S.A.F.C. - the future
- Thread starter alan reed
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I think we need to accept that we won't have a 'big meeting', round a big polished table, as we tend to picture it.
Things like this tend to involve a series of meetings, sometimes involving a couple of admin people going through piles of paperwork relating to players contracts, etc. There are lots of i's & t's and sadly lots of potential stumbling blocks, the biggest being Donald's ego.
Anyway, this is Grumpy's text reply to my question ...
"It's exactly what I'd expect if the bones of an agreement is there. Two teams of lawyers thrashing out the details. There's no need for principals to be involved in that level of detail, although points could be referred back as they arise. So long as both sides are talking at some level, that's fine."
Pondering the time taken this year and comparing this the apparent speed of last years "nearly deal".
In my mind this will come down to the uncertainties over the revenue that the club can make and the additional levels of investment required to plug this gap.
This time last year there was a certainty over the base level of matchday revenue from season tickets sold and commercial revenues with a certainty that a successful team on the pitch would increase attendances as demonstrated by SD's 1st season in charge and the goodwill he would have generated on selling the club to "Dell" which would have seen a further spike in revenues as we were now owned by a multi-billionaire. The fact that Dell would have only been a minority shareholder would not have mattered to the majority we would be owned by a man who had the money not only to get promoted to the Championship but the Premier League and be able to hold our own.
A year later and we are all learning to live in a post covid world.
The clubs income streams have been wiped out overnight.
If and when the fans are allowed back in these numbers are capped at approximately 10k.
Commercial revenues through sponsorship and hospitality will be harder to generate - businesses are cautious with advertising and corporate entertaining in a socially distanced environment is not going to high on peoples agenda.
In this scenario SD and any other owner will be losing money hand over fist.
So from a buyers perspective why would you hurry to do a deal - when every home game where they are no fans is costing you at least £300k in gate receipts alone but they also know the club cannot be allowed to go the wall and the longer SD remains in situ he is losing the fan's goodwill which erodes the value of the club and may need to build into their offer additional monies to help fund the current losses and allow some investment in the playing staff to achieve promoting to the Championship as quickly as possible.
From SD's side he will know how much he is losing a month but he will also know how much the club is worth and he will have to weigh up what his sweet spot is in selling the club to stop him having to fund the day to day to losses. Any contingency payments fo future successes become harder to value as TV deals will be face downward pressure in the coming years as the impact of Covid hits us all.
Saturday morning musings - no gossip no information - just thoughts on why this deal is more complex than 12 months ago.
In my mind this will come down to the uncertainties over the revenue that the club can make and the additional levels of investment required to plug this gap.
This time last year there was a certainty over the base level of matchday revenue from season tickets sold and commercial revenues with a certainty that a successful team on the pitch would increase attendances as demonstrated by SD's 1st season in charge and the goodwill he would have generated on selling the club to "Dell" which would have seen a further spike in revenues as we were now owned by a multi-billionaire. The fact that Dell would have only been a minority shareholder would not have mattered to the majority we would be owned by a man who had the money not only to get promoted to the Championship but the Premier League and be able to hold our own.
A year later and we are all learning to live in a post covid world.
The clubs income streams have been wiped out overnight.
If and when the fans are allowed back in these numbers are capped at approximately 10k.
Commercial revenues through sponsorship and hospitality will be harder to generate - businesses are cautious with advertising and corporate entertaining in a socially distanced environment is not going to high on peoples agenda.
In this scenario SD and any other owner will be losing money hand over fist.
So from a buyers perspective why would you hurry to do a deal - when every home game where they are no fans is costing you at least £300k in gate receipts alone but they also know the club cannot be allowed to go the wall and the longer SD remains in situ he is losing the fan's goodwill which erodes the value of the club and may need to build into their offer additional monies to help fund the current losses and allow some investment in the playing staff to achieve promoting to the Championship as quickly as possible.
From SD's side he will know how much he is losing a month but he will also know how much the club is worth and he will have to weigh up what his sweet spot is in selling the club to stop him having to fund the day to day to losses. Any contingency payments fo future successes become harder to value as TV deals will be face downward pressure in the coming years as the impact of Covid hits us all.
Saturday morning musings - no gossip no information - just thoughts on why this deal is more complex than 12 months ago.
I have been involved with buying businesses in the past and to some extent the easy bit is agreeing the initial price and also how that's going to be paid - in my experience it is rarely as a single lump sum.
Where it gets really sticky is in agreeing the contract and especially understanding and agreeing past, and in some cases, hidden liabilities. Due diligence is all well and good but the purchaser can never be 100% sure that they understand the full extent of the potential liabilities as they invariably do not sit neatly in the accounts. The liabilities may not actually be fully understood by the vendor or are not given the same importance by both parties.
