[Archived] Rumour: Venky's To Sell?

[Exiled in Toronto]

But the way the club had been run, from managerial appointments, to scouting, to player acquisitions and sales meant that relegation was barely even a threat in the vast majority of our time in this league. Selling your best players is something that happens to every club of our size (and has even had to happen to Manchester United on occasion, and is happening to Arsenal).

And our wage structure wouldnt mean liquidation even if relegated. Look at the most extreme example - Portsmouth. We have been nowhere near as bad as they were, and yet they finished mid table in the Championship, still in existence and can at least hope to have a shot at the playoffs next season such is the unpredictable nature of the league. I deliberately don't include Leeds in any comparison since their revenue potential and fan base is so much greater than ours.

You're looking at it as a fan and not as an owner. The gap between income and expenditure if we go down will be in the tens of millions - you would be happy covering that AND repaying the 20 million overdraft which could well be called in if relegated?

Wolves is a better model for a club like us in the long run: lower wages, no debt and relegation being an inconvenience rather than a catastrophe. But getting from where we are to that will be painful and not without risk.

[RoverInverness]

Firstly the bloke existed-

I agree, but the point being made to you is that this is unprovable - just like Phil's arguments. You have not succesfully refuted this because it is not possible to do so.

The club is on a downward spiral but I chose not to believe the word of a person who only yesterday was telling us that Venkys workers were crying for help via a Nazi symbol on a sign lol.

Sorry, I do not understand.

Give it 6 weeks and I expect Phillip to come on here and tell us that the sale fell through because of an unknown factor and that there were 10 people looking to sell the club etc etc.

Fair point regarding Phil's variable accuracy and Nicko like failure to accept when he's wrong. However, it is not just Phil telling us the club is for sale. Kamy and BPF have also independently heard this, as have numerous other posters. Even Zac, previously also pro-Venkys, claims to know about some really bad things happening inside the club. There is now far too much evidence to ignore.

Anyway each to their own I've made my point.

And thanks for doing so.

[Exiled in Toronto]

but at the moment, we have Venky's who are putting in £5m/year that replaces the trusts input.

That would be the first thing you have believed about Venky's Personally, it looks one of their more questionable claims to me!

[ABBEY]

Thanks den, though my absence wasn't due to a ban - I had only been banned for 2 hours. But the season was over and there was very little but bad news to talk about...

good god its back.

[tony gale's mic]

You're looking at it as a fan and not as an owner. The gap between income and expenditure if we go down will be in the tens of millions - you would be happy covering that AND repaying the 20 million overdraft which could well be called in if relegated?

Wolves is a better model for a club like us in the long run: lower wages, no debt and relegation being an inconvenience rather than a catastrophe. But getting from where we are to that will be painful and not without risk.

No even as an owner, football clubs are totally different to other businesses. Other businesses don't have the crucial dimension that football has - ie on the pitch performance being symbiotic with the balance sheet performance. Most owners of football clubs will be delighted to break even, most owners of businesses aren't. We were performing very well on the pitch over an extended period of time, it was hardly a fluke and nor was it solely down to one manager as under Souness and Allardyce we had performed very well too. During Allardyce's 2 calendar years in charge we were a top ten club almost the entire time (eg if you take into account the record after Ince left etc).

So the model the club was operating on reduced relegation to a much lower possibility than Wolves did. Since football is ultimately about keeping yourself afloat to provide entertainment and success for your fans, rather than the profit making exercise that most businesses operate on, surely this was a more successful model than Wolves'? Seven years is a long enough run to assess how viable our model was, surely?

Clubs which get relegated get £48 million over 4 years in parachute payments. That covers a lot of the shortfall, and relegation wage drop clauses if they exist would be another way of rectifying this. There's many clubs with finances worse than ours who have managed to stay afloat even when relegated. The clubs that really went downhill were the ones being run by madmen making crazy decisions - something which I worry is happening now.

[Exiled in Toronto]

No even as an owner, football clubs are totally different to other businesses. Other businesses don't have the crucial dimension that football has - ie on the pitch performance being symbiotic with the balance sheet performance. Most owners of football clubs will be delighted to break even, most owners of businesses aren't. We were performing very well on the pitch over an extended period of time, it was hardly a fluke and nor was it solely down to one manager as under Souness and Allardyce we had performed very well too. During Allardyce's 2 calendar years in charge we were a top ten club almost the entire time (eg if you take into account the record after Ince left etc).

