FPP to take full control

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As for the sale price, we have to remember that whatever is paid to Madrox for SAFC (now that the debt is written off) must first be used to repay FPP (£10m or so) and then SD (£6m or so). So a sale price of £35m is actually £19m for Madrox to be set against the £12m they originally paid.

So the break even point for Madrox is basically a sale price of £28m. After paying off debts, the equity is Madrox is the same as the money put in to buy the club. Except SD and JS would lose money as CM apparently didn’t put a penny in.

Or... the money put in by FPP is still in the club. It was put in as share capital, but between the two companies that Donald owns, I'd say it's highly likely that circumstances exist where he can remove that money from the club in order to pay off FPP.

In fact, as amply demonstrated by the last few weeks, they could even create a loan between the two companies (again) and write it off as an exceptional operating expense again. Whatever the mechanism, I think it's very likely that Donald can pay it back using the club's cash.
 
Having read the wisemensay article, I think this is yet another red herring.

The situation with the parachute payments is as we all know, basically irrelevant. SAFC used to have a debt of £25m to Ellis Short and had £25m of parachute payments coming in, i.e. nothing. Now it doesn’t have the debt to Ellis Short but it doesn’t have the parachute payments either. So no change.

The situation was confused by SD claiming they paid Ellis Short £40m for the club. They didn’t in any practical sense. They just agreed to pass on the £25m he was owed anyway. The equivalent of trying to show off to a bird in a pub about your income and including your credit card limits. Twattish but nothing criminal.

The loan from SD to Madrox also means nothing. Nothing as it relates to SAFC anyway. Madrox is simply the vehicle that the three shareholders have used to buy SAFC and the ownership proportion is fixed by the shareholdings. So if extra money had to put into SAFC, then logically each shareholder should put in the proportion that matches their shareholding.

But what if Juan and Charlie say they won’t or can’t put any money in? Well SD would even quite rightly say that he should be getting extra shares as he is putting up the money. But then you have the issue of having to define what value the shares are and the other shareholders have to agree to that valuation.

So what would normally happen in that scenario is that SD would say that as he is putting the extra money in, then that extra money should be paid back first before any gains from a sale of the club are shared out. Which is totally fair enough.

The fact that the loan from SD to Madrox is interest-bearing has zero effect on SAFC because SAFC is not paying the interest. All the interest is doing is increasing the economic interest of SD at the expense of CM and JS. Nothing more and nothing less.

It’s like buying a house with your mate 50:50 and then when you need to get a new boiler done, he says he doesn’t have the cash to split the cost. Well if you pay for the boiler, should he still get 50%? No - it should be 50% after the cost of the boiler (plus interest) is taken into account. That is all that is happening here.

Once again, the SD communication is diabolical but equally it seems that there is some sort of agenda to smear him as well. His biggest mistake was pretending to pay £40m for the club when that is only true in the most tenuous of legal senses. In any practical sense, he paid £15m (later reduced to £12m).

But now, even when he puts another £6m of his own cash into the club (don’t see Juan & Charlie risking anything), he is being attacked for it even though any interest costs are being taken out of Juan & Charlie, not the club.

As for the sale price, we have to remember that whatever is paid to Madrox for SAFC (now that the debt is written off) must first be used to repay FPP (£10m or so) and then SD (£6m or so). So a sale price of £35m is actually £19m for Madrox to be set against the £12m they originally paid.

So the break even point for Madrox is basically a sale price of £28m. After paying off debts, the equity is Madrox is the same as the money put in to buy the club. Except SD and JS would lose money as CM apparently didn’t put a penny in.
Thanks Bob. It is difficult for an average fan when the same figures can be described in different ways with vastly different meanings.

Something has been bugging me. What about the competitors to Donald's group at the time of their takeover?

Short got £37 million, and Donald paid £12 million. Is it possible that other bids would have seen Short get less but the club would have been better off?
 
Thanks Bob. It is difficult for an average fan when the same figures can be described in different ways with vastly different meanings.

Something has been bugging me. What about the competitors to Donald's group at the time of their takeover?

Short got £37 million, and Donald paid £12 million. Is it possible that other bids would have seen Short get less but the club would have been better off?

