[Archived] Rovers Might Have Been Sold?

[philipl]

It can't. We all know that, and the Trust know that. So why did they put us up for sale if they want to control every last aspect of our future under a new owner for the next 100 years? No-one will ever want to buy under the conditions that people seem to believe can be imposed by the Trust. Why pay to buy something where the last owners tell you what you can and can't do with it? That's not owning, it's renting. For sale means for sale.

Placing terms and conditions of sale in a contract of sale is extremely common.

The Moores family did that with Liverpool only for Gillett and Hicks to load the club with debt the day the restrictive covenant expired.

The black and white position being taken by this post is incredibly simplistic and doesn't face reality.

The reality is that Jack died ten years ago and put in place provisions which would have safeguarded Rovers in perpetuity in the conditions that existed when he passed away.

In 2000, £3m a year bridged the gap between the gate receipts Rovers received and the gate receipts generated by the larger clubs Rovers are competing with.

These days, Arsenal are targeting matchday receipts of £3m per match, the gap between Rovers and the clubs Jack had in mind are £30m per year and £3m pays the costs of one middle ranking Prem player for a year if you are a decent negotiator.

So the Trust are stuck administrating a document which cannot be changed (sadly Jack cannot return to give new instructions) with protections for Rovers which probably now need expert legal advice to interpret as the financial world of football has seen at least a fivefold inflation since Jack passed away. The Trustees are caught on a triple dilemma:

- the other beneficiaries are not as passionate about Rovers as Jack was so are probably not giving letters in the same way Jack did, but HAVE agreed to many acts of generosity towards Rovers over the past ten years,

- the discretionary amounts they could pay to Rovers make virtually no difference and do not achieve the stated objectives so therefore are not being paid in current circumstances just as Jack himself switched off the tap in 95/6 and always set the task of Rovers washing their own face which in the big picture over the last three seasons the club has done,

- and are facing other clauses which probably expose them to huge potential liabilities should the club run into real problems such as real potential relegation; note the very visible presence of David Brown when the league position was around 18-20 just before Christmas in the last two seasons.

Therefore of course they are doing the best for those interests which have been entrusted to them which includes BRFC. If there is a buyer out there who can point Rovers to a safer brighter future than Jack provided for (bearing in mind they have instructions written in year 2000- and probably earlier- Premier League numbers), they will sell having fulfilled Jack's wishes. If they can find someone to take the huge potential liability that is Rovers if the club ever gets into trouble away from them, they will be enormously relieved as they are responsible for EVERYTHING Jack placed in Trust, not just that potential black hole that is the Rovers.

So from a Rovers supporter perspective, knowing as we do that Rovers long term is totally dependent on the PL media income flowing and that the club is badly placed to generate any other incomes, the Trust is deeply valuable to us in that

- there are checks and limits to protect the club's downside even though they were designed for a world which existed ten years ago

- we have owners who will NEVER TAKE ANYTHING OUT of the club from charging expenses upwards

- and have been pretty successful in ensuring the club has been extremely well managed and will continue to be so whilst they are in charge.

[philipl]

There are two reality checks in today's papers:

The Liverpool board and owners postpone their meeting as NO credible bids have been received. The banks are charging £2.5m interest PER WEEK on £110m of Liverool's debt!!!!

So where are the people on here saying Liverpool are being sold and we are not?

There is a profile of O'Neill in the Guardian which is not yet online which spells out that the Lerner model at Villa was not working. He was making modest yet sustained generous injections to Villa yet controlling football costs in order to generate an operating return at some point in the future simply was never going to happen so he turned the tap off after three years.

The bottom line is those fans who are berating the Trust and are looking for a new buyer are simply asking for somebody else to bankroll a passion the fans themselves are unwilling to put their hands in their own pockets to pay for. It is a totally dishonest position to take.

[Ozz]

So in post 4315 Philip, are you suggesting that Jacks will is now actually holding us back? Or is it a wonderful piece of foresight by Jack, protecting us against pillaging on the Portsmouth scale, meaning a sale will only occur when the financial climate in the PL returns to reality?

