ALL issues relating to the bond issue and club finances

[Rood]

A1Dan - you obviously havent followed the discussion or understood the positions of the various people involved here. If you had then you wouldnt be making such statements. Im not really sure how else to explain it to you so if you havent understood the point yet then I guess you never will.

Andersred himself accepts that he was completely wrong, yet you dont accept it? Bizarre.

 

[Rood]

Whats stopping Red Football JV selling their interest in Red Football (which owns MU) for a nominal sum?

Not really sure what exactly you are asking here?

 

[Commadus]

Not really sure what exactly you are asking here?

Red Football JV owns all the shares in Red Football

Red Football own Manchester United assets - ground, brand, etc..

The PIK is on the books of Red Football JV

What if Red Football JV sells its shares in Red Football for say £1m to Red Football JV2 (also owned by the glazers)

Now Red Football JV has £1m in the bank but no shares and the PIk is secured against that. Let Red Football JV go bankrupt and walk away?

 

[ciderman9000000]

There are two things wrong with that, as has been repeatedly pionted out in this thread:

1) Most people on both sides thought it was likely they would take out the dividend to pay the PIKs. Apologies if you were a lone voice saying it wouldn't happen, but if you're giong to gloat, then at least include GCHQ etc in your list of people who "have been proven to be completely wrong".

2) As I've been pointing out to GCHQ, who I think finally accepted the point, without knowing where the money has come from, there's no evidence that anybody has been proved right or wrong.
If they have simply refinanced on slightly more favourable terms, then that is a long way from "paying off the debt", and in terms of the question of whether they might draw the dividend to pay debt down, we're in pretty much the same place as we were. Moving the debt around was obviously always an option, but doesn't change anything in terms of whetehr and how they can afford to pay it off.
If you can show that they have used their own capital to pay off the PIKs, then you are right, but whenever anybody suggests that we find out how teh PIKs were repaid they get told to mind their own business, so we are left in the dark unfortunately.

Well that's bollocks. Many of us, most prominently GCHQ, have always said that, though it looked likely that some portion of the PIK's would be paid using the club's money (personally I have been saying for ages now that the Glazers would never take any more than the carve-out, that to use the club's money to any greater extent would be wholly counter-productive), there could quite possibly be other options available to the owners that we don't know about. TMRD for one has always said that we shouldn't underestimate the Glazers' personal wealth, that if they want to find money from somewhere then they'll likely have little difficulty doing so. None of us have ever believed that the owners would drain United of cash to pay off their personal debt, only anders believed this and made his lofty calls to boycott on the strength of his predictions; and far too many fell for it and let themselves become convinced that the Glazers wanted to harm the club to pay off their debt, wholly in spite of our repeated and very vocal protestations against this ridiculous notion. So don't try telling us that we all got it wrong. feck off.

 

[ciderman9000000]

Red Football JV owns all the shares in Red Football

Red Football own Manchester United assets - ground, brand, etc..

The PIK is on the books of Red Football JV

What if Red Football JV sells its shares in Red Football for say £1m to Red Football JV2 (also owned by the glazers)

Now Red Football JV has £1m in the bank but no shares and the PIk is secured against that. Let Red Football JV go bankrupt and walk away?

They wouldn't be allowed to sell any shares that are used as security. Are you suggesting that they might enacted some kind of crap scam in order to pay the PIK's?

 

[Rood]

They wouldn't be allowed to sell any shares that are used as security. Are you suggesting that they might enacted some kind of crap scam in order to pay the PIK's?

Exactly - I have no idea where Commadus is going with that.

 

[anver]

A1Dan - you obviously havent followed the discussion or understood the positions of the various people involved here. If you had then you wouldnt be making such statements. Im not really sure how else to explain it to you so if you havent understood the point yet then I guess you never will.

Andersred himself accepts that he was completely wrong, yet you dont accept it? Bizarre.

Rood, Andersred said he was wrong when he stressed that the Glazers would only be able to pay off the PIKs with money from the club. And everyone accepts that the club money was not touched to pay off that loan.

We all know the PIKs have been paid off by raising another loan, or by selling a Glazer asset. But the question is how exactly was it paid off? If it was another loan, then the status quo stands, because the owner's private debt will eventually reflect on the club's assets. So, the debt remains.

