leave off Reams, hes not as accurate as he thinks but he has contacts and does get some things right. People forgetting he gave out info about Harris before anyone else
That article on VOTVonline started to give me a headache ... imagine the finer details... for me this is clearly the issue that is stalling all the progress, it all looks good then a very complex series of renegotiations is required not to pay out what is essentially another X million on top of the asking price...
Hmmm ... lets hope this belgium is savvy enough to have it all in place, get his team to do thee negotiating ... and get something over the line...
That article on VOTVonline started to give me a headache ... imagine the finer details... for me this is clearly the issue that is stalling all the progress, it all looks good then a very complex series of renegotiations is required not to pay out what is essentially another X million on top of the asking price...
Hmmm ... lets hope this belgium is savvy enough to have it all in place, get his team to do thee negotiating ... and get something over the line...
It's both positive and negative that all the obstacles can be overcome financially in the end. Nobody has a veto but the price can potentially go up. I can see why if someone believes they have agreed a deal at £x they might then only be willing to pay £y if they suddenly discover they've got to pay £z to a third party as well. Or it just gets bogged down in extra negotiations with the third party to try to avoid that.
Ultimately, though, it has to happen so I believe it will. I am not pessimistic about the final outcome, I just wanted to show why it isn't as straightforward as two parties shaking hands in a room. Read it at www.votvonline.com.
That article on VOTVonline started to give me a headache ... imagine the finer details... for me this is clearly the issue that is stalling all the progress, it all looks good then a very complex series of renegotiations is required not to pay out what is essentially another X million on top of the asking price...
Hmmm ... lets hope this belgium is savvy enough to have it all in place, get his team to do thee negotiating ... and get something over the line...
It's both positive and negative that all the obstacles can be overcome financially in the end. Nobody has a veto but the price can potentially go up. I can see why if someone believes they have agreed a deal at £x they might then only be willing to pay £y if they suddenly discover they've got to pay £z to a third party as well. Or it just gets bogged down in extra negotiations with the third party to try to avoid that.
Ultimately, though, it has to happen so I believe it will. I am not pessimistic about the final outcome, I just wanted to show why it isn't as straightforward as two parties shaking hands in a room. Read it at www.votvonline.com.
The article on votvonline is very interesting and does seem to explain why negotiations to sell the Club might be very messy. The following is key;
"However, the due diligence report confirms that “the loan agreement states that should there be a change in control, that Club (sic) will be required to repay the loans immediately in full.
In practice, this means Murray and the former directors have the right to receive their money back at the point of takeover, even though they would never get it back if the club is not promoted under the current owners."
The key consequence of this situation is, potentially, that a Buyer would need to find around £13m (£8m due to the former Directors, circa £5m to the two Banks) before the Owners get any of their £20m or so back.
Even if the former Directors, as fans, might be inclined to be flexible in order to achieve a sale (in any event, their money is gone if the Club folds) they may well take the view that they should rank pari passu with the loans injected by the Owners. If so, then for the Owners to receive £10m (and hence lose £10m), for example, a Buyer would need to stump up close to £23m. It's not hard to imagine the irritation this situation would cause Cash, Jimenez et al!!!
However, there is something very odd about this. When Richard Murray consolidated the ownership of the Club under Baton 2010 he did so with the explicit intention of selling the Club on to a new Owner, arguing that a simpler ownership structure would facilitate a sale and giving himself until the end of the season (2010/11) to complete a transaction.
To achieve this he obviously needed to cut a deal with all those invested and the idea of deferring payment of loans until promotion to the Premier League (when that would be affordable) appeared very elegant. It's extraordinary, therefore, that he'd have agreed to a change of control provision that would complicate the very sale he simply had to complete to save the Club. Extraordinary. Perhaps the former Directors were much more robust in their negotiations than appeared to be the case at the time?
Following this logic, perhaps Murray had a gentleman's agreement which said that provided he took no money out when he passed the Baton on, the former Directors would reschedule too? Either way, that would appear to be the way it worked, but I'll bet Cash is seriously pissed off he didn't anticipate the current scenario. If Airman is right, the former Directors, including Murray, have him by the unmentionables.
