[Archived] Venky's willing to sell?

[Daniel Louis Grabko (Dan)]

The amount of capital listed under Venky's London was roughly 40m as far as I remember.

I know that it was mentioned on a BRFCS podcast as well, and I think you are in the right ballpark there - but a look at the accounts will tell us what that capital is made up of, which could be any combination of debt and/or equity.

[deftangel]

I don't think it's incumbent on any detractors to have to state a detailed counter-proposal if they don't believe this will work but at the very least they could stop rehashing reasoning which has already been discounted when pooh-poohing the idea.

I've seen the fit-and-proper persons test, BRAG, Wayne Wild and the supposed liquidation of assets like Brockhall brought up several times and Daniel has already gone to great length to explain how those issues/barriers either don't exist or can be overcome.

Several detractors are also working on the assumption that the £10m, if it can be raised, is the end of things and how it wouldn't be possible to run the club on that. Well of course bloody of course. If things ever got that far then surely that figure is just the beginning and there to show that the plan could be viable in the face of other less compelling alternatives. The Board, once in place would immediately set about trying to find additional investment as a matter of priority but there would at least be something to invest in, unlike some nightmare scenarios.

Venky's have demonstrated that they can't honour even the most basic commitments to the bank despite supposedly having the wealth to do so readily. Ultimately if you're Barclay's, are you likely to be so sure Venky's really represent the best chance of not writing off any debt? Sometimes accepting lesser/deferred payments over a longer period of time from a more reliable entity will be a more attractive option.

The main problems with the proposal as it stands are the "only 2 years in the Championship" bit and the likely difficulty in getting enough people to put in. As Dave said however, this should be seen as a starting point, not a take it or leave it proposal. In the absence of any real alternatives at this point, surely our best chance of moving forward is to explore how this proposal can be improved upon rather than throwing our hands up in the air and saying it won't work and that trying to save the club is just "wasting everyone's time".

Miker on the other hand seems to suggest other courses of action would be more beneficial to the community. By all means, but until someone actually fleshes something out it is difficult to make a qualitative assessment as to if that would be the case. It's one thing to say this won't work, it's another to say "this is a waste of time, efforts are better placed elsewhere". It's not unreasonable to expect some alternative suggestions if you're firing the latter.

Like anyone else, I'm hopeful we escape relegation this year but it's far from guaranteed that won't be just a stay of execution. What's another 12 months of Venky's mismanagement and Kean on a Premiership lifestyle likely to do?

[winstonsmith]

First the £20-30m (Actually about £36m on the accounts) you refer to is not accessible to them, as Brockhall and Ewood Park are prohibited from being sold or developed for anything other than their current use by covenants signed by Venkys in the purchase agreement to buy the Club. Thank you Walker Trust for that!

Are the documents containing these covenants in the public domain and, if so, how do we get hold of copies ? I think I would rest easier if I knew that there would be little point in Venky's trying to sell off Ewood or Brockhall.

Edit: Just seen your reply to Paul above !

[alexanders]

Its a very though evironment to make something happen. Private many people are struggling with unsecure jobs and in business life many business have turned to focus on core business and reduce costs.

Maybe you can try and get a big invester from Scandinavia where the economy is still good?

[Daniel Louis Grabko (Dan)]

Several detractors are also working on the assumption that the £10m, if it can be raised, is the end of things and how it wouldn't be possible to run the club on that. Well of course bloody of course. If things ever got that far then surely that figure is just the beginning and there to show that the plan could be viable in the face of other less compelling alternatives. The Board, once in place would immediately set about trying to find additional investment as a matter of priority but there would at least be something to invest in, unlike some nightmare scenarios.

This is an important point - for one, it is human nature to want to be part of a success. If this got off the ground and actually got to the point where the supporters' organization actually had the funds and negotiated a sale in principle, even the staunchest of the original group of nay sayers would want to get in on it if they could afford to. I daresay Sparky Marky might even come around if it got to that point. In other words, shares would not be limited to 10,000. That is not saying that people are sheep by any means, but the group mentality is strong in social beings such as ourselves!

