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Thankyou Mounts, that's the general conclusion I'm getting towards, at no point did I say he was ripping off the club, some just infered it from my comments.

 

His remit to Garty was... 'don't lose my money'..... which he hasn't. He's made money and helped to keep us where we are. However, he hasn't invested 100M & hasn't lost money. Having assets also means he can borrow on those assets at x%, loan it x%+ y ensuring no losses. It's basic modern financial business. Don't forget the 3.6M 'arrangement fee' charged from moving his 10% interest to 5% instead.

 

While he's there we're laughing, when he sells on he's laughing...... but seriously don't think this 100M has come out of his arse pocket & he's some sort of messiah. He's a business man first & foremost.

 

So from my previous post, as stated, people are making money from BWFC. The obvious ones are the players, but they're far from alone

 

I did not know about the arrangement fee so you can add that to the money E.D. has already recieved in interest payments and the percentage he makes from each transfer, the million dollar question is what is Eddie going to do when he decides to sell the club, will he write the debt off? or sell the club for a nominal fee with the new owners promising to clear the debt? I suppose its all guess work, thankfully according to Gartside he is still committed to BWFC and recently spent a few million on the academy, the longer were in the premier league the more money Eddie will recieve in interest payments, hopefully we can stay up for a few more years while we try to reduce our outgoings to match our income.

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the debt does not worry me as it is all to one person (nearly)   debts only become a problem when the lender wants them repaid at the moment he does n't so fine.   if tomorrow he rang up and said

Firstly we do not owe the money NOW as ED is not calling in the debt so I do not understand where your coming from. I am not an accountant but my understanding is that a lot of the debt is a paper los

I think the kettle markets reached boiling point tbh.

Do we know if he owns the freehold? Would he get planning to develop the land at Euxton or Lostock?

 

Also who else would lend to us?

 

 

 

"Year on year, we have also reduced our losses and that is without any significant player trading. In fact we added to the squad, and so that is encouraging because obviously as we go forward we will be subject to the forthcoming framework of the Financial Fair play, and it is good to have been able to achieve that progress in cutting the losses.

 

"Again, and I have said this before, we cannot ever underestimate what Eddie Davies does for our club. As a fan and our owner, he continues to significantly back us on and off the pitch, and he has done that again.

 

"As the report shows, our debt is to Eddie, and as a result of that support, we have no dangerous levels of bank debt which is a major plus fact for our club.

 

"Eddie has invested more than ?100 million in the Wanderers. He is a huge factor in the time we have enjoyed in this elite league and he continues to back us.

 

"As well as that, we are also in a strong position as regards our facilities, as we own them. We have an excellent infrastructure in place and we will look to build on that as we seek to continue developing.

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I really dont worry about the 110 million debt, the reason being Davies has been in charge 10 years the first 5 years we had approx 50 million debt which ED was netting interest at 10% thats thats 5 million x 5 = 25 million, the next 3 years we had approx 70 million of debt again I think the deal was 10% thats approx 21 million, the last 2 years approx 100 million of debt at 5% that another 10 million, in total and this is rough guess Eddie has taken 56 million in interest payments, add to that he takes a cut of transfers, over the last 10 years we have sold a good number of players for decent amounts I have know idea what % he takes but if it was 5% that could easily be another 5-10 million, so lets say minimum of 5 million that lot adds up to around 60 million he has taken back, the squad has been valued at 61.5 million that maybe optimistic but I would say we would easily achieve 40-50 million and that figure is based on getting nothing for Cahil, as I said earlier Eddie Davies and his money men have all bases covered, a large part of our debt has already been paid backto Eddie Davies, quite clever really and were all panicking about the 110 headline figure, in reality most of it is already recovered by E.D. Before any one questions my figures there just an indication of what has happened and obviously not exactly accurate but close enough to give an indication of the state of play.

 

No offence - but you are talking bollocks - the club owes ?110 million NOW.

 

The money which Mr Davies as taken out (as interest payments) of the club in the PAST is incidental to what it owes him NOW.

 

The club does not seem to have ?110 million laying about in a desk drawer somewhere or other - the money appears to have been spent. SO it would have to find ?110 million pounds from somewhere or other if and when that ?110 million debt is called in.

 

The accounts show that the club OWE Mr Davies close on ?100 million NOW.

