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Derby takeover ....


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A Spanish consortium have agreed a takeover of Derby - another means to avoid FFP?  Wonder if they will try and buy the ground and training facilities or lease them from MM. Will be interesting if they go for the ground and the price they will have to pay after MM claims he paid £80m !!!!!!

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"Subject to EFL Approval". 

The Erik Alonso who fell out with Chansiri?

Think that the EFL have every right to take their good sweet time. :)

"Selling Stadium and Training Ground back". Charges over each, as well as the Club- been cleared with MSD has it? He'll want his dues and rightly so!

Selling it (Pride Park) back, when there's a 30 year lease- another issue for EFL?

Edited by Mr Popodopolous
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9 hours ago, Mr Popodopolous said:

"Subject to EFL Approval". 

The Erik Alonso who fell out with Chansiri?

Think that the EFL have every right to take their good sweet time. :)

"Selling Stadium and Training Ground back". Charges over each, as well as the Club- been cleared with MSD has it? He'll want his dues and rightly so!

Selling it (Pride Park) back, when there's a 30 year lease- another issue for EFL?

He’s a front for Matt Southall allegedly.

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22 minutes ago, Davefevs said:

He’s a front for Matt Southall allegedly.

Matt Southall?!

As in Charlton?

That is absolutely ludicrous, surely, but would be so funny if true.

It would be good for the local Range Rover dealership, though 😉.

Edited by PHILINFRANCE
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Heard part of an interview with the new owner on the radio earlier. 

He used the phrase “ sleeping giant” ( although I don't know if he was referring to Rooney or DCFC) but that’s them b******d then! 

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Ha the kiss of death that, "Sleeping giant" indeed. Comatose more like it?

You know what would be great.

Monday: EFL approval of takeover materialises.

Tuesday: Indeed announced that Southall is a key component...

Wednesday: EFL Appeal verdict is in. 12 point deduction with immediate effect. Welcome to Derby and probably League One Erik!!

If Carlsberg did karma based takeover Scenarios...

Wonder how much of their financial chicanery, position, relationship with the EFL had been disclosed by old Sideshow Mel to Alonso etc...

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5 hours ago, Mr Popodopolous said:

Read that Pride Park is part of the deal. This raises more than a few questions.

As soon as I heard about the club being sold I wondered how Pride Park would feature.

As Derby County FC sold the ground to a third party company, then I cannot see how the ground can be included within the sale of DCFC to Alonso - it’s not DCFC’s to sell.  Especially given the contentious nature of the sale of the ground, i.e. to circumvent ffp rules, then I think one of 2 things should happen. 

Either Derby County purchase Pride Park back from whichever of Mel Morris’s companies that now owns it, with that expenditure contributing to Derby’s cumulative losses and counting towards ffp. Or, Alonso purchases DCFC from Mel Morris and separately, and subsequent to the purchase of the football club,  purchases Pride Park from it’s current owner, with the price paid for the stadium contributing to DCFC’s losses for ffp.

If the stadium is included within the sale of the football club then Morris/Derby will have truly had his/their cake and eaten it.

However, we can rest easy in the secure knowledge that the EFL’s vigilance and the robust application of their airtight rules will enable any sleight of hand to be thwarted and the appropriate punishment handed out! 

 

 

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Under current EFL rules the new owners can set up a new holding company that acquires the shares in the football club group and the stadium group.  They can they state that the new holding company is the head of the group that should be used for FFP - see EFL FFP Regulations paragraph 1.1.3 (b).  If the EFL requests they can ask for a different group (see the same reference). That would make for an interesting case, which decision takes precedence. 

Edited by Hxj
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17 hours ago, downendcity said:

As soon as I heard about the club being sold I wondered how Pride Park would feature.

As Derby County FC sold the ground to a third party company, then I cannot see how the ground can be included within the sale of DCFC to Alonso - it’s not DCFC’s to sell.  Especially given the contentious nature of the sale of the ground, i.e. to circumvent ffp rules, then I think one of 2 things should happen. 