In addition to that there would of course be efforts to secure more investment - but it would not be in the form of trying to fleece existing shareholders for additional investment. Maybe an investment partner could be brought in with a minority interest for example. I am sure there are plenty of companies out there that could use the opportunity to be associated with English Football's highest profile supporter-owned club to better effect than the Venkys have by buying a controlling stake - there's plenty of great marketing spin in that.

[Mercer]

Well, here's my take, feel free to disagree:

First the £20-30m (Actually about £36m on the accounts) you refer to is not accessible to them, as Brockhall and Ewood Park are prohibited from being sold or developed for anything other than their current use by covenants signed by Venkys in the purchase agreement to buy the Club. Thank you Walker Trust for that!

Second, the entire senior playing squad's value on the accounts is booked at just under £14m. This is of course much lower than its true value, and under normal operating circumstances it is possible that they might realize that £40m figure you quote. However, in the scenario we are talking about, they would be lucky to realize half that in what would amount to a fire sale of players.

As you say there are two options, sell or liquidate what you can and then sell. If they liquidated and then sold or let the Club go into administration, they would have a very bad PR nightmare on their hands, the likes of which cannot even be compared to anything to date. Their reputation would be destroyed and their pride shattered - I honestly think that this would only be considered as a very last resort if no buyers could be found. On the other hand, selling the Club to the supporters allows you to escape in a face-saving manner - there are several ways it could be spun by them to paint themselves as philanthropists giving the club back to the community, for example. They could also possibly negotiate non-cash incentives, such as advantageous advertising terms, that would allow them to build on this marketing ploy of making them good guys.

At some stage they have to think about cutting their losses instead of trying gain back their investment. I think it has already pretty much dawned on them this they won't be doing that. They have much bigger business conglomerate to think about than just Rovers, and for that reason alone I don't think they would just attempt to cut and run with whatever they could. In addition to that, I don't think Barclays would allow any of those player sales funds to leave the country once they got an inkling of what was going on. It may be that Venkys only way out is to find a buyer willing to take the Club off their hands for the price of assumption of the debt.

Before I get ridiculed for that statement, try to digest what I have written. The only assets that could be liquidated are the players, and Barclays will have a hawk's eye on that situation at all times. In the event of a fire sale, they may barely raise enough to pay off a £21m debt (if it is indeed still that high). What do they have left then? A stadium and training facilities that they cannot do anything with. It is not an attractive proposition if in the end you also destroy whatever marketing advantage you got out of the whole deal in the first place, which is negligible at best.

If someone can paint me a more attractive picture for Venkys liquidating instead of cutting their losses in accepting a cut price bid from a loyal and dedicated new owner, then please educate me, I am open to being totally wrong and way off base!

What is to stop Venky's resigning membership of either the PL or Championship as appropriate.

No football is then played and current use ceases to exist.

How do you think the courts would then rule, if they even needed to, on the covenants you refer to re Brockhall & Ewood ? If you try hard enough, there is a way around most things and, where necessary, law is there to be challenged and changed as it is both fluid and evolutionary.

[deftangel]

What is to stop Venky's resigning membership of either the PL or Championship as appropriate.

No football is then played and current use ceases to exist.

How do you think the courts would then rule on the covenants you refer to re Brockhall & Ewood ? If you try hard enough, there is a way around most things and

law is there to be challenged and changed as it is fluid and evolves with case law.

Perhaps but that kind of action would be absolutely unprecedented and would be something approaching a worldwide scandal. Even for little old us for whom we deem nobody cares about and someone as thick skinned as Mrs Desai.

Venky's reputation would be in absolute tatters, on an exponentially new level to what one could argue it is now.

I think from the point of view of Daniel's proposal, i.e. the potential negotiation of the sale of the club to a charitable trust then such extreme factors aren't really a factor. It's hardly a way to negotiate; "No, those assets do have book value because we could just forfeit membership of the league and sell them to pay the lawyers we would need to defend that in court". If they were ever to even get to the stage of negotiating then that would mean they are at least interested in doing a deal and would have a vested interest in not being that magnitude of a dick about things.

[Mercer]

Perhaps but that kind of action would be absolutely unprecedented and would be something approaching a worldwide scandal. Even for little old us for whom we deem nobody cares about and someone as thick skinned as Mrs Desai.

Venky's reputation would be in absolute tatters, on an exponentially new level to what one could argue it is now.

