[Archived] Venkys London Limited - Accounts

[TBTF]

After last nights performance, a fire sale of the clubs players could be a blessing. There is so much waste in the squad that isn't suited to the Premier League or the Championship but which commands about £200k a week.

On the financial front- If the current overdraft is secured against Venky's assets, how will the Bank of India demand payment from Rovers should the need arise? Venkys own all of Rover's assets but if the loan itself is not secured against British assets, how would they be able to force the club to pay back from its operations rather than the Venkys Hatcheries group? The decision to strip Rovers of assets would surely have to made by Venkys themselves rather than bank enforcement.

Bank won't make demand on Rovers and thats exactly it-Venkys , if called upon to repay B o India would likely take comfort in the assets they own ie Rovers..This has been a disastrous few days for the Club with few who have seen it , holding out any hope of getting promoted.Highly unlikely funds will be forthcoming in Jan and the rumour is now that the upcoming financial fair play is going to be a killer for us.

Under that Venkys CANNOT just fund the losses even if they wanted or were able to.

I think the stick Philipl has received for allegedly being a doom monger is broadly the point of his post Darrenrover.The game is close to being up for us sadly.

[Mercer]

After last nights performance, a fire sale of the clubs players could be a blessing. There is so much waste in the squad that isn't suited to the Premier League or the Championship but which commands about £200k a week.

On the financial front- If the current overdraft is secured against Venky's assets, how will the Bank of India demand payment from Rovers should the need arise? Venkys own all of Rover's assets but if the loan itself is not secured against British assets, how would they be able to force the club to pay back from its operations rather than the Venkys Hatcheries group? The decision to strip Rovers of assets would surely have to made by Venkys themselves rather than bank enforcement.

Key to all this is who is the borrower !?!?

Based on the consolidated 31 March 2012 accounts for the UK operation, it seems the borrower is BRFC. It seems that Venk. Hatch. Pvt Ltd is the lender's secured guarantor.

A lender, in the main, only enforces security as a last resort.

First the lender will exhaust all options in trying to recover money from the borrower. The bottom line to this is BRFC could be stripped bare with Venky's Indian assets untouched !

[Andy]

If a fire sale is needed, then let's get it done in January and play some kids.

This season may well be a write-off anyway, so let's get players like Edwards, Henley, Raheem Hanley, Fernandez, Jake Kean and Osawe some game time with a view to kicking on next season.

I don't think it's the end of the world if we stay in the Chumpionship this season, like some have suggested.

If we don't go up next season, that's a different matter...

[PAFELL]

Everybody sitting comfortably tonight?

Is the club debt free or not.

Shaw and Singh have recently told the action group that the club is debt free. Are they telling the truth.

Not being an accountant the recent released accounts, to me, do not read comfortable. To me they say there are still debts, but just not due yet. If the club is not promoted this season we are in serious trouble.

Key to all this is who is the borrower !?!?

Based on the consolidated 31 March 2012 accounts for the UK operation, it seems the borrower is BRFC. It seems that Venk. Hatch. Pvt Ltd is the lender's secured guarantor.

A lender, in the main, only enforces security as a last resort.

First the lender will exhaust all options in trying to recover money from the borrower. The bottom line to this is BRFC could be stripped bare with Venky's Indian assets untouched !

I ask the same question to you as I did to philip. Is the club debt free as shaw and singh claim it is?

[tomphil]

They would not be able to get shut of the likes of Murphy though as he's finished at top level and no one else will take his wages on. Some may be interested in Etuhu but no again not on the wedge he's on. They would most likely look to sell one of two of the most saleable assests for the most money, i.e Rhodes but in all likelyhood we will see what we did last year. It's already happening with Givet, Pederson, Simon etc all frozen to the bench, add Dunn to that and a lot of older players and big wages will be turfed out to slash running costs and they'll be replaced by cheap Portugese players. I think all this is part of Bergs remit.

