Ricoh Arena 'very profitable' even without Sky Blues (1 Viewer)

[Nick]

Coventry City Council leader Ann Lucas has claimed the Ricoh Arena is “very profitable” - even without the Sky Blues.
Her claim came as the long-running dispute between the Ricoh and Sky Blues left the prospect of Coventry City playing in Northampton - and a part-council run football stadium without a football team.

Coun Lucas’s remarks follow the part-council owned Arena Coventry Limited’s last accounts for the year ending May last year showing a £1million profit - when the Sky Blues had paid nearly all its £1.3million annual rent.
Since then ACL was thrown a £14million taxpayer lifeline when the council voted in January unanimously in private to buy out ACL’s Yorkshire Bank mortgage.

It means the stadium company can pay much lower annual mortgage payments to the council, to alleviate ACL’s finances.
Coun Lucas claimed ACL’s mortgage payments have been halved because of the deal, with some speculating they could be £500,000.
The Telegraph has called on ACL and the council to justify Coun Lucas’s claim that ACL is “very profitable” - by opening up the books and showing us the evidence.

ACL has also been challenged to show how it calculates its claims that football-related revenue has more recently only constituted less than 10 per cent of its overall income.Coun Lucas told BBC Coventry and Warwickshire: “ACL have got a business plan, and they’re telling us they can manage without the club.”

She added: “It’s a very profitable enterprise. We wouldn’t have bought the loan if we thought it would be money at risk.
”In words which appeared to signal any sale of the Ricoh to the club’s owners Sisu/Otium was highly unlikely, she said: “At the right time, and right price, to the right people, we may be prepared to sell. “But I am not saying ‘yay’ or ‘nay’ to anything.”

“We have (ACL) directors (including council executives Martin Reeves and Chris West) charged with ensuring it runs a profitable business.
“I wished we’d have come to some arrangement with Coventry City Football Club. That didn’t happen.
“I’ve clearly indicated to (Sisu boss) Joy Seppala to come and talk to me. If somebody can show me it’s worth selling, the council will consider it.
”The council are joint owners of ACL with the Alan Edward Higgs Charity, for which Peter Knatchbull-Hughesen is an ACL director.Talks collapsed last year over a sale of the Higgs 50 per cent share in ACL to Sisu, for what was believed to be £4million - with claims being made on both sides as to the reasons.
He has since been engaged in a war of words with Coventry City boss Tim Fisher.

Some fans are supporting the Not One Penny More (to Sisu) campaign and are refusing to go to ‘home’ matches at Northampton - in the hope the club’s business will become further distressed and Sisu are forced to sell.

It is not clear whether Warwickshire businessman Michael Byng, or previous bidders such as US investor Preston Haskell IV, could ultimately make a bid for the club.

Any sale would depend on Ms Seppala wanting to sell up in future.Sisu company Otium have League permission to groundshare at Northampton Town for up to five years while building a new stadium in the Coventry area

.Mr Byng maintains he wants to buy the Ricoh and then buy the football club.

He was last night at the Sky Blues game at Leyton Orient with Otium director Mark Labovitch and other club representatives.
ACL last week refused to sign a Creditor Voluntary Arrangement to bring the Sky Blues out of administration.
It resulted in a further 10 point League penalty and looming liquidation of one company, Coventry City Football Club Limited - as the League transferred the crucial ‘golden share’ right to play matches to Otium.ACL had last week offered to lower the rent to £150,000 with a ten-year deal.
But nothing was offered to Sisu over ownership and matchday revenues, which have previously been the stumbling blocks in negotiations
.Football finance expert Dr John Beech, of Coventry University, said: “If ACL really want the club back in Ricoh, they will have to shift position.”He also tweeted: “Not so clear what ACL’s motives are other than ‘Sisu out.’

He added: “I’m sure Sisu want the Ricoh - makes sense from every perspective to re-unite club and stadium.
As reported yesterday, a High Court judge has thrown out Sisu companies’ application for a judicial review against the council’s £14m ACL transaction.
Mr Justice Males turned down the claim it was unlawful “state aid”, saying it was made on commercial terms to protect the council’s investment in ACL.