I think from the point of view of Daniel's proposal, i.e. the potential negotiation of the sale of the club to a charitable trust then such extreme factors aren't really a factor. It's hardly a way to negotiate; "No, those assets do have book value because we could just forfeit membership of the league and sell them to pay the lawyers we would need to defend that in court". If they were ever to even get to the stage of negotiating then that would mean they are at least interested in doing a deal and would have a vested interest in not being that magnitude of a dick about things.

A lot of dosh at stake. £20m+ is twice the bottom line of their Indian operation.

Possible storm in a teacup.

Scandalous now what they are doing and we have even had a MP standing-up and telling a Parliamentary Select Committee. Impact of that ? None that I can see.

[Fife Rover]

Dan question for you. Puting yourself in the Raos shoes for a moment - this isn't a punishment. You own an asset which has declined dramatically in value, and may get worse, plus you have managed a project which has been an abject failure for 15 months. One way and another its cost a lot of money. The club is relegated and other than a fan based consortium, offering between £0 - £10m, there are no buyers. The fan based consortium are pretty much the same people who have made your life a misery for most of the 15 months.

On the plus side, from Venky's perspective, you have a squad valued at perhaps £40m, club assets of perhaps £20-30m all of which could be turned into real cash. On the minus side the bank is owed at least £21m

Playing devil's advocate here - which looks the more attractive? Sell or break up and dispose?

That is precisely what I have been thinking as well Paul. Being a born pessimist but also having a god business sense, and given the situation you expounded (which is as near correct as can be at present) there is only one course of action that the Venkys could take, and that has to be to realise as much as possible on the assets and get the hell out of it. Absolute no-brainer!

[deftangel]

A lot of dosh at stake. £20m+ is twice the bottom line of their Indian operation.

Possible storm in a teacup.

Scandalous now what they are doing and we have even had a MP standing-up and telling a Parliamentary Select Committee. Impact of that ? None that I can see.

Mr Harris at SportingIntelligence has them wealthy enough to swallow writing off their Blackburn experiment. It's not like their failure here would jeopardise the group so directly or they would be a lot more switched on in protecting their asset.

Their actions since taking ownership are indeed scandalous but there isn't much perception of that in the outside world. They just see the chicken jokes and think we're all protesting against Steve Kean because he's a rubbish manager. The vast majority of their mismanagement isn't visible to the naked eye, we're even endlessly debating the scope of it on here.

Forfeiting the league status of top flight team (in the most high profile league in the world no less) to liquidise real estate and recoup some of their investment? That's a whole new level. Has it even happened before? The media would be all over it, even if it were to occur in the Championship.

[riggers77]

Would love dans plan to come off if the ###### hit the fan. If I were to put my grand in can I put it to the vote that we do an Athletic Bilbao and only allow players from say Lancashire.

[LeChuck]

Would love dans plan to come off if the ###### hit the fan. If I were to put my grand in can I put it to the vote that we do an Athletic Bilbao and only allow players from say Lancashire.

Might as well just vote to not allow the club above League Two whilst you're at it...

[Baz]

I think this will fail on the basis of £1000 is a lot of money for people to put up (and effectively acheive no return on that investment). I also think the target of 10,000 lot of £1000 is mis-guided too. At present we have somewhere around 16k regular home fans, of which I would say the majority attend as part of a family - parents with kids, husbands and wives etc... So I would expect if they were investing it would be one £1000 between them and not each. Therefore, you would be looking at more people investing the £1000 than regular attendees at Ewood. I just dont think the % take-up is likely at all.

I cant really offer an alternative to this though, unless we have someone in our midst with the contacts and werewithall to find new owners. If JA can find buyers, whats to say others cannot?

[Mercer]

Mr Harris at SportingIntelligence has them wealthy enough to swallow writing off their Blackburn experiment. It's not like their failure here would jeopardise the group so directly or they would be a lot more switched on in protecting their asset.

Their actions since taking ownership are indeed scandalous but there isn't much perception of that in the outside world. They just see the chicken jokes and think we're all protesting against Steve Kean because he's a rubbish manager. The vast majority of their mismanagement isn't visible to the naked eye, we're even endlessly debating the scope of it on here.

