A Sustainable Club? (2 Viewers)

shmmeee · Oct 22, 2013

Lots of talk on here about "the club and stadium must be united" for the club to be healthy going forward.

I don't see any of the options being talked about as making our situation any better. Let's say (best case scenario) CCC gift the Ricoh to Sisu, even with a clause stating it must be tied to the club.

The club is currently £60m in debt. This will give the club an asset worth roughly that amount, problem solved right? Wrong!

Any sale of the club would then require someone to pay, say £60m to clear the Sisu debt and buy the club. We now owe £60m to the new owner, and have charges on the club meaning that ARVO are entitled to our assets should we go bust.

Let's say the club build a new stadium at the cost of £25m (low estimate). We're not £85m in debt and in the same situation.

We all want CCFC back in Cov, but we also want a CCFC for our children and grandchildren to "enjoy" like we have. While this debt is hanging around our neck we will not move forward.

Personally, the only way out I see is liquidation or a proper administration (one involving the club, not a property subsidiary).

Yes it would mean a penatly/starting lower down the leagues, but it would mean a chance at a proper future, whether through fan ownership or another owner, we will not move forward while the legacy of Richardson and McGinnity looms over us.

I know a lot would balk at the idea of wishing for liquidation, so I ask: What is your solution for a CCFC that is strong long into the future? Can we ever be sustainable in this current form?

Deleted member 5849 · Oct 22, 2013

shmmeee said:
Can we ever be sustainable in this current form?

It's an interesting question, for sure.

Firstly, do we know what (if any?) debt was written off on the last administration?

Secondly, here are a couple of articles well worth a read from the Guardian. Slightly frightening!

http://www.theguardian.com/football/2013/apr/18/premier-league-finances-club-by-club

http://www.theguardian.com/news/datablog/2013/apr/18/premier-league-club-accounts-debt

Stoke are probably the best hope, I guess.

Looking fairly solid financially in this fourth year since promotion to the Premier League in 2008. Backed by the bet365 online gambling fortune of Stoke native Peter Coates and family, whose loan was up to £24m in the year.

It's a debt, but it's a benefactor type debt. Here's more:

Net debt: £14m
Interest payable: Nil

However... there are many articles around about them being debt free... which turns out to be 'external debt free' with no interest charged on loans. In that respect, it's worryingly similar to the confusion that Ranson's statements about us being debt free brought about. Following that logic, we're debt free now!

I also don't think it would take offering SISU all the debt back to see them go either btw... so let's say, optimistically(!) we have our own Peter Coates floating around somewhere, owner of Harrisonturdcup87 and making a fortune.

£30mil to buy off SISU, that £30mil as debt but interest free, with the possibility of some being converted to equity at a later date, a ground deal similar to Northampton's where a 150 year lease is given out for £1 a year, and the club begins to look at least... manageable. Not perfect(!) but manageable.

In itself the debt isn't the problem as such, it's the ability to service the debt.

The wider question though, and back to those articles, is whether English football's bubble can last, full stop. Those figures suggest the choice is either run with debt or die... but running with debt will result in death too.

shmmeee · Oct 22, 2013

Deleted member 5849 said:
It's an interesting question, for sure.

Firstly, do we know what (if any?) debt was written off on the last administration?

Secondly, here are a couple of articles well worth a read from the Guardian. Slightly frightening!

http://www.theguardian.com/football/2013/apr/18/premier-league-finances-club-by-club

http://www.theguardian.com/news/datablog/2013/apr/18/premier-league-club-accounts-debt

Stoke are probably the best hope, I guess.

It's a debt, but it's a benefactor type debt. Here's more:

However... there are many articles around about them being debt free... which turns out to be 'external debt free' with no interest charged on loans. In that respect, it's worryingly similar to the confusion that Ranson's statements about us being debt free brought about. Following that logic, we're debt free now!

I also don't think it would take offering SISU all the debt back to see them go either btw... so let's say, optimistically(!) we have our own Peter Coates floating around somewhere, owner of Harrisonturdcup87 and making a fortune.