[Mercer]

Is the club debt free or not.

Shaw and Singh have recently told the action group that the club is debt free. Are they telling the truth.

Not being an accountant the recent released accounts, to me, do not read comfortable. To me they say there are still debts, but just not due yet. If the club is not promoted this season we are in serious trouble.

I ask the same question to you as I did to philip. Is the club debt free as shaw and singh claim it is?

As I said earlier in this thread, just how on earth can we be debt free when the accounts for 31 March 2012 show that we have net current liabilities of £11.5million and other liabilities due in more than 12 months of £3.5million.

That is £15million of debt in any accountant's language.

They are the indisputable facts, black and white.

So, unless Venky's have further invested from their own personal monies to the tune of about £35million (to cover £15million debt at 31 March 2012 and likely losses since) there is, IMO, no way we can be debt free. I look forward to Singh or Shaw proving otherwise.

[PAFELL]

As I said earlier in this thread, just how on earth can we be debt free when the accounts for 31 March 2012 show that we have net current liabilities of £11.5million and other liabilities due in more than 12 months of £3.5million.

That is £15million of debt in any accountant's language.

They are the indisputable facts, black and white.

So, unless Venky's have further invested from their own personal monies to the tune of about £35million (to cover £15million debt at 31 March 2012 and likely losses since) there is, IMO, no way we can be debt free. I look forward to Singh or Shaw proving otherwise.

Thats how I read the accounts and I am not an acountant in any way.

I find it strange that others read the accounts that show a debt of about 15 mill, different to you, philip and others on here.

I conclude that if Shaw and Singh can tell blatant lies about the accounts to the action group. what else are they lying about? As you say and I agree, the accounts are there in black and white showing this debt. Staggering beyond words.

[Athlete]

They would not be able to get shut of the likes of Murphy though as he's finished at top level and no one else will take his wages on. Some may be interested in Etuhu but no again not on the wedge he's on. They would most likely look to sell one of two of the most saleable assests for the most money, i.e Rhodes but in all likelyhood we will see what we did last year. It's already happening with Givet, Pederson, Simon etc all frozen to the bench, add Dunn to that and a lot of older players and big wages will be turfed out to slash running costs and they'll be replaced by cheap Portugese players. I think all this is part of Bergs remit.

...hope your wrong and Berg has some balls and stands up to em..

[K-Hod]

Everybody sitting comfortably tonight?

Put up or shut up and stop trolling. Your attention seeking is embarassing.

[Mercer]

Thats how I read the accounts and I am not an acountant in any way.

I find it strange that others read the accounts that show a debt of about 15 mill, different to you, philip and others on here.

I conclude that if Shaw and Singh can tell blatant lies about the accounts to the action group. what else are they lying about? As you say and I agree, the accounts are there in black and white showing this debt. Staggering beyond words.

Unfortunately, IMO, there is far too much spin surrounding Rovers' operations now.

Again, IMO, the Action Group have been neutralised by the 'cosy little chats'. Reminds me of the unions and their 'beer and sandwiches' back in the Callaghan days at Downing Street. As I have said before, it's easy for some to become intoxicated by the slightest whiff of 'importance'/ 'power' and they can quickly lose focus on what the key issues are.

[broadsword]

Glen Mullan hasn't posted on here for a while.

[TBTF]

Is the club debt free or not.

Shaw and Singh have recently told the action group that the club is debt free. Are they telling the truth.

Not being an accountant the recent released accounts, to me, do not read comfortable. To me they say there are still debts, but just not due yet. If the club is not promoted this season we are in serious trouble.

I ask the same question to you as I did to philip. Is the club debt free as shaw and singh claim it is?

Is this not a play on words? there is obviously debt in place to fund our ongoing losses but because its with Bank of India and in Venkys name Shaw/Singh are saying Club is debt free.But when the sh1t hits the fan and the Bank come calling on Venkys which assets do you think they will use to pay it of?????

