Grendel
Well-Known Member
The shareholder value is £5.5 million OSB stated anyone suggesting other wise is talking rubbish. And they are.
Bob Ainsworth on ACL sale to Wasps (7 Viewers)
- Thread starter TheRoyalScam
- Start date
The shareholder value is £5.5 million OSB stated anyone suggesting other wise is talking rubbish. And they are.
I wasn't inferring you were a criminal.
My point is that these are politicians and they have to be accountable. A politician cannot simply say 'on my lawyers advice I refuse to answer any questions'.
No, I don't think they do have anything to hide, but I do know SISU have lawyers that will try and twist things round e.g. a slip of paper with a scribbled note saying "hell will freeze over" is definately council official policy democratically confirmed by the council.
I don't think CCC should even fuel this crap by making some slip up which prolongues the agony. When SISU have finally packed their bags and are off to the next take-over or whatever, then it is up to the opposition to do their job and put AL under scrutiny. It is not SISUs job to protect us from our council, they are supposed to be running a football club.
stupot07
Well-Known Member
http://youtu.be/PGNiXGX2nLU
Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors
Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors
Did he say the 14m loan doesn't have to be repaid? No, he didn't. He was talking about the accounting structure - he did not deny that the total cost is 19m with the loan.
stupot07
Well-Known Member
http://youtu.be/t1DWBKk5xHQ
Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors
shy_tall_knight
Well-Known Member
To obtain the full use of ACL it cost WASPS £5.5m + £14m loan, who cares a technical accounting term like shareholder value, cash is king, WASPS will have paid £5.5m plus then have the loan interest to repay plus the loan principal, all you council hater pro sisu mob just ignore the loan. If it was £60m would it still be talked about as a £5m purchase
Grendel
Well-Known Member
What's the value of the shareholding in ACL? I keep asking but you will not answer.
Pssst - look below my original post on page 1.
Grendel
Well-Known Member
So Higgs got £9.5 million for their share in ACL?
Yes, I agree, but in these circumstances I think they could unwittingly give SISU some ammunition - even if it is later refuted. The whole game is about clamming up in front of SISU's lawyers - which I agree with. The opposition has to hold AL etc. to account - not SISU. If SISU win, then the taxpayer pays. If the conservatives later prove that AL did not act in the interest of the city, then hopefully the voters will decide not to vote labour. That is democracy. SISU have screwed up big time and burnt a lot of money. I hope that they end up with the loss as opposed to Coventry taxpayers and CCC should give them as little chance of winning as possible. Say nothing.
skybluetony176
Well-Known Member
Perhaps they're hiding a smoking gun. Du Du Duuuuuu!
Grendel
Well-Known Member
What are they hiding do you think?
They are no longer liable for the ACL loan. Previously they were a 50% partner in the business which had to pay the loan and would have been jointly and severally liabe for the loan had ACL defaulted - or whatever was agreed with CCC when the loan was granted.
chiefdave
Well-Known Member
Surely if you're going to take into account the £14m loan when discussing the purchase price you also have to factor in any money guaranteed to ACL through existing contracts. Otherwise you're taking a very one sided point of view.
albatross
Well-Known Member
The actual value of ACL will vary at any given time and will certainly be dependant upon the number of tenants and revenue streams that are open to ACL. During the JR there were a number of valuation scenarios given by independents that would determine the value of ACL given the rental income from CCFC. It is certainly worth more now than when WASPS purchased it.
With regards to the deal for ACL yes ACL was purchased for 5.5M so that was the value of ACL at the time given the liabilities than came with ACL. If they do not service that loan they default and eventually the council would take back the lease. It has to be paid with real pound notes and will be funded most probably by monies taken by ACL unless an individual or company was to make an investment in ACL and pay it off for equity in the company.
oldskyblue58
CCFC Finance Director
sorry but that is quite wrong in terms of what Wasps bought. The loan already existed, the need to repay already existed....... in ACL. That hasn't changed and it will be the operations of ACL not Wasps that repay the loan. Part of the reason that the value of 5.5m was paid is because it reflected the fact that ACL had to pay the 14m loan back over time.
