What's the use in always 'to this date'?
You do know that eventually the money will come out of United, and all those wads of cash wouldn't be with us only because of Glazers took over United and pushed our fortunes high. Is that a fair statement?
ALL issues relating to the bond issue and club finances
- Thread starter sammsky1
- Start date
- Status
What's the use in always 'to this date'?
You do know that eventually the money will come out of United, and all those wads of cash wouldn't be with us only because of Glazers took over United and pushed our fortunes high. Is that a fair statement?
Well no, I didnt know that
I just remembered interest payment talk from yesterday, maybe got it mixed up. Dunno. Anyway, the point's kinda the same.. They're costing the club money...
Also the PIK has to either be repaid at some point or refinanced?
I've no idea, it makes little sense.
The first part, "You do know that the money will eventually come out of United?" I can answer simply enough; no, we don't know that; we were previously assured with 100% certainty that it would have gone by now, but it hasn't, and we now know that the Glazers have been wheeling-and-dealing unbeknownst to everyone and bought back 20% of their own personal debt. The biggest surprise of Friday's accounts were that we don't know what's going on with the PIK's.
As for "And all those wads of cash wouldn't be with us only because of Glazers took over United and pushed our fortunes high" though; i have absolutely no idea what that means.
Well no, I didnt know that
I just remembered interest payment talk from yesterday, maybe got it mixed up. Dunno. Anyway, the point's kinda the same.. They're costing the club money...
Also the PIK has to either be repaid at some point or refinanced?
The debt's costing the club money, yes, but the huge increase in revenues is bringing more money in to negate that cost. The result? The club's doing alright. The debt's a concern, of course it is, but it's no reason to be running around screaming and waving your arms in the air à la Crerand or becoming all bitter, miserable and full of hatred for anything with a pulse à la fred; shit happens but we're doing ok; cheer-up, people!
Cider,
It's fair to say that we don't know how the 20% of PIK's are being handled. When the interest rate is 16.25%, which in filthy high, the Glazers haven't written it off, and the PIK values remain the same. You and I possibly can't know, if Glazers are still charging the 16.25% on the 20% and taking the interests for themselves. Seems stupid thing to do.
As for the point where I didn't make any sense, Glazers have come and have increased our revenues fairly well. They haven't been bad owners so far, (if you discount the ACS and ticket prices, even which might be justified), but we know that cash will be taken out of United at some point of time, as it's unfair to expect Glazers will pay the 700 odd Million out of their own pocket, coz after all, they 'bought' United and it's their property now.
And this money being taken out of United is not justified by this increase in revenue, coz it's fair enough to say that even the old PLC board would have taken it to the next level, coz we've been the best run club in England for the last 25 odd years.
Yes, I agree with that. At least to some extent.
And again, I dont think we're doomed because of the Glazers and I dont really care who owns or who makes money off United. But my impression is that most fans have a problem seeing United as a business and how someone, somehow, uses it to make money. So no matter how much you're right, you'll never convince those people.. The Glazers has put United in debt, and they did so to make money. It's like if someone kidnapped someone you cared for and held them for ransom.
I dunno. It's a lot of if's and but's, i guess we'll just have to wait and see.
As for the Glazers charging themselves interest on their own 20% of the PIK's though, yeah it sounds stupid because it is; they couldn't profit from giving themselves money and there's no way they could ever take out more than their restricted entitlements from the club, so i wouldn't worry about that if i were you.
Whilst I agree, all I'm saying is while it's not good to paint a doom and gloom picture, it's not correct to just ignore these valid issues coz currently no money hasn't been taken out of the club and there's no visibility for us.
As for Man Utd being too big club to go under, look at companies like Enron. We should definitely take middle ground, (not entirely MUST, but not GCHQ as well), and actively pursue alternative ownership models.
Unfortunately, MUST remains the only vocal option for the protestors and remain the only alternative for people who aren't comfortable with Glazers.
Maybe, we can start something which offers a good alternative.