So the model the club was operating on reduced relegation to a much lower possibility than Wolves did. Since football is ultimately about keeping yourself afloat to provide entertainment and success for your fans, rather than the profit making exercise that most businesses operate on, surely this was a more successful model than Wolves'?

Clubs which get relegated get £48 million over 4 years in parachute payments. That covers a lot of the shortfall, and relegation wage drop clauses if they exist would be another way of rectifying this. There's many clubs with finances worse than ours who have managed to stay afloat even when relegated. The clubs that really went downhill were the ones being run by madmen making crazy decisions - something which I worry is happening now.

48 million divided by 4 = 12 million. Compare that to how much we got last season and a wage bill of over 40 million

[thenodrog]

... Let's face it there is no investment in football it's just a question of how much you want to throw away

If I won the Euromillions this week and bought the club I think the money would be gone inside two years. PL football is not an investment, it's financial suicide.

Exactly Paul. I've been banging on about that for years. Odd thing is that so many people on here are only able to see a blank screen above this comment..... Bit like it is with some people and Thestrals.

[tony gale's mic]

48 million divided by 4 = 12 million. Compare that to how much we got last season and a wage bill of over 40 million

Then there's transfer fees from players sold, a decrease in the wage bill from players who leave, plus the knowledge that even after two years of cost cutting you'll still be getting that 12 million a season for the following two seasons...

Like I said, hardly the certain catastrophe you're painting it out to be.

[A cup of beans]

PL football is not an investment, it's financial suicide.

100% agree, paul.

and sadly.. as each day goes by.. the owners probably believe that too!

[thenodrog]

He resigned as Venky's couldn't sack him until 12 months had passed. So shouldn't be a compensation package.

imo thats naive modes. Basically 'You obviously want shot of me but you cannot sack me until next year so lets do a deal. Make me an offer to resign and if it's big enough then I will'.

[Mercer]

Who might that be Steve Kean ???

I don't think Kean will resign (not with a two year contract behind him - if he does, he's less intelligent than some already think) nor will Venky's sack him now and pay out compo..

IMO, he will only go when ownership changes.

[thenodrog]

I am reasonably sure that there are negotiations happening now.

What the chances are that this will result in a sale is anybody's guess. I explained in the podcast why I think it makes sense for Venky's to sell this summer but it needs a determined buyer, a willing seller, an agreed price and all the terms and conditions to be tied down for a deal to be signed and I have absolutely no idea whether any one of those is present.

There had been a significant set back but that happened probably ten days ago and things then went very quiet. Quiet can be interpreted two ways- nothing happening or the more intense the negotiations the quieter it is likely to be.

At the moment we seem to be mirroring the Man City farce although I doubt we'll end up with a similar result somehow.

Don't know if this has been asked of you or even if you have the answer but if there is interest etc etc are Kentaro / SEM involved in 'introducing' this potential new owner?

[den]

Wolves is a better model for a club like us in the long run: lower wages, no debt and relegation being an inconvenience rather than a catastrophe. But getting from where we are to that will be painful and not without risk.

Exiled, why would we want to be like Wolves? Beats me - I would imagine that pre-venky's, their fans and their board would have moved heaven and earth to perform as Rovers did.

This wage-turnover discussion that's being used as evidence that the trustees were overstretching themselves and maybe running the club to some kind of "out of control" situation:

The trust didn't have to run the club at 80/90% of turnover. It was a choice that they opted for. They could have reduced the wage bill at any time - as indeed they did towards the sale. They chose to run the club at that wage level. The whole object of the trustees and indeed of JW, was to keep Rovers in as high a league as possible. They realised between them, that whatever we think about the obscene wages that footballers earn, the best way of keeping us in the top division was to keep the wage bill as high as possible. Rovers needed a higher ratio than clubs with a bigger turnover, in order to compth them. The wage bill was also a measure of how a manager was performing. Interestingly, using that judgement would see Sam successful and Kean as a failure [not that that's what I set out to say ].

