What Next For The Allams?

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originallambrettaman said:
<laugh> Man United have a debt three times ours, but a revenue over ten times ours, I'm not sure you even understand basic economics.

I don't think we're in any danger at all, as I've stated several times, but the Allams have dug themselves a hole by building up a level of debt far higher than the value of the club.

It's fine for us in the short term, as it forces them to keep throwing money at the job until we get back in the Premier League and our income better matches our debt level. It's a dangerous position though, he's a petty vindictive man, if he ever did decide to completely throw his toys out the pram and write off his investment, we'd be in a worse position that we were under Bartlett(I'm not sure why anyone is mentioning Duffen, he never owned the club, nor did he fund anything).

I am not concerned about our current debt level causing the demise of the club, but that doesn't mean I'm not concerned about us being £100m in debt.
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I understand basic economics, my point was your concern about debt levels.
 
originallambrettaman said:
<laugh> Man United have a debt three times ours, but a revenue over ten times ours, I'm not sure you even understand basic economics.

I don't think we're in any danger at all, as I've stated several times, but the Allams have dug themselves a hole by building up a level of debt far higher than the value of the club.

It's fine for us in the short term, as it forces them to keep throwing money at the job until we get back in the Premier League and our income better matches our debt level. It's a dangerous position though, he's a petty vindictive man, if he ever did decide to completely throw his toys out the pram and write off his investment, we'd be in a worse position that we were under Bartlett(I'm not sure why anyone is mentioning Duffen, he never owned the club, nor did he fund anything).

I am not concerned about our current debt level causing the demise of the club, but that doesn't mean I'm not concerned about us being £100m in debt.
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Isn't that what he has been doing and increasing the debt?
 
originallambrettaman said:
They're not going to increase the debt any further, it's now about not pulling money out, rather than putting more in.
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So.. you just said all that he can do is throw money at us to get us back up but you think he'll do that by not increasing the debt further?

I would be happy for him to write off his debt and he may well.
 
I can see them jumping on the 'austerity' bandwagon and deciding to impose it on the club. Would be a good/humorous test of the principle.
 
SydneyTiger14 said:
So.. you just said all that he can do is throw money at us to get us back up but you think he'll do that by not increasing the debt further?

I would be happy for him to write off his debt and he may well.
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That doesn't make sense..... Why would he write off >80mill of debt? That's greater than the value of the club!
Allam is rich, but he's not that rich to write off that levels of debt
 
originallambrettaman said:
<laugh> Man United have a debt three times ours, but a revenue over ten times ours, I'm not sure you even understand basic economics.

I don't think we're in any danger at all, as I've stated several times, but the Allams have dug themselves a hole by building up a level of debt far higher than the value of the club.

It's fine for us in the short term, as it forces them to keep throwing money at the job until we get back in the Premier League and our income better matches our debt level. It's a dangerous position though, he's a petty vindictive man, if he ever did decide to completely throw his toys out the pram and write off his investment, we'd be in a worse position that we were under Bartlett(I'm not sure why anyone is mentioning Duffen, he never owned the club, nor did he fund anything).

I am not concerned about our current debt level causing the demise of the club, but that doesn't mean I'm not concerned about us being £100m in debt.
Click to expand...


They've dug themselves a big hole yet you keep demanding we sign players. hmmm
 
originallambrettaman said:
It's a dangerous position though, he's a petty vindictive man, if he ever did decide to completely throw his toys out the pram and write off his investment, we'd be in a worse position that we were under Bartlett
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If Allam wrote off his investment then City would be debt free. It's the possibility of Allam trying to recoup his investment by stripping out the club that is the worst case scenario - but I can't see it happening.

The reason for that is that I don't believe he is petty and vindictive. I think he is focussed entirely in decisions that he perceives are right for him and for the business. Trouble is, in a footballing context at least, his decision focus is ****e.

But asset stripping wouldn't be senseless in a footballing sense only, it would also be daft and costly in a wider business sense too. I don't see any evidence that Allam wants to cut his nose off to spite his face when the damage runs into millions of pounds.
 
AlRawdah said:
If Allam wrote off his investment then City would be debt free. It's the possibility of Allam trying to recoup his investment by stripping out the club that is the worst case scenario - but I can't see it happening.

The reason for that is that I don't believe he is petty and vindictive. I think he is focussed entirely in decisions that he perceives are right for him and for the business. Trouble is, in a footballing context at least, his decision focus is ****e.

But asset stripping wouldn't be senseless in a footballing sense only, it would also be daft and costly in a wider business sense too. I don't see any evidence that Allam wants to cut his nose off to spite his face when the damage runs into millions of pounds.
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When I said 'write off his investment', I meant cashing in on what he could, rather than actually writing off any debt. I agree with everything you've said.
 
SydneyTiger14 said:
So your remark that it forces them to keep throwing money at the job was incorrect.
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Under normal circumstances, any business with a massive debt to it's owner, which suffered a 60% drop in income, would slash it's costs and try and reduce that debt level.

But this isn't a normal business and potential Premier League riches cause all normal rules to be thrown out the window.

It's by not paying down the debt and by keeping costs relatively high that they are continuing to throw money at it, I don't expect much, if any, increase in the level of debt.
 
originallambrettaman said:
Under normal circumstances, any business with a massive debt to it's owner, which suffered a 60% drop in income, would slash it's costs and try and reduce that debt level.

But this isn't a normal business and potential Premier League riches cause all normal rules to be thrown out the window.

It's by not paying down the debt and by keeping costs relatively high that they are continuing to throw money at it, I don't expect much, if any, increase in the level of debt.
Click to expand...

If running costs continue to be higher than our income then our debt will by nature increase.
 
You only have to look at their track record to predict what will happen next.

They wanted the freehold to the stadium to generate more income (profit)
They threatened to move the stadium to melton if this did not happen.
The council refused, but the threat was not followed through.

Instead, they went for plan B.
Premier league money.

They then realised premier league money was only sustainable by having more income than the other bottom half teams. Hence the name change.

The realisation that they would need approval from the FA brought the threat of selling the club if the name change was not approved.

It wasn't approved and this is where the the threat to sell was proved to be a bluff, because at this point the club was an asset (premier league status secured) and had their best chance to find a buyer to recoup their losses.

The fact they didn't do it suggests they saw an opportunity to turn their losses into profit with the new TV deals looming.

Their tactic to appeal seemed secondary at that point. Their primary tactic was to make the FA irrelevant to their plans by rebranding the club on every marketing asset they own which the FA have no authority over.

The tactic here was to get the hull tigers name into the public domain wherever possible and to get the media using the name.....

Then two unexpected things happened which won't have been in their plans. The first was winning the appeal to nullify the original decision.

Much was made at the time as to why the Allams refused to enter a new application to beef up those parts that were pointed out as weak. For me, this was because resubmitting the application just bought them time to carry on with their original plan of rebranding the club internally to the point where the media would start to use the name. They even appealed to the FA to defer the decision under the guise of letting the club focus on matters on the pitch.

What was not in the plans however was relegation.

This has significantly reduced their options in terms of finding a buyer to cut their losses, and also has weakened their argument with the FA around the need to generate more income than their premier league rivals.

However I still believe getting the FAs agreement is seen as a nice to have rather than a necessity.

Their only viable plan is premier league football so they will just put the name change on hold for a season and continue to internally market the club as hull tigers because the FA have no say over this.

If I'm wrong, then we'll know this within the next 7 days because two things will have happened.

Brady will have been sold for £7m, and Bruce will still not have signed anyone.

Worrying times.
 
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