The various accounts suggest that Short was willing to write off all of the debt at one point...
 
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Thanks for that, it's good to have a precise summary.

My problem is that there's been a half hearted attempt at promotion and a total lack of clarity ...

... at the moment I have no idea if Donald has any intention of selling the club.
I am sure there is an effort to sell the club - ideally not at a big loss.

As far as I can tell, they need to sell the club for £28m debt-free not to lose money.
 
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A
Thanks Bob. It is difficult for an average fan when the same figures can be described in different ways with vastly different meanings.

Something has been bugging me. What about the competitors to Donald's group at the time of their takeover?

Short got £37 million, and Donald paid £12 million. Is it possible that other bids would have seen Short get less but the club would have been better off?
As I understand it, there were marginally higher bids on the table but Ellis didn’t trust the buyers. He gave Madrox the chance to gazump the others.
 
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Sam Allardyce ripped aside his jacket and beat his chest like King Kong. 46,000 inside the Stadium of Light roared their approval. Sunderland’s players danced along during a lap of honour. They had just beaten Everton 3-0 to stay in the Premier League for a 10th consecutive season and their victory helped to relegate neighbours Newcastle United. There was joy on Wearside and a surge of optimism.

Had the Netflix cameras been rolling, they would have captured a champagne dressing room, where owner Ellis Short joined the revelry; the next day, they would have caught Penshaw Monument lit up in red and white by Sunderland City Council.

“It’s hard to beat that feeling,” Allardyce tells The Athletic. “I’ve won promotions with different clubs and it’s special but so is the feeling you get when you and your staff have managed to save a club. It’s relief but it’s also satisfaction. You know how much it means to Sunderland fans and everyone at the club. You could sense the relief.”

The club and its wider fanbase felt it was a moment of opportunity. Allardyce had only been there for eight months and he sensed it, too. It was May 2016 and it felt like Sunderland had bottomed out. The club had been teetering on the brink of relegation for seasons and had become known for acts of dramatic escapology.

But Allardyce, Sunderland’s eighth permanent manager in seven erratic years, had taken a sluggish squad that scraped 12 points from the first half of the 2015-16 season — and looked certainties to go down — and galvanised them into a streamlined team.

Jan Kirchhoff had arrived in January from Bayern Munich and had made a huge impact. “We all felt like we’d created something we could build upon,” he tells The Athletic. “That we were able to stay in the Premier League, perform in it, and might even be able to attack the top-10 teams. All of us felt like we had a great future.”

In the second half of that season, Sunderland’s record was P19 W6 D9 L4. Three of those defeats were to clubs in the top four. Against Everton, Allardyce named the same starting XI for the seventh game in a row. The previous match had been a stirring 3-2 victory over Chelsea. At last, Sunderland had a solid foundation.

Allardyce felt three high-calibre signings that summer would turn them into a team that could look forwards with optimism, rather than with the familiar sense of dread or confusion. “We have to move away from the fact that we’re all so happy at being heroes for surviving,” he said the next day. “We have to think much bigger, have much more ambition.”

And yet, within two years, Sunderland were in League One. Back-to-back relegations ripped the heart and soul out of the club, much of it caught on camera in Neflix’s Sunderland ‘Til I Die.

No one foresaw that on the night of Sunderland 3-0 Everton. Then, "Sunderland ‘Til I Die" was still a chant, an expression of pride, rather than a soundtrack to decline. Then, Sunderland were still a big football club with possibilities, rather than a box set. It had provided a glimpse of the club it could be.

This was only four years ago this month. Even three years ago, Sunderland were still in the richest league in the world. Today, they feel like a Premier League memory.

Sunderland stand uncertain in seventh place in the third tier and, if the season ends now, it will be the lowest finishing position in their 141-year history. Today, talk is not about potential, about “a great future” — it is about flawed ownership, creditors, parachute payments, loans and regression. Talk is about Sunderland unravelling. It is about Sunderland dying. Nobody is dancing.
 
