[Archived] Rovers Takeover Thread

[Craigman]

Any more news on the potential takeover Nicko ?

[nicko]

Any more news on the potential takeover Nicko ?

Plenty of bits of info, some interesting, some relevant, some possibly irrelevant.

It's like doing a jigsaw in the dark just now. Lots of pieces, but better if someone turns the light on.

Might know more shortly.

The two specific areas that the bidders and everyone else needs to know are - 'how much is needed to pay for the shares?' and 'how much is left for players?'

The obvious extra interest for those trying to work out the what the bidders are about is 'whose money is it?' and 'why do they want to buy Rovers?'

[John]

Nicko, I know you cannot give much if anything away - does it seem like they potentially could be realistic new owners, even though I presume we are at the very early stages of anything happening.

If you cannot tell us anything, when might we hear something more on this??

[nicko]

Nicko, I know you cannot give much if anything away - does it seem like they potentially could be realistic new owners, even though I presume we are at the very early stages of anything happening.

If you cannot tell us anything, when might we hear something more on this??

I am being given positive noises, but I will be a lot happier when the cash is on the table.

It would be wrong to name who I think is involved in Chris Ronnie's team because it might put the price up...and the only winners there are the Trustees. And, anyway, I have not had it officially confirmed to me.

Despite some people's concerns about him, I think he is straight and well-meaning.

However until I get the full story - or more of it - I couldn't say whether they are the proverbial fit and proper potential owners.

I have no reason to doubt their integrity, but that's not down to me.

[Paul]

Bazzang this is what Brian said first:

For example, if the trustees provide £20m to buy a player, that said player will sign a contract worth somewhere in the region of £4 to £5m a year, which over a 5 year period is another £25m on top of the fee. In basic terms that one player could be putting around £6 -£7m (Inc insurance etc) a year onto the clubs operating costs. It doesn't take an accountant to see that if we are currently breaking even, the addition of this player means we are then losing £6 -£7m a year without even taking into account the transfer fee. The problem with Rovers is that bringing in players of this calibre and value will not put extra bums on seats or significantly increase our operating income - so its simply not worth the risk. It would be suicide to operate on this theory, particularly with the sums of money we are looking at these days in football. When Jack was around, the amounts of money he was providing in relation to his wealth were very very small. Now two Ronaldos are probably worth a tenth of the whole Trusts value. Going down this route could put the whole trust at risk (of which we are only a very small part).

Brian then said this:

Agreed, but I do feel that some people on here expect this.

Even so, if we spent the 20m on three players the cumalitive wages and employment costs would be similar to the figure above, if not slightly higher.

I was just trying to point out the dangers of over investing on players and that paying the transfer fee or fees is only half of the issue that needs to be considered when making a new signing.

Surely it absolutely obvious spending £20m on 'x' number of players will cost perhaps £7m per annum in wages, insurance, employment costs etc. Therefore for Rovers to spend £20m this summer will cost, over your 4 years, £48m (£20m + 4 x £7m). Given the bulk of the TV revenue is already spoken for I'm still interested to read from anyone how this will be funded. If we finish 9th this year and the £20m on transfers put us in 5th next season our place money would increase by £4m. Lets imagine that was consistently our finish (5th) for the 4 season period - the club would earn an extra £16m for a £48m outlay. It simply does not make sense.

The bald facts are Rovers are performing very well on a limited budget. There are no new revenue streams available. Filling the ground every week is the only way to increase revenue and the Blackburn public continue to demonstrate they simply are not interested in turning up - at any price.

I'm sure the trust would be delighted to hear from any individual who can demonstrate how investing £48m over 4 seasons will benefit the club rather than bankrupt it. To compare us with Spurs doesn't hold water. If Rovers spent half the money Spurs have done we would be broke. There is no revenue to fund the club other than TV money, the current apathetic public and small (by comparison to other clubs) commercial income. It just does not work.

All the calls for investment fall down on this one fact, it cannot be funded. I believe the trust will invest sufficient to maintain our PL status, all the talk of moving to the next level is just that - talk. There is no next level, there might be a freak season of CL qualification but that is all.

