[Archived] Venkys London Ltd Accounts

[Dunnfc]

So the executive summary is we are selling players to fund day to day expenditure, coupled with rapidly declining turnover and a reliance on short term 'emergency' finance in the same way as pillars of financial prudence Bolton and the Huns. Oh well, all is rosey then.

Who knows where it's from!? Hopefully will be asked by the supporters group though.

More informed discussion/investigative comments on here outlining facts, possibilities etc. than that tripe published by the LET.

[chaddyrovers]

Yes I was already aware of that and your summary is excellent. I know you said you had only skimmed through and if you do have the time a more detailed analysis would be brilliant. I for one appreciate your input and I am sure others do too.

Agree.

I would like a proper detail analysis if possible Mercerman

[eddy11d]

So what are the options for Venkys now and which option is likely to get them the most money back? If we can work out that then I think it will give us a clearer idea of what's going to happen (although this is Venkys we're talking about). By my reckoning, they've got around 4; carry on as we are now, put us into administration and sell our assets, sell the club for next to nothing with the buyer taking on the £25 million debt, or invest and try to get us back into the premier league. Are there any more?

[tomphil]

Who knows where it's from!? Hopefully will be asked by the supporters group though.

More informed discussion/investigative comments on here outlining facts, possibilities etc. than that tripe published by the LET.

Some funds will lend against players i believe although it must come with some whopping insurance. We'll be running dry of them though.

Next 3 mill tied against Lowey ?

[1arC]

Some funds will lend against players i believe although it must come with some whopping insurance. We'll be running dry of them though.

Next 3 mill tied against Lowey ?

Do you mean like Global eleven?

[tomphil]

There's a few about, who'd be surprised if we were borrowing from one in Brunei ?

[RevidgeBlue]

Really poor piece from the LT. It's obvious to anyone with half a brain cells that the only reason the annual loss is down to manageable proportions is that the "crown jewels" were sold off and they almost make that sound like a good thing as opposed to the previous year when we made a loss on player trading etc.

Although for the purposes of the accounts it is claimed that adequate funding will be available etc it sounds as though much will depend on the BOI renewing the annual overdraft facility in March. If they do presumably we can limp on as we're doing now. If not who knows?

[Lancaster Rover]

"Global Eleven raised as much as $20 million to invest in marketing rights for exhibition games played by Brazil that Kentaro held until last year. The fund also bet on the transfer rights of players from South America where groups lend money to teams in return for a stake in the sale price of athletes. The sport’s governing body is mulling whether to ban the practice".

There we are again with those football futures rumours

Getting some up and coming portuguesers or south americans into a premier league club would be good business one would imagine for a company like Global Eleven.........

[tomphil]

You look at that then you look at the grossly over inflated fees Liverpool have paid Southampton in recent years and may do again then you do wonder if something like this isn't behind such practices. Groups of people getting rich using the clubs money to take the gamble on buying players with so called potential.

Ray Ransons mob have been doing it for a while as well.

[Dunnfc]

Global 11 (Kentaro & Indoo Sella) did go bust but some alleged UAE investors lost a lot of money in that particular enterprise.

[JBiz]

So the executive summary is we are selling players to fund day to day expenditure, coupled with rapidly declining turnover and a reliance on short term 'emergency' finance in the same way as pillars of financial prudence Bolton and the Huns. Oh well, all is rosey then.

I wonder why the owners believe their asset is increasing in value?

[bob fleming]

I wondervwhy do the owners believe their asset is increasing in value?

Class A's

[JBiz]

Class A's

Must be, or perhaps they've stopped paying people for advice, just paying to tell them what they want to hear!

The Lancashire Telegraph piece today is also a joke.

[OscarRaven]

I wonder why the owners believe their asset is increasing in value?

Probably to avoid an impairment charge. Very surprised LET have made an article from the filing at companies house and passed it off as a communication from Venky's to the fans. Poor stuff.

The accounts show that the hemorrhage has been stemmed (not ceased), Rovers still spending more (mainly wages) than they receive even with healthy profit from player trading - requiring that someone step in and pay the difference (eventually). This has been largely the owners, mostly thorough debt, however some debt converted to shares.

Scary accounts? Sure if the owners don't pick up the tab for their mismanagement once again, but directionally better than last year. The current wages to turnover ratio is also probably lower than those accounts (which will still have a significant proportion of Hanley, Rhodes and Duffy wages included).

I'm afraid to say those accounts reflect much needed action in starting to bring costs under control, all for nothing however if we drop another division.

Interesting though, what would you do if given the keys to the club tomorrow, even without the debt you would need to bring in circa. 20 million a year through "investment" or player trading just to balance the books?

[Stuart]

The Lancashire Telegraph piece today is also a joke.

LT (only) readers and Facebookettes will lap it up though.

[J*B]

Incredible that this has been allowed to be published. This football club, a pillar in the local community, a source a heritage, local jobs and passion is being dismantled and the local newspaper are promoting the enemy rather than backing the locals.

[Baz]

Can one of the qualified accountants on here write a piece on the accounts, that we could submit to the LT, in reply? Facts only, not suppositions. I'm sure there's no-one at the LT who has the capacity to challenge what they are being fed by the club, so they may welcome a reply they can publish.

[ABBEY]

RT my tweet I did just before .. make venkygraph and radio venks aware

[McClarky]

Really poor article from the LET. It's just lifted from the accounts with a spin from Vs and no critical or challenging comment at all. This is s turd which cannot be poliched no matter how much effort is put into it.