So, bottom line is that the wage/turnover ratio was well controlled and contributed to how successful we actually were. As for the debt, that was never out of control. The club were happy to go along with a small level of debt - as are most businesses.

[thenodrog]

Paul is right about the underlying financial position the club is in, which is why no-one bought it for over two years of being on sale.

You can't make money out the club.

The simplest and most logical comment (and one that I have repeated many times over) is that if you could make money out of BRFC then the Walker Trust would never have sold.

[broadsword]

The simplest and most logical comment (and one that I have repeated many times over) is that if you could make money out of BRFC then the Walker Trust would never have sold.

Yes, absolutely, and what is more, you have to question the motives of anyone who who want to buy such a loss-making concern where there is no prospective alternative business model which would turn a profit.

Did anyone really believe all that jive about making Rovers "India's club"? There was never any realistic prospect of that. Mind you, it didn't stretch credibility as much as saying we could get amongst the Champion's League placings with a few players "on lease".

If they do keep hold of us, I'd like to know what their plans are. That's on the assumption we can get a straight, consistent answer out of them that actually makes sense. Because at the moment we seem incapable of signing any players and we've just lost our best one. Not content with chucking the paddle away, they've set fire to the canoe.

[thenodrog]

The Venky's are different owners from what we are used to,their aquisition of Rovers for totally different reasons....the promotion of THEIR family business.Its blatantly clear they want maximum exposure for minimal investment,we are very much second best in the running here..how on earth this marriage from hell benefits us in any way is beyond me to be honest.You only have to observe their short tenure to date and it really should set alarm bells ringing.

Lets face it they were sold a pup. Victims to the silvery tongue of some universally despised football agent. No doubt as big fish in their own country and in awe of western culture they would be like kids standing with their noses pressed hard against a toy shop window. I think the reallities of running a money pit Prem league operation in the UK must have come as a mighty shock to them.

[Exiled in Toronto]

Exiled, why would we want to be like Wolves? Beats me - I would imagine that pre-venky's, their fans and their board would have moved heaven and earth to perform as Rovers did.

This wage-turnover discussion that's being used as evidence that the trustees were overstretching themselves and maybe running the club to some kind of "out of control" situation:

The trust didn't have to run the club at 80/90% of turnover. It was a choice that they opted for. They could have reduced the wage bill at any time - as indeed they did towards the sale. They chose to run the club at that wage level. The whole object of the trustees and indeed of JW, was to keep Rovers in as high a league as possible. They realised between them, that whatever we think about the obscene wages that footballers earn, the best way of keeping us in the top division was to keep the wage bill as high as possible. Rovers needed a higher ratio than clubs with a bigger turnover, in order to compth them. The wage bill was also a measure of how a manager was performing. Interestingly, using that judgement would see Sam successful and Kean as a failure [not that that's what I set out to say ].

So, bottom line is that the wage/turnover ratio was well controlled and contributed to how successful we actually were. As for the debt, that was never out of control. The club were happy to go along with a small level of debt - as are most businesses.

The club was being financially run in the last 2 years for a sale. There had been three sources of funding to cover the intrinsic annual loss: owner donation, increasing debt, player sales - and we needed all three to stay as we were for long. The first was stopped, the second reached its limit and the third has severe risks of weaking the main revenue stream of place money. It could not carry on, which is why our owners sold us.

[greco]

That would be the first thing you have believed about Venky's Personally, it looks one of their more questionable claims to me!

had they continued with the strategy, that williams architected and put in a yearly fee of the promised 10 mill, they would have recieved exposure and pr worth much more.

Their plan from the start, actually sounded promising, but sadly theyve shown a distinct lack of ability and intellect, to stay on course.

some excellent post paul, really echoed my thoughts

[BangkokRover]

Their plan from the start, actually sounded promising, but sadly theyve shown a distinct lack of ability and intellect, to stay on course.

If they had plan that would have been a start, there is no reason at all why someone could not run a football club for the publicity and for the good will that a successful sporting club brings. As an example some VERY wealthy people own sporting clubs for fun and enjoyment. People even run F1 teams with their private money which is at least as expensive as running a EPL team.

The reason people top dollar/euro/pounds to advertise on football teams shirts is they have millions of eyes on the every say 5 days. Honestly to buy that amount of advertising around the world to reach the same amount of people would really be eye watering and make running an EPL team as cheap.