Sam Allardyce ripped aside his jacket and beat his chest like King Kong. 46,000 inside the Stadium of Light roared their approval. Sunderland’s players danced along during a lap of honour. They had just beaten Everton 3-0 to stay in the Premier League for a 10th consecutive season and their victory helped to relegate neighbours Newcastle United. There was joy on Wearside and a surge of optimism.

Had the Netflix cameras been rolling, they would have captured a champagne dressing room, where owner Ellis Short joined the revelry; the next day, they would have caught Penshaw Monument lit up in red and white by Sunderland City Council.

“It’s hard to beat that feeling,” Allardyce tells The Athletic. “I’ve won promotions with different clubs and it’s special but so is the feeling you get when you and your staff have managed to save a club. It’s relief but it’s also satisfaction. You know how much it means to Sunderland fans and everyone at the club. You could sense the relief.”

The club and its wider fanbase felt it was a moment of opportunity. Allardyce had only been there for eight months and he sensed it, too. It was May 2016 and it felt like Sunderland had bottomed out. The club had been teetering on the brink of relegation for seasons and had become known for acts of dramatic escapology.

But Allardyce, Sunderland’s eighth permanent manager in seven erratic years, had taken a sluggish squad that scraped 12 points from the first half of the 2015-16 season — and looked certainties to go down — and galvanised them into a streamlined team.

Jan Kirchhoff had arrived in January from Bayern Munich and had made a huge impact. “We all felt like we’d created something we could build upon,” he tells The Athletic. “That we were able to stay in the Premier League, perform in it, and might even be able to attack the top-10 teams. All of us felt like we had a great future.”

In the second half of that season, Sunderland’s record was P19 W6 D9 L4. Three of those defeats were to clubs in the top four. Against Everton, Allardyce named the same starting XI for the seventh game in a row. The previous match had been a stirring 3-2 victory over Chelsea. At last, Sunderland had a solid foundation.

Allardyce felt three high-calibre signings that summer would turn them into a team that could look forwards with optimism, rather than with the familiar sense of dread or confusion. “We have to move away from the fact that we’re all so happy at being heroes for surviving,” he said the next day. “We have to think much bigger, have much more ambition.”

And yet, within two years, Sunderland were in League One. Back-to-back relegations ripped the heart and soul out of the club, much of it caught on camera in Neflix’s Sunderland ‘Til I Die.

No one foresaw that on the night of Sunderland 3-0 Everton. Then, "Sunderland ‘Til I Die" was still a chant, an expression of pride, rather than a soundtrack to decline. Then, Sunderland were still a big football club with possibilities, rather than a box set. It had provided a glimpse of the club it could be.

This was only four years ago this month. Even three years ago, Sunderland were still in the richest league in the world. Today, they feel like a Premier League memory.

Sunderland stand uncertain in seventh place in the third tier and, if the season ends now, it will be the lowest finishing position in their 141-year history. Today, talk is not about potential, about “a great future” — it is about flawed ownership, creditors, parachute payments, loans and regression. Talk is about Sunderland unravelling. It is about Sunderland dying. Nobody is dancing.


surely theres got to be more to come?
 
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if you look at the link I posted it suggests cattermole and coleman so there must be more to come...I take it you copied that from RTG @Larza ? the lad who posted it said that he doesnt get the full lot not been a full subscriber yet
 
Having read the wisemensay article, I think this is yet another red herring.

The situation with the parachute payments is as we all know, basically irrelevant. SAFC used to have a debt of £25m to Ellis Short and had £25m of parachute payments coming in, i.e. nothing. Now it doesn’t have the debt to Ellis Short but it doesn’t have the parachute payments either. So no change.

The situation was confused by SD claiming they paid Ellis Short £40m for the club. They didn’t in any practical sense. They just agreed to pass on the £25m he was owed anyway. The equivalent of trying to show off to a bird in a pub about your income and including your credit card limits. Twattish but nothing criminal.

The loan from SD to Madrox also means nothing. Nothing as it relates to SAFC anyway. Madrox is simply the vehicle that the three shareholders have used to buy SAFC and the ownership proportion is fixed by the shareholdings. So if extra money had to put into SAFC, then logically each shareholder should put in the proportion that matches their shareholding.