[tomphil]

Lets pretend everything is ok but don't read on or you'll find it really isn't.

Otherwise known as the LT headline.

[Exiled in Toronto]

2nd loan seems fishy with the 14% interest charges. I'd like to know more about this tbh.

Doesn't appear to be to dissimilar to the company Bolton used in 2015 but will dig it out - *Got it it's called Nucleas - http://www.theboltonnews.co.uk/sport/13629649.Whites_confirm_funding_deal/ & http://www.business-money.com/announcements/nucleaus-provides-3-5m-funding-facility-for-boloton-wanderers-football-club

Plenty of companies like that including close finance who work in the football circles and supply loans and such rates to bridge monies issues, short term.

Maybe BRAG could find out who owns the second loan? If it was the same provider (SBOI) then usually they pay off the first loan and give you a new one.

The 14% loan isn't new. If memory serves it was a forward loan against one of the 8 million quid parachute payments.

I am also of the opinion that they can't be making money out of this. Someone is putting in the cash each year and if I wanted to launder money I wouldn't buy a company with a huge wage bill made up of long-term nigh on unbreakable contracts.

The fact is, six years on, we have no idea if they are millionaires or billionaires, why they bought the club, why they are still here, and where the cash injections come from (I interpret the whole BOI thing as the ten million overdraft, not the incremental cash).

[Dunnfc]

The 14% loan isn't new. If memory serves it was a forward loan against one of the 8 million quid parachute payments.

I am also of the opinion that they can't be making money out of this. Someone is putting in the cash each year and if I wanted to launder money I wouldn't buy a company with a huge wage bill made up of long-term nigh on unbreakable contracts.

The fact is, six years on, we have no idea if they are millionaires or billionaires, why they bought the club, why they are still here, and where the cash injections come from (I interpret the whole BOI thing as the ten million overdraft, not the incremental cash).

Your correct it was certainly in the set of 2015. It appears though to be a figure of £4,500,000 initially under "Other Loans", separate from the overdraft which stands at £10,381,653.00 and listed separately in the row further up on page 34 (Creditors due in 12 months). It can't be the main loan given the balance repayment figure (£1,715,264.00) and the extract cites the bank loan and overdraft with a small disclaimer at the bottom simply referring the second loan (4.5m) as a short term other loan at 14% but without definition or type of lender i.e the first loan "Bank loan".

That is what makes me think it's some asset finance company like Close Finance, Nucleas, etc

I don't think they are making money, i think they did initially but there overall complete lack of acumen and ability to make the most basic business/management decisions, there actions and lack of remorse to date then in my opinion they can suffer every loss. My main issue is who is supplying the second loan? 14% isn't a commercial rate which would suggest it is coming from alternative means, this needs to be questioned. Indeed cash is coming in (7 million this year's accounts) but there is no debenture held on VLL through a Venky parent company (VHG) or SBOI which again something or PCG must have been offered up previously in India as security against the continuing loans.

[punerover]

SBI provides commercial loans at interest rates ranging from 11.20% - 16.30% - Similar loans are offered in India from NBFC's [Non banking financial companies in leau of assets mortgaged ]This could be one of those loans. Loans from Loan sharks are offered at about 1.5-2% per month which would amount to 18-24% per year which makes this loan unlikely from such a source. [You never know though they might have convinced someone that 14% is good interest rate after demonitization]

Your correct it was certainly in the set of 2015. It appears though to be a figure of £4,500,000 initially under "Other Loans", separate from the overdraft which stands at £10,381,653.00 and listed separately in the row further up on page 34 (Creditors due in 12 months). It can't be the main loan given the balance repayment figure (£1,715,264.00) and the extract cites the bank loan and overdraft with a small disclaimer at the bottom simply referring the second loan (4.5m) as a short term other loan at 14% but without definition or type of lender i.e the first loan "Bank loan".

That is what makes me think it's some asset finance company like Close Finance, Nucleas, etc

I don't think they are making money, i think they did initially but there overall complete lack of acumen and ability to make the most basic business/management decisions, there actions and lack of remorse to date then in my opinion they can suffer every loss. My main issue is who is supplying the second loan? 14% isn't a commercial rate which would suggest it is coming from alternative means, this needs to be questioned. Indeed cash is coming in (7 million this year's accounts) but there is no debenture held on VLL through a Venky parent company (VHG) or SBOI which again something or PCG must have been offered up previously in India as security against the continuing loans.

[Dunnfc]

SBI provides commercial loans at interest rates ranging from 11.20% - 16.30% - Similar loans are offered in India from NBFC's [Non banking financial companies in leau of assets mortgaged ]This could be one of those loans. Loans from Loan sharks are offered at about 1.5-2% per month which would amount to 18-24% per year which makes this loan unlikely from such a source. [You never know though they might have convinced someone that 14% is good interest rate after demonitization]

That exactly is what i was suggesting! I.e Close Finance etc type of company.

[punerover]

That exactly is what i was suggesting! I.e Close Finance etc type of company.

My only concern will be

1. Is the company that is financing the 4.5 mil a subsidiary of / related to Venkys? i.e. Do they directly or indirectly benefit from paying 14% interest rate?

2. What are the assets mortgaged in order to get that loan? I am assuming its an Indian asset that is being mortgaged assuming the loan was sourced from India. 14% sounds like an Indian interest rate.