Venky’s v Indian Government (a) - 13/11/2024 - Re-Arranged Challenge Match

[jny]

18 minutes ago, AllRoverAsia said:

"If you believe this shit you're as think as Steve thinks you are"

If you tolerate this then your chickens will be next

[philipl]

https://www.lancashiretelegraph.co.uk/sport/23772915.blackburn-rovers-issue-statement-financial-situation/

So Venky's set up VOL ostensibly to invest in their core businesses but instead bought Gary Neville's pad and nothing else.

The Indian authorities seized property to the same value in India over the mislabelling of the purpose of the cash sent to VOL.

The club statement says 

- Rovers remain in business because Venky's make up the difference for all the losses

- Rovers also remain in business because Venky's have made commitments to cover all losses in future sufficient to cover all Rovers future commitments

- so if you are a supplier to Rovers (including employees), the situation is unchanged.

- from the public's point of view, the only support for this statement is Venky's having written a detailed and unequivocal letter to the club's auditors committing to meet all Rovers' legal and commercial obligations for Rovers to remain in business as a football club for the foreseeable future. The auditors state this unequivocally in every audit report issued since Venky's Hatcheries in India became the ultimate owner of Rovers.

 

This is why the club statement is written the way it is. It is mirroring the words used in a letter of support to the auditors

 

Of couse, nothing is being said in the club statement whether budgets are cut or not, or if players have to be sold BUT the club statement would NOT be lying if the underlying reality is Venky's are telling Rovers to do this. They could have cut the support and told Rovers to reduce losses on a planned basis because they will only plug a smaller hole.

That is the nightmare scenario and when JDT says the project has changed, this might be what he is alluding to. It is also possibly the reason for the smokescreen about taxes thrown up to deflect.

 

Being optimistic for a moment, the smokescreen actually did its job in covering a very embarrassing turn of events for Venky's which has now come into the public domain anyway after the window has closed. And it is smokescreen- the assumption is we have all forgotten the time we were googling Indian tax rule changes or talking to our mates in Delhi...

 

Glen speculates the Indian Authorities are now going to look at Venky's London Limited. 

MY best guess is they already have. Nobody launches an expensive overseas investigation without looking at the biggest numbers first. Seriously, if you are told to look at something odd, are you going to crawl over 6m and ignore the 270m washed through the sister company set up at the same time with the same owners and same directors? Of course not.

 

So there is reason for thinking this is contained now unless Venky's London was also described as a chicken company and the Indian Foreign Exchange folks are still in the process of gathering 270m of Venky's Indian assets for seizure- I think such a scenario is highly improbable. And nothing in the club statement would be inconsistent with the whole thing being a bit of Indian Government posturing for geopolitical reasons. Many Indian businesses with overseas operations are having an unusually rough time with Foreign Exchange compliance currently.

 

 

 

Edited September 7, 2023 by philipl

[lraC]

10 hours ago, MarkBRFC said:

 

 

 

How “The club” can state that is beyond me and given how the owners are under investigation, for what appears to be a serious matter, then perhaps “The club” needs to carry out some further due diligence.

I know meetings take place between Waggott and various groups, so perhaps the next key question, is why he came out bragging about paying the wages and leasing a new coach. Was he aware of what was really going on, or did he believe the narrative about the tax changes?

Dependent on his answer to this and given that the investigation appears to be on going, perhaps a proper statement, about what the consequences and some assurances to the football authorities, needs to be forthcoming. 

[AllRoverAsia]

6 minutes ago, lraC said:

How “The club” can state that is beyond me and given how the owners are under investigation, for what appears to be a serious matter, then perhaps “The club” needs to carry out some further due diligence.

I know meetings take place between Waggott and various groups, so perhaps the next key question, is why he came out bragging about paying the wages and leasing a new coach. Was he aware of what was really going on, or did he believe the narrative about the tax changes?

Dependent on his answer to this and given that the investigation appears to be on going, perhaps a proper statement, about what the consequences and some assurances to the football authorities, needs to be forthcoming. 

Deflection and a compelling need to say something, that he considered positive, in what he knew where really trying times.

[unclejack28]

7 hours ago, glen9mullan said:

Quite the contrary, their wealth is land and property and if it can be confiscated so easily they won't be sleeping easily.

As i mentioned earlier, Venkys is a listed company with shareholders, and shares open to everyone.

Swiping 7 million of company funds for their own use if that turns out to be the case will have ramifications on their business.

Their share price is plummeting, their sales have dropped off the map.

Saving face in their own Country, is very much different to sticking two fingers up to us in Blackburn

Share price 1 day -0.05%

Share price 5 day -0.03%

Share price 1 month +2.75%

Not sure you can call this plummeting?