Forfeiting the league status of top flight team (in the most high profile league in the world no less) to liquidise real estate and recoup some of their investment? That's a whole new level. Has it even happened before? The media would be all over it, even if it were to occur in the Championship.

Have been many discussions about the scale of their wealth and, IMO, their wealth is vastly overstated. I do not believe they would even contemplate writing-off £20m.

This is 5,000 miles from their own backyard and as I said earlier, I think it would be a storm in a teacup and the waters could very easily be calmed with a strategic philanthropic gift of say £2 or £3m back in Pune / India which would, quite possibly, more than offset any damage done to their image.

[rovers11]

I have just read this on the BRAG facebook page

The Action Groups committee has provisionally agreed a meeting with Chief Executive of Blackburn Rovers which will happen before the next home game, whilst the group is heavily involved in a potential takeover bid being led by Wayne Wild, this is in full conjunction with the Action Group.

The progress in the last 72 hours has been immense and for the first time the appears to be light at the end of the tunnel, together we stand - divided we fall

Can anyone involved with brag expand on the supposed meeting with the chief exec as written on the brag facebook page on saturday? I felt this was potentially massive news but all of the big news coming out of brag since has been about the wayne wild lead takeover rather than this meeting. Can anyone confirm the meeting is taking place?

[Daniel Louis Grabko (Dan)]

1329246440[/url]' post='1225888']

Have been many discussions about the scale of their wealth and, IMO, their wealth is vastly overstated. I do not believe they would even contemplate writing-off £20m.

This is 5,000 miles from their own backyard and as I said earlier, I think it would be a storm in a teacup and the waters could very easily be calmed with a strategic philanthropic gift of say £2 or £3m back in Pune / India which would, quite possibly, more than offset any damage done to their image.

They are a global concern Mercer, they of course have to think twice, they could very well shut out any future business opportunities in Europe with such a blatant disregard. It may be your opinion that their wealth is overstated, but it is a fact that the global concern recorded £100m in profit on £1,000m in turnover. Annual basis.

Of course you are entitled to your opinion on their wealth, I mean wealth is all relative. They aren't in a Sheik or Abramovich territory, but I think you would have to concede that you used selective figures there to make your point. You have to admit it would be a pretty unprecedented attempt at open asset stripping for them to actually try something like that. I would think you might have a bit of merit to your point there if VH Group was only an Indian enterprise. Their own back yard is 5 continents of operations, and the Premier League and English football in general is the most popular and visible football league system in the world at the moment.

[Daniel Louis Grabko (Dan)]

1329248271[/url]' post='1225898']

Can anyone involved with brag expand on the supposed meeting with the chief exec as written on the brag facebook page on saturday? I felt this was potentially massive news but all of the big news coming out of brag since has been about the wayne wild lead takeover rather than this meeting. Can anyone confirm the meeting is taking place?

Is this the statement that got BRAG a bad rap, especially on podcast 25? I hadn't seen it until now, and can sympathize with how it could easily have been misinterpreted. Made it sound like they were moving to do it themselves, and really is just a case of clumsy wording, it seems. Need to be more careful.

Anyway, I thought Mrs. Desai was the Chief Executive? Isn't Hunt just the Deputy Chief Executive? I too am very curious! Is there a date set?

[miqaayil]

I do not know if i should be posting this ... but just a shot at my best laid plan 3 phase approach

Phase 1

Ian Currie , Ian Battersby and Wayne Wild and whoever willing to invest form a local consortium , if can include a few MP great , make an appointment with or send feelers to saudi (e.g HRH AL-WALEED) , QATAR (E.G QIA) ,Kuwait . Pitch the predicament of club , role in community , population census, future plans , devolopment area etc etc ... explain abt phase 2 and 3

phase 2

Set-up a good board , grow the image of the club , have target of europe in 3 seasons ....