Nothing will be clear until the next quarterly returns are published.

 

[Commadus]

Exactly - I have no idea where Commadus is going with that.

I made the point in a roundabout way to express what you wrote below with some scepticism.

There is a big difference between having security over physical assets (Old Trafford etc) as opposed to security on the shares of a company (RFJV).

You disagreed with Pete but the point is the PIK is secured on the assets of Red Football via share ownership.

 

[Rood]

Rood, Andersred said he was wrong when he stressed that the Glazers would only be able to pay off the PIKs with money from the club. And everyone accepts that the club money was not touched to pay off that loan.

We all know the PIKs have been paid off by raising another loan, or by selling a Glazer asset. But the question is how exactly was it paid off? If it was another loan, then the status quo stands, because the owner's private debt will eventually reflect on the club's assets. So, the debt remains.

Nothing will be clear until the next quarterly returns are published.

I dont disagree with much you have said there. However you must accept the fact that the Glazers have now set a precedent that they will not be using cash from the club to pay off their personal debts - this is the important point.


Also there are others options for sources of repayment:
1) that they paid it off with their own cash (I have always said to andersred that he has no idea about their personal finances and investments)
2) swapped debt for equity in the club (Glazers have officially denied this)

BTW I doubt the next 1/4ly results will shed any light on this.

 

[Commadus]

I dont disagree with much you have said there. However you must accept the fact that the Glazers have now set a precedent that they will not be using cash from the club to pay off their personal debts - this is the important point.


Also there are others options for sources of repayment:
1) that they paid it off with their own cash (I have always said to andersred that he has no idea about their personal finances and investments)
2) swapped debt for equity in the club (Glazers have officially denied this)

You need to step back. Manchester United is the Glazers property and they can use it to whatever means they like = something I have no issue with. They could pay the PIks off with profits from United - it's their money.

My only disagreement was not with the Glazers as much as they whole concept of debt fuelled buyouts.

It's why the whole MUST / Red Knights issues was a non starter for me - they would still use debt.

 

[Rood]

I made the point in a roundabout way to express what you wrote below with some scepticism.



You disagreed with Pete but the point is the PIK is secured on the assets of Red Football via share ownership.

Yes but your 'roundabout' point is wrong as what you suggested is not possible!

So my original point remains.

 

[Commadus]

Yes but your 'roundabout' point is wrong as what you suggested is not possible!

So my original point remains.

Yes I know its not possible thats why I amde the point to get it into your head you are wrong.

There is a big difference between having security over physical assets (Old Trafford etc) as opposed to security on the shares of a company (RFJV).

As Pete pointed out. What is the difference?

Red Football JV can't just sell the shares in Red Football. You agree.

The PIK are secured on the share ownership in Red Football which is backed by the assets.

You are wrong.

 

[Transfer United Till I Die]

Exactly - I have no idea where Commadus is going with that.

To another of the glazers malls to critically assess footfall, occupancyl and future revenue?

 

[Rood]

As Pete pointed out. What is the difference?

I've already explained the difference and nothing you have said affects that!

If there is no difference then why do the PIK holders expect double the amount of interest than a Bond holder? The answer is because it is a completely different level of security

The real difference in practical terms is about what default on those loans means for the club - in my eyes, if there is default on the senior debt then it is bad for the club as assets may in theory need to be liquidated to pay off the debts.. But if there is default on the Glazer personal debt then it is only they who lose out (by losing their own shares), not the club.

This distinction is vital.

 

[ciderman9000000]

Yes I know its not possible thats why I amde the point to get it into your head you are wrong.



As Pete pointed out. What is the difference?

Red Football JV can't just sell the shares in Red Football. You agree.

The PIK are secured on the share ownership in Red Football which is backed by the assets.

You are wrong.

Are you saying that the owners could not have raised the money by selling a portion of the club because the PIK notes were secured on those shares? I'm not sure myself on this, but if the investor was given assurances that his cash would be used to write-off the PIK's and thus free the club's shares from the secured loans then I don't see how it would pose a problem. Perhaps i've missed your point.