£30mil to buy off SISU, that £30mil as debt but interest free, with the possibility of some being converted to equity at a later date, a ground deal similar to Northampton's where a 150 year lease is given out for £1 a year, and the club begins to look at least... manageable. Not perfect(!) but manageable.

In itself the debt isn't the problem as such, it's the ability to service the debt.

The wider question though, and back to those articles, is whether English football's bubble can last, full stop. Those figures suggest the choice is either run with debt or die... but running with debt will result in death too.

I think you're right about the bubble, and maybe we should ride it out until the whole thing pops, because while no-one will want to save us, someone will want to save the whole thing.

Also, I agree, if we can find a benefactor willing to pump cash in for little or no return (*cough* Geoffrey Robinson *cough*) what's to stop them getting bored, asking for the cash back?

Also, if we have such a benefactor in the wings, why wait till the club is reunited with the Ricoh? Surely they won't be interested in the property, just the club and no doubt a CCFC fan would be welcomed with open arms by the council and offered a better deal?

Edit: I agree debt isn't an issue, it's being able to service it, but looking at those figures we'd be on par with the likes of Arsenal and Liverpool. Where we need to be closer to Fulham.

Gary.j · Oct 22, 2013

I'm with the OP, the debt will be a noose around our necks for years to come. I'd rather take the hit now and start the rebuilding process. Responsible, answerable, fan ownership is the only option I favour, supporters would need to accept the notion of not spending more than we bring in, wherever that would leave us.

I am happy to meet with anyone who wishes to discuss these ideas!

shmmeee · Oct 22, 2013

Gary.j said:
I'm with the OP, the debt will be a noose around our necks for years to come. I'd rather take the hit now and start the rebuilding process. Responsible, answerable, fan ownership is the only option I favour, supporters would need to accept the notion of not spending more than we bring in, wherever that would leave us.

I am happy to meet with anyone who wishes to discuss these ideas!

Have a look into Exeter City. I don't think they've got it quite right, but it's interesting to see the issues they are having with fan ownership (reduced volunteering, insular Trust board, feeling of "give it a go" from fans, arguments about whether they need to own the freehold of the ground). All their documentation is on the Trust site so it's a good place to look.

I think fan ownership is workable but needs to be thought about very carefully as I don't think there's a working British model yet.

Besides, while I'd be happy to talk about it as an intellectual exercise, now is not the time. We'd need to be ready should admin happen (and that is after all the stated purpose of the Trust) but that time isn't now and you'd have trouble getting people on board while the club is still around and not for sale.

Deleted member 5849 · Oct 22, 2013

shmmeee said:
Also, I agree, if we can find a benefactor willing to pump cash in for little or no return (*cough* Geoffrey Robinson *cough*) what's to stop them getting bored, asking for the cash back?

Indeed. You also hope for Stoke's sake that Peter Coates's will leaves provision on the event of his death! However, was always thus. Fulham owned by (forget the name:facepalm: ) in the 50s and 60s... Glossop were the Hill-Woods' team until they landed on Arsenal.

Also, if we have such a benefactor in the wings, why wait till the club is reunited with the Ricoh? Surely they won't be interested in the property, just the club and no doubt a CCFC fan would be welcomed with open arms by the council and offered a better deal?

I guess the most logical reason is like it or not, as it stands the club needs a benefactor to keep pumping money into the club. Mutton's comments showed a lack of awareness of this, when he castigated the owners for cutting costs and not investing in the team... whereas surely for a sustainable model they should have been congratulated for that?!? So a 'responsible' benefactor probably needs to see the opportunity to not pour his cash down the drain quite so quickly... and would probably point to SImon Jordan as a reason why. May have been orange but did a decent job for Palace, always looked out for them... but eventually unresolved ground issues forced them into administration.

Edit: I agree debt isn't an issue, it's being able to service it, but looking at those figures we'd be on par with the likes of Arsenal and Liverpool. Where we need to be closer to Fulham.