Either Derby County purchase Pride Park back from whichever of Mel Morris’s companies that now owns it, with that expenditure contributing to Derby’s cumulative losses and counting towards ffp. Or, Alonso purchases DCFC from Mel Morris and separately, and subsequent to the purchase of the football club,  purchases Pride Park from it’s current owner, with the price paid for the stadium contributing to DCFC’s losses for ffp.

If the stadium is included within the sale of the football club then Morris/Derby will have truly had his/their cake and eaten it.

However, we can rest easy in the secure knowledge that the EFL’s vigilance and the robust application of their airtight rules will enable any sleight of hand to be thwarted and the appropriate punishment handed out! 

 

 

I'd have to see further reports as to the veracity, think was a Tweet by Ryan Conway.

I don't disagree with your post but given that Infrastructure expenditure-and this was for the right reasons- is excluded from FFP, it is so a club can grow etc, thing is that when UEFA made these rules they also excluded Profit on Disposal of Fixed Assets from FFP calcs. Problem is EFL changed the latter in 2016.

I fear a scenario whereby the Stsdium is brought back, added to Balance Sheet. It is Infrastructure, only Profit and Loss Hit is Depreciation and Costs of running Pride Park- the former is adjusted out for FFP, latter within Operating Costs.

I recall when it was sold, one qualifying condition was that it 'could no longer be a material part of football operations'.

Can you overturn a 25 year lease just like that.

What I am trying to ascertain is why no media have even mentioned MSD charge over Pride Park and the rest. That was quite onerous from memory, surely not all paid down as part of takeover.

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The charges in respect of both Rams Investment (Gabay) and MSD contain no provisions restricting change in ultimate ownership of the companies.

Therefore Morris can sell the companies to who ever he wants to and amounts due under those charges will simply remain due.

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17 minutes ago, Mr Popodopolous said:

Can you overturn a 25 year lease just like that.

No - you just put both parties to the lease in the same group and the net transactions at the group level will be nil.

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1 hour ago, Hxj said:

The charges in respect of both Rams Investment (Gabay) and MSD contain no provisions restricting change in ultimate ownership of the companies.

Therefore Morris can sell the companies to who ever he wants to and amounts due under those charges will simply remain due.

Thanks. Had a quick look the other day but not looked in depth for a while.

Suppose it is possible that either Alonso or Morris is paying off the charge as part of the deal?

1 hour ago, Hxj said:

No - you just put both parties to the lease in the same group and the net transactions at the group level will be nil.

Yep, would cancel out at a Group Level. Given that one of the stipulations in the Written Reasons (from memory) was that the Stadium would no longer be a material part of operations, could this trigger a fresh Investigation into the legitimacy of the 2018 Transaction?

Consolidation or reconsolidation would put it back as one again, a material part of operations.

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2 minutes ago, Mr Popodopolous said:

Yep, would cancel out at a Group Level. Given that one of the stipulations in the Written Reasons (from memory) was that the Stadium would no longer be a material part of operations, could this trigger a fresh Investigation into the legitimacy of the 2018 Transaction?

Consolidation or reconsolidation would put it back as one again, a material part of operations.

The cynic in me wonders whether Pride Park being included within the transaction to purchase the football club will avoid the need for the value of the stadium being detailed, thereby avoiding any embarrassment if the value is substantially different from that used to avoid ffp sanctions.

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4 hours ago, downendcity said:

The cynic in me wonders whether Pride Park being included within the transaction to purchase the football club will avoid the need for the value of the stadium being detailed, thereby avoiding any embarrassment if the value is substantially different from that used to avoid ffp sanctions.

Maybe. Certainly shouldn't be substantially different though given a note in the 2019 Gellaw Newco 202 (Purchasing Company) underneath the Investment Property bit:

Note 3, Investment Property and is stated as being at Fair Value with the following note, a note that also appears on the 2020 Accounts- so in Covid times and released in 2021:

Quote

"Investment property comprises Pride Park Stadium. The fair value of the investment property has been entered at cost in this the year of acquisition."