He ruled Sisu’s refusal to pay rent had been designed to apply pressure in negotiations over Ricoh rent, ownership and revenue.s
Many fans believe Sisu want to acquire the Ricoh and land around it on the cheap.
Coun Lucas said the whole project was important to the council for regeneration and jobs

.Meanwhile the Football League would not comment on if it is set to lift the transfer embargo preventing the signing of players.
The embargo is in place due to late filing of accounts and the club’s administration.
A Football League spokesman confirmed the club is no longer in administration in footballing terms, even though Coventry City Football Club Ltd remains in adminstration, pending liquidation.

 

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[torchomatic]

So profitable that they needed a £14M bailout? Yeah right. I think someone is whistling in the dark.

 

[CarpyCov84]

So profitable that they needed a £14M bailout? Yeah right. I think someone is whistling in the dark.

My view EXACTLY !!!

 

[valiant15]

Is any of this relevant now seeing as it's our old home now?

 

[Noggin]

So profitable that they needed a £14M bailout? Yeah right. I think someone is whistling in the dark.

It wasn't really a bailout, they still owe the exact same amount of money just to someone else and on better terms. That said I don't believe the Ricoh is "Very Profitable" either and whilst I support the Telegraph calling her out I really don't feel they have demanded the same for the CCFC books.

 

[RFC]

And 'pigs fly' but only on months with an 'I' in the month, on Sundays!

So profitable that they needed a £14M bailout? Yeah right. I think someone is whistling in the dark.

 

[RFC]

Can any of the parties in this whole sordid affair be trusted?

The Council Leaders comments are a joke IMHO.

Personally I don't think either ACL or CCC give a 'dam' whether CCFC play at the Ricoh or not and more importantly, NEVER EVER HAVE DONE!

 

[valiant15]

So you think they'd rather have a 32k stadium sitting empty?

 

[Bill Glazier]

I still don't understand why Sisu didn't buy half the stadium for £4million. That's clearly peanuts.

 

[Block19]

If the Ricoh is very profitable, why don't the council offer the stadium free for a year? To help the club out and see football back in the city.

 

[Manchester_sky_blue]

I still don't understand why Sisu didn't buy half the stadium for £4million. That's clearly peanuts.

I suspect because it wasnt half the stadium for that, it was half of ACL which isnt the same thing.

 

[torchomatic]

Good idea, Block. Show they are willing to do anything to get their Club back. SISU should be trying their hardest to make amends and return to the City.

 

[mrbluesky87]

Can any of the parties in this whole sordid affair be trusted?

The Council Leaders comments are a joke IMHO.

Personally I don't think either ACL or CCC give a 'dam' whether CCFC play at the Ricoh or not and more importantly, NEVER EVER HAVE DONE!

Im sure they do however I will say it yet again THE COUNCIL WILL SELL BUT NOT TO SISU thats the whole point. Why go over and over the same thing. Why on Gods earth would anybody sell to SISU. So while I understand you fully support the SISU campaign on this everything they have done for the club is a joke.

Nobody really backs either side but what is a factual comment is that SISU have caused us more harm then ACL.

 

[tisza]

If ACL reckon they can maintain a profit with the club only having to pay a rent of 150k then it shouldn't be too difficult for them to replace that income.
Not having the football club does free up the stadium part all year round for alternative uses.

 

[theferret]

If ACL reckon they can maintain a profit with the club only having to pay a rent of 150k then it shouldn't be too difficult for them to replace that income.
Not having the football club does free up the stadium part all year round for alternative uses.

What alternate uses?

 

[Manchester_sky_blue]

If ACL reckon they can maintain a profit with the club only having to pay a rent of 150k then it shouldn't be too difficult for them to replace that income.
Not having the football club does free up the stadium part all year round for alternative uses.

The flipside of that is if they were so certain that they can survive without the club then why did they make the last ditch £150k offer? Having previously stated that the best and final offer was £400k? Smacks of desperation.

The thing is though, if they are telling porkies about the profitability of the stadium they are only hurting themselves, the stadium will either flourish or it won't, 2 choices.

 

[mrbluesky87]

The problem is we over analyse everything. It doesnt matter whether ACL can manage with ot without CCFC, the statement was a clear "we will not sell any precentage of the Ricoh to Otium" however when they have disappeared we will gladly speak to the new owners and if we dont believe they are fit and proper then the same applies"
At least the council do a fit and proper test.

 

[Broken Hearted Sky Blue]

So profitable that they needed a £14M bailout? Yeah right. I think someone is whistling in the dark.