Phase 3

Sell marketing rights of each country , e.g china , india , middle east to sports/marketing/PR company in local country , We promise tour , training camps , selecting suitable youngsters for our academy train them and return them to their respective countries , these company's manage them and sell them in local clubs

This plan can be further explored to include Fans organization to hold small percentage and local consortium hold small percentage.When it comes to asia ... whether venkys sell depends on who is behind the consortium

[Mercer]

They are a global concern Mercer, they of course have to think twice, they could very well shut out any future business opportunities in Europe with such a blatant disregard. It may be your opinion that their wealth is overstated, but it is a fact that the global concern recorded £100m in profit on £1,000m in turnover. Annual basis.Of course you are entitled to your opinion on their wealth, I mean wealth is all relative. They aren't in a Sheik or Abramovich territory, but I think you would have to concede that you used selective figures there to make your point. You have to admit it would be a pretty unprecedented attempt at open asset stripping for them to actually try something like that. I would think you might have a bit of merit to your point there if VH Group was only an Indian enterprise. Their own back yard is 5 continents of operations, and the Premier League and English football in general is the most popular and visible football league system in the world at the moment.

Dan, you might be right but at the time of the takeover there was enormous discussion on this and I'm pretty certain that some were getting their decimal points mixed-up in currency conversion. TBH, haven't reviewed / researched Venky's operations as I have better things to do with my time, however, would comment that their behaviours do not mirror owners with a bottom line profit of £100m pa !!!! Again, outside the UK, Rovers, unfortunately, hardly cause a ripple and therefore whether Indian dominated or mainly Indian with other global interests, I doubt that what they do with the Rovers is going to matter much in their markets.

[Daniel Louis Grabko (Dan)]

1329250284[/url]' post='1225908']

Dan, you might be right but at the time of the takeover there was enormous discussion on this and I'm pretty certain that some were getting their decimal points mixed-up in currency conversion. TBH, haven't reviewed / researched Venky's operations as I have better things to do with my time, however, would comment that their behaviours do not mirror owners with a bottom line profit of £100m pa !!!! Again, outside the UK, Rovers, unfortunately, hardly cause a ripple and therefore whether Indian dominated or mainly Indian with other global interests, I doubt that what they do with the Rovers is going to matter much in their markets.

Fair enough, I stand to be corrected if that is the case, but I am taking sources from respected journalists and publications in the financial sector. Anyway, we are going to have to agree to disagree on the impact of a blatant asset stripping of this magnitude, it just isn't at all likely. About as likely as this plan seeing a flood of 30,000 supporters lining up with money in their hands ready to invest on the first day. But that's just my opinion.

[Daniel Louis Grabko (Dan)]

1329249955[/url]' post='1225905']

I do not know if i should be posting this ... but just a shot at my best laid plan 3 phase approach

Phase 1

Ian Currie , Ian Battersby and Wayne Wild and whoever willing to invest form a local consortium , if can include a few MP great , make an appointment with or send feelers to saudi (e.g HRH AL-WALEED) , QATAR (E.G QIA) ,Kuwait . Pitch the predicament of club , role in community , population census, future plans , devolopment area etc etc ... explain abt phase 2 and 3

phase 2

Set-up a good board , grow the image of the club , have target of europe in 3 seasons ....

Phase 3

Sell marketing rights of each country , e.g china , india , middle east to sports/marketing/PR company in local country , We promise tour , training camps , selecting suitable youngsters for our academy train them and return them to their respective countries , these company's manage them and sell them in local clubs

This plan can be further explored to include Fans organization to hold small percentage and local consortium hold small percentage.When it comes to asia ... whether venkys sell depends on who is behind the consortium

Ok, Phase 3 actually sounds very interesting as a plan for increasing turnover in new areas in a creative way that also invests in the long term future of the club, expands the Academy operations, and increases the scouting network and knowledge. Even excluding the need for the scope of phase 1 of your plan. Guarantee top level training to the respective countries' best young talent, and keep the creme de la creme while returning most of them to their home countries to play in their leagues. I like your thinking!

[Mercer]

Fair enough, I stand to be corrected if that is the case, but I am taking sources from respected journalists and publications in the financial sector. Anyway, we are going to have to agree to disagree on the impact of a blatant asset stripping of this magnitude, it just isn't at all likely. About as likely as this plan seeing a flood of 30,000 supporters lining up with money in their hands ready to invest on the first day. But that's just my opinion.

The journos have been some of the biggest culprits about overstating their wealth. Let's get one thing clear, whichever way you look at their behaviour in connection with Rovers, IMO, it seems like they haven't a pot to p1ss in which is out of line with a £100m profit pa organisation.