[nicko]

I believe the trust will invest sufficient to maintain our PL status.

Well, what have they put in for this summer's pot?

Surely the point is that these people want out...nobody blames them, but that's the reality.

[PAFELL]

I am being given positive noises, but I will be a lot happier when the cash is on the table.

It would be wrong to name who I think is involved in Chris Ronnie's team because it might put the price up...and the only winners there are the Trustees. And, anyway, I have not had it officially confirmed to me.

Despite some people's concerns about him, I think he is straight and well-meaning.

However until I get the full story - or more of it - I couldn't say whether they are the proverbial fit and proper potential owners.

I have no reason to doubt their integrity, but that's not down to me.

Despite some people's concerns about him, I think he is straight and well-meaning Is this the concern people have with regards to Chris Ronnie or the person you think may be involed in chris Ronnie's team?

[Eddie]

All the calls for investment fall down on this one fact, it cannot be funded. I believe the trust will invest sufficient to maintain our PL status, all the talk of moving to the next level is just that - talk. There is no next level, there might be a freak season of CL qualification but that is all.

Isn't that exactly why we need new investment?

We are all agreed that we don't want someone coming in who has any intention of making a profit, that won't work, not unless some miracle happened and we suddenly won the league. I just find it interesting that most people who are against the takeover subscribe to your line of thought, which is that we don't have the means to support ourselves in the long-term and because of that we shouldn't try and bring in a new investor. It just doesn't make sense to me.

[philipl]

Why do investors invest?

To make profits.

We need a football-loving Rovers-supporting philanthropist or some meglomaniac who wants a short cut to winning the Champions League on the cheap. Well, £200m from where Rovers are now....

[ABBEY]

Isn't that exactly why we need new investment?

We are all agreed that we don't want someone coming in who has any intention of making a profit, that won't work, .

finally got it..we want investors who want to lose money?

[RevidgeBlue]

It's a tough call isn't it - stick with the existing owners who currently are investing nothing into the club and seemingly have no plans to invest in the immediate future.

But who may and it's a very big "may" bail us out if the proverbial sticky stuff hits the fan. I doubt they would personally because Jack was still around the last time we went down and at the end of the first unsuccessful season outside the top flight. So I presume it was his decision to bail us out.

Or move onto new owners who may put more in on an annual basis now but may want to run a mile if we go down.

Personally I feel it's time to move on but that's no reflection on what the Trustees have done for us in the past.

[RevidgeBlue]

£33m of new cash injected into Rovers as a gift or ordinary share capital in the complete seasons 2001/2 to 2006/7.

Surely that was 33m quids worth of debt converted into share capital which didn't have to be immediately repaid rather than actual cash injected?

[philipl]

£33m actual cash.

£85m was converted debt into capital

[den]

I believe the trust will invest sufficient to maintain our PL status, all the talk of moving to the next level is just that - talk. There is no next level, there might be a freak season of CL qualification but that is all.

Problem is Paul - there is NO level of funding that is sufficient to guarantee PL status. If only it were so easy. They have simply said to the club "you have enough money now because of TV monies, so we're not giving you any more". how do they make that judgement, can they forecast football scores? They haven't taken that step because we can guarantee PL status, have they. The trustees have no idea how next season will pan out.

I think the truth is that they don't want to put cash in any more.

More than one person at the club has said in the past that the trustees have better things to do with their money than subsidise a loss making football club. I always wonder how that stands with Jack's wishes.

[Paul]

Problem is Paul - there is NO level of funding that is sufficient to guarantee PL status. If only it were so easy. They have simply said to the club "you have enough money now because of TV monies, so we're not giving you any more". how do they make that judgement, can they forecast football scores? They haven't taken that step because we can guarantee PL status, have they. The trustees have no idea how next season will pan out.

I agree den but I'd guess there is an obligation on the trust to maintain the club's PL status. If we go down the potential cost is enormous to either gain promotion or to fund the losses, therefore it makes financial sense to spend the minimum to maintain PL status.