If youve got a mortgage youve always stuck with one lender then? Not a good idea financially

 

[theferret]

The problem is we over analyse everything. It doesnt matter whether ACL can manage with ot without CCFC, the statement was a clear "we will not sell any precentage of the Ricoh to Otium" however when they have disappeared we will gladly speak to the new owners and if we dont believe they are fit and proper then the same applies"
At least the council do a fit and proper test.

Why didn't they do a fit a proper test when they insisted GR sell to SISU in the first place?

I do agree with the general point though. If new owners of the football club were to make an approach to buy a stake then there is no way they would close the door on that and would happily negotiate I would imagine.

 

[shmmeee]

So profitable that they needed a £14M bailout? Yeah right. I think someone is whistling in the dark.

How was it a bailout?

I've done a very similar thing: I've borrows money from a family member at better rates than Id get elsewhere to reduce my outgoings. He gets more than a savings account so its win win.

 

[chiefdave]

Business make budgets based on what they are expecting to happen. They were expecting £1.3m in rent from CCFC, when they stopped paying of course that caused issues. The whole point of the swap to the lower rate loan as well as the internal restructuring (including losing some of the highest paid employees) was done to ensure ACL was a viable business without CCFC moving forward.

ACL have had their accounts signed off on this basis. Seems to be a non story to me.

If ACL were having financial problems how would they be able to offer such a massive reduction in rent.

Very profitable may not have been the best choice of words but this seems like a non story to me.

 

[theferret]

If youve got a mortgage youve always stuck with one lender then? Not a good idea financially

I think the issue is that she seems to have contradicted herself somewhat - on the one hand stating ACL would have been in a "right mess" were it not for the bail out, to now saying it is "very profitable", all in the space of 24 hours. Those statements do seem to come from opposite ends of two extremes. I suspect the truth lies somewhere in between.

 

[Broken Hearted Sky Blue]

Can any of the parties in this whole sordid affair be trusted?

The Council Leaders comments are a joke IMHO.

Personally I don't think either ACL or CCC give a 'dam' whether CCFC play at the Ricoh or not and more importantly, NEVER EVER HAVE DONE!

Personally I dont give a damn what you think

 

[Broken Hearted Sky Blue]

I think the issue is that she seems to have contradicted herself somewhat - on the one hand stating ACL would have been in a "right mess" were it not for the bail out, to now saying it is "very profitable", all in the space of 24 hours. Those statements do seem to come from opposite ends of two extremes. I suspect the truth lies somewhere in between.

Depends on the difference between the two interest payments I would have thought

 

[WiganSkyBlue]

The flipside of that is if they were so certain that they can survive without the club then why did they make the last ditch £150k offer? Having previously stated that the best and final offer was £400k? Smacks of desperation.

Because the fans showed that they wanted them to. Supporters wanted one side or the other to make concessions - ACL did, SISU didn't. ACL directors live locally, SISU's probably don't so couldn't give a monkeys. But, as many have said on the forum, this has quite a bit to run yet, so we shall see what transpires. Just hope it's new owners who will show, through investment in the team, a better commitment than the shysters currently in charge.

 

[mrbluesky87]

Why didn't they do a fit a proper test when they insisted GR sell to SISU in the first place?

I do agree with the general point though. If new owners of the football club were to make an approach to buy a stake then there is no way they would close the door on that and would happily negotiate I would imagine.

Defo, this is now a personal vendetta between the 2 sides which doesnt help us however it is ACL's prerogative to sell to whoever they see fit. Thats why I am convinced its now time for SISU to sell so we can all move on thus it begs the question why are SISU still here?? At the same time if SISU were to pay over the odds i'm sure they would sell but thats just not going to happen.

 

[Manchester_sky_blue]

Because the fans showed that they wanted them to. Supporters wanted one side or the other to make concessions - ACL did, SISU didn't. ACL directors live locally, SISU's probably don't so couldn't give a monkeys. But, as many have said on the forum, this has quite a bit to run yet, so we shall see what transpires. Just hope it's new owners who will show, through investment in the team, a better commitment than the shysters currently in charge.

I'd like to believe that was the reason but I suspect in reality it was more of a last ditch attempt to retain the footballing incomes. The directors of ACL may all be city fans but their first duty is to the profitability of ACL.

 

[skybluehugh]

If the Ricoh is very profitable, why don't the council offer the stadium free for a year? To help the club out and see football back in the city.

