ?
chiefdave
Well-Known Member
Where have you seen the council have a casting vote? Wasn't aware of that, had assumed as it's 50/50 ownership it would be some sort of interlocking arrangement.
In your opinion what's the solution? Renting hasn't worked and SISU have stated they won't come back under a rental agreement. You're saying ownership doesn't have any benefit. That leaves building a new ground which isn't financially viable.