But what if Juan and Charlie say they won’t or can’t put any money in? Well SD would even quite rightly say that he should be getting extra shares as he is putting up the money. But then you have the issue of having to define what value the shares are and the other shareholders have to agree to that valuation.

So what would normally happen in that scenario is that SD would say that as he is putting the extra money in, then that extra money should be paid back first before any gains from a sale of the club are shared out. Which is totally fair enough.

The fact that the loan from SD to Madrox is interest-bearing has zero effect on SAFC because SAFC is not paying the interest. All the interest is doing is increasing the economic interest of SD at the expense of CM and JS. Nothing more and nothing less.

It’s like buying a house with your mate 50:50 and then when you need to get a new boiler done, he says he doesn’t have the cash to split the cost. Well if you pay for the boiler, should he still get 50%? No - it should be 50% after the cost of the boiler (plus interest) is taken into account. That is all that is happening here.

Once again, the SD communication is diabolical but equally it seems that there is some sort of agenda to smear him as well. His biggest mistake was pretending to pay £40m for the club when that is only true in the most tenuous of legal senses. In any practical sense, he paid £15m (later reduced to £12m).

But now, even when he puts another £6m of his own cash into the club (don’t see Juan & Charlie risking anything), he is being attacked for it even though any interest costs are being taken out of Juan & Charlie, not the club.

As for the sale price, we have to remember that whatever is paid to Madrox for SAFC (now that the debt is written off) must first be used to repay FPP (£10m or so) and then SD (£6m or so). So a sale price of £35m is actually £19m for Madrox to be set against the £12m they originally paid.

So the break even point for Madrox is basically a sale price of £28m. After paying off debts, the equity is Madrox is the same as the money put in to buy the club. Except SD and JS would lose money as CM apparently didn’t put a penny in.

It's like me getting together with a new lass and saying let's put our money together love and get a joint account. She says 'ok fine, but do you owe anyone money'? I say no I'm debt free me (when really I owe 25k to a dodgy loan shark). So she trusts me and we pool our cash. She then gets 25k inheritance in when her poor Mam dies so I pay the lot straight to the dodgy loan shark. She finds out and goes nuts. I say haway man love it was a debt we owed and now it's settled with our money but don't worry I'll pay it back. I then write that money off a couple of years later. It's not confused it's underhand, deceitful and down right twattish behaviour.
 
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Last spring, Sunderland were almost sold to Mark Campbell, a businessman. The process reached such an advanced point that Ross was being consulted by the prospective new owners.

“It was astonishing,” a senior club source tells The Athletic. “Jack was on holiday, getting messages about signings from the new people. He had to ask Stewart whether he was OK to talk to them. ‘Yeah, yeah, crack on’ he was told.

“There would be all these mixed signals. Jack would hear from the current owners that they were going to offer a certain player a contract. Why? Couldn’t they sell the club after all? Then Jack would hear again from the new guys — they would be at the club, inside the training ground, going for dinner with him, as if they had already bought it.

“Through the summer, we had no idea who was going to own the club. And then it just disappeared. Honestly, it was mental.”

In terms of infrastructure, Sunderland still thought of itself as a Premier League outfit. But a broken lift at the training ground was not fixed and behind the scenes, Donald and Methven were chopping a “ruinously high” £40 million wage bill down to £15 million.

“They were people who genuinely wanted to do a good job but I’m not too sure they knew how to do it,” another source at the club says. “On recruitment, it was ****ing horrendous. They were so far out of their depth. I don’t think the chairman realised what a big job it was and didn’t really have the funds to do it. They were always chasing.”
 
if you look at the link I posted it suggests cattermole and coleman so there must be more to come...I take it you copied that from RTG @Larza ? the lad who posted it said that he doesnt get the full lot not been a full subscriber yet
I just got sent that by text, just been over there and found another bit that I’ve copied in, it doesn’t make good reading but not a surprise.
 
“On the face of it, Sunderland should be an easy sell,” one person involved in a consortium which attempted to buy the club last year, tells The Athletic. “They’ve got the stadium, the fanbase and a good academy but behind the scenes, it’s a mess. For the money they’re asking, you could buy a Championship club, with fewer nasty issues.”