Agreed. As SAF says though, there's always a bunch of fans who aren't happy with the owners, not just since 2005. I'm not trying to convince those people of anything, because as you say that would probably be impossible, i'm simply trying to show to others who might be reading this and are perhaps more open minded and less angry about everything that those people are mostly just full of hot-air and like to cause panic and give prophecies of doom because it helps them to justify their own bitterness and hatred.
I'm off to bed now. Night.
@fishfingers
I don't ignore the issues, i actually discuss them at great length. I just believe that an opinion born out of hatred is invariably a misguided one, and so personally instead try to seek out something a little more realistic.
When you start from a position of hatred for the Glazers then you deny yourself the ability to ever fully understand the situation because that hatred clouds everything you see. I think those who preach hatred are also preaching ignorance, and ignorance isn't really my cup of tea to be honest. It'll do us no good.
I don't ignore the issues, i actually discuss them at great length. I just believe that an opinion born out of hatred is invariably a misguided one, and so personally instead try to seek out something a little more realistic.
When you start from a position of hatred for the Glazers then you deny yourself the ability to ever fully understand the situation because that hatred clouds everything you see. I think those who preach hatred are also preaching ignorance, and ignorance isn't really my cup of tea to be honest. It'll do us no good.
So you think then, fred, that the owners would rather lose the club to the PIK holders and make feck all rather than sell the club, pay off the PIK holders and pocket hundreds of £millions in the process? And your reason for believing this nonsense is that something vaguely similar (but upon closer inspection completely different) is sort of kinda happening at Liverpool?
Ok, fred, i see you've really thought this through
The owners are doing EXACTLY that at Liverpool.
Rather than sell at a loss they are hanging on and are taking the risk that the banks will come in, take the club and sell it at even less than what they'd get for it now.
The banks have basically said whoever comes in with the first sensible bid will get the club. Had they sold it alot sooner ( and the interest was there, they just wouldnt negotiate on the price ) then the banks wouldnt be coming in next week to take over and they would have walked away with a bit of profit.
Why didnt they sell ? Because they are greedy cnuts who wanted more than the club was actually worth.. if that doesnt ring a bell then feck all will because go look at what the Glazers think the club is valued at. Way more than anyone else happens to think it is.
There is nothing to suggest that should they default on the PIKs they would go out to sell up. First and foremost they would sell what they could to get as much money together as they could, then if that doesnt work they'd put the club on the market, and I can promise you that if they cant get the kind of money they require then you would just get a Liverpool situation.
The Glazers will be watching very closely what happens at Liverpool because if the owners succeed in their legal challenge to block the sale, then that would make it even less likely that the Glazers would sell if they default.
The ONLY difference between us and the Liverpool situation is that we don't have to pay back the money just yet. They do.
Come the time when the banks start coming knocking on the door, then the fun really starts. Why do you suppose the Glazers keep changing the financing arrangements. Not because it suits them but because it keeps the banks away for a little bit longer. They arent actually clearing off the debts, just delaying the point at which the banks says enough is enough.
Ahem. I beg to differ actually but carry on. I hate to interupt a great story.
hmmm yeah ok, fred.
I'm sure it was mentioned at some point over the last few days but when do we get the financials that give us an idea of the state of play with the PIKs, does anyone know?
January probably (that's when RFJV's 2008/09 accounts were published)
Cheers, anders.
Will no doubt be more bad news for the football fans of Manchester United.
Yet they were correct. The Glazers had to refinance. It wasn't scaremongering, just accept it.
Tangent much?
I think you need to consider where some people are now watching the on the pitch happenings from.
Have you protested about the absurd price rises and the ACS then?
Yep, they were going off David Gill's own suggestion that the original Glazer plan was too aggressive. Then later you had the finance documents that they got sight of, fuelling the "f*cked in 3 years" comments.