Bolton are truly, truly terrifying! It's also what I go back to. I know they want a return, but I also don't think we should take it so literally as SISU would want everything back to leave. It's finding that sweet spot...

Deleted member 5849 · Oct 22, 2013

shmmeee said:
Have a look into Exeter City. I don't think they've got it quite right, but it's interesting to see the issues they are having with fan ownership (reduced volunteering, insular Trust board, feeling of "give it a go" from fans, arguments about whether they need to own the freehold of the ground). All their documentation is on the Trust site so it's a good place to look.

I think fan ownership is workable but needs to be thought about very carefully as I don't think there's a working British model yet.

Besides, while I'd be happy to talk about it as an intellectual exercise, now is not the time. We'd need to be ready should admin happen (and that is after all the stated purpose of the Trust) but that time isn't now and you'd have trouble getting people on board while the club is still around and not for sale.

Yeah. My position is always in an ideal world fan ownership is best.

Pragmatically, realistically... it doesn't work in this country apart from as a firefighting measure. As a point of last resort is its only role as it stands.

shmmeee · Oct 22, 2013

Deleted member 5849 said:
Bolton are truly, truly terrifying! It's also what I go back to. I know they want a return, but I also don't think we should take it so literally as SISU would want everything back to leave. It's finding that sweet spot...

I'm under no illusions that Sisu will not accept a return lower than they would get liquidating the club and selling the development land off. What that figure is I don't know, but I'd guess it's more than £30m.

shmmeee · Oct 22, 2013

Deleted member 5849 said:
Yeah. My position is always in an ideal world fan ownership is best.

Pragmatically, realistically... it doesn't work in this country apart from as a firefighting measure. As a point of last resort is its only role as it stands.

But why? It's only seen as a last resort because most fans groups can only afford to pick up the club after a catastrophic failure.

Logically I don't see any reason why it shouldn't work from scratch, after all there are successful teams all over the world that are fan run from day one. I'm not sure what makes British football so unsustainable.

Why couldn't we run the club like Walsall, financially responsible, competitive, make a very small profit. I'd hope that with transparent finances and decision making that fans would understand why we can't buy expensive players. I'd also hope that a fan owned club would do the one thing that has fucked over this club in terms of fanbase and that's refusing to engage with the fanbase on major decisions.

We're still here arguing about decisions taken by the board up to 20 years ago, would a club where the chairman comes out and openly and honestly takes and answers fans questions be treated better?

Then again, maybe I'm relying more on hope than expectation.

Deleted member 5849 · Oct 22, 2013

shmmeee said:
I'm under no illusions that Sisu will not accept a return lower than they would get liquidating the club and selling the development land off. What that figure is I don't know, but I'd guess it's more than £30m.

It's never been tested though (and, unfortunately, probably never will!). Hoffman's 'pay the rent' offer showed why he's never likely to get a deal accepted. That, after all, wasn't paying the rent, but fronting the money to begin with and getting it returned, along with admin expenses, later on down the line.

I'd suspect any offer for the club as it stands would be for £1 and an agreement to pay off some of the debt later on down the line but, as you say, effectively you're just replacing old commercial debt with new commercial debt if that happens... and again it gambles on the club actually being successful.

If it's not, you'd be in danger of a Portsmouth situation where the same bugger could call in his debts and keep returning like a bad smell, just as they thought they were rid of him!

shmmeee · Oct 22, 2013

Deleted member 5849 said:
If it's not, you'd be in danger of a Portsmouth situation where the same bugger could call in his debts and keep returning like a bad smell, just as they thought they were rid of him!

That's my worry. Any deal to get rid of Sisu HAS to cut all ties, including debt present or future and any charges held over the club.

Mucca Mad Boys · Oct 22, 2013

The only obvious way out of it, which is a lot easier said than done, is to get promoted, then try and build on that.