I'm sure somebody will correct me if I have this wrong.
I have wondered for a while if this was the sticking point. If true you can see it two ways, i prefer the second:
a) Murrey and co are holding up the sale by being unreasonable in their demands. Their money is, in reality lost if they stick with the current owners. The reason they did the deal in the first place was because they were potless and had had made bad decisions, as such they should do the honourable thing and do a soft deal on their part to let any wider deal go through.
b) Murrey (whether on purpose or not) has pulled out a masterstroke, as, whilst he has not always made the best decisions in his tenure he has always (IMO) made them with the best interests of CAFC at heart. As such with, effectively a "blocking" vote (unless someone wants to buy him out at par) then he can, to an extent, block the club being sold to someone he does not feel is the right person.
Couple of other points worth mentioning;
1. The Training Ground - If there is any doubt as to who owns this, why does someone not just spend £4 and do a Land Regsitry Search - would put the question to bed once and for all.
2. If the take over does not happen, why does one of the many sleuths on here not get in touch with http://www.icij.org/ who in March did a huge investigation/leak about a whole load of BVI companies and see if they have any info they can share on the current owners.
It's a complex position, but there's a few things on the Voice article which need clarifying, if possible.
“the loan agreement states that should there be a change in control, that Club (sic) will be required to repay the loans immediately in full”.
I can't imagine that there is a single loan agreement that covers Lombard and the Directors. Possible that the former directors agreed a single document, but not the Bank on a completely separate loan. So...do both have the same Material Adverse Change (MAC) clause? Quite possible, as any lender would expect to be able to, quite rightly, review their position in the event of any MAC.
I do agree that Lombard, as part of a strategy at RBS, could look to recover their loan or, at the very least, demand that it is re-structured on an amortising basis (and probably an increased rate/fee if they really want out and try to force it).
"A more formidable obstacle still is potentially posed by the banks. The HSBC loan is underwritten by Murray..."
I can't see any mention of a HSBC loan. There is an £800K overdraft facility, which would not have a MAC clause, but which would though be on-demand. Potentially some leeway if Murray continues to guarantee it.
Given commentary on payment of wages in recent months, it's not unreasonable to think that the overdraft is pretty much fully utilised, so it may well be a further £800K required. If, as suggested, Murray is keen to retain his 10%, then this could ensure this facility is retained.
"Lombard may, of course, equally take the view that the incoming owners represent lower counterparty risk than the current regime, which is clearly short of cash. But their attitude cannot be taken for granted."
A very good point. I would expect any incoming owner though to have established banking relationships and if they were in a position to re-finance this loan with their own bank that would be a positive sign.
As AB says...complicated, but certainly not impossible.
It seems a typically good analysis from AB of what the problems COULD be, backed up with detail and facts.
We don't know if any or all of these are issues or holding up the deal. In fact, we don't know if the deal has been held up. It could be that it is going to schedule, a schedule which takes into account having to get the bank and the ex-directors sorted.
There was an assumption that a statement on the OS meant a completed deal within hours but that was never the case or even likely.
My guess it that when it is announced on the OS as complete then it will be complete.
Comments
Happy new year to all you depressives.
Hmmm ... lets hope this belgium is savvy enough to have it all in place, get his team to do thee negotiating ... and get something over the line...
:-)
Ultimately, though, it has to happen so I believe it will. I am not pessimistic about the final outcome, I just wanted to show why it isn't as straightforward as two parties shaking hands in a room. Read it at www.votvonline.com.
Oh well I still suspect your right and that we will soon be told of the news we are waiting for
"However, the due diligence report confirms that “the loan agreement states that should there be a change in control, that Club (sic) will be required to repay the loans immediately in full.
In practice, this means Murray and the former directors have the right to receive their money back at the point of takeover, even though they would never get it back if the club is not promoted under the current owners."
The key consequence of this situation is, potentially, that a Buyer would need to find around £13m (£8m due to the former Directors, circa £5m to the two Banks) before the Owners get any of their £20m or so back.