[philipl]

It's not Jack's Will per se- it is the documents establishing and instructing the Trust which actually goes back to the 1980's.

This is both protecting us and creating uncertainty because the Trust are working with instructions which did not envisage the sort of numbers that currently exist in football. I think the Sky deal in 1998 was c.£200m- now media is worth c.£2.5bn.

[47er]

- we have owners who will NEVER TAKE ANYTHING OUT of the club from charging expenses upwards

and will NEVER PUT ANYTHING IN unless we appear to be doomed to relegation. In which case the owners will mount a panic rescue because relegation means the end of the TV revenue and the whole pack of cards comes tumbling down. Hardly the basis for running a football club is it?

[philipl]

and will NEVER PUT ANYTHING IN unless we appear to be doomed to relegation. In which case the owners will mount a panic rescue because relegation means the end of the TV revenue and the whole pack of cards comes tumbling down. Hardly the basis for running a football club is it?

I think you are deluded. I hope you are right that there is a fairy godmother but the Trust are by far and away the Rovers' best bet at present.

[PAFELL]

I think you are deluded. I hope you are right that there is a fairy godmother but the Trust are by far and away the Rovers' best bet at present.

Er is the northern premier league still going. Because without proper investment in players, that is where Rovers could end up. The club is a few years away from not being able to compete at all under the present situation - which you suggest is best for Rovers. Are you saying that the trust would be quite happy for rovers to be relagated etc, as long as they themselves are doing right by Jack's will or the trust that was set up. How is not investing in the club or business the best thing for the club?

[47er]

I think you are deluded. I hope you are right that there is a fairy godmother but the Trust are by far and away the Rovers' best bet at present.

What you are advocating is an eternity of transfer windows like this one. As fans say------they are losing the will to live.

By the way I think you are deluded (and arrogant) but saying so in no way helps the debate.

[philipl]

What you are advocating is an eternity of transfer windows like this one. As fans say------they are losing the will to live.

By the way I think you are deluded (and arrogant) but saying so in no way helps the debate.

But you have absolutely no practical answer.

All your posts are airy fairy waffle.

[thenodrog]

and will NEVER PUT ANYTHING IN unless we appear to be doomed to relegation. In which case the owners will mount a panic rescue because relegation means the end of the TV revenue and the whole pack of cards comes tumbling down. Hardly the basis for running a football club is it?

Why should they? Football is financially a very sick patient, and owning a football club in this day and age is for 'idiots with a death wish' as Alan Sugar once said. Personally I'd need much more money than the Walker families total before I'd even consider owning a club with good intent. (I might asset strip one that I didn't care about, flog the players and sell the ground to Tesco's but thats a different matter.)

Tell you waht 47er.. why dont you sell your house and car and give it to BRFC? It's much more prteferable to leaving everything to your kids isn't it?

..... The banks are charging £2.5m interest PER WEEK on £110m of Liverool's debt!!!!

How does that work?

[thenodrog]

But you have absolutely no practical answer.

All your posts are airy fairy waffle.

We have an increasing number of followers who exhibit the spoilt attitudes of cry babies.

If Jack Walker had said circa 1990 that he was going to put enough money into the then lowly and perrenially skint BRFC to rebuild the ground and the team into a proper Premier league outfit with a state of the art training facility and winning a few major trophies on the way as well as enjoying the occasionall foray into europe, but that after 20 years the club had to stand on it's own feet financially we'd all have snatched his bloody hand off.

People whinge about the trust but imo if Jack were alive today he'd have drawn the purse strings together too. Whatever he might have been he was certainly no fool intent on financial suicide.

[joey_big_nose]

We have an increasing number of followers who exhibit the spoilt attitudes of cry babies.

If Jack Walker had said circa 1990 that he was going to put enough money into the then lowly and perrenially skint BRFC to rebuild the ground and the team into a proper Premier league outfit with a state of the art training facility and winning a few major trophies on the way as well as enjoying the occasionall foray into europe, but that after 20 years the club had to stand on it's own feet financially we'd all have snatched his bloody hand off.