It's all about opinions and, IMO, I have seen nothing in their behaviour with Rovers to suggest that they wouldn't do anything to recoup their £23m+ outlay. Make no mistake, if they hadn't been confident of getting their money back, even if relegated, they would surely have snatched-off the hand of Q.P. in the alleged 'bid' back in October.

I think what you and WW are trying to do is admirable but I don't think you will even make it out of the starting blocks because £10m is, IMO, woefully short and, even if it wasn't, I'm well nigh certain you couldn't raise it through the supporters.

Honesty is key in all this and I don't think it's in the best interest of supporters if their hopes are raised, perhaps unfairly.

[darrenrover]

Not knocking anybody, 11 out of 10 for effort but I would like to point out a pertinent fact that IMO needs to be considered.

Rovers average home gate 22,172 (don't forget cheap season and match day tickets and away following included)

Newcastle Utd ave home gate 48,924

Sunderland 38,461

Fulham 25,237

Championship:

West Ham 29,868

Cardiff 22,289

Southampton 25,546

Derby 25,989

Nottingham Forest 22,124

Leicester City 23,192

Leeds United 24,363

Brighton 20,126

Division 1:

Sheffield Wednesday 20,136

Sheffield United 18,293

Char ton Athletic 17,976

They all field 11 players and 5 subs per game.

I won't elaborate further but just thought these statistics should be considered in the great scheme of things.

[rovers11]

Is this the statement that got BRAG a bad rap, especially on podcast 25? I hadn't seen it until now, and can sympathize with how it could easily have been misinterpreted. Made it sound like they were moving to do it themselves, and really is just a case of clumsy wording, it seems. Need to be more careful.

Anyway, I thought Mrs. Desai was the Chief Executive? Isn't Hunt just the Deputy Chief Executive? I too am very curious! Is there a date set?

I haven't read their statement or had a chance to listen to podcast 25 yet so not really sure what was said. However, I am intrigued by the comment on their facebook group about this meeting. I think they are referring to paul hunt and just got a little muddled as to what his job title is. The brag facebook group is closed so if anyone could enlighten us about this meeting, that would be useful.

[47er]

I don't think it's incumbent on any detractors to have to state a detailed counter-proposal if they don't believe this will work but at the very least they could stop rehashing reasoning which has already been discounted when pooh-poohing the idea.

I've seen the fit-and-proper persons test, BRAG, Wayne Wild and the supposed liquidation of assets like Brockhall brought up several times and Daniel has already gone to great length to explain how those issues/barriers either don't exist or can be overcome.

Several detractors are also working on the assumption that the £10m, if it can be raised, is the end of things and how it wouldn't be possible to run the club on that. Well of course bloody of course. If things ever got that far then surely that figure is just the beginning and there to show that the plan could be viable in the face of other less compelling alternatives. The Board, once in place would immediately set about trying to find additional investment as a matter of priority but there would at least be something to invest in, unlike some nightmare scenarios.

Venky's have demonstrated that they can't honour even the most basic commitments to the bank despite supposedly having the wealth to do so readily. Ultimately if you're Barclay's, are you likely to be so sure Venky's really represent the best chance of not writing off any debt? Sometimes accepting lesser/deferred payments over a longer period of time from a more reliable entity will be a more attractive option.

The main problems with the proposal as it stands are the "only 2 years in the Championship" bit and the likely difficulty in getting enough people to put in. As Dave said however, this should be seen as a starting point, not a take it or leave it proposal. In the absence of any real alternatives at this point, surely our best chance of moving forward is to explore how this proposal can be improved upon rather than throwing our hands up in the air and saying it won't work and that trying to save the club is just "wasting everyone's time".

Miker on the other hand seems to suggest other courses of action would be more beneficial to the community. By all means, but until someone actually fleshes something out it is difficult to make a qualitative assessment as to if that would be the case. It's one thing to say this won't work, it's another to say "this is a waste of time, efforts are better placed elsewhere". It's not unreasonable to expect some alternative suggestions if you're firing the latter.

Like anyone else, I'm hopeful we escape relegation this year but it's far from guaranteed that won't be just a stay of execution. What's another 12 months of Venky's mismanagement and Kean on a Premiership lifestyle likely to do?

Agree with all of that.You've covered it all.