I think the truth is that they don't want to put cash in any more.

I think the truth is they want to send the minimum amount possible and / or are keeping back funds for a rain day

More than one person at the club has said in the past that the trustees have better things to do with their money than subsidise a loss making football club. I always wonder how that stands with Jack's wishes.

I don't suppose it stands very well, I always thought Blakburn Rovers was what Jack wanted to do with his money.

Isn't that exactly why we need new investment?

So you're arguing we need new investment because the trust can see longterm new investment is not sustainable? How long before any new owner reaches the same conclusion? What happens when new owners see there is no money to be made or the funding is too great? Ask Hicks and Gillette for advice?

We are all agreed that we don't want someone coming in who has any intention of making a profit, that won't work, not unless some miracle happened and we suddenly won the league.

Are we all agreed? I'm not against anyone making a profit from Rovers but I am worried by the thought of where this profit will be generated? It comes back to the same point there is no method in the local area of increrasing revenues significantly.

I just find it interesting that most people who are against the takeover subscribe to your line of thought, which is that we don't have the means to support ourselves in the long-term and because of that we shouldn't try and bring in a new investor. It just doesn't make sense to me.

I find it interesting those in favour of spending money have no plan to repay or earn it, you just want someone to give us money. Eddie it doesn't make sense to say "we don't want someone coming in who has any intention of making a profit, that won't work" - the whole of Western economics is based on the need to make a profit. Owners who do not want to make a profit would be a disaster. Do you think JW sits back thinking "Damn, made a profit this year".

I have not said I am against a takeover, I was against the idea of Dan Williams as he lacked any public credibility. I'm not sure about anyone connected with Mike Ashley and until we have an understanding of the motives and plans I'll remain sceptical.

The majority want a quick fix, give Mark Hughes money and see what happens. I and a few others ask the question "How will this be funded?" I don't mean in the short-term of a takeover, I'm talking longterm. There has to be an answer for any owner, trust or otherwise. I'd love to see the team improved and better able to challenge but I want to know how it will be paid for. You can't answer that.

I'll give you a simple comparison. Millions in this country have short-term, cheap fixed rate mortgages. Those deals are ending and the mortgagees are now bleating rates have risen and they can't afford the repayments. Those people didn't look two years down the line, they simply looked at today, perhaps a little more foresight would have helped? You're suggesting the same for our football club.

[Paul]

Well, what have they put in for this summer's pot?

I don't know but Rovers have worked this way in recent years. When was the last time the club announced there is £xxxm available for transfers? All I'm saying is that should relegation look possible I'm sure the trust will spend to avoid it. I doubt there will be much spent in the summer by the trust as it's looking like cannon fodder will be promoted. That is possibly how the trust view things.

Surely the point is that these people want out...nobody blames them, but that's the reality.

I haven't blamed them for wanting out and I'm not against a sale. I simply question the motivation. There are a few new owners who seem happy with their lot - Villa for example, on the otherhand Liverpool, City are walking timebombs. We need someone who will come in quietly for the longterm, we don't need an Hicks / Gillette scenario.

It seems very likley to me the trust want out and crucially recognise now is a very good time to sell - football looks sexy and has buckets of cash.

[Blackburn Ender]

Nicko, wasn't it you who said a while back that you'd talked to Mark Hughes who said he was happy with what he had to spend this summer?

Without going back through the topic, I think you reported it was the most forward/honest/open you'd heard him be?

[nicko]

Nicko, wasn't it you who said a while back that you'd talked to Mark Hughes who said he was happy with what he had to spend this summer?

Without going back through the topic, I think you reported it was the most forward/honest/open you'd heard him be?

Yes, he was very cheerful about a month ago. I put the figure that he could be given to work with in the £10 million region.

Obviously if there was more to spend he would be even happier.

That is one of TWO major answers we need to discover from the prospective buyer.

[nicko]

Despite some people's concerns about him, I think he is straight and well-meaning Is this the concern people have with regards to Chris Ronnie or the person you think may be involed in chris Ronnie's team?