People whinge about the trust but imo if Jack were alive today he'd have drawn the purse strings together too. Whatever he might have been he was certainly no fool intent on financial suicide.

Absolutely true. On top of that the cost of making a prem team competitive must be a ten fold increase after taking interest into account since Jack's day. Even if Jack had been born twenty years later and took the reigns this afternoon the amount of money he invested in the nineties would only put us in the position of Stoke or Sunderland. Able to sign some big names, but not enough to get anywhere near the big guns.

As it is you have to say - looking at the likes of Stoke or Sunderland - prudent management is more important than sinking 30m in as it all too often disappears with the team finishing lower down the league.

If we got a 30m investment but replaced Allardyce poorly then I think we would be no better off, perhaps even worse. Newcastle are a fantastic example of that.

The financial side of the game is a completely different kettle of fish now. Jack's timing of arriving into Rovers - after the Sky revolution transformed the game but before the arrival of the billionaires - was crucial in giving us an edge. As was, clearly, Kenny's ability to sign quality players (Shearer, Sutton, Flowers, Le Saux etc) and get a lot out of modest ones (Wilcox, Ripley etc).

[Balwer]

How does that work?

Ocean Finance?

100% interest seems fairly steep doesn't it? Particularly since most financial institutions would charge less than a tenth of that.

[philipl]

How does that work?

The banks converted the £110m part of the £237m owed which they feel totally exposed on into "Payment in Kind" or PIK. It is similar to the originally £150m now £215m debt the Glazers have that turns into £500m of debt by 2015 except that is to a hedge fund- the banks have simply used this hedge fund device themselves. You could say that the banks see Liverpool's liquidation value to be no more than £127m which is probably a fair bet.

This is how banks are now biting back at debts which are in the so big that the banks have a problem category. It is what has enabled them to appoint Martin Broughton to oversee the sale and puts then into total control over what happens on 6 October when they are due to be repaid. Only Politics would prevent them from foreclosing and taking full ownership.

I guess they will be telling Gillett and Hicks today that their share holding is lost now following the cancellation of that meeting today and will be taking full control immediately to negotiate a sale before 6 October with no say in the process from the Americans. The Americans of course can always write a cheque for £237m plus accumulated interested before 6 October and the banks and Broughton would walk away.

[den]

The Trust, contrary to popular board opinion, will not see us relegated.

Hmmm, I keep reading these views that the trustees will keep our Premier League status safe. 2 questions for you ET:

1] if they wont put cash in, how can they keep us in this league?

2] How, or why did we get relegated while Jack Walker was alive?

Don't kid yourselves that we are safe from relegation under the trustees. As someone said earlier, limbo isn't the place to be.

Gord - you're still not telling us the way forward.

[Balwer]

The banks converted the £110m part of the £237m owed which they feel totally exposed on into "Payment in Kind" or PIK. It is similar to the originally £150m now £215m debt the Glazers have that turns into £500m of debt by 2015 except that is to a hedge fund- the banks have simply used this hedge fund device themselves. You could say that the banks see Liverpool's liquidation value to be no more than £127m which is probably a fair bet.

This is how banks are now biting back at debts which are in the so big that the banks have a problem category. It is what has enabled them to appoint Martin Broughton to oversee the sale and puts then into total control over what happens on 6 October when they are due to be repaid. Only Politics would prevent them from foreclosing and taking full ownership.

I guess is they will in effect be telling Gillett and Hicks that they have lost the lot now following the cancellation of that meeting today and will be taking full control immediately with the intent of negotiating a sale before 6 October with no say in the process from the Americans. The Americans of course can always right a cheque for £237m plus accumulated interested before 6 October and the banks and Broughton will walk away.

If it's a PIK instrument then there is no cash pay element as the interest just rolls up, so they aid their cash flow. Also if it's a PIK note then it should be around 15% to 17%, similar to the Glazers one. As Gordon says 2.5m per week on 110m just doesn't add up, it'd be more like 400K per week I'd have thought.