If the loan were 60m then if Wasps paid £5m for it then yes the value of the purchase of the shares and therefore the control of ACL is £5m
If you buy a BT share on the stockmarket for 418p (todays price) do you also take a share of the BT loans - no of course you don't, you get a piece of paper that cost you 418p and at this moment is worth 418p
I am with Grendel on this the deal was not worth 19m it was £5.54m
I understand that, but the share was not for sale without the loan. So the loan is a factor. If it is being serviced by other contracts, good. If there were no loan, where would the money from the other incomes go? Presumably it would be profit. So, with the loan you get 14m less profit. In other words in total you have paid 5,5m in cash and sacrificed 14m in profit -total 19,5m. A lot worse off than just paying 5,5m and that is the end of it.
What would be the value of the 5,5m share if there was no loan?
DazzleTommyDazzle
Well-Known Member
I don't like the sale of ACL to Wasps. I think it puts our club in a very dangerous position.
However, to try to construct an argument that the loan in ACL is somehow irrelevant to the overall valuation of the company is nonsense.
However, to try to construct an argument that the loan in ACL is somehow irrelevant to the overall valuation of the company is nonsense.
skybluetony176
Well-Known Member
Probably nothing.
The council are probably laughing at SISU for chasing around looking for the fabled smoking gun while spanking millions because they know it doesn't exist but they carry on being secretive fueling the fire because its a joke that keeps on giving. The only other party laughing is probably SISU's legal team.
oldskyblue58
CCFC Finance Director
no it wouldn't. The whole point of a limited company is to limit the liability to the amount paid on the shares. If they are fully paid then there is no further liability. The only other actions are if directors have acted improperly or illegally in which case they could be held liable for debts, or if there have been guarantees given by shareholders etc in respect of any debts - none have ever been mentioned
shy_tall_knight
Well-Known Member
Yes they got £2.5m in cash and off loaded 50% of a £14m debt that they were responsible for. If my house was for sale for £100k and I had a £25k mortgage, if you paid me £75k but took on the mortgage it would be the same as paying me £100k outright and me having to settle the mortgage, how much did the house cost £75k or £100k, I would say £100k every time
oldskyblue58
CCFC Finance Director
if they paid 5.54m to buy the shares it would be 5.54m .... it works either way.
yes the deal is worth 5.5m but Grendel isn't right either because he says the valuation doesn't take into account the loan which of course it absolutely does. The valuation takes into account everything.
There may be guarantees though. I have a limited company and on some contracts I have to act as guarantor for my own company - thus doing away with the Ltd bit.
oldskyblue58
CCFC Finance Director
not saying it isn't relevant ...... but it is relevant to how the price was set it is not an add on to valuation. If wasps sold ACL tomorrow then ACL would still have the loan and the sale price would reflect that
Well why didn't they buy the share without the loan then? All the income servicing the 14m would go to them then.
but they wouldn't have paid 5.5m, if they did they we really would have a reason to be pissed at the council.
shy_tall_knight
Well-Known Member
Whilst control of ACL through owning its shares cost £5.5m, a £14m loan to service is part of the purchase consideration, if WASPS had not agreed to service the loan or the council had written off the loan would it be the same deal. If you were putting together an investment project would you be looking for authorisation to spend just £5m
oldskyblue58
CCFC Finance Director
I think Grendel is referring to the valuation placed on it by the council and ainsworth at 19m. Pretty certain Grendel understands that the amount actually paid includes an assessment of all ACL assets and liabilities.
I think people are talking cross purposes on a lot of this
Then the price is already discounted by the value of the outstanding loan. The true price is therefore the purchase price plus the loan. Otherwise why pay the loan back?
No, it's called spin as per Les Reid and Grendel.
DazzleTommyDazzle
Well-Known Member
Agree entirely with that, but some earlier posters appeared to be saying that the existence of the loan was irrelevant to the overall valuation.
If they really believe that, I'd love the chance to sell a company to them
shy_tall_knight
Well-Known Member
So if there was no loan what do you think the price would have been,