Especially with hindsight, the move to put CCFC in admin by ACL was an unmitigated disaster for everyone involved: SISU (perhaps least of all), ACL (lost their anchor tenant), CCC (coventry economy loses out), taxpayers (likewise as the CCC, maybe job losses may happen?) and CCFC fans (do I need to explain this one?) have all lost out.

Deleted member 5849 · Oct 22, 2013

shmmeee said:
But why? It's only seen as a last resort because most fans groups can only afford to pick up the club after a catastrophic failure.

Logically I don't see any reason why it shouldn't work from scratch, after all there are successful teams all over the world that are fan run from day one. I'm not sure what makes British football so unsustainable.

Why couldn't we run the club like Walsall, financially responsible, competitive, make a very small profit. I'd hope that with transparent finances and decision making that fans would understand why we can't buy expensive players. I'd also hope that a fan owned club would do the one thing that has fucked over this club in terms of fanbase and that's refusing to engage with the fanbase on major decisions.

We're still here arguing about decisions taken by the board up to 20 years ago, would a club where the chairman comes out and openly and honestly takes and answers fans questions be treated better?

Then again, maybe I'm relying more on hope than expectation.

Walsall maybe not the best example, given their ground situation

It's the all over the world that's the issue however. Each country gets its footballing culture, and in order to stand still (let alone progress) teams have to fit into that culture to a certain degree. Swansea are held up as fan owned wet dreams, but really it's rich owners who happen to have the club's best interests at heart, to an extent they're no different to Stoke really... or Crystal Palace.

Now in my eyes McGinnity had many failings, the biggest being the club was being run then on a short term, pay backcash owed by whatever means model, rather than looking at what was best for the club long term. he was, though, relatively open and honest with fans? As a pointless anecdote I had a 2 hour one on one chat with him over a nice cup of tea, where he told Geoffrey Robinson to ring back, was slightly dismissive in certain areas (if we'd have actually bought Malky Mackay the bank would have slapped his wrists apparently) and frighteningly honest in others (his opinion on the club captain was one that surprised me, given he was a current employee at the time!!

In among all that though he was right, costs had to be cut. Fans soon got fed up of that though, didn't they?

Open and honest question and answers would start well, no doubt, just as per Exeter, but eventually the cynicism would take over. It's a bit like politics, each election the new boys get a honeymoon period for being different to the ones before... after a while those self same differences held up as shining beacons become sticks to beat them with. On a direct club level, SISU's 'good business sense' is a fine example, for one Their ruthlessness and ability to take no financial prisoners was exactly why they were an improvement on the wet wooly and too cosy set up of a Coventry clique before... how times change!

shmmeee · Oct 22, 2013

SkyBlue_Taylor said:
The only obvious way out of it, which is a lot easier said than done, is to get promoted, then try and build on that.

Especially with hindsight, the move to put CCFC in admin by ACL was an unmitigated disaster for everyone involved: SISU (perhaps least of all), ACL (lost their anchor tenant), CCC (coventry economy loses out), taxpayers (likewise as the CCC, maybe job losses may happen?) and CCFC fans (do I need to explain this one?) have all lost out.

You need to explain how ACL put CCFC in admin against their wishes.

Let's be intellectually honest here, it was Sisu's wish for Ltd to go bust to get out of the lease. That was their plan from day 1 and ACL/CCC walked into it because they didn't know the clusterfuck around the GS would happen.

If Sisu didn't want the club to go into admin, they could have paid their debt at any time. They didn't. They didn't even try and stop the requests for cash before the admin request.

Deleted member 5849 · Oct 22, 2013

shmmeee said:
You need to explain how ACL put CCFC in admin against their wishes.

Let's be intellectually honest here, it was Sisu's wish for Ltd to go bust to get out of the lease. That was their plan from day 1 and ACL/CCC walked into it because they didn't know the clusterfuck around the GS would happen.

If Sisu didn't want the club to go into admin, they could have paid their debt at any time. They didn't. They didn't even try and stop the requests for cash before the admin request.

Indeed, it's going over old ground, and it certainly suggests ACL fucked up massively in their tactics... they did end up acting like any business with good sense should however... and the option always was there for the club to pay off what was an insignificant debt.

Of course they were never going to do so as long as ACL were as inflexible either however, so we are where we are, but raking over that doesn't necessarily move us forward either.

bigfatronssba · Oct 22, 2013

Deleted member 5849 said:
Walsall maybe not the best example, given their ground situation

It's the all over the world that's the issue however. Each country gets its footballing culture, and in order to stand still (let alone progress) teams have to fit into that culture to a certain degree. Swansea are held up as fan owned wet dreams, but really it's rich owners who happen to have the club's best interests at heart, to an extent they're no different to Stoke really... or Crystal Palace.

Now in my eyes McGinnity had many failings, the biggest being the club was being run then on a short term, pay backcash owed by whatever means model, rather than looking at what was best for the club long term. he was, though, relatively open and honest with fans? As a pointless anecdote I had a 2 hour one on one chat with him over a nice cup of tea, where he told Geoffrey Robinson to ring back, was slightly dismissive in certain areas (if we'd have actually bought Malky Mackay the bank would have slapped his wrists apparently) and frighteningly honest in others (his opinion on the club captain was one that surprised me, given he was a current employee at the time!!

In among all that though he was right, costs had to be cut. Fans soon got fed up of that though, didn't they?

Open and honest question and answers would start well, no doubt, just as per Exeter, but eventually the cynicism would take over. It's a bit like politics, each election the new boys get a honeymoon period for being different to the ones before... after a while those self same differences held up as shining beacons become sticks to beat them with. On a direct club level, SISU's 'good business sense' is a fine example, for one Their ruthlessness and ability to take no financial prisoners was exactly why they were an improvement on the wet wooly and too cosy set up of a Coventry clique before... how times change!

I'm not going to pretend that McGinnity was great for the club or anything like that, but he never pulled any punches about what his role was. He was there to lower the dangerously high debt. I can't remember the exact figures, but was it not something like £60m down to £20m? In the past 20 years he must have been the only chairman to have actually reduced the debt? He must also have been the only one who got near to achieving their purpose at CCFC?

shmmeee · Oct 22, 2013

He started it

Deleted member 5849 · Oct 22, 2013

bigfatronssba said:
I'm not going to pretend that McGinnity was great for the club or anything like that, but he never pulled any punches about what his role was. He was there to lower the dangerously high debt. I can't remember the exact figures, but was it not something like £60m down to £20m? In the past 20 years he must have been the only chairman to have actually reduced the debt? He must also have been the only one who got near to achieving their purpose at CCFC?

As ever it's clouded a bit as, ironically under Richardson, we'd actually slashed it in half through player sales by the time the coup happened. It's actually one of the less straight things about McGinnity that he liked to take credit for £60 mil downwards, but it was more like £30mil when he took over.

A certain irony both were on the same board but both so different, as combine the best features of Richardson and McGinnity, you might have actually had a decent chairman in there!

But yep, that was kind of my point that McGinnity was pretty blunt about his decisions (he was blunt about why Black was sacked too wasn't he? Just people didn't like the decision, but he was up front about it!) but he was popular to begin with because he wasn't Richardson... then those not Richardson qualities became the things that made him Public Enemy Number 1!

Deleted member 5849 · Oct 22, 2013

Oh yeah, if you want another read of how open and honest chairmen can soon become something very different to fans when things go wrong, have a look in depth about this chap:

http://en.wikipedia.org/wiki/Richard_Murray

Note a few parallels with us, both good and bad!

Deleted member 5849 · Oct 22, 2013

Oh and while we're at it, some interesting bases for top flight clubs' owners according to that Guardian article.

Arsenal majority shareholding registered in Jersey, as is Sunderland;

Bolton is registered in Bermuda, as was Fulham;

Manchester United plc (registered in the Cayman Islands)

Spurs registered in the Bahamas;

Wolves registered in Guernsey.

it risks derailing a fine question from the OP, but it's probably worth pointing out there's nothing unusual in SISU's choices of location...

shmmeee · Oct 22, 2013

bigfatronssba said:
I'm not going to pretend that McGinnity was great for the club or anything like that, but he never pulled any punches about what his role was. He was there to lower the dangerously high debt. I can't remember the exact figures, but was it not something like £60m down to £20m? In the past 20 years he must have been the only chairman to have actually reduced the debt? He must also have been the only one who got near to achieving their purpose at CCFC?

Very true. Unlike the last few charimen who have been there to cut costs and increased the debt...

shmmeee · Oct 22, 2013

SkyBlue_Taylor said:
I never said anything about ACL putting CCFC in admin 'against their own wishes'. But, ACL applied to the high courts to make an administration order, because they were owed money.

Then in retaliation of this, CCFC ltd. was put into admin by SISU (my bad, I should've made that clear in my post before), so ACL would drop the admin order. I suppose SISU did say that they'd have to file for admin if rent talks did not restart, to me, this suggests SISU wanted to talk (no one knows how they would've went), but also, that they may have wanted to place CCFC ltd. in admin to break the lease if ACL didn't want to talk. But it isn't entirely clear-cut.

There's shared blame because if ACL hadn't got confident with PHIV to 'oust SISU', they may have been willing to talk, but also, had the admin order not been applied for, would SISU have placed CCFC ltd in admin? To me, it was an option SISU had, but not necessarily with an intention to use it.

Why would they have tried to stop admin that year? Season was basically over, with nearly nothing to play for, and if rent talks didn't restart, and SISU knew the lease was in CCFC ltd, they could put it admin, therefore nulling the lease and through the process, ACL would get paid their money owed and SISU/Otium would remain in control of the club (as they were able to fufill the administrator's criteria). Perhaps ACL sparked the events and were then strategically outmanoeuvred?

Dammit, stop dragging me into these arguments

Sisu stopped paying the rent. That started the admin process. They knew all along that that debt would be called eventually, in fairness to ACL they took a lot longer than most creditors would.

And again, the club has never been in admin, just a property subsidiary. We should never have lost the 10 points last season and the ones this season are nothing to do with the admin, but to do with the deal Otium made with the FL (as stated by the FL), hence why they have stated that even if the CVA gets accepted we wouldn't get our points back.

(I know you didn't say this bit, just putting it out there).

Anyway, what's done is done, let's look forward.

DazzleTommyDazzle · Oct 22, 2013

There will always be some fans who want to spend spend spend....

However, I think that given our recent history, there's been an increasing number who have realised that this was unlikely to lead to a good outcome.

Personally my issue in more recent times (more specifically the reign of the late lamented KD) was not the fact that cuts were being made, but the (in my view) unintelligent way that they were implemented.

KD seemed to take the view that all cost savings were by definition good (a view shared by some posters - I particularly recall having a long debate with Tommy Atkins), wheras I believed that there was little point in saving £1m or even £2m, if the result was that you were virtually certain to be relegated (selling Juke that January :facepalm and would then lose £4m plus in revenue. Even without the benefits of my accountancy training, I could have worked out that the net effect was bad.

italiahorse · Oct 22, 2013

I fail to understand this £60M CCFC debt.
Surely the debt went with Ltd.

shmmeee · Oct 22, 2013

italiahorse said:
I fail to understand this £60M CCFC debt.
Surely the debt went with Ltd.

I'm massively out of my depth here, but I think it goes like this:

CCFC Ltd owed CCFC Holding/ARVO £60m. As they have gone bust that debt still resides with CCFC Holdings/Otium/ARVO/Joy Seppala's cat.

In turn, CCFC Holdings/Joy's cat owes Sisu Capital £60m, there were owed £60m by CCFC Ltd, but they've gone bust.