 

Certainly Eddie owns the club - and in a way owes the money to himself BUT the money isn't there in the safe just to be given to him when he wants it - it as been SPENT.

 

Ok he might be getting an income back on interest charges BUT the money is still OUTSTANDING and to be fair he took the RISK of buying the club when no one else would - and we were heading in the wrong direction in division 2 when he put his hand in his pocket remember!

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No offence - but you are talking bollocks - the club owes ?110 million NOW.

 

The money which Mr Davies as taken out (as interest payments) of the club in the PAST is incidental to what it owes him NOW.

 

The club does not seem to have ?110 million laying about in a desk drawer somewhere or other - the money appears to have been spent. SO it would have to find ?110 million pounds from somewhere or other if and when that ?110 million debt is called in.

 

The accounts show that the club OWE Mr Davies close on ?100 million NOW.

 

Certainly Eddie owns the club - and in a way owes the money to himself BUT the money isn't there in the safe just to be given to him when he wants it - it as been SPENT.

 

Ok he might be getting an income back on interest charges BUT the money is still OUTSTANDING and to be fair he took the RISK of buying the club when no one else would - and we were heading in the wrong direction in division 2 when he put his hand in his pocket remember!

 

Have you just said he's talking bollocks, then virtually agreed with him.

 

That's how i've just read that anyway.

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Eddie Davies will only ever see that capital investment paid back IF the club is sold to exceptionally wealthy owners. He knows full well that he will NEVER get anything like that if he calls in the debt. A firesale only ever brings in a quarter of the normal value at best- just look at any store having a closing down sale. The stadium is worthless without a club, so its only real value is as a piece of development land. Property markets as they are right now, the land is worth around ?20mn at best- less demolition costs to developers= virtually worthless. Assuming the valuation of the players is correct, ?15mn is probably the best a fire-sale would achieve. ED would be lucky to see ?25mn of that ?110mn and would have killed his ?5mn a year income stream. It is like owning a house that cost ?110,000 to build and currently letting it out for ?5,500 a year (about ?450 a month). The property market currently values the house at ?25,000. If you were in that situation, would you sell- knowing you would make more in rent in five years than you would ever get by selling?

 

Relegation might prove a different story. The Sky cash cow would have gone, so it would be difficult to see where the ?5mn+ for ED would come from. I can see him either writing off a large portion of the debt or reducing interest still further even then. It is HMRC that usually puts clubs into administration, not private investors. In that regard, we are quite safe (for now). Maybe we will be better off getting used to being without the Sky money sooner rather than later- there is no way Sky will be able to afford the kind of money it currently pays if everyone gets a Greek subscription- which they legally can!

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Have you just said he's talking bollocks, then virtually agreed with him.

 

That's how i've just read that anyway.

 

Nope.

 

Mounts seems to think the interest - which he reckons Davies as had up to now - about ?60 million as per his figures - covers a large part of the debt.

 

It does not.

 

The debt stands at ?110 million still - the interest payments received by Davies in previous years has not reduced this sum in any way.

 

 

Perhaps Mount's is saying that Davies need not worry because if the players were sold (with the ground, etc) and was added to this sum of ?60 million or so - the money that he put into the club would be similar to the money he got out the club so he would still not have lost his money - this is also bollocks.

 

For example say you had ?100 million and stuck it in the bank - at the end of 10 years you would still have got your ?100 million PLUS the interest (in this case ?60 million) as well.

 

If you then went to bank after 10 years and find that you have only got ?100 million - the same sum you deposited a decade ago - would you be happy and think - well I've not lost anything - I doubt it - you would be asking where your ?60 million interest was - and so would any other sensible person.

 

Davies as made a big capital investment in the club - sure he's got the interest from it but his ?100 million is still owed to him and Mount's seems to have not realised this in his post above.

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Nope.

 

Mounts seems to think the interest - which he reckons Davies as had up to now - about ?60 million as per his figures - covers a large part of the debt.

 

It does not.

 

The debt stands at ?110 million still - the interest payments received by Davies in previous years has not reduced this sum in any way.

 

 

Perhaps Mount's is saying that Davies need not worry because if the players were sold (with the ground, etc) and was added to this sum of ?60 million or so - the money that he put into the club would be similar to the money he got out the club so he would still not have lost his money - this is also bollocks.

