GFH completed the takeover of English soccer club Leeds United in December through its Dubai-based subsidiary, GFH Capital; it hopes the deal will vindicate its new way of doing business. It did not give a value for the deal, but its cashflow statement indicates GFH has so far paid over $33 million for Leeds, with a further $42.7 million in liabilities. The statement values the club at $88 million. "I think it was a transaction that to a certain extent confirmed the recovery of GFH," said Al Rayes. Because of its debt burden, GFH may not be able to put as much money into Leeds as other Gulf investors have showered on European soccer clubs such as Manchester City. But with new players and staff, including former Reading coach Brian McDermott, GFH says it plans to turn Leeds into a sustainable franchise by emulating the success of clubs such as Reading. "I would like Leeds to reach that stage as well...but you can't just do changes overnight, you have to do it smoothly. Overall we are looking at the enhancement of operations and enhancement of results." GFH has had to outline its strategy not only to its shareholders but also to the soccer club's vocal fan base, an unusual demand on a firm that has kept a low profile since 2009. GFH classified its stake in Leeds as being "held-for-sale" on its year-end financial statements, but Al Rayes said this did not mean it intended to exit the club any time soon. He said GFH planned to bring new investors into Leeds while retaining an "influential minority" stake, declining to give a figure. "New investors will come into the club, some directly and some under the GFH name. This will further extend opportunities for Leeds United and further bring resources to the club." "To clarify, we are a private equity house - we create funds and create value and then achieve a good return." In March, GFH Capital sold a 10 percent stake in Leeds to Bahrain-based International Investment Bank. I'm no accountant but don't like the figure of 42 million dollars in liabilities. Perhaps some of you can shed some light on it
Eire It means to many degrees that they have to guarentee payments for eg: your ground rent,wages,police costs, etc.etc. But basically what it means is you wont be getting any dosh for transferes cos they are skint
Not enough info to comment fully, but it also explains why LUFC have had a positive impact on GFH's financials. They have (re)valued the investment as being worth $88m, when its cost them effectively $76m (not all cash). They are showing the difference as a profit on their investment, I would imagine.
and it does not mean what Mighty says, it gives no info on that, which would depend on the capacity of the owners (and any new investors) to provide further funding - though regrettably he's probably right all the same
Scum and Real Madrid to name but two, are hundreds of millions in debt but doesn't seem to interfere with transfers.
Eire Thats because Manchester United as a club and as a business have the assets, and a potential world wide market investors are queueing up to invest their money with them GFH have paid 33m out in cash and have a reserve liability cost of 42.7m = 76.7m it states they are hoping to make Leeds Utd. a sustainable francise which means basically at present your club is running at a loss difficult to find investors to invest their dosh in a company thats making a loss especially a club with no assets you dont even own ER or TA people say the potential for Leeds Utd is massive. I agree but so is the risk and the dosh outlay
Few clubs if any clubs have the tangible assets to match their market valuation. In fact, nor do other companies. Value of a company is based on - tangible assets (so yes, if Leeds owned the ground, Leeds would be worth more), semi-tangibles like value of players under contract, then a whole host of intangibles and judgements about the future prospects (revenue streams today, revenue streams if get to Prem, likelihood of promotion/relegation (thats why I'd pay no more than 2p for Millwall are currently), lots of judgements (aka guesses) about the future prospects.
40 Millwall are a fantastic prospect for would be investors with the new development of Bermondsey just around the corner but our chairman (who insidently turned down Leeds cos he has more than 1 brain cell) isnt looking for investors we even kicked our shirt sponsors into touch and are running with a cancer charity we dont need their dosh we are exactly where GFH would love Leeds Utd. to be Keep your 2p we dont need it
I am well aware you don't need any 2p pieces, Mighty - I realised that when you all started throwing them at me on my last visit
Steve save your dosh m8 to throw at 40 when he next visits But try to be a bit more generous 2p pieces you tight git
good input - £50 notes make marvellous aeroplanes, when folded, which is probably what you had in mind
I noticed that It may refer to their financial performance, as in a business successful in making money out of running a yoyo Championshiprem team - no idea if thats true, have not ever looked at their financials, but its a possible interpretation of the comment. Though I do hope thats not what GFH would see as a success for Leeds.
Though I do hope thats not what GFH would see as a success for Leeds. Would be a bloody big success if they can turn you into another reading but the way things are looking theres more chance theyll turn you into another Darlington
Only if huge dosh is outlayed. Current ownership and management clearly is not doing that. Nice WUM attempt though.
I've told them before they're just MKDons light since the old Leeds got scrapped. Maybe they'll accept their status now their own board say it.