 

[Commadus]

I've already explained the difference and nothing you have said affects that!

If there is no difference then why do the PIK holders expect double the amount of interest than a Bond holder? The answer is because it is a completely different level of security

The real difference in practical terms is about what default on those loans means for the club - in my eyes, if there is default on the senior debt then it is bad for the club as assets may in theory need to be liquidated to pay off the debts.. But if there is default on the Glazer personal debt then it is only they who lose out (by losing their own shares), not the club.

This distinction is vital.

The way I see it is if the PIK is defaulted the right of title of those shares passes to the PIk holders. If the club defaults then the right of title of the assets passes over to the Bond holders. Anyone who owns the shares has claim on the assets.

Complicating this with the club, Glazers, or in your eyes really means little. Yes I know the PIK holders can demand a higher rate of interest as the PIK was a quasi debt/equity which could be rolled up and had higher risk attached to it.

 

[Rood]

The way I see it is if the PIK is defaulted the right of title of those shares passes to the PIk holders. If the club defaults then the right of title of the assets passes over to the Bond holders. Anyone who owns the shares has claim on the assets.

Complicating this with the club, Glazers, or in your eyes really means little. Yes I know the PIK holders can demand a higher rate of interest as the PIK was a quasi debt/equity which could be rolled up and had higher risk attached to it.

Yes but their claim is secondary to that of the Bond holders who have the first charge - that is the vital difference.

And as I said, the only thing I really care about is what ramifications any default would have for the club - a default on the PIK (or any replacement of it) would result in the Glazers losing their shares in the club. In fact, it is quite ironic that many strong antiGlazers worry about the PIK, when it could have been the best way to get rid of them!

 

[Sir A1ex]

A1Dan - you obviously havent followed the discussion or understood the positions of the various people involved here. If you had then you wouldnt be making such statements. Im not really sure how else to explain it to you so if you havent understood the point yet then I guess you never will.

Andersred himself accepts that he was completely wrong, yet you dont accept it? Bizarre.

It's you who either doesn't or pretends not to understand.

Anders was indeed wrong in is literal assertion that the PIKs could not be paid off by any other means - he failed to take into account the fact that they could be swapped for debt by another name. And he has admitted this.

But while he was technically wrong in that sense, the spirit of the point he was making has not been disproven at all.

Humour me for a minute in my shocking ignorance and explain how the Glazers' ability to repay the PIKs from their own purse has been proved, as opposed to just their ability to find a slightly cheaper loan?

 

[Dr. Dwayne]

Because they are now powerless to do anything. This is about trying to effect change, not trying to apportion blame.

If the Glazers fecked off tomorrow, then I wouldn't sit around whinging and blaming them for any residual problems, I would happily never think of them again.

Powerless? They fcuked off the club at the first sign of a good ROI. I reckon they're culpable for some of this.

Effecting change? You have got to be taking those MUST emails literally. The Glazers have proved these last five years they don't give a fig about the fans.

Yeah, it's nothing to do with the ticket price increases, ACS etc..

Still cheaper than Arsenal...and we win trophies. Don't let things like inflation cloud your judgment.

 

[Sir A1ex]

Powerless?

Yes... What power do you suggest they now have to change things?

 

[datura]

Still cheaper than Arsenal...and we win trophies. Don't let things like inflation cloud your judgment.

That's not the point, but then it doesn't affect you so why should you care?

 

[Sir A1ex]

So don't try telling us that we all got it wrong. feck off.

Toys back in pram, cider. You'll excuse me if I don't continue this conversation until you've remembered how to have a civilised debate.

 

[ciderman9000000]

Toys back in pram, cider. You'll excuse me if I don't continue this conversation until you've remembered how to have a civilised debate.

No reply. Thought as much.

 

[GCHQ]

There are two things wrong with that, as has been repeatedly pionted out in this thread:

1) Most people on both sides thought it was likely they would take out the dividend to pay the PIKs. Apologies if you were a lone voice saying it wouldn't happen, but if you're giong to gloat, then at least include GCHQ etc in your list of people who "have been proven to be completely wrong".