 

For example say you had ?100 million and stuck it in the bank - at the end of 10 years you would still have got your ?100 million PLUS the interest (in this case ?60 million) as well.

 

If you then went to bank after 10 years and find that you have only got ?100 million - the same sum you deposited a decade ago - would you be happy and think - well I've not lost anything - I doubt it - you would be asking where your ?60 million interest was - and so would any other sensible person.

 

Davies as made a big capital investment in the club - sure he's got the interest from it but his ?100 million is still owed to him and Mount's seems to have not realised this in his post above.

 

Spot on. The club he owns owes him money- ?110mn. Calling in the debt would ensure he never gets it, whereas if he simply forces the club to live within its means whilst giving himself a few million a year, he is likely to see a return on his investment.

 

The whole football world needs to take a good hard look at itself. The players (and their agents) are too greedy and the clubs are stupid enough to give in to them. The bubble will burst eventually. A salary cap is in order- but it must come from FIFA to ensure that players can't just go to another country that doesn't have a cap. Most of us find ?25k a week over the top- but you can stick a nought on that for certain players in the Premier League. We take around ?8mn a year in gate receipts. If the Sky money goes- and it could if the European Court of Justice's ruling is upheld- that is all a club has. If you need a squad of 25 players, the ?8mn works out at just over ?6,000 a week each. Still pretty good money for kicking a pig's bladder around a field. Considering the average footballer works around 25 hours per week at the most, that works out at 50 times the national minimum wage. City's work-shy Tevez is on the equivalent of around ten grand an hour- over 1,600 times the NMW. I have cancelled my Sky subscription as I do not want to pay for that.

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No offence - but you are talking bollocks - the club owes ?110 million NOW.

 

The money which Mr Davies as taken out (as interest payments) of the club in the PAST is incidental to what it owes him NOW.

 

The club does not seem to have ?110 million laying about in a desk drawer somewhere or other - the money appears to have been spent. SO it would have to find ?110 million pounds from somewhere or other if and when that ?110 million debt is called in.

 

The accounts show that the club OWE Mr Davies close on ?100 million NOW.

 

Certainly Eddie owns the club - and in a way owes the money to himself BUT the money isn't there in the safe just to be given to him when he wants it - it as been SPENT.

 

Ok he might be getting an income back on interest charges BUT the money is still OUTSTANDING and to be fair he took the RISK of buying the club when no one else would - and we were heading in the wrong direction in division 2 when he put his hand in his pocket remember!

 

Firstly we do not owe the money NOW as ED is not calling in the debt so I do not understand where your coming from. I am not an accountant but my understanding is that a lot of the debt is a paper loss due to the club changing accounting policy a few years back and amortisation of players registrations (transfer fees to you and me) these are written off over the length of the players contract, in the case off Elmander we had wrote down each year a portion of the initial transfer fee so when he left for nothing that was already accounted for, now if we sell a player like Matt Taylor who has had his players registration amortised down to nil and then recieve a transfer fee that is put back on the balance sheet as a profit, we do this for every player at the club.

 

In the accounts for 2010 we have amortised 14 million( this is not a hard cash loss unless you sell all your players for nowt) and we probably did similar in the previous 2 years ( maybe somebody can check previous years amortisation amounts?) that would amount to a paper loss of 42 milllion and is shown as such on the clubs balance sheet, no doubt it helps us pay no tax (maybe an accountant can varirfy that my understanding is correct or otherwise)Ifwe manage to sell any of our players that should go back on the bottom line.

 

Finally Eddie Davies clearly loves BWFC but is not an idiot and does not want to lose his hard earned fortune, reading between the lines he wanted to help his favourite team without cutting his bollocks off, so the plan was formulated for him to use his money in the best possible way to ensure we did not go bust, the best way to do this was to lend BWFC the money and charge interest and pay that interest back to himself, and over a period of time he would recoup his outlay and the club could continue trading while Eddie got his money back on the drip, in addition to that and to help him get his initial outlay back sooner he took a cut of transfer fees, on top of that he got a nice little arrangement fee when BWFC changed interest payments from 10 to 5%.