[QUOTEI also believe in trying to be truthful and honest with people at all times. I have been accused of dishonesty with my arguments on here (intellectual dishonesty) but I do at least try to be honest and I do at least try to stick with the known facts unless it is a matter of opinion that we are discussing.[/QUOTE]
The general perception on here isn't that you're dishonest, but that your arrogant, dismissive and patronising. Datura, redjazz and others put up relevant points that you dismiss as trivial when they have far more significance than you give credit for. You refuse to budge on your stance and that's what disappoints people.
Something that can equally be levelled at GCHQ et al.
Unfortunately, I see that as self-defeating. Why give their business plan to the Glazers? When have the Glazers ever addressed United fans to allay concerns about the debt or why they need to increase ticket prices, or the imposition of the ACS?
The costs would be recovered from the losing side, as per usual in a court case like this.
Sorry guys you can post all you like, nothing is going to change my view that the Glazers are bad news for Manchester United.
I'm quite shocked at the lengths some will go too defend those scumbags.
I'm quite shocked at the lengths some will go too defend those scumbags.
Absolutely. It's incredible how anyone can stick up for them.
If Fergie wasn't here, we would be seriously fecked.
Personally, I certainly wish the Glazers had never taken over, and would love them to be bought out by anyone that could get rid of the debts (not much chance of that if Liverpool can't even get a sugar-daddy type owner at their low price though).
My fundamental disagreement is with those that say that the answer to United's troubles is to boycott the club. Just can't get on board with that. There's a nihilistic attitude that pisses me off.
I want United to win CLs (or at least always qualify for the latter stages of them) and get that debt paid down. If someone can buy out the Glazers in the meantime then fantastic. But the Liverpool situation tells me that it is just not going to happen anytime soon.
I wouldn't have such a big issue with the Glazers as owners if the debts were gone. I'm under no illusions that football club owners through the ages have all been altruistic people. They've generally been in it for the power, the fame and the money.
You wont find one amongst us who doesn't wish that we'd never been made an LBO in the first place. In that respect, yes the Glazers are bad news, and i doubt anyone would expect you to change your mind on that.
Surely you see that 'bad news' can be of various levels of severity though, right? News of your house blowing-up the day after your insurance ran-out, for example, would be worse news than would news that somebody's drawn a cock on your garage door.
The effect the Glazers have on United has always been grossly exaggerated. We've been given an impression of a club on its knees, but the reality is far less dramatic.
That's all we hope you can understand.
If you're not read to accept that either though, well, nevermind; i'm not sure it really matters what any of us think anyway; the chances of the Glazers selling the club look microscopic. We'll all get to see over the coming years exactly how fecked United is... 'Not fecked at all really' would be my guess.
I could never boycott the club. I've been there before those cnuts and I'll be there when they're long gone.
But the damage they have done is unthinkable. They have ripped the soul out of the club. That is unforgivable.
No hatred here- follow the money!
When the bastards have bought up all the PIK's for themselves and are charging you 16.5% interest on the side we'll check back and see how you are doing.
They've increased the value of the club significantly, Fred. That's where you keep going wrong. What matters to the Glazers is the profit they make on their initial £270m equity investment and the value of that equity.
Reducing debt was never part of the plan. The plan was always to significantly increase revenues and most importantly EBITDA/cash inflow from operating activities, service the debt by meeting interest payments, and then use the free cashflow for capital expenditure on players/facilities in order to sustain future growth.
The team and squad is not weaker/smaller than when they took over. That's nonsense. Staff costs are now £50m pa higher than when they took over.
If they sold the club tomorrow for £1.25bn (realistic valuation) then they'd make a c. £350m-£400m profit on their original £270m equity investment. That would be over a five year period. I'm not sure about you but I like the sound of that return on investment.
Isn't 8.5x EBITDA an oft-quoted valuation for a business though, GCHQ? Obviously that would be why the Glazers aren't selling - there's no point paying expected value if they don't feel it's worth their while so that's perfectly understandable.
Please could you also clarify, which of the figures that take the club from a £100m EBITDA profit to an £83m accounting loss involve money leaving the club? Thanks.