[T4E]

Hmmm, I keep reading these views that the trustees will keep our Premier League status safe. 2 questions for you ET:

1] if they wont put cash in, how can they keep us in this league?

Same way they have over the last ten years?

The proof is in the pudding.

[philipl]

If it's a PIK instrument then there is no cash pay element as the interest just rolls up, so they aid their cash flow. Also if it's a PIK note then it should be around 15% to 17%, similar to the Glazers one. As Gordon says 2.5m per week on 110m just doesn't add up, it'd be more like 400K per week I'd have thought.

Check with the Telegraph on that one- they put that number in their report.

Of course there are no real laws against usury in the UK and if a lender really wants to put the squeeze on (and in the case of the two Americans at Liverpool have every right to given the perfectly valid takeovers they have turned down in the past), they can do so.

[den]

Same way they have over the last ten years?

The proof is in the pudding.

How did they do that then? What happened when we went down?

Oh and you didn't answer this one:-

2] How, or why did we get relegated while Jack Walker was alive?

Come on I2E, you know they can't guarantee to keep us in this league.

[unluckymorton]

What you are advocating is an eternity of transfer windows like this one. As fans say------they are losing the will to live.

By the way I think you are deluded (and arrogant) but saying so in no way helps the debate.

Losing the will to live? You/They need to take a reality check. We follow Blackburn Rovers, a club without a benefactor. The management and board are doing a tremendous job to keep us in the best league in the world. I am proud that the clup are not willing to go down the same road as Hull & Portsmouth by spending money they haven't got and the likes of West Ham by selling out to whoever is interested. We are pretty self sufficient as far as football clubs go and we should be proud of our existence in the top flight. As a child in the 70's I dreamt of being in the top flight and here we are about to start our 10th consecutive season in the Premier League.

I assume those losing the will to live only jumped on the band wagon when it stopped to pick up the glory hunters in 1992-1995.

I think the time taken to agree the best deal for Blackburn Rovers Football Club is time well spent. I'm sure the board and the trustee's will ensure that the best decision possible is made for the future of our club.

[unluckymorton]

How did they do that then? What happened when we went down?

Oh and you didn't answer this one:-

2] How, or why did we get relegated while Jack Walker was alive?

Come on I2E, you know they can't guarantee to keep us in this league.

There are few teams that can guarantee Premier League survival den, and there is not a benefactor or manager in the world that could guarantee Premier League survival for our club.

[T4E]

How did they do that then? What happened when we went down?

Oh and you didn't answer this one:-

2] How, or why did we get relegated while Jack Walker was alive?

Come on I2E, you know they can't guarantee to keep us in this league.

The second question is of no interest to me, I was taking you up on the first.

We went down under Jack, since we've been back we've never been all that close to going down under the trustees. No, its not guaranteed, nothing is, but their track record is flawless.

[den]

There are few teams that can guarantee Premier League survival den, and there is not a benefactor or manager in the world that could guarantee Premier League survival for our club.

Thank you Unlucky. El Tombro - are you listening?

It is obviously vital that the trustees make the right decisions, but we must not underestimate the problems that continued uncertainty brings. It's been so evident this summer.

[philipl]

The second question is of no interest to me, I was taking you up on the first.

We went down under Jack, since we've been back we've never been all that close to going down under the trustees. No, its not guaranteed, nothing is, but their track record is flawless.

Backing that up-

Gap between Rovers' points total and the number of points the Premier League's 18th-placed club:

2001/02 10 points

2002/03 18

2003/04 11

2004/05 9

2005/06 29

2006/07 14

2007/08 22

2008/09 7

2009/10 20

[T4E]

Backing that up-

Gap between Rovers' points total and the number of points the Premier League's 18th-placed club:

2001/02 10 points

2002/03 18

2003/04 11

2004/05 9

2005/06 29

2006/07 14

2007/08 22

2008/09 7

2009/10 20

So on average we finish more than 15 points clear of relegation. Or in other words, we win 5 more games than the best relegated team.

Not bad at all.