 

[JohnD]

3 hours ago, philipl said:

Many Indian companies with overseas operations are having an unusually rough time with Foreign Exchange compliance currently

Really?

Which ones Philip?

Edited September 7, 2023 by JohnD

[alex l]

Those expecting/hoping for Rovers to release information critical of or providing sensitive information about Venkys are not going to get it. Firstly SW and GB et al may not be aware of all the going ons in India. Second, even if they are, they are employees of the club and therefore the owners. If the owners don't want to comment publicly, you won't hear from the club or  representatives. 

[alex l]

amongst an article on religious issues in India is this snippet on the government's approach to illegal business dealings...

 

 

[Upside Down]

34 minutes ago, alex l said:

amongst an article on religious issues in India is this snippet on the government's approach to illegal business dealings...

 

 

More like it's part of what I was talking about earlier.

[philipl]

2 hours ago, JohnD said:

Really?

Which ones Philip?

This is not something Indians are running around telling the world about. Venky's/Rovers were deflecting the real reason for their/our problems. 

But from talking to senior business people in India, there are far more questions about foreign exchange exports out of India and retrospective checking of past submissions to the authorities for foreign exchange approvals being used for the purposes  granted for.

I am not aware of anyone being punished the way Venky's have been but moving money out of India has gone from being a bureaucratic but routine process to an expectation of having your paperwork challenged and additional justifications requested.

 

[Andy]

I don’t believe the whole ‘tax’ thing was a legitimate concern for the club - think it was the red tops who brought that into play for us.

Possibly got wind of something happening over there and 1+1=3.

One element of this, from the info that was passed a number of weeks ago, is that Venky’s were aware that this investigation/process would be happening since Jan/Feb of this year.

Club revenue was protected in the subsequent months by things like EFL money, season tickets, etc. So it only became an operational issue to us around the time when the sponsorship deal was put into place.

Edited September 7, 2023 by Andy

[wilsdenrover]

5 hours ago, philipl said:

https://www.lancashiretelegraph.co.uk/sport/23772915.blackburn-rovers-issue-statement-financial-situation/

So Venky's set up VOL ostensibly to invest in their core businesses but instead bought Gary Neville's pad and nothing else.

The Indian authorities seized property to the same value in India over the mislabelling of the purpose of the cash sent to VOL.

The club statement says 

- Rovers remain in business because Venky's make up the difference for all the losses

- Rovers also remain in business because Venky's have made commitments to cover all losses in future sufficient to cover all Rovers future commitments

- so if you are a supplier to Rovers (including employees), the situation is unchanged.

- from the public's point of view, the only support for this statement is Venky's having written a detailed and unequivocal letter to the club's auditors committing to meet all Rovers' legal and commercial obligations for Rovers to remain in business as a football club for the foreseeable future. The auditors state this unequivocally in every audit report issued since Venky's Hatcheries in India became the ultimate owner of Rovers.

 

This is why the club statement is written the way it is. It is mirroring the words used in a letter of support to the auditors

 

Of couse, nothing is being said in the club statement whether budgets are cut or not, or if players have to be sold BUT the club statement would NOT be lying if the underlying reality is Venky's are telling Rovers to do this. They could have cut the support and told Rovers to reduce losses on a planned basis because they will only plug a smaller hole.

That is the nightmare scenario and when JDT says the project has changed, this might be what he is alluding to. It is also possibly the reason for the smokescreen about taxes thrown up to deflect.

 

Being optimistic for a moment, the smokescreen actually did its job in covering a very embarrassing turn of events for Venky's which has now come into the public domain anyway after the window has closed. And it is smokescreen- the assumption is we have all forgotten the time we were googling Indian tax rule changes or talking to our mates in Delhi...

 

Glen speculates the Indian Authorities are now going to look at Venky's London Limited. 

MY best guess is they already have. Nobody launches an expensive overseas investigation without looking at the biggest numbers first. Seriously, if you are told to look at something odd, are you going to crawl over 6m and ignore the 270m washed through the sister company set up at the same time with the same owners and same directors? Of course not.

 

So there is reason for thinking this is contained now unless Venky's London was also described as a chicken company and the Indian Foreign Exchange folks are still in the process of gathering 270m of Venky's Indian assets for seizure- I think such a scenario is highly improbable. And nothing in the club statement would be inconsistent with the whole thing being a bit of Indian Government posturing for geopolitical reasons. Many Indian businesses with overseas operations are having an unusually rough time with Foreign Exchange compliance currently.

 

 

 

Except the last line of the press release was ‘further investigation is under progress’…

[glen9mullan]

3 hours ago, unclejack28 said:

Share price 1 day -0.05%

Share price 5 day -0.03%

Share price 1 month +2.75%

Not sure you can call this plummeting?