Please could you also clarify, which of the figures that take the club from a £100m EBITDA profit to an £83m accounting loss involve money leaving the club? Thanks.
Well, as you've been told dozens of times, the Glazers charging themselves 16.5% interest on any portion of the PIK notes will neither cost the club a penny nor make a penny profit for them.
If you still can't understand this then perhaps you should re-read the three or four pages in this thread that we spent tirelessly explaining it to you over and over again.
Until then i suggest you find something else to feed your boring wums, because this one's shit.
Yup, and when you combine the increases in revenue with the tax savings and dividends which would have been paid out under the PLC model, then the overall effect to the club itself in cash terms is actually pretty insignificant.
And with commercial revenue growing at an ever increasing rate, the more inclined I'm going to be to start arguing that the Glazers ownership model hasn't actually cost the club a penny.
No. I won't accept it. Refinancing is not an admission or indication of failure. It is the sensible thing to do in certain circumstances and was probably their plan all along.
Whichever way you look at it, I think the early days, whilst awash with easy-to-obtain credit, were the dodgy days for the Glazers and a fair bit of wheeling and dealing was required to squeeze them through it. The next period should have been a little easier but then the world had to go and have a recession and the banks got all miserly which wouldn't have made things any easier for the Glazers.
But the Glazers have steered a way through all this mess and now appear to be in a pretty strong position.
I know some people like to use the word "luck" at this juncture but if this is the kind of luck that rubs off on them then it can't be all bad, can it?
No just pointing out that it hasn't been easy to run a business for anyone over the last few years, particularly one heavily reliant on credit. It's called context.
OK. I'm getting a bit tired of these two points now.
Ticket rises & ACS.
How much mileage do you think you can get out of the same old arguments?
Yes, the tickets went up. By all accounts they were going up in the first year of the Glazers' tenure anyway because it was a rise agreed by the PLC. Maybe this was the start of a "let's see what happens" thing by the PLC? Who knows if they would have increased them again the next year and again and again?
I love how every other pound of revenue that the Glazers have brought into the club is dismissed with, "The PLC would have done that" but ticket price increases. Oh no. They wouldn't have done that.
What we will never know is if they would have put them up by as much (or maybe even more) as the Glazers did but I think that it is fair to say that the difference between what they are now and what they would have been had the Glazers not taken over is not quite the enormous sum of money many are making it out to be.
I reckon we might be talking £100-150/year difference for some season tickets.
As for the ACS. Yes. Bad idea by the Glazers but I can understand why they did it. However, why would you not want to go to the Cup games if you want to go to all the League games?
If we get to a CL Semi against Real Madrid this season, people will beg, steal or borrow the funds and some will probably end up paying over the odds. The ACS means that ST holders don't have to worry about this, they will have their tickets.
On top of that, the ACS generally only gets prohibitively expensive if the team does well which leaves the whole argument in a weird situation.
What would you rather have?
I've said it before and I'll say it again. Ticket prices are expensive across the board. It is not something peculiar to Manchester United but we have to compete. Chelsea have a billionaire owner who brought no debts but many of their fans have found themselves priced out by the ticket price hikes down there, too. What does this tell you?
The shit I have to take from some people because of my views means that I have to stand up to them or stand down. Maybe it's my Mancunian blood but the idea of standing down has never really appealled to me.
I may well come across as arrogant but I don't think I have ever said, "I'm right, you're wrong and that's that". I put across my view forcefully and with conviction because it is a view I believe strongly in.
Redjazz and I have a bit of history from the newbs because we didn't exactly get off on the best footing. However, I don't think I have ever dismissed anything he has said as "trivial". He is another one though who was attempting to show me how little we have left for player transfers after the £70m carve out and then yearly £25m dividend and £6m management fees that we would be seeing.
I never dismissed this as "trivial" but I think I can now dismiss it as "bollocks".
My refusal to budge on my stance disappoints people? Wtf? I'm the only one "guilty" of that around here, am I?