 

What has Eddie Davies gained? firstly he has propped his favourite football team and at the same time protected his hard earned fortune and enabled a small-medium club to compete with the big boys (for that I am eternally grateful as every BWFC fan should be, some are not, fook knows why) secondly he has already got a large trench of his outlay back (and a significant part of the debt is a paper loss anyway), this would enable him to write off all the debt if neccesary,thirdly he owns BWFC lock stock and barrel he bought the club for a very small initial outlay and would easily get his initial outlay back were he too call it a day. I may have it completely wrong but that is how I see it, if time tells a different story and I am talking bollox, I will bow to your superior knowledge sluffy.

Edited by Mounts Kipper
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Looking at this from ED viewpoint, BWFC is one of many companies within his portfolio. If he consolidates all these into one Group Parent company then the ?100M debt at Bolton will be offset against inter company loans in another company.

As long as he's happy with the value if his investment in BWFC that is reflected somewhere in his Group of companies, then it's OK and the Group moves on from year to year.

 

The issue only crystalizes if ED looks to sell one of his investments, BWFC, and he doesn't realize the value that he has it in his books for.

 

As the Company that loans BWFC the money that we survive on, is based off-shore in Bermuda, we will never know how ED Group is structured and what value he has on his investment in BWFC

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Looking at this from ED viewpoint, BWFC is one of many companies within his portfolio. If he consolidates all these into one Group Parent company then the ?100M debt at Bolton will be offset against inter company loans in another company.

As long as he's happy with the value if his investment in BWFC that is reflected somewhere in his Group of companies, then it's OK and the Group moves on from year to year.

 

The issue only crystalizes if ED looks to sell one of his investments, BWFC, and he doesn't realize the value that he has it in his books for.

 

As the Company that loans BWFC the money that we survive on, is based off-shore in Bermuda, we will never know how ED Group is structured and what value he has on his investment in BWFC

 

He does not own any other companies he stepped down from Strix a few years ago now, his only current directorship os with BWFC, just checked BWFC accounts and 70 million loss has been accrued in the last 3 years, that is when BWFC changed accounting to include of amortisation of players registrations my view is that the amortisation completely skews where we are financially and should be taken with a large pinch of salt as should the headline debt figure of 110 million, that does not mean we should not continue to control outgoings and reduce overheads, interestingly enough the losses last year is 14 million the amortisation of players registrations and Eddies interest payments of 5.1 million plus Administrative expenses of 15 million ( no idea how we can justify admin expenses of that amount any ideas anyone?)

Edited by Mounts Kipper
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The stadium is worthless without a club, so its only real value is as a piece of development land.

 

Or it could be sold and rented back to the club. Crystal Palace and Leeds are two examples of clubs that did that when they got into financial difficulties. Not a good idea though, because any potential buyer would then be able to kick the club out if they chose to and any potential investor would be put off buying the club if they didn't own their own ground. I think Pompey is one example were different investors own different bits of land around the ground.

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The other side of the player right off is the value in the balance sheet as an asset when said player is purchased. This value is then written off over the length of his contract.

Question to ask here is what is that value? Is it what we paid, is it a guess of their market value, is it cost left on their contract for wages and bonus??

 

Another thing to check is what was the accounting policy prior to the change of depreciating the players value? Did we put a players value on the balance sheet and only write a gain or loss to Profit when the player leaves or did we write off the transfer fee against Profit upon competition of the purchase?

 

Depending on what we find out, this ?70m hit on player depreciation could be down to placing unrealistic values on them in the first place?

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Isn't it the total of their wages multiplied by years on the contract - for book value?

 

So ?1m per year over a three year deal means the club enter ?3m into the books for the value of the player and then it decreases by a third with the passing of each season - I think....

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Or it could be sold and rented back to the club. Crystal Palace and Leeds are two examples of clubs that did that when they got into financial difficulties. Not a good idea though, because any potential buyer would then be able to kick the club out if they chose to and any potential investor would be put off buying the club if they didn't own their own ground. I think Pompey is one example were different investors own different bits of land around the ground.

 

Even if we got the ?30mn the stadium is supposedly worth, the rent would give the club another outgoing to contend with, whilst bringing debt levels back to what they were just a couple of years ago. In the meantime, we are at the mercy of property developers and any financial difficulties they might experience. The club owns the stadium, Eddie Davies owns the club. Leeds and Crystal Palace owed other football clubs, the FA and HMRC. The HMRC issued the winding-up petitions. Owners owed by clubs don't tend to. Failing to pay football creditors allows the FA to place a club at whatever tier of the system it wishes- Leeds and Crystal Palace could have been expelled from the Football League if they failed to pay football creditors and would have ceased to exist altogether, had HMRC not been paid.