 

https://in.investing.com/news/venkys-plummets-16-on-poor-q1-show-profit-falls-61-profit-margins-affected-3759071

 

 

[lraC]

Perhaps the Indian authorities have been told that VLL was also set up as a poultry business but miss spelt it and it became paltry. 
 

The chicken adds in the early years, could have been a red herring. 

Edited September 7, 2023 by lraC

[den]

54 minutes ago, philipl said:

This is not something Indians are running around telling the world about. Venky's/Rovers were deflecting the real reason for their/our problems. 

But from talking to senior business people in India, there are far more questions about foreign exchange exports out of India and retrospective checking of past submissions to the authorities for foreign exchange approvals being used for the purposes  granted for.

I am not aware of anyone being punished the way Venky's have been but moving money out of India has gone from being a bureaucratic but routine process to an expectation of having your paperwork challenged and additional justifications requested.

 

Hmmm.

There was a sudden, drastic cut to rovers budget Philip. You’re talking about a change to process. That hasn’t happened overnight.

[tomphil]

How do we know VLL hasn't invested small amounts in other businesses over here ?

I'm sure we had a poster who followed a trail a few years ago that showed Vs were investing in things connected to their core business .   They were also going to start Venkys express over here so this might cover their backsides if Venkys London Ltd is looked at as it was started to use the club for business reasons.

Amazing though they aren't asking questions why the VH group uses funds to cover such a huge loss making enterprise in England.

Maybe this seizing property thing is just a shot across the bows from the govt, look at what we can do if you don't adhere sort of thing.

Edited September 7, 2023 by tomphil

[Giant]

The ultra nationalist Indian government has joined the other similar governments in China and Russia in anti West foreign policy. It’s all part of the BRIC group, who were all over the news last month, attempting to show how tough they are on foreigners. No doubt those who are enjoying watching Modi bashing the Venkys will approve, even though it affects the immediate funding at BRFC. 

[tomphil]

43 minutes ago, Giant said:

The ultra nationalist Indian government has joined the other similar governments in China and Russia in anti West foreign policy. It’s all part of the BRIC group, who were all over the news last month, attempting to show how tough they are on foreigners. No doubt those who are enjoying watching Modi bashing the Venkys will approve, even though it affects the immediate funding at BRFC. 

So it isn't their fault they used millions of company money to buy a house in England but listed it as a poultry farm or similar so as to navigate tax rules ?

Oh, ok then it must be Rovers fans fault.

[Giant]

10 minutes ago, tomphil said:

So it isn't their fault they used millions of company money to buy a house in England but listed it as a poultry farm or similar so as to navigate tax rules ?

Oh, ok then it must be Rovers fans fault.

1. Yes it is

2. No it isn’t 

The point I was referencing was GB’s mention of “Geo-political” events in his interview.

Edited September 7, 2023 by Giant

[47er]

1 hour ago, Giant said:

The ultra nationalist Indian government has joined the other similar governments in China and Russia in anti West foreign policy. It’s all part of the BRIC group, who were all over the news last month, attempting to show how tough they are on foreigners. No doubt those who are enjoying watching Modi bashing the Venkys will approve, even though it affects the immediate funding at BRFC. 

So you approve of this club being owned by tax-dodging spivs?

Edited September 7, 2023 by 47er

[Guest]

18 minutes ago, 47er said:

So you approve of this club being owned by tax-dodging spivs?

To be fair, nobody, anywhere in the world, accrues that kind of wealth without paying as little tax as possible. 

Every single business owner in the world is a ltd company to achieve exactly that.

[47er]

24 minutes ago, Mellor Rover said:

To be fair, nobody, anywhere in the world, accrues that kind of wealth without paying as little tax as possible. 

Every single business owner in the world is a ltd company to achieve exactly that.

Yeah--I suppose that's true. Puts the club at risk when they get caught though.

[Guest]

13 hours ago, glen9mullan said:

Their share price is plummeting, their sales have dropped off the map.

It takes a quick google search to debunk this myth.

[broadsword]

They've been norty boys before. They got done for that development without permission. When day made you rich, you can pay the annoying govt man to go away sometimes.

 

This does smell different. The funding is tailing off and has been for a while. The manager is tampy. The club statement does not reassure in any way.

I don't get the feeling this is a short term blip, it feels more like the beginning of the end. If it is, will the club fold

[glen9mullan]

7 minutes ago, JoeH said:

It takes a quick google search to debunk this myth.

Their own first quarter report, issued in August which I've already posted the link confirms this, not sure why you'd suggest it's a myth given its public record