Although, "entered at cost" for "Fair Value"....hmmm.

UNLESS and only unless it's paid at Fair Value then feels like yet another case for the EFL. Wonder how aware they even are of these Accounts and the note- surely they're well aware.

Edited by Mr Popodopolous
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Reading that 49 page Charge they took out last August with MSD for the first time in a while, there must be something I'm missing or misunderstanding:

Quote

5.   NEGATIVE PLEDGE

No Chargor may:

(a) create or agree to create or permit to subsist any Security Interest or Quasi-Interest over all of part of the Charged Property; or

(b) sell, transfer, lease out, lend or otherwise dispose of all or any part of the Charged Property (other than in respect of assets charged under Clause 3.3 (Floating Charge) on arm's length terms in the ordinary course of trading) or the right to receive or be paid the proceeds arising on the disposal of the same, or agree to attempt to do so,

except as permitted by the Term Loan Agreement or with the prior consent of the Lender.

Chargor being Derby, all the companies plus Gellaw Newco 202 and 204. MSD the lender.

Do some terms contradict this- as I say is there something I'm missing? It says Floating, Fixed Charge as well as Negative Pledge at the top of the Document.

Course if it's been paid down by Alonso etc then...

I'm fantasising a bit with this last bit but could Sideshow Mel have done the sale without bothering to notify MSD- or maybe sold it to the new buyers without bothering to inform them of this small matter. :whistle2:

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3 hours ago, Mr Popodopolous said:

I'm fantasising a bit

Really 🤣🤣🤣

The chargors are the companies, the charged property being the land owned by the companies.

So the owner of any company can sell the company without the charge stopping that sale.

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1 hour ago, Hxj said:

Really 🤣🤣🤣

The chargors are the companies, the charged property being the land owned by the companies.

So the owner of any company can sell the company without the charge stopping that sale.

Yes, just a little haha- I'm sure he's complied with all applicable regs etc.

So the Negative Pledge is an irrelevant consideration here then? The Term Loan Agreement or agreement of the Lender seems to be a factor?

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Interesting snippet in Matt Hughes and his Ahead of the Game column- he must have a source at or with knowledge of Derby?

Quote

EFL PROBING ALONSO'S MONEY

Prospective new Derby owner Erik Alonso is facing questions from the EFL over the source of his funds before a proposed takeover can be signed off. 

Alonso lodged proof of funds with the EFL this week after reaching an agreement to purchase the club from Mel Morris, but questions remain about his trading history and the money's origin. 

Alonso's case may not be helped by the fact that the EFL pushed through a previous takeover attempt at Derby by Sheik Khaled last year after receiving reassurances from Morris

There is suspicion Morris took the step of publicising the sale agreement to pressure the EFL to provide endorsement.

Now clearly they do the due diligence on all owners so bits of this maybe a little hammed up, but this last bolded bit could be interesting- and remember Derby last August unilaterally published the EFL Case Written Reasons so they have form for it...Sideshow Mel has form for this kinda thing, the rage when they were charged with FFP denying it could happen or was legitimate, DESPITE the Written Reasons stating all was open to Ongoing and Multi-Layered Review- he's a tad Trumpian except perhaps without some of the Buffoonery?

So this is not surprising- the bolded bit above makes him appear a bit of a chump given the History of that Consortium and takeovers, or desperate to get out.

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Suggests in the Mirror that Pride Park will be part of the deal, but that Moor Farm will not. 

They'll be renting the latter, mentioned some company I've never heard of, as for the former, the price will be most interesting.

One of their more sensible posters suggests that their Amortisation policy means they could spend £20m on one player at this level, Alonso said he could?

Given the Stadium Sale drops off after this season, might past losses not hem them in as far as £20m on a single player goes? 

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