Even if the former Directors, as fans, might be inclined to be flexible in order to achieve a sale (in any event, their money is gone if the Club folds) they may well take the view that they should rank pari passu with the loans injected by the Owners. If so, then for the Owners to receive £10m (and hence lose £10m), for example, a Buyer would need to stump up close to £23m. It's not hard to imagine the irritation this situation would cause Cash, Jimenez et al!!!
However, there is something very odd about this. When Richard Murray consolidated the ownership of the Club under Baton 2010 he did so with the explicit intention of selling the Club on to a new Owner, arguing that a simpler ownership structure would facilitate a sale and giving himself until the end of the season (2010/11) to complete a transaction.
To achieve this he obviously needed to cut a deal with all those invested and the idea of deferring payment of loans until promotion to the Premier League (when that would be affordable) appeared very elegant. It's extraordinary, therefore, that he'd have agreed to a change of control provision that would complicate the very sale he simply had to complete to save the Club. Extraordinary. Perhaps the former Directors were much more robust in their negotiations than appeared to be the case at the time?
Following this logic, perhaps Murray had a gentleman's agreement which said that provided he took no money out when he passed the Baton on, the former Directors would reschedule too? Either way, that would appear to be the way it worked, but I'll bet Cash is seriously pissed off he didn't anticipate the current scenario. If Airman is right, the former Directors, including Murray, have him by the unmentionables.
I'm sure somebody will correct me if I have this wrong.
a) Murrey and co are holding up the sale by being unreasonable in their demands. Their money is, in reality lost if they stick with the current owners. The reason they did the deal in the first place was because they were potless and had had made bad decisions, as such they should do the honourable thing and do a soft deal on their part to let any wider deal go through.
b) Murrey (whether on purpose or not) has pulled out a masterstroke, as, whilst he has not always made the best decisions in his tenure he has always (IMO) made them with the best interests of CAFC at heart. As such with, effectively a "blocking" vote (unless someone wants to buy him out at par) then he can, to an extent, block the club being sold to someone he does not feel is the right person.
Couple of other points worth mentioning;
1. The Training Ground - If there is any doubt as to who owns this, why does someone not just spend £4 and do a Land Regsitry Search - would put the question to bed once and for all.
2. If the take over does not happen, why does one of the many sleuths on here not get in touch with http://www.icij.org/ who in March did a huge investigation/leak about a whole load of BVI companies and see if they have any info they can share on the current owners.
“the loan agreement states that should there be a change in control, that Club (sic) will be required to repay the loans immediately in full”.
I can't imagine that there is a single loan agreement that covers Lombard and the Directors. Possible that the former directors agreed a single document, but not the Bank on a completely separate loan. So...do both have the same Material Adverse Change (MAC) clause? Quite possible, as any lender would expect to be able to, quite rightly, review their position in the event of any MAC.
I do agree that Lombard, as part of a strategy at RBS, could look to recover their loan or, at the very least, demand that it is re-structured on an amortising basis (and probably an increased rate/fee if they really want out and try to force it).
"A more formidable obstacle still is potentially posed by the banks. The HSBC loan is underwritten by Murray..."
I can't see any mention of a HSBC loan. There is an £800K overdraft facility, which would not have a MAC clause, but which would though be on-demand. Potentially some leeway if Murray continues to guarantee it.
Given commentary on payment of wages in recent months, it's not unreasonable to think that the overdraft is pretty much fully utilised, so it may well be a further £800K required. If, as suggested, Murray is keen to retain his 10%, then this could ensure this facility is retained.
"Lombard may, of course, equally take the view that the incoming owners represent lower counterparty risk than the current regime, which is clearly short of cash. But their attitude cannot be taken for granted."
A very good point. I would expect any incoming owner though to have established banking relationships and if they were in a position to re-finance this loan with their own bank that would be a positive sign.
As AB says...complicated, but certainly not impossible.
We don't know if any or all of these are issues or holding up the deal. In fact, we don't know if the deal has been held up. It could be that it is going to schedule, a schedule which takes into account having to get the bank and the ex-directors sorted.
There was an assumption that a statement on the OS meant a completed deal within hours but that was never the case or even likely.
My guess it that when it is announced on the OS as complete then it will be complete.