Its clear there's a major problem brewing here-why do Mercerman and Philipl keep getting battered for saying so?? And the people in the Ewood corridors (including Shebby) are conspicuously silent.

[Tom]

Everybody sitting comfortably tonight?

Is there any need for this post?

It just comes across that you are enjoying the current situation and taking pleasure from being right

That's obviously not the case but it just seems a pointless post to make

[Mercer]

Is this not a play on words? there is obviously debt in place to fund our ongoing losses but because its with Bank of India and in Venkys name Shaw/Singh are saying Club is debt free.But when the sh1t hits the fan and the Bank come calling on Venkys which assets do you think they will use to pay it of?????

Its clear there's a major problem brewing here-why do Mercerman and Philipl keep getting battered for saying so?? And the people in the Ewood corridors (including Shebby) are conspicuously silent.

In actual fact, as per my earlier post this morning, the key to all this is who is the actual borrower. Based on the accounts for 31 March 2012, I suspect the borrower is BRFC and the ultimate parent company in India has provided a secured guarantee. If this is the case, if the bank comes calling, it will first exhaust all possible options with the borrower (BRFC) - if BRFC can't repay the debt, you are then into insolvency with all that that entails. IMO, the bank would only enforce its security with the ultimate Indian parent company once it had got to the end of the insolvency process with BRFC and only then if there was still a shortfall - at that stage, I would suspect that the Raos would find the money to discharge any remaining debt in order to preserve their Indian assets.

[broadsword]

The club would be broken up for scrap and would go out of existence?

[Baz]

In actual fact, as per my earlier post this morning, the key to all this is who is the actual borrower. Based on the accounts for 31 March 2012, I suspect the borrower is BRFC and the ultimate parent company in India has provided a secured guarantee. If this is the case, if the bank comes calling, it will first exhaust all possible options with the borrower (BRFC) - if BRFC can't repay the debt, you are then into insolvency with all that that entails. IMO, the bank would only enforce its security with the ultimate Indian parent company once it had got to the end of the insolvency process with BRFC and only then if there was still a shortfall - at that stage, I would suspect that the Raos would find the money to discharge any remaining debt in order to preserve their Indian assets.

In my experience If BRFC cant pay the debt, then they would go after assets in India first before insolvency in the UK. Venkys may choose to use BRFC as their prime source to pay the debt, but the bank will go for cash assets in India first. Not that this is comforting in any way.

I wonder if the Action group could get an answer from the club on how they are addressing the massive increases in Operating costs. The meeting they had with Derek Shaw initimated they where looking to save a few £ here and there on their fixed costs, which really wont make much difference to anything.

[BuckyRover]

A bit of a tangent here but bare with me. If Venkys decided to sell our facilities (Ewood, Brockhall etc) who would buy them?

[PAFELL]

Unfortunately, IMO, there is far too much spin surrounding Rovers' operations now.

Again, IMO, the Action Group have been neutralised by the 'cosy little chats'. Reminds me of the unions and their 'beer and sandwiches' back in the Callaghan days at Downing Street. As I have said before, it's easy for some to become intoxicated by the slightest whiff of 'importance'/ 'power' and they can quickly lose focus on what the key issues are.

In another walk of life those who sucked up to management / owners were called scabs.

Glen Mullan hasn't posted on here for a while.

He has been on other threads talking about his new friends, Karen (Silk) and Derek (shaw)

I wonder if he has said sorry to the folk who went to Pune.

[glen9mullan]

In another walk of life those who sucked up to management / owners were called scabs.

He has been on other threads talking about his new friends, Karen (Silk) and Derek (shaw)

I wonder if he has said sorry to the folk who went to Pune.

I see you are carrying on with your anti- Blackburn Rovers campaign in everything they do, good or bad.

Whilst continuing to stalk individuals up and down the net. Seriously get a bloody life, if you aint having your daily rant on twitter, you dont disappoint and have it on here instead.