In one instance the contract was 205 pages long and after a few weeks of wrangling back and forward over the phone and by email we met up in at their offices to resolve it - the meeting lasted just short of 18 hours with both parties (and their very expensive legal teams) adjourning to separate rooms several times before an acceptable version was finally agreed on. The legal fees were eyewatering - they are on the clock so it is in their interest to nit-pick all the way through the process.
From what the likes of Smug and Magnus are posting on here it sounds like the deal is agreed in principle and probably Donald isn't holding out on price but that the legal teams and the more junior people (like me) are now having their own private battle on the terms and conditions.
Where it gets really sticky is in agreeing the contract and especially understanding and agreeing past, and in some cases, hidden liabilities. Due diligence is all well and good but the purchaser can never be 100% sure that they understand the full extent of the potential liabilities as they invariably do not sit neatly in the accounts. The liabilities may not actually be fully understood by the vendor or are not given the same importance by both parties.
In one instance the contract was 205 pages long and after a few weeks of wrangling back and forward over the phone and by email we met up in at their offices to resolve it - the meeting lasted just short of 18 hours with both parties (and their very expensive legal teams) adjourning to separate rooms several times before an acceptable version was finally agreed on. The legal fees were eyewatering - they are on the clock so it is in their interest to nit-pick all the way through the process.
From what the likes of Smug and Magnus are posting on here it sounds like the deal is agreed in principle and probably Donald isn't holding out on price but that the legal teams and the more junior people (like me) are now having their own private battle on the terms and conditions.
It’s obviously a different world but I work in sales of 9-figure outsourcing and infrastructure deals. The key people involved in selling and buying basically stay involved until everyone is agreed with the way forward, then it’s left to me and my counterparts who are more junior to deal with the contracts and nitty gritty.
I’m sure it would be a similar story in any large transaction, be it for services or assets.
I’m sure it would be a similar story in any large transaction, be it for services or assets.
Hate moaning about over the road but I see they are now picking at GOM. The guy has clearly forgotten more that they know.
Thats what you pay legal expert for.. to sort out the paper work
Na, uses u and na, not smugs form
If a price had not been agreed at the beginning or access to the books to be inspected then to ascertain the current state of accounts and that there were no serious anomalies any negotiations would not be as advanced as they seem or appear o be if the legal people are now doing there business, as suggested on the forums by those " in the know". To be this far down the line would suggest that any deal agreed ,although not signed off, is progressing.. It would have to be a massive hiccup if the conclusion was not reached.
If what people are saying on here (legal teams taking over, main people leaving them to draft it etc ) I'd agree that it would have to be a long way down the line. I've got reason to believe that none of that is the case though
Why now though GG, you’ve never come across as being ITK on this so what has changed. Plus there are some posters who do get to know stuff are saying quite the opposite. I hope you are so wrong you are banished form forums forever
Why now though GG, you’ve never come across as being ITK on this so what has changed. Plus there are some posters who do get to know stuff are saying quite the opposite. I hope you are so wrong you are banished form forums forever
Like I said mate, spoken to someone I've known for years who would be in a position to know. Don't normally speak to him so when I did I thought I'd ask about the takeover, he says almost exactly what Niall Quinn’s Dad said on here. Interest from FPP but they didn't agree with Donald's price before and don't agree with it now. Suggested there's misinformation coming out about the deal and said not to expect anything to change in the near future. I'm not expecting people to agree, but I'd pass on what was said if it was positive so have to do the same when it isn't. I don't think he'd be out of the loop but I hope he is and that the sources others have are more accurate
Chin up Janey. You've got a lot to look forward to in the coming weeks. Focus on the house move and where in the house you are going to put the photos of your treasured family members. Be strong.
This is exactly how this board should be mate, people passing on what they've heard from people they know, not a bear pit where people are savaged for no good reason.
As things stand, imo, 'FPP' are the biggest investors, have an offer on the table and are in control of what happens next.
Donald has no other offers, is losing money and staring into the barrel of another failed season.
There's a point whereby he has no option but to sell ...
... otherwise we'll be at the top and on our way to promotion.
Sadly 'FPP' have no pressure on them to do anything as things stand.
If people want something positive, as far as I'm aware there's no need for the quotation marks around FPP, no reason to think one is acting independently
I've heard Donald needs to sell up... What time scales are anyone's guess
I'm guessing here, but I'd imagine that's part of the problem. Donald is stubborn and wants a high price, likely the price he'd have to fight to get if we were a division above, never mind when we're still stuck here with Covid and wage caps and a staff seemingly stripped to the bone. He wants what he wants, others know what they value it at, but others also know that Donald is likely to keep losing money and that there's no guarantee he'll suddenly get us promoted. As always, the issue is Donald, he is entitled to ask what he wants but until that changes there'll be a stand off