2) As I've been pointing out to GCHQ, who I think finally accepted the point, without knowing where the money has come from, there's no evidence that anybody has been proved right or wrong.
If they have simply refinanced on slightly more favourable terms, then that is a long way from "paying off the debt", and in terms of the question of whether they might draw the dividend to pay debt down, we're in pretty much the same place as we were. Moving the debt around was obviously always an option, but doesn't change anything in terms of whetehr and how they can afford to pay it off.
If you can show that they have used their own capital to pay off the PIKs, then you are right, but whenever anybody suggests that we find out how teh PIKs were repaid they get told to mind their own business, so we are left in the dark unfortunately.

Where exactly have I accepted your point? Andersred himself admits he got it wrong and has been eating humble pie for the last week. Perhaps you should follow his lead and show a little bit of humility. You just look ridiculous otherwise.

 

[GCHQ]

Well that's bollocks. Many of us, most prominently GCHQ, have always said that, though it looked likely that some portion of the PIK's would be paid using the club's money (personally I have been saying for ages now that the Glazers would never take any more than the carve-out, that to use the club's money to any greater extent would be wholly counter-productive), there could quite possibly be other options available to the owners that we don't know about. TMRD for one has always said that we shouldn't underestimate the Glazers' personal wealth, that if they want to find money from somewhere then they'll likely have little difficulty doing so. None of us have ever believed that the owners would drain United of cash to pay off their personal debt, only anders believed this and made his lofty calls to boycott on the strength of his predictions; and far too many fell for it and let themselves become convinced that the Glazers wanted to harm the club to pay off their debt, wholly in spite of our repeated and very vocal protestations against this ridiculous notion. So don't try telling us that we all got it wrong. feck off.

Spot on Cider.

 

[Commadus]

Fiddling whilst Rome Burns.

 

[Rood]

Anders was indeed wrong in is literal assertion that the PIKs could not be paid off by any other means ...

Exactly - that was all I said before and you disagreed but now you have realised your error. Well done.

Humour me for a minute in my shocking ignorance and explain how the Glazers' ability to repay the PIKs from their own purse has been proved, as opposed to just their ability to find a slightly cheaper loan?

Who said it had been proved? No one!

 

[ciderman9000000]

Fiddling whilst Rome Burns.

Ooh scary.

 

[Sir A1ex]

Where exactly have I accepted your point?

It is true that we need to know more detail to understand if it is a massive improvement or just marginally better but either way it is a step in the right direction.

That is my point - that we need to know how it was paid to understand whether this is some marginal improvement that doesn't have any real effect on the debate, or the sort of game changer people are making it out to be.

Andersred got a technicality wrong and admited it. So what? It gives you guys the chance to crow a bit, but you're not fooling anybody by claiming that it means everything he, MUST and other have said is wrong.

 

[Sir A1ex]

Who said it had been proved? No one!

The other is about the point of view that had previously been put forward by MUST/andersred/etc and it is on that score that people like myself have every right to gloat as they have been proven to be completely wrong (and not for the first time either).

There's a big difference between being shown to have overlooked a technical flaw in your argument (ie that the PIKs could technically be paid of just by transferring the debt elsewhere) and being "proven to be completely wrong".

You know this, you're too smart not to. But I'll play along and give you a simple anology to illustrate the point.

As it happens I just transferred a credit card balance this week, as it was on high interest, and I obtained a new card with 0% balance transfers.
I had previously commented to my wife on various occasions that paying off the credit card debt was going to be a bit of a struggle (fortunately, it hasn't come to thinking about selling assets to do so!).
If I tried to claim to her now that I was totally wrong and I've paid it all off, she would rightly worry about my grasp of our finances.

Now, you could well argue that the Glazers, like the wife and I, are keeping teh debt at a manageable level, and being careful to take advantage of the best credit options. That is your belief, which you are entiteld to. Indeed it is a genuine question that is the nub of this whole issue.

But you can't argue that the repayment of the PIKs can be shown to be of any real consequence to the debate, without knowledge of how they were repaid.

 

[Sir A1ex]

Spot on Cider.

Come now GCHQ, I wouldn't expect you to endorse such aggresively offensive posting, you're normally quite calm (if wrong).