For a guy who has no interest in the action group you tend to mention them all the time, you even drive past public houses that some of the members drink in , Take pictures and then call them names, How old are you , 2???? I Say 2 because my 3 year old daughter talks with far more inteligence , and acts far more sensibly..... grow up Peter!!!

I guess everyone at Rovers who talks to supporters needs to be removed in your goldfish bowel

[mark1875]

In another walk of life those who sucked up to management / owners were called scabs.

So we're scabs. but anyone else talks to the management/owners and you praise it, this just proves your anti-action group campaign, i could find many similar to the one below, give it a rest!

We all want communication from the owners. Well it looks like venkys may respond to the Fans forum. Communication is better than none

This is what you always told us to do, "change approach" then when we do it we become scabs and you still continue your crusade

I have said all along there are reasons for protesting. But they will not move venkys.

This makes brags approach wrong, as they will not acheive their aims. As it is not working, you have to change tact.

I have said over and over, there is reason to protest. But venkys will not give in to demands - which is what protests are. Therefore another approach is needed.

[iamarover]

We hear from BRAG, or whatever the apologist appeasers are called, that Derek Shaw is analysing suppliers who are providing furniture at pretty expensive prices. Well, as he and they re-arrange those deck chairs on the Titanic that is called Blackburn Rovers, everyone would do well to do a bit of background on the charlatans who own the club. This is now extraordinarily serious. The very future of the club is in peril. I am no accountant, but I have run several businesses, and I know a suspect P&L when I see one. I don't mean 'suspect' as in corrupt, but as in vulnerable.

http://investing.businessweek.com/research/stocks/financials/financials.asp?ticker=WH:IN&dataset=incomeStatement&period=A&currency=US%20Dollar

These are the more worrying figures than any cooked up Rovers P&L. These are the people who own us. And, in football ownership terms, these figures say the Venky's do not have a pot to p*ss in. People misunderstood the Trust. To an extent the overdraft was irrelevant as the whole Trust was more than good (and responsible for), a figure several times higher. It isn't the size of your mortgage, it is your ability to pay that matters. And I don't believe they (Venky's) can.

Chickens are just a low margin, high cost business. And the figures are terrifying. This report shows the business year on year to March 2012, Revenues year on year are only $175m. And profits, are miserably low at $7.5m, or 5 million quid (1%). Just over half a Jordan Rhodes.

Glen Mullan's assertion that Venky's have somehow 'gifted' Rovers $20m, is completely impossible on this analysis. The idea that they could repeat that this year is risible.

The following link is one of many other reports on Venky's last quarterly update (to October 2012) which shows further downward pressure on profits and a poor outlook from one of India's leading investing funds. There are many out there on Google. And the news is.... It is getting worse.

.

http://www.hdfcsec.com/research/ResearchDetails.aspx?report_id=2989272

The Venky share price slid 15% on this news last month. Prior to this, the outlook was much rosier, with profits forecast at three times the current level. This is worrying on a number of levels. Firstly, the business is clearly volatile, ever subject to bird flu, rising commodity prices etc. And the figures are tiny. $7.5m or three times that at over $20m, it doesn't really matter. This firm has no business owning a football club with potential exposure figures way in excess of that.

Interestingly none of the sources I found in India on my recent trip there, ever mentioned Rovers. None of the financial houses analysing their business does either. Which means.

1. They are hiding their exposure from the Indian stock market (unlikely and illegal)

2. There isn't any exposure. Their Ken Batesesque ownership model with shell companies and 'loans' from off shore accounts mean they could collapse the Rovers without their core business being exposed. 'OldCo' would go into administration, in the way Rangers FC have done, leaving the way for a NewCo to emerge, probably shorn of all playing assets and possibly its property assets. Ewood and Brockhall,all sold to pay the OldCo debtors, formed in a queue conveniently staffed by Venky companies and directors. This NewCo football club, with a team sheet and a couple of playing strips, would be offered to BRSIT who would need about 50 quid to buy it.

