Wasps downward spiral... (73 Viewers)

[chiefdave]

Do they go to every one to ask individually?

someone on that bonds site says they need 75% agreement but is that 75% of all bondholders, which seems a tough task, or 75% of those who bother to respond, which seems easier to achieve.

 

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[HuckerbyDublinWhelan]

Aaah Shugs - what a man. Still dying on that hill.

 

[MalcSB]

someone on that bonds site says they need 75% agreement but is that 75% of all bondholders, which seems a tough task, or 75% of those who bother to respond, which seems easier to achieve.

From a quick read back, it is 75% of the nominal value of the bonds which is not necessarily the same as 75% of the number of individual bondholders.

 

[Liquid Gold]

someone on that bonds site says they need 75% agreement but is that 75% of all bondholders, which seems a tough task, or 75% of those who bother to respond, which seems easier to achieve.

I think it's the value of bonds held

If Richardson owns 26% of them they're laughing.

 

[Philosoraptor]

People selling them won’t kill them as a company, they will still have the same face value regardless of what they are sold for. The key will be who buys them at what price. If Wasps can buy them back themselves at less than face value their risk will be mitigated somewhat.

If sufficient bondholders sell, then there won't be enough money from the loan, or that's how I imagine it to be. Would you have confidence in buying a bond which has struggled to refinance?

Do you keep the bond waiting for it to one day mature sometime in the future, or cut your losses and run?

It's very murky water all round.

 

[oldfiver]

someone on that bonds site says they need 75% agreement but is that 75% of all bondholders, which seems a tough task, or 75% of those who bother to respond, which seems easier to achieve.

25% needed to get a resolution raised
75% to get a resolution passed

 

[Grendel]

Unless it's not a loan and they somehow just get a grant they don't need to pay back.

This can be used to increase the assets value, then there can finance and pay back the bonds.

Its sounding like the arrangement they had to buy it in the first place.

They won’t be getting a £35 million grant

 

[MalcSB]

They won’t be getting a £35 million grant

Perhaps £13 million grant to address dilapidations and put a new conservatory on would raise the value of the arena to act as surety for a loan of £35 million.

 

[oldfiver]

They won’t be getting a £35 million grant

If they get £13m unencumbrred it puts the extra amount needed to pay bondholders in reach

 

[fernandopartridge]

The bonds are in effect an interest only mortgage for an indefinite period

 

[CCFC54321]

Richardson after the HSBC refused to lend them scaving bastards the money…

 

[fernandopartridge]

Perhaps £13 million grant to address dilapidations and put a new conservatory on would raise the value of the arena to act as surety for a loan of £35 million.

Maybe but a lender will still look at affordability from the point of view of the borrower surely?

 

[fernandopartridge]

Think we might be getting into the territory of when the bond does get put back on the market, people selling them will just kill 'em as a company.

The loan taken out from a bank will not be enough to cover the losses.

All conjecture though.

People selling the bonds for nothing doesn't have any material impact on Wasps

 

[MalcSB]

If sufficient bondholders sell, then there won't be enough money from the loan, or that's how I imagine it to be. Would you have confidence in buying a bond which has struggled to refinance?

Do you keep the bond waiting for it to one day mature sometime in the future, or cut your losses and run?

It's very murky water all round.

If the bonds are relisted, some holders may get out at them at less than face value, in the same way that some bought them at less than face value when they were being traded (as low as 40%). The bonds would still have a total face value of £35 million, losses in the first instance would be felt by the bondholders who would then be able to seek recom0ense from the sureties and guarantors. That would hit Wasps.

The question of whether to wait for a future maturity is already being discussed on their chat forum with very mixed views being expressed.

 

[MalcSB]

Y

Maybe but a lender will still look at affordability from the point of view of the borrower surely?

You would have thought so. I can’t see how a company needing to go cap in hand for grants, losing money and with apparently declining attendances would be an attractive proposition. But who knows.

 

[shepardo01]

 

[MalcSB]

The bonds are in effect an interest only mortgage for an indefinite period

They were an interest only mortgage for 7 years, now need bondholders agreement to extend.

They are in default.

 

[Flying Fokker]

Basically, HSBC have said fuck off because the assets aren't worth enough.

They have gone to Reeves and he's going to back them to be able to increase the value of the asset with grants he can push for them.

That clown can stuff off.

 

[Gynnsthetonic]

So Wasps have borrowed £35m of other people's money and promised to pay it back in May 2022, but they've spent all the money and can't pay it back, is it me or is this theft and fraud on a massive scale.

 

[SBAndy]

This post was of particular interest from ADVFN:

It seems to have passed by the posters here that if/when these bonds are re listed their value will plummet. I would guess to below 50%. They would be considered as “junk”. The higher the interest rate, the junkier they become, the greater the fall in price. There will be many wanting to sell with not many buyers, at least initially. With time someone wanting to buy the stadium on the cheap might take an interest. Easy peasy if the bonds can be bought at a considerable discount.