Of course its a lot more difficult to run a smaller team successfully compared to a large team but its also cheaper but its not impossible look at what Mark Hughes and John Williams achieved.

Lets hope things take a turn for the better soon.

[SIMON GARNERS 194]

Lets face it they were sold a pup. Victims to the silvery tongue of some universally despised football agent. No doubt as big fish in their own country and in awe of western culture they would be like kids standing with their noses pressed hard against a toy shop window. I think the reallities of running a money pit Prem league operation in the UK must have come as a mighty shock to them.

Agree.

I also firmly believe Theno that those same agents played a part in marginalising John Williams,Tom Finn et al.Again they gave bad advise to further their own gain.

Stinks.

[yoda]

If they had plan that would have been a start, there is no reason at all why someone could not run a football club for the publicity and for the good will that a successful sporting club brings. As an example some VERY wealthy people own sporting clubs for fun and enjoyment. People even run F1 teams with their private money which is at least as expensive as running a EPL team.

The reason people top dollar/euro/pounds to advertise on football teams shirts is they have millions of eyes on the every say 5 days. Honestly to buy that amount of advertising around the world to reach the same amount of people would really be eye watering and make running an EPL team as cheap.

Of course its a lot more difficult to run a smaller team successfully compared to a large team but its also cheaper but its not impossible look at what Mark Hughes and John Williams achieved.

Lets hope things take a turn for the better soon.

I don't see how things can turn out for the better, if Venkys sell the club now it will be on the basis of damaged goods so the price will be lowered significantly,

the lower the price = more chancers waiting in the wings, unless Philip has someone lined up so he can get his finders fee that he missed out on last time

[BangkokRover]

I don't see how things can turn out for the better, if Venkys sell the club now it will be on the basis of damaged goods so the price will be lowered significantly,

the lower the price = more chancers waiting in the wings, unless Philip has someone lined up so he can get his finders fee that he missed out on last time

Well this would get better if we were sold to the company suggested on this thread as the new owners are a lot richer and have LOTS of experience in running multiple businesses.

[thenodrog]

In the nature of these things, the sale is going to look very uncertain/unlikely until virtually the moment it is announced. I am not putting any %ages on it not least because there might just be an Indian concern talking to Venky's over in Pune which could be a more attractive exit to Venky's than the Bugshans.

If we are sold, it is a huge leap into the unknown.

If we are not sold, we will be relegated this season

... you asked my opinion.

Might be wrong but being bullish I'd imagine if before any new owner put pen to paper they'd have a proper manager all lined up. To take us on without that and a bit of time to trade in and out a few players is buying a disaster all lined up and waiting to happen. Alternatively to be bearish the other option is to buy us later either for a desperate 'stop loss' price from the Venkeys, when we are relegated or cheaper still from the receivers.

[BangkokRover]

Not sure any serious buyer would be willing to wait to see if we are relegated. We all remember being in the Chumpionship before and its incredibly difficult to get back up.

[greco]

If they had plan that would have been a start, there is no reason at all why someone could not run a football club for the publicity and for the good will that a successful sporting club brings. As an example some VERY wealthy people own sporting clubs for fun and enjoyment. People even run F1 teams with their private money which is at least as expensive as running a EPL team.

The reason people top dollar/euro/pounds to advertise on football teams shirts is they have millions of eyes on the every say 5 days. Honestly to buy that amount of advertising around the world to reach the same amount of people would really be eye watering and make running an EPL team as cheap.

Of course its a lot more difficult to run a smaller team successfully compared to a large team but its also cheaper but its not impossible look at what Mark Hughes and John Williams achieved.

Lets hope things take a turn for the better soon.

imo it seemed plausible, they own a big indian company, in an blooming asian market. They wanted global exposure and a growth in their main business.

So i thought they were owners, willing to lose a bit on football, as the other side of the coin, would be namebrading, pr and growth on the global scene.

in essence a loss in their football club, but a plus in the chicken industry, that would erase the loss in football or perhaps even better it. So it Could/would be a case of the rao´s getting richer and rovers too.

they do have some time, to get back on track, but looking at the way they fukked up their own plan and the mistakes made, its a longshot.