No reply. Thought as much.

Better, keep it up.

For what it's worth, if you've always denied that any money would be drawn down from the club then of course you can exempt yourself from that 1st point, much as I said Rood could. But I know for a fact that plenty of people on "your side" conceded that it was a reasonable possibility it would happen, and any attempt to rewrite history really isn't going to change that.

 

[ciderman9000000]

For what it's worth, if you've always denied that any money would be drawn down from the club then of course you can exempt yourself from that 1st point, much as I said Rood could. But I know for a fact that plenty of people on "your side" conceded that it was a reasonable possibility it would happen, and any attempt to rewrite history really isn't going to change that.

It was a reasonable possibility, yes, though only anders personally guaranteed everyone that the carve-out and dividends would be taken as soon as possible and called for anyone attending matches to boycott on the strength of this guarantee. It didn't happen. The PIK's have been paid and the club's cash remains untouched; Gill's assurances were truthful; anders' guarantees were false. The Glazers will not sacrifice important transfer funds to pay off their personal debts, there have been no restrictions placed on SAF. Any doubt you continue to try and spread, A1Dan, is thwarted by all the evidence weighing so heavily against you. Do you still think SAF and Gill to be liars? Do you still believe the chancer Drasdo over our great manager? If so then you're an embarrassment and a fool, for what it's worth.

 

[Commadus]

It was a reasonable possibility, yes, though only anders personally guaranteed everyone that the carve-out and dividends would be taken as soon as possible and called for anyone attending matches to boycott on the strength of this guarantee. It didn't happen. The PIK's have been paid and the club's cash remains untouched; Gill's assurances were truthful; anders' guarantees were false. The Glazers will not sacrifice important transfer funds to pay off their personal debts, there have been no restrictions placed on SAF. Any doubt you continue to try and spread, A1Dan, is thwarted by all the evidence weighing so strongly against you. Do you still think SAF and Gill to be liars? Do you still believe the chancer Drasdo over our great manager? If you do then you're an embarrassment and a fool, for what it's worth.

Glazers Cash. If they wanted to pay the PIK from the Club Cash they can - its their club.

As to restrictions on transfers - what do you mean?

 

[GCHQ]

That is my point - that we need to know how it was paid to understand whether this is some marginal improvement that doesn't have any real effect on the debate, or the sort of game changer people are making it out to be.

Andersred got a technicality wrong and admited it. So what? It gives you guys the chance to crow a bit, but you're not fooling anybody by claiming that it means everything he, MUST and other have said is wrong.

It's not a technicality for god's sake. It's absolutely fundamental to the entire debate. Anders and MUST made it quite clear that as far as they were concerned the Glazers had no option other than to raid the club's cash reserves to pay down the PIKs. To paraphrase what Drasdo said: ''The Glazers are going to drive a forklift truck up to the gates of Old Trafford, load it up to the max with cash and run off with it back to RFJV to pay down the PIKs''.

The crucial point is that the Glazers have proved they have other options. They have proved that they will not need to take cash out of the club to the extent that it will negatively impact on the running of the club. That's the key point here. Yes, they might still take cash out in the future but it won't be anywhere near the sort of level that the likes of Anders and MUST said they would. Their whole argument about how the Glazers ownership was going to negatively impact the club in the years to come was based on their belief that the Glazers simply had to take as much cash as possible out of the club to pay down the PIKs. A belief that now lies in ruins.

 

[ciderman9000000]

Glazers Cash. If they wanted to pay the PIK from the Club Cash they can - its their club.

As to restrictions on transfers - what do you mean?

Whatever.

Engage your brain, what do you think I mean? I'm quite clearly refering to SAF's assurances that he's never been restricted in his spending by the Glazers and Drasdo and MUST's accusations of this being a lie. The accounts show that in all likelihood SAF was telling the truth, that there's loads of cash available and has been ever since the Ronaldo sale; there's been no need for any restrictions. Rooney's bumper new contract demonstrates perfectly the Glazer's willingness to spend when necessary; when SAF asks Gill for money, the Glazers provide Gill with the money SAF's asked for. Show me any evidence that suggests we should believe Drasdo's version of events over the word of our manager. There is none. Which is why to remain convinced that SAF is lying is so bloody shameful and embarrassing; SAF and Gill were telling the truth.