I was referring to someone on here describing him as 'having the IQ of a glass of water' and being 'Mike Ashley's stooge.'

[Hughesy]

Apparently Martin O'Neill wants £80m this summer to spend, Benitez has already handed in his shopping list and Roy Keane is also looking for £60m+. Chelsea also look set to be doing alot of changing! Looks like it may be a very busy transfer window with alot of cash moving around.

[LeftWinger]

Apparently Martin O'Neill wants £80m this summer to spend, Benitez has already handed in his shopping list and Roy Keane is also looking for £60m+. Chelsea also look set to be doing alot of changing! Looks like it may be a very busy transfer window with alot of cash moving around.

The big problem of course is when these clubs can spend 60-80m on players, all players values become inflated, and 10m seems like nothing.

[Tris]

The big problem of course is when these clubs can spend 60-80m on players, all players values become inflated, and 10m seems like nothing.

Quite. In fact it's sheer madness to even try to keep up with the Joneses when they have a budget 6 or 8 times larger. We'd be better off keeping the 10 million dry and waiting for the lunacy to end.

[LeftWinger]

Quite. In fact it's sheer madness to even try to keep up with the Joneses when they have a budget 6 or 8 times larger. We'd be better off keeping the 10 million dry and waiting for the lunacy to end.

I think our best bet, barring finding gems from abroad, is to find Bentley style players.

The likes of Denilson, Armand Traore, Johnny Evans, Scott Sinclair, Chris Eagles etc.

Players who've got talent, but need first team football if they're ever going to make it.

[Tris]

Isn't that exactly why we need new investment?

We are all agreed that we don't want someone coming in who has any intention of making a profit, that won't work

finally got it..we want investors who want to lose money?

Lots of contributors to this thread are very good at spending other peoples cash. Be that cash under the control of the Trustees, or belonging to some mythical figure like the one described by Eddie - who wants to invest with no requirement to make any return.

Let's say the fans were asked to form a cooperative to match the (supposed) £10 million being made available to Hughes in the summer. Say 10,000 fans to contribute a grand each. I'm sure most people can lay their hands on £1000 for the good of Mark Hughes's transter kitty - raid the savings, new credit card, bank loan, loan shark, sell some assets - whatever.

But would any of the people who are so keen to slag off the Trustees for supposed "lack of investment" actually like to stand up and be counted in such a way?

It's OK until it's your own cash, or it's you having to make the monthly repayments on a loan.

[Eddie]

I find it interesting those in favour of spending money have no plan to repay or earn it, you just want someone to give us money. Eddie it doesn't make sense to say "we don't want someone coming in who has any intention of making a profit, that won't work" - the whole of Western economics is based on the need to make a profit. Owners who do not want to make a profit would be a disaster. Do you think JW sits back thinking "Damn, made a profit this year".

I have not said I am against a takeover, I was against the idea of Dan Williams as he lacked any public credibility. I'm not sure about anyone connected with Mike Ashley and until we have an understanding of the motives and plans I'll remain sceptical.

The majority want a quick fix, give Mark Hughes money and see what happens. I and a few others ask the question "How will this be funded?" I don't mean in the short-term of a takeover, I'm talking longterm. There has to be an answer for any owner, trust or otherwise. I'd love to see the team improved and better able to challenge but I want to know how it will be paid for. You can't answer that.

I'll give you a simple comparison. Millions in this country have short-term, cheap fixed rate mortgages. Those deals are ending and the mortgagees are now bleating rates have risen and they can't afford the repayments. Those people didn't look two years down the line, they simply looked at today, perhaps a little more foresight would have helped? You're suggesting the same for our football club.

There are plenty of examples of owners in various sports who are essentially just "giving" money to the club, that is really what we need to be looking for as it is unrealistic to expect that this club will be able to generate a profit for anyone putting a serious amount into it. I'm not advocating that we look for a short term fix, I simply think that we might be able to find a short term and a long term fix in the same place, as far as I'm concerned we don't have a huge amount of long term safety as things stand, so thing have to be done. We have to take our time in finding the right buyer, but we have to find one.