If certain things were to happen then I would change my stance on the Glazers but they have NOT happened as yet. I can see all the bad stuff but I can also see all the good stuff and it is my view that, on balance and given the fact that the ideal situation is impossible, what we have is a decent set-up which is working well and if it ain't broke... well, there would be no guarantees whatsoever that a change would be better anyway.
Fergie seems happy, the players seem happy, despite the ticket increases, if we weren't privy to the financials then I believe a lot more fans would be happy too. Watching United over the last few years hasn't been cheap but what price seeing your team lift three PLs, one CL, two CCs and the World Club Cup?
For heaven's sake, of course it was scaremongering!
The Glazers were always going to refinance what was by its very definition short-term borrowing post-takeover.
And yet nobody from MUST thought it would be worth informing Manchester United supporters that the initial debt would be refinanced shortly after the takeover?
I think deep down we all know why that was.
No, 8.5x EBITDA isn't an oft quoted valuation for a business. Not sure where you've got that from.
12.5x EBITDA is perfectly conservative in the football industry, especially for a club like Manchester United with its brand value, proven ability to generate cash and vast potential for growth. If you look at recent share purchases over at Arsenal then you'll note that they fall almost exactly in line with that 12.5x EBITDA calculation.
I'm not going through the accounting items again to be honest. Just read back through the thread a little bit.
No it wasn't. It was a snapshot fact based on the evidence at hand, now well-outdated and an easy target for your 20/20 hindsight management skills.
Snapshot fact my arse. MUST knew exactly what they were doing when they stated that the Glazers would be forced to sell the club within three years due to a failure of their business plan, without mentioning that that the Glazers would attempt (successfully) to refinance the initial debt.
It was bullshit and it was propaganda. It was MUST to a tee.
They may have refinanced but have blown an obscene amount of money doing it money that could have been invested in the club structure. Red football is more important than Manchester United football club and there will be a penalty to pay in terms of Manchester United staying at the top of European football. Don't reply we have a huge amount of cash in the bank you and I both know what its eventual purpose will be and it wont be spent on the club. As I stated earlier it looks like we are stuck with the bloodsuckers and if that is the case perhaps seeking an accommodation with MUST instead of disrespecting them would be a good move for all involved. Personally I can't wait for the day their greed is satisfied with an offer they can't refuse
Debt is the road to ruin, anyone?
Didn't David Gill say that pre Glazer?
yeah i guess even Gill can get some things wrong.And bearing in mind that I have a hard enough time keeping and understanding my finances, let alone that of a football club ...How much of the windfall we are experiencing, as far as commercial generated income, do you think is a result of the marketing and business savvy of the Glazers and their ownership?
Might it be a possibility that given the increase in global interests in the sport, that the increase in commercial revenue is a net result of that? Has this ownership hit on a money making phoenomina that only they could have thought of in the last five years, or is it possible that we could have had, under different ownership, also seen increases in these revenue streams?
If under different circumstances, say, ones that didn't involve being saddled with this amount of debt that needs serviced, couldn't this commercial revenue be used to invest in ways that show actual benefit to the club, and not just to offset the loss from all these "one-off" fees?
Could it not be argued that these owners are indeed costing us a penny, or to be more precise, costing us all the pennys it's going to take to pay down the debt they have saddle the club with?
In a "if my auntie had bollocks she'd be my uncle", kind of way, you mean?
The most important thing to remember is this: The club was for sale for the best part of 15 years. Anyone could have come along and made all this money but nobody but the Glazers did.
If all this was such a "no brainer" kind of thing that anyone could have done, why wasn't there a queue of people clamouring to take over Manchester United and mine that gold?
What we do know about the Glazers is that they take this area extremely seriously and view it as key to their overall strategy. To this end, they have set up dedicated offices in London in 2008 with the specific job of pursuing commercial deals.
The Glazers aren't super-human and it could well be that they are only doing what others could do but there is a world of difference between actually doing and saying "I could have done that".
In my head, I have invented the toaster, the wheel and Pizza flavoured Pringles. No one sends me any money from these things though.
- Status