 

[Commadus]

Whatever.

Engage your brain, what do you think I mean? I'm quite clearly refering to SAF's assurances that he's never been restricted in his spending by the Glazers and Drasdo and MUST's accusations of this being a lie. The accounts show that in all likelihood SAF was telling the truth, that there's loads of cash available and has been ever since the Ronaldo sale; there's been no need for any restrictions. Rooney's bumper new contract demonstrates perfectly the Glazer's willingness to spend when necessary; when SAF asks Gill for money, the Glazers provide Gill with the money SAF's asked for. Show me any evidence that suggests we should believe Drasdo's version of events over the word of our manager. There is none. Which is why to remain convinced that SAF is lying is so bloody shameful and embarrassing; SAF and Gill were telling the truth.

whatever.

 

[Rood]

There's a big difference between being shown to have overlooked a technical flaw in your argument (ie that the PIKs could technically be paid of just by transferring the debt elsewhere) and being "proven to be completely wrong".

You know this, you're too smart not to. But I'll play along and give you a simple anology to illustrate the point...

Stopped reading there - your analogies are usually good for a laugh but rarely have anything at all to do with the point at hand.

You can ignore the facts all you want and downplay it all as a 'technicality' but Im afraid you are missing the big picture here and what this means going forward.
Why do you think Andersred spent a ridiculous amount of time analysing shopping malls etc? It was all to support his view that the Glazers had no other means of repayment apart from club cash! And in turn that is absolutely integral to his entire argument about how the debt would impact transfers and how the Glazers could not survive without taking huge amounts of cash out of the club etc etc. All bollocks Im afraid - just as I have been saying all along.

Anyway I dont really have much else to add to be honest so if we have to agree to disagree then so be it. Even Crerand Legend has cottoned on to what is going on here - sooner or later Im sure the penny will drop with you as well.

 

[Crerand Legend]

The anti MUST/Drasdo hysteria on here is laughable. They will soon be getting the blame for the Manchester weather

 

[Sir A1ex]

It's not a technicality for god's sake. It's absolutely fundamental to the entire debate. Anders and MUST made it quite clear that as far as they were concerned the Glazers had no option other than to raid the club's cash reserves to pay down the PIKs. To paraphrase what Drasdo said: ''The Glazers are going to drive a forklift truck up to the gates of Old Trafford, load it up to the max with cash and run off with it back to RFJV to pay down the PIKs''.

The crucial point is that the Glazers have proved they have other options. They have proved that they will not need to take cash out of the club to the extent that it will negatively impact on the running of the club. That's the key point here. Yes, they might still take cash out in the future but it won't be anywhere near the sort of level that the likes of Anders and MUST said they would. Their whole argument about how the Glazers ownership was going to negatively impact the club in the years to come was based on their belief that the Glazers simply had to take as much cash as possible out of the club to pay down the PIKs. A belief that now lies in ruins.

Ok, I know you get all in a tizz about hypothetical points, thought experiments etc, but indulge me for a minute, there is a good point:

Say you were the Glazers and you were concerned with rebutting "the Anders proposition" (the latter being true in reality, you can take the former as being your wildest fantasy). Now, an opportunity arises to replace the PIKs with pretty much identical debts, without incurring any significant transaction costs. By doing so you can then go around saying much what you are saying... that the PIKs have been repaid without touching club funds, and your opponents were wrong all along. But in reality, has anything changed or been proven?

Now, for those who struggle with that word hypothetical, this is not what I am suggesting has happened. If they have new loans I'm quite sure they are on a rate that is at least a bit better - they'd struggle to do as bad as 16%!

But it does entirely illustrate the point that, without knowing where the money has come from we can't start claiming that anybody's opinions have been proved or not, other than on the entirely superficial issue of whether the old PIKs could be got rid of.

I'm sure you will none the less continue to cling on to your irrelevant point about your famous victory over Anders, but the facts of the matter are clear, or more to the point, they aren't and so no inference can really be drawn.

 

[DanH]

It is very true the Glazers have gone on about it a fair old bit.