A look at these figures does beg the question as to where they got the money to put up almost USD$40m to buy the Rovers and another $30m to gaurantee the debt. On profits wildly varying 5m to 10m, this looks almost implausible. Looking at the Financials tab, cash in hand in 2012 went from around USD2m to $20m (12 million quid) this year. Hmmmm. Where did this come from? 50% of the cost of the club coming out of the TV revenue? We can only speculate.

If Rovers do not go up this year, then the Four Horsemen will be riding. No one's fault. Except, perhaps, the Trust. Who played a blinder all those years, only to betray the memory of a great man with their very last act. His tears will be felt on Sunday all the more bitterly.

[RoverScot]

http://www.sportingintelligence.com/2011/01/17/blackburn-india-special-the-vh-group-in-detail-170103/

This Nick Harris article explains how the VH group works overall with the Venkys India arm being the only one with public accounts.

The current accounts do say that there was a £12 million capital contribution reserve placed that is not expected to be paid back so Glen M is not making it up.

Glen M does sound a bit silly agreeing with Derek Shaw about quotes on chairs when Myles Anderson and Jordan Slew combined earn more in a week than the cost saved.

[Mercer]

http://www.sportingi...-detail-170103/

This Nick Harris article explains how the VH group works overall with the Venkys India arm being the only one with public accounts.

The current accounts do say that there was a £12 million capital contribution reserve placed that is not expected to be paid back so Glen M is not making it up. I might be wrong here but I thought as part of the Terms of Sale, there was a stipulation that a certain amount of additional capital had to be invested within 12 months of purchase ?

Glen M does sound a bit silly agreeing with Derek Shaw about quotes on chairs when Myles Anderson and Jordan Slew combined earn more in a week than the cost saved. Spot on !

[RoverScot]

The going concern note includes this gem:

"In addition the directors have also considered the potential impact on the group's cash flows were BRFC not to regain its FA Premier League status and have identified mitigating actions that would manage the cash flow requirements of the group in such circumstances..."

Be afraid

In fact be keaning terrified

I just found a similar quotation was in the 2010/2011 accounts too in the same section. Its just the same standardised stuff. After both its said that the VH group had given assurances that they would continue to fund the club so it makes sense that if the VH group were not funding the club, we would have to shift alot of players off the wage bill - which I assume is the mitigated actions.

The Barclays Bank loan of £21 million was due to be paid in July 2012 regardless according to these accounts and last years too. This might explain why the Walkers Trust were so keen to get rid of it to anyone as they didn't want to be the ones who paid it.

Mercerman - I might be wrong here but I thought as part of the Terms of Sale, there was a stipulation that a certain amount of additional capital had to be invested within 12 months of purchase ?

I think this was a £10 million amount that appeared in the 2010/11 as issued share capital. I don't think the number was £12 million.

[Mercer]

I just found a similar quotation was in the 2010/2011 accounts too in the same section. Its just standardised nonsence. No need to be keaning terrified by it.

The Barclays Bank loan of £21 million was due to be paid in July 2012 regardless according to these accounts and last years too. This might explain why the Walkers Trust were so keen to get rid of it to anyone as they didn't want to be the ones who paid it.

Mercerman - I might be wrong here but I thought as part of the Terms of Sale, there was a stipulation that a certain amount of additional capital had to be invested within 12 months of purchase ?

I think this was a £10 million amount that appeared in the 2010/11 as issued share capital. I don't think the number was £12 million.

For those who have difficulty sleeping and want some reading material, take a look at this as it might help put a few things in perspective:

http://www.frc.org.u...e-for-Dire.aspx

What you see in the accounts for 31 March 2012 is not 'standardised stuff'. It is there very much for a reason.

The accounts show a breakeven position after a player trading surplus of £20million and net short term debt of £11.5million and are very much the reasons to be concerned hence the going concern disclosures/qualifications.