But that would not be helping out the club. all it would do is give the squatters a years grace. that 1.3m would not have been put into the club it just wouldn't have had to come out of our owners pocket. in my view

 

[skybluehugh]

The flipside of that is if they were so certain that they can survive without the club then why did they make the last ditch £150k offer? Having previously stated that the best and final offer was £400k? Smacks of desperation.
The thing is though, if they are telling porkies about the profitability of the stadium they are only hurting themselves, the stadium will either flourish or it won't, 2 choices.

The desperation was to keep our football club playing in the city it was named after in in some cattle shed in Northampton.

 

[njdlawyer]

Any business losing a customer paying £1.3million pa will suffer as a result. Common sense and no sane person (admittedly that rules out a few who use this site) could argue otherwise..

...similarly you would think that saving £1.3million pa would greatly enhance the finances of any normal business particularly where such a saving represented 8.5% of total turnover

It is irrelevant though...

Are those on this thread that want to believe that ACL are in financial trouble of the view that the Ricoh should be handed over to SISU / Otium for nothing / knockdown price thus saddling us with an underperforming and antagonistic hedge fund as owners for the foreseeable future?

And if ACL are, indeed, in rude financial health, what difference does it make to where we are and what is happening to us? And why should they consider reducing their rent offer still further from what is already a rock bottom figure?

Good or bad the finances of ACL have absolutely nothing to do with the future viability of our club

 

[Manchester_sky_blue]

The desperation was to keep our football club playing in the city it was named after in in some cattle shed in Northampton.

Again, i'd really like to believe that was the reason but i'm more than averagly certain that it was really money that drove the decision. if they are adamant they wont sell to SISU then there was little advantage in offering them a new rent deal unless they were desperate for the income. I do think that SISU have more blame in this whole sorry affair than ACL/CCC do but neither do I believe they have always had the clubs interests heart. I recognise that you dont agree but i cant share your faith in them.

 

[MusicDating]

I'd like to believe that was the reason but I suspect in reality it was more of a last ditch attempt to retain the footballing incomes. The directors of ACL may all be city fans but their first duty is to the profitability of ACL.

Agreed. I think the trick that ACL missed was not offering a 150k/year rent as soon as SISU announced the groundshare deal with Northampton. This would have sent the message that they wanted us to play there no matter what (I think SISU would have still rejected that offer, in fact even a play for free offer). As ACL only offered it at the last minute, my conclusion is they were still trying to make money out of the club.

 

[Manchester_sky_blue]

Are those on this thread that want to believe that ACL are in financial trouble of the view that the Ricoh should be handed over to SISU / Otium for nothing / knockdown price thus saddling us with an underperforming and antagonistic hedge fund as owners for the foreseeable future?

...............

Good or bad the finances of ACL have absolutely nothing to do with the future viability of our club

Personally I feel the only realistic way forward for club and stadium is for both to be taken over by new owners, preferably by the same owners! It would stick in the throat if ACL was sold on the cheap to SISU but if it meant that SISU then sold both club and stadium on to someone else and we could start again it may be the best option.

ACL's financial health is important to the club during our time away because we surely have to hope that a team bearing the name of Coventry will play there again some day soon. Be it City under new ownership or a phoenix club im not sure, only time will tell i guess. Either way we need the stadium to stay operational whilst we sort this mess out.

 

[theferret]

Good or bad the finances of ACL have absolutely nothing to do with the future viability of our club

Of course they do, and to argue otherwise is absurd, unless you subscribe to the view that ownership, or part ownership of the ground we play in, should not be on the agenda of either current or future owners of the football club.

You'll be hard-pressed to find anyone on here who doesn't argue that uniting the stadium and football club under single ownership is vital for the long term viability of CCFC, and to a lesser extent ACL (but that is unclear).

It is therefore very relevant; relevant to whether ACL choose to sell, and relevant to how much they sell for. I suspect that will not be to SISU, but seeing as our agenda seems to be to get rid of them, then surely we all hope that any new owners would sit down and have that conversation with ACL on day one.

 

[torchomatic]

OK then. Have it your way. If they were so profitable why did they need a family member, i.e. the council to pay off their mortgage and reduce their outgoings?

How was it a bailout?

I've done a very similar thing: I've borrows money from a family member at better rates than Id get elsewhere to reduce my outgoings. He gets more than a savings account so its win win.