A possible pathway to ownership of the stadium with the debt burden against it being significantly reduced?

 

[oldfiver]

This post was of particular interest from ADVFN:



A possible pathway to ownership of the stadium with the debt burden against it being significantly reduced?

Does not alter the debt if bonds sold for1p still £35m owed

There is misconception that the default automatically puts the stadium in bondholders hands

 

[Terry Gibson's perm]

Does not alter the debt if bonds sold for1p still £35m owed

There is misconception that the default automatically puts the stadium in bondholders hands

Even if it did what are they going to do with it.

 

[CCFC54321]

So Wasps have borrowed £35m of other

So Wasps have borrowed £35m of other people's money and promised to pay it back in May 2022, but they've spent all the money and can't pay it back, is it me or is this theft and fraud on a massive scale.

Those bastards most likely knew 2-3 years ago the whole thing was collapsing around them but continued to piss money away in training grounds etc they couldn’t afford but we all knew what was being said behind the scenes was “don’t worry ccc will help us out.”

Fucking disgusting how they treated the bond holders but what do you expect with a franchise they couldn’t give a toss about their now tiny fan base.

 

[CCFC54321]

Does not alter the debt if bonds sold for1p still £35m owed

There is misconception that the default automatically puts the stadium in bondholders hands

Not proud to say this but SISU have played a blinder here…. Sweat the bastards out and pick it up on the cheap.

 

[Gynnsthetonic]

Who or what company is paying the 6.5% interest anyway and how are they still paying it, surely the next step will be to postpone the payments.

 

[Grendel]

Not proud to say this but SISU have played a blinder here…. Sweat the bastards out and pick it up on the cheap.

how would that work?

 

[oldfiver]

how would that work?

It wouldn't- if it goes cheaply there would be a queue of bidders

 

[HuckerbyDublinWhelan]

Check the “tickets” thread out…. Really starting to take potshots at us

 

[Gynnsthetonic]

Check the “tickets” thread out…. Really starting to take potshots at us

Mainly Shugs, 'where have all these Cov fans come from'. Ffs we've been here for 140 years, who do these people think they are, they nest in another City with an existing football and Rugby team. Just fuck off the back down south!

 

[HuckerbyDublinWhelan]

Mainly Shugs, 'where have all these Cov fans come from'. Ffs we've been here for 140 years, who do these people think they are, they nest in another City with an existing football and Rugby team. Just fuck off the back down south!

Shugs is concerned, this is the first time he’s started taking shots at us directly… normally it’s “SISU bad - why don’t you be angry at them” etc

he deffo thought the bond would be paid today. Definitely an ex-city fan, who’s switched to wasps… isn’t Jan is it?

 

[Nick]

Check the “tickets” thread out…. Really starting to take potshots at us

What's their beef?

 

[HuckerbyDublinWhelan]

What's their beef?

“Where have all these Coventry fans come from?”

“Few promotions and they’ve lost their principles”

 

[SBAndy]

Does not alter the debt if bonds sold for1p still £35m owed

There is misconception that the default automatically puts the stadium in bondholders hands

Forgive me, but why is it a misconception? Surely if Wasps formally default then the security can be enacted. Say for example SISU bought all the bonds at 50p in the £ (total outlay £17.5m) then Wasps were unable to refinance, leaving the long-lease at the Arena as the security. Surely SISU would be able to either retain the security or alternatively sell to another of their companies to recoup the £35m but having only had outlay of half? If there’s something I’m missing let me know (aside from the fact they almost certainly won’t/wouldn’t do that).

 

[oldfiver]

Forgive me, but why is it a misconception? Surely if Wasps formally default then the security can be enacted. Say for example SISU bought all the bonds at 50p in the £ (total outlay £17.5m) then Wasps were unable to refinance, leaving the long-lease at the Arena as the security. Surely SISU would be able to either retain the security or alternatively sell to another of their companies to recoup the £35m but having only had outlay of half? If there’s something I’m missing let me know (aside from the fact they almost certainly won’t/wouldn’t do that).

I would need t

Forgive me, but why is it a misconception? Surely if Wasps formally default then the security can be enacted. Say for example SISU bought all the bonds at 50p in the £ (total outlay £17.5m) then Wasps were unable to refinance, leaving the long-lease at the Arena as the security. Surely SISU would be able to either retain the security or alternatively sell to another of their companies to recoup the £35m but having only had outlay of half? If there’s something I’m missing let me know (aside from the fact they almost certainly won’t/wouldn’t do that).

I would need to reread the prospectus but I don't think the bondholders as a class have a way to directly do what you suggest. There is convoluted route to follow.

 

[Grendel]

Fastcst who posted at 9 last night seems to have an idea of the likely scenarios

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