But I could be massively wrong.

shmmeee · Oct 22, 2013

DazzleTommyDazzle said:
There will always be some fans who want to spend spend spend....

However, I think that given our recent history, there's been an increasing number who have realised that this was unlikely to lead to a good outcome.

Personally my issue in more recent times (more specifically the reign of the late lamented KD) was not the fact that cuts were being made, but the (in my view) unintelligent way that they were implemented.

KD seemed to take the view that all cost savings were by definition good (a view shared by some posters - I particularly recall having a long debate with Tommy Atkins), wheras I believed that there was little point in saving £1m or even £2m, if the result was that you were virtually certain to be relegated (selling Juke that January :facepalm and would then lose £4m plus in revenue. Even without the benefits of my accountancy training, I could have worked out that the net effect was bad.

I think a large problem is that the club is set up from finances to training ground to be a Premiership club. A debt of £60m is nothing there as NWs link shows, it's sustainable debt.

The problem comes from when do we accept that we're not a Prem club and start dismantling some of that Prem infrastructure? Until we do we either lose money as a Championship club or we "speculate to accumulate" to get promoted.

I think a big problem is we wasted our time with parachute payments and the league moved on, meaning the investment required to move us to a Prem club was bigger than it would've been if, ironically, McGinnity wasn't focussed on cost saving in those first few years. If instead we'd gone back up we'd be in a healthier position despite the debt.

All that said, I'm not convinced we ever got value for money from players or managers in the Championship and the club could have been run a lot better. Sisu's current strategy on the pitch is a good one, but they tried it too early. If they could have supported us a season or two longer and brought in the likes of Robins or Pressley in the Championship we'd be OK.

Like a lot of things, I blame Ken Delieu.

Deleted member 5849 · Oct 22, 2013

shmmeee said:
The problem comes from when do we accept that we're not a Prem club and start dismantling some of that Prem infrastructure?

It's again taking it in a slightly malevolant direction but it's also why I keep banging on about the likes of Darlington, and how if the club did go bust and we started again the Ricoh probably isn't a sensible venue to start at, when non league, as the running costs alone would suck cash up that should be spent building a future.

Which to an extent locks into where we are now, a venue such as the Ricoh needs a half decent team to succeed... but a venue such as the Ricoh also needs a team to hand over more money than is perhaps wise for such a team to do so.

Caught between the devil and the deep blue sea, different commercial priorities locking together in a dance of death.

shmmeee · Oct 22, 2013

Deleted member 5849 said:
It's again taking it in a slightly malevolant direction but it's also why I keep banging on about the likes of Darlington, and how if the club did go bust and we started again the Ricoh probably isn't a sensible venue to start at, when non league, as the running costs alone would suck cash up that should be spent building a future.

Which to an extent locks into where we are now, a venue such as the Ricoh needs a half decent team to succeed... but a venue such as the Ricoh also needs a team to hand over more money than is perhaps wise for such a team to do so.

Caught between the devil and the deep blue sea, different commercial priorities locking together in a dance of death.

I dunno, I think there is a way out. Death spirals are not much different to success spirals with different starting conditions. The main problem with the Ricoh project overall it seems to me is the demise of the club in the time between it being OKed and being opened. Ironically, we may just (knock on wood, say it quietly) be seeing the start of an upward trajectory from the club in the first time in a long time. Yes it's partly because we're at our lowest point, but it's also because we are free from past obligations, have a strong academy, a sensible manager who plays attractive, winning football and a low wage bill (for better or worse, let's wait till March before we judge the sense of that).

We are, for the first time, a club whose fanbase (under normal circumstances) exceeds it's current infrastructure and league position. That spells good news on the pitch normally, and good news off it as we are running more efficiently.

Get back to the Ricoh on preferential terms while we're where we are commercially, that allow us to continue this path, and we could easily be looking at a Championship club with gates of 20k again in a couple of years. In some ways I hope to god we don't get promoted this season, because by far the biggest benefit is the feelgood factor and increased attendances that come with a successful season