 

Eddie Davies is here for the duration. Whether he can continue bankrolling our losses is another matter. We will have to live within our means or risk running up massive debts with the banks. That would be a recipe for disaster.

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Or it could be sold and rented back to the club. Crystal Palace and Leeds are two examples of clubs that did that when they got into financial difficulties. Not a good idea though, because any potential buyer would then be able to kick the club out if they chose to and any potential investor would be put off buying the club if they didn't own their own ground. I think Pompey is one example were different investors own different bits of land around the ground.

 

The two clubs you are talking about have grounds built on land that has a strong value though, Palace are hoping to move back to the Crystal Palace athletics track when the whole Olympic stadium thing is sorted out and Sellhurst will be sold to developers for a huge sum.

 

Even if we stopped playing all together I could not see the value of the Reebok's land being very strong as there is still so much available land in the surrounding area. Who would want to flatten it and build something? would they build another Supermarket, flats, more retail space, offices? Just cannot see it being viable and for that reason it would be unlikly IMO that an investor would buy it from us to rent it to us as tennants.

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The two clubs you are talking about have grounds built on land that has a strong value though, Palace are hoping to move back to the Crystal Palace athletics track when the whole Olympic stadium thing is sorted out and Sellhurst will be sold to developers for a huge sum.

 

Even if we stopped playing all together I could not see the value of the Reebok's land being very strong as there is still so much available land in the surrounding area. Who would want to flatten it and build something? would they build another Supermarket, flats, more retail space, offices? Just cannot see it being viable and for that reason it would be unlikly IMO that an investor would buy it from us to rent it to us as tennants.

 

 

We are not likely to move from the Reebok it is not going to come to that, however you are wrong about the value of the land, if you look at rentals for shopping centres in the UK middlebrook is right up there with the most expensive if the club went tits up the land would be extremely valuable to a potential retail developer

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the debt does not worry me as it is all to one person (nearly)

 

debts only become a problem when the lender wants them repaid at the moment he does n't so fine.

 

if tomorrow he rang up and said I now want this repaid, the club would have to say we can not repay you, so his option is then ti

force the club into adminstration, he then ends up getting say 50p in the ? so no reason to do it.

 

the more i read of this i think we are lucky to have a guy pumping money in and maybe people should be grateful for what he has done/is doing.

 

if he pulled his money i think we would end up with a club bit more in line with what some of our so called supporters deserve.

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No club has a God-given right to be in the PL. I am of the opinion that with the gap between rich and poor in the PL getting ever wider, it is only a matter of time before it becomes a cast-iron guarantee that promoted clubs will be relegated and each of the other 17 places is filled by the same team every year. That is assuming the TV money keeps rolling in.......

 

I don't think relegation would be the end as some supporters seem to think. We will never win the Premier League. We will never be in the Champions' League. We have little to aim for in the PL. A top half finish? The rate player wages and values are going up, the extra money earned from the extra place does not warrant the expenditure. Unless wages and transfer fees go down, we will be left further behind every year, both on the pich and financially.

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Am I right in saying the plan is to move first team squad training to Lostock?

 

The land at Euxton albeit with housing planning permission will be worth a few bob.

Do we own that? Always thought it was rented

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I think I'm going to put my head back in the sand on this one, until you fiscal geniuses have sorted it.

 

Just to clear everything up:

 

  1. There is no immediate financial crisis at BWFC
  2. Eddie Davies will not call in the debt for the forseeable future, as he will never get it
  3. Even relegation isn't financial doom, although a further relegation might be
  4. The sole major creditor is the owner of the club- he is in it for the long haul not just a quick buck
  5. Relax. There is nothing any of us can do about it anyway

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Just to clear everything up:

 

  1. There is no immediate financial crisis at BWFC
  2. Eddie Davies will not call in the debt for the forseeable future, as he will never get it
  3. Even relegation isn't financial doom, although a further relegation might be
  4. The sole major creditor is the owner of the club- he is in it for the long haul not just a quick buck
  5. Relax. There is nothing any of us can do about it anyway

 

Right, now thats cleared up, back to the matters on the pitch! Wheres that gun to head pic again...

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