Nah… Goodwill is none of the above. It is an intangible asset. Basically the premium paid above the net value of the combined assets. A taxi firm might have ten cars valued at £120k, a radio and computer system worth £1k it may hold a stock of motoring consumables, these are tangible assets. It’s web site, telephone number and trading style are intangible assets. Goodwill is its customer base, contracts and reputation which in a taxi firm may include its licenses. There is no security in goodwill as it is transient. In the terms and conditions of sale it will say that there are no guarantees or warranties attributed to goodwill. I have no idea where you got your version of goodwill from.
Basically a framework that governs conduct of both paries in relation to a transaction. It's not actually goodwill at all if you think about it. As I said previously I used it as an umbrella term. Oh, and cultural industries are all about 'intangible assets' , btw. Which in itself is an umbrella term.
No that’s a Heads of Terms Agreement. Basically it sets out what the purchaser is buying, the timescale and obligations of each party. It might for instance state that the buyer has to within 14 days, lodge a £5m non refundable deposit into ….. account. Once received the seller will within 14 days provide full disclosure to all accounts. It’s that sort of thing but as I said goodwill is an element of the value of the business and nothing to do with the terms of the sale.
And was I not linking it to the heads of terms if you back-read? I'll defer to your superior use of technical language but I still think the point stands.
Flanagan trying to stir up doubts, I'd be curious to know what his sources are? As the deposit has been paid I'm not quite sure how there could be a 'stumbling block' over the payment structure which would already be agreed.
The very nature of goodwill is the payment against the valuation of the business. It's essentially the 'premium' you have paid for a business, so by its nature it's built into the deal.
Flanaghan's OK. He was directly referencing Buckingham's article in the Athletic. And Baz and Mike White were hardly distancing themselves - but whilst also making the implicit point they get nowt from the club themselves
Ah ok so was just quoting a journo not claiming his own sources, fair enough, but also still surprised if there's stumbling blocks over the deal structure if a deposit has already been paid.
And it's agreed in the head of terms. Doesn't that usually dictate the deposit? I know at least some (In my experience most) deals are structured where the intangible value pretty much determines the price of the non - refundable deposit then the Due Diligence determines the actual transfer price of the tangibles. Again apologies for less than precise use of jargon but I assumed that's how most multi-stakeholder, high value deals are done. Though I'm sure someone with a BTEC will pick me up on my grammar.
Yes it's been quite some time since I did M&A at Uni, but I would have thought DD would largely be completed before the deposit is paid, it's only the market sensitive information that would then be investigated and navigated once the deposit has been paid where essentially only a really hairy piece of information would scupper the deal. I would have thought the full value of the deal would therefore already be locked in, with maybe only a bit of wiggle room. Particularly for a football club, I could imagine the table position could have some impact depending on how long the takeover is taking. I would have thought Ilicai would be trying to wrap things up as quickly as possible to get in and right the ship. Reminds me of when the Allams themselves took over and Assem complained that because he rushed it to prevent the club going into Administration he didn't do proper DD and missed some of the hidden debt and issues with the club.
... And then the curious case of ex-chairmen refunding money in out of court settlements following asset freezes and such like. I have a strong suspicion there's still a can of worms that's yet to be publicly opened in terms of that last paragraph.... Actions taken pre-Allam of course. They may be ****s, but they're not crooks.
Surely enough water's gone under the bridge by now that anything would have been resolved? Was that Geovanni rights image thing ever sorted?
No idea, but surely that's not big enough to scupper a deal, and if it's yet to be resolved then its current legal status will be verifiably documented somewhere, so you'd think that'd be factored in regardless.
City lost the Geovanni image rights case, but were still talking about appealing it in 2019, no idea if they ever did. It’s unlikely to be a significant issue either way, it was only about running a tax avoidance scheme on £440k of his earnings.
