FFP must put people off buying us because the days of buying your way to promotion and the kudos of the Prem will be more difficult.
No point being a billionnaire owner of CAFC but not being able to throw money at it is there as no billionaire will be happy kicking about in the Champ.
I believe we have a t/o of about 9M per year, under FPP are allowed a loss of c 3M per year, which means total of 12M per year to play with. Relegated Prem clubs come down with say similar t/o but parachute money of 18M per year (for 4yrs now!!) on top plus should have better squads to start with too and if they have been sensible will have tier 1 acaemies producing and stealing the better players.
That is a pretty substantial gap to close and as I have said before, the sheer quantity of money in the PL (plus insufficiently punished bancruptcies) means more clubs (norwich, southampton, palace, wigan, reading to name a few) have no debts any more so less 'basket cases' heading down.
I genuinly worry that the PL will, in the next 2/3 years become a closed shop with relegated clubs going back up 75% of the time. In fact if CAFC don't go up this year I would want all 3 relegated clubs to go straight back up to remove them and their parachute money from next years championship competition!
It is what the PL would like and will sadly affect the competitivness of the Championship the most.
FFP must put people off buying us because the days of buying your way to promotion and the kudos of the Prem will be more difficult.
No point being a billionnaire owner of CAFC but not being able to throw money at it is there as no billionaire will be happy kicking about in the Champ.
I believe we have a t/o of about 9M per year, under FPP are allowed a loss of c 3M per year, which means total of 12M per year to play with. Relegated Prem clubs come down with say similar t/o but parachute money of 18M per year (for 4yrs now!!) on top plus should have better squads to start with too and if they have been sensible will have tier 1 acaemies producing and stealing the better players.
That is a pretty substantial gap to close and as I have said before, the sheer quantity of money in the PL (plus insufficiently punished bancruptcies) means more clubs (norwich, southampton, palace, wigan, reading to name a few) have no debts any more so less 'basket cases' heading down.
I genuinly worry that the PL will, in the next 2/3 years become a closed shop with relegated clubs going back up 75% of the time. In fact if CAFC don't go up this year I would want all 3 relegated clubs to go straight back up to remove them and their parachute money from next years championship competition!
It is what the PL would like and will sadly affect the competitivness of the Championship the most.
Hope I am wrong but we will find out soon enough.
Conversely, you could argue that it can make the club more attractive – bright young manager – good young players – nice facilities. Less investment required to achieve your goals!
FFP must put people off buying us because the days of buying your way to promotion and the kudos of the Prem will be more difficult.
No point being a billionnaire owner of CAFC but not being able to throw money at it is there as no billionaire will be happy kicking about in the Champ.
I believe we have a t/o of about 9M per year, under FPP are allowed a loss of c 3M per year, which means total of 12M per year to play with. Relegated Prem clubs come down with say similar t/o but parachute money of 18M per year (for 4yrs now!!) on top plus should have better squads to start with too and if they have been sensible will have tier 1 acaemies producing and stealing the better players.
That is a pretty substantial gap to close and as I have said before, the sheer quantity of money in the PL (plus insufficiently punished bancruptcies) means more clubs (norwich, southampton, palace, wigan, reading to name a few) have no debts any more so less 'basket cases' heading down.
I genuinly worry that the PL will, in the next 2/3 years become a closed shop with relegated clubs going back up 75% of the time. In fact if CAFC don't go up this year I would want all 3 relegated clubs to go straight back up to remove them and their parachute money from next years championship competition!
It is what the PL would like and will sadly affect the competitivness of the Championship the most.
Hope I am wrong but we will find out soon enough.
That's very interesting, Athletico - many thanks for enlightening me, and you clearly demonstrate the iniquity of insufficiently punished bankruptcies. It's a fairly grim picture. Could you explain something to me about FFP? If an investor were to pitch up with vast amounts of money, presumably there is a limit on the amount he could spend on transfers and wages. How is that limit calculated?
Thanks for those links, Razil. So, if I understand it correctly, FFP allows us to make an £8 million loss this coming season, yet the Lancs Telegraph says: "This year the guidelines say [Blackburn] Rovers must not make a pre-tax loss of greater than £3 million". Why the difference?
£5m equity on top as I understand it, but I am sure one of the financial wizards on here can clarify, and it only limits certain areas so £8m on the playing squad etc of course you need that money in the first place
"This year the guidelines say Rovers must not make a pre-tax loss of greater than £3m, with the additional shareholder equity investment of £5m allowed."
Daily Fail says it all!! they could not even spell Larnaca right! what hope of the stry being right? So what if the Russians are coming, there money is just as good, plus their ladies are among the best looking in Europe. Bring em on.
Mind you, have you seen this headline in the Russian press? 'Buyout Imminent' The photos of the secret money man (keep an eye out for him at Welling) aided by a former UK Rock Scissors Paper champion and mother Teresa with Jiminez round the back of the covered end catering outlet have had to be cut, sadly.
"This year the guidelines say Rovers must not make a pre-tax loss of greater than £3m, with the additional shareholder equity investment of £5m allowed."
This thread is a big reason we need a trust, its all here in black and white. And it can only succeed if enough people join and participate in some way. It cannot survive and be maintained without popular support. It is in my view essential to have any chance of protecting our club. Let's act now and build something rather than wait until the horse has bolted. Http://castrust.org/join
It's ok - I'm just about to buy a film that TJ financed and when I release it this Christmas the gazillions we are going to make will be ploughed into our January transfer window budget :-)
I can't comment on directors deferred loans except to say that they are not secured on The Valley so no linkage as far as I can see... perhaps new owners don't want old directors hanging around?!
And the current board simply cannot secure loans against the Valley because banks do NOT lend to football clubs anymore! Not since the credit crunch... not since Aviva and HBOS each lost £10-20M to Southampton and Palace...
I don't pretend to be an expert on these matters, so perhaps you're right, but this is what the 2012 accounts say (p19) of the £8.55m (then) owed to the former directors and Richard Murray:
"The loans are secured over the fixed and floating charges of the company's assets".
Now accepting that the company (CAFC Ltd) pays nominal rent on The Valley to Charlton Athletic Holdings Limited (which confusingly is another subsidiary of Baton 2010 Ltd and not the ultimate BVI-registered CAFC Holdings Limited) and the player registrations revert to the FL, what does this mean in practice the loans are secured against?
I am not a lawyer - just thought I would say that! So I looked up fixed and floating charge on Google:
The key point is that any fixed charge secured on assets needs to be registered so that the beneficiary can grab the asset in court before all the other creditors get a slice. The assets are clearly in UK domicile and part of the Baton group. So if there are no fixed charges then all loans must be floating charges on the business.
Also I am not a property developer but I suspect that the Valley is worth more alive than dead! That is as part of a football club with chances of a big payout in the Premier League. And this is where the poker game gets really clever...
All previous directors get paid out IF CAFC promoted - this is written into their arrangement... what if a future owner said the same thing? If you had lent £15M over two years into a club would you be prepared to hand the management and ownership across and be classed as a deferred creditor, i.e., would you trust the future owners to have the nous AND backing to make that final push ... without repeating the Pardew fiasco?
Or would you stay put until someone offers you hard cash for two years delivery / added value on the pitch?
I expect there are other options too re. funding but those are for another day...
There is a conflict of interests between the leagues because they are run by separate bodies... even though all but the top six in the Premier League are under threat of relegation...
It is possible that after this season coming up, the only clubs who secure promotion to the Premier League will be ex-Premier League clubs with their financial muscle. Whoever wins the play-off final next time may become a permanent yo-yo club?
Having said that, last season no clubs bounced straight back and Wolves went down with Blackburn having a 'mare... funny ol' game innit?!
Does any one know the real reason why parachute payments exist???
If there were no parachute payments all Premier League Clubs who felt they were at risk of relegation - at least half the League probably - would be very cautious when negotiating player contracts. Expensive four year deals would be out since these would lead to financial ruin on relegation. However, such prudent management would make the Premier League more uncompetitive than it already is and, as result, the "product" would be less attractive to its global audience.
Richard Scudamore's solution is to say "... don't worry Guys, go out and compete for the best players in the world and offer them crazy four year deals.....If it all goes belly up we'll cushion the blow by paying you £15m a year".
Scudamore is only concerned about the Premier League and this strategy helps. He doesn't give a fig about the Champjonship which the parachute payments are turning into a very unlevel playing field.
Does any one know the real reason why parachute payments exist???
Definitely reward teams with money, including relegated clubs...but 120m? Really?
The league wants FFP to come into play, whilst giving vast sums of money to clubs? Seems contradictory to me...
With all the tv revenue, simply have a set 20 amounts of figures which are given to each PL team. Remainder to be put into coaching, grass roots!
Because a lot of clubs, including us, couldn't cope with the sharp financial deficit on getting relegated from the Prem and ended up taking a second relegation within a year or two. The theory is that the parachute payments should make it a little easier for clubs to adjust to their new and unwanted status. I agree that the amounts now do seem excessive. But then, just about everything to do with money in the Premiership is excessive.
Does any one know the real reason why parachute payments exist???
If there were no parachute payments all Premier League Clubs who felt they were at risk of relegation - at least half the League probably - would be very cautious when negotiating player contracts. Expensive four year deals would be out since these would lead to financial ruin on relegation. However, such prudent management would make the Premier League more uncompetitive than it already is and, as result, the "product" would be less attractive to its global audience.
Richard Scudamore's solution is to say "... don't worry Guys, go out and compete for the best players in the world and offer them crazy four year deals.....If it all goes belly up we'll cushion the blow by paying you £15m a year".
Scudamore is only concerned about the Premier League and this strategy helps. He doesn't give a fig about the Champjonship which the parachute payments are turning into a very unlevel playing field.
Hope that makes sense.
Your summary makes perfect sense, Mundell - but whether the inflated parachute payments make sense, I very much doubt. In effect, failure is handsomely rewarded.
Does any one know the real reason why parachute payments exist???
Definitely reward teams with money, including relegated clubs...but 120m? Really?
The league wants FFP to come into play, whilst giving vast sums of money to clubs? Seems contradictory to me...
With all the tv revenue, simply have a set 20 amounts of figures which are given to each PL team. Remainder to be put into coaching, grass roots!
Because a lot of clubs, including us, couldn't cope with the sharp financial deficit on getting relegated from the Prem and ended up taking a second relegation within a year or two. The theory is that the parachute payments should make it a little easier for clubs to adjust to their new and unwanted status. I agree that the amounts now do seem excessive. But then, just about everything to do with money in the Premiership is excessive.
There is still a massive gulf between those teams receiving the parachute payments and the rest of the Championship though.
Does any one know the real reason why parachute payments exist???
Definitely reward teams with money, including relegated clubs...but 120m? Really?
The league wants FFP to come into play, whilst giving vast sums of money to clubs? Seems contradictory to me...
With all the tv revenue, simply have a set 20 amounts of figures which are given to each PL team. Remainder to be put into coaching, grass roots!
Because a lot of clubs, including us, couldn't cope with the sharp financial deficit on getting relegated from the Prem and ended up taking a second relegation within a year or two. The theory is that the parachute payments should make it a little easier for clubs to adjust to their new and unwanted status. I agree that the amounts now do seem excessive. But then, just about everything to do with money in the Premiership is excessive.
There is still a massive gulf between those teams receiving the parachute payments and the rest of the Championship though.
Absolutely, but as long as the Premiership clubs are on silly money there is going to be a massive gulf somewhere. The only question is, does it include the relegated clubs or doesn't it? In my pessimistic moments I can really see a future where a whole layer of clubs have been put out of business by the insatiable greed of football's "elite".
In my pessimistic moments I can really see a future where a whole layer of clubs have been put out of business by the insatiable greed of football's "elite".
Sooner or later there will be a European League where the top teams play each other and forget all about their national league systems.
In my pessimistic moments I can really see a future where a whole layer of clubs have been put out of business by the insatiable greed of football's "elite".
Sooner or later there will be a European League where the top teams play each other and forget all about their national league systems.
Comments
No point being a billionnaire owner of CAFC but not being able to throw money at it is there as no billionaire will be happy kicking about in the Champ.
I believe we have a t/o of about 9M per year, under FPP are allowed a loss of c 3M per year, which means total of 12M per year to play with. Relegated Prem clubs come down with say similar t/o but parachute money of 18M per year (for 4yrs now!!) on top plus should have better squads to start with too and if they have been sensible will have tier 1 acaemies producing and stealing the better players.
That is a pretty substantial gap to close and as I have said before, the sheer quantity of money in the PL (plus insufficiently punished bancruptcies) means more clubs (norwich, southampton, palace, wigan, reading to name a few) have no debts any more so less 'basket cases' heading down.
I genuinly worry that the PL will, in the next 2/3 years become a closed shop with relegated clubs going back up 75% of the time. In fact if CAFC don't go up this year I would want all 3 relegated clubs to go straight back up to remove them and their parachute money from next years championship competition!
It is what the PL would like and will sadly affect the competitivness of the Championship the most.
Hope I am wrong but we will find out soon enough.
companylawclub.co.uk/topics/fixed_and_floating_charges.shtml
The key point is that any fixed charge secured on assets needs to be registered so that the beneficiary can grab the asset in court before all the other creditors get a slice. The assets are clearly in UK domicile and part of the Baton group. So if there are no fixed charges then all loans must be floating charges on the business.
Also I am not a property developer but I suspect that the Valley is worth more alive than dead! That is as part of a football club with chances of a big payout in the Premier League. And this is where the poker game gets really clever...
All previous directors get paid out IF CAFC promoted - this is written into their arrangement... what if a future owner said the same thing? If you had lent £15M over two years into a club would you be prepared to hand the management and ownership across and be classed as a deferred creditor, i.e., would you trust the future owners to have the nous AND backing to make that final push ... without repeating the Pardew fiasco?
Or would you stay put until someone offers you hard cash for two years delivery / added value on the pitch?
I expect there are other options too re. funding but those are for another day...
Definitely reward teams with money, including relegated clubs...but 120m? Really?
The league wants FFP to come into play, whilst giving vast sums of money to clubs? Seems contradictory to me...
With all the tv revenue, simply have a set 20 amounts of figures which are given to each PL team. Remainder to be put into coaching, grass roots!
There is a conflict of interests between the leagues because they are run by separate bodies... even though all but the top six in the Premier League are under threat of relegation...
It is possible that after this season coming up, the only clubs who secure promotion to the Premier League will be ex-Premier League clubs with their financial muscle. Whoever wins the play-off final next time may become a permanent yo-yo club?
Having said that, last season no clubs bounced straight back and Wolves went down with Blackburn having a 'mare... funny ol' game innit?!
Richard Scudamore's solution is to say "... don't worry Guys, go out and compete for the best players in the world and offer them crazy four year deals.....If it all goes belly up we'll cushion the blow by paying you £15m a year".
Scudamore is only concerned about the Premier League and this strategy helps. He doesn't give a fig about the Champjonship which the parachute payments are turning into a very unlevel playing field.
Hope that makes sense.
Sooner or later there will be a European League where the top teams play each other and forget all about their national league systems.
Keep it competitive, but the money floating around is ludicrous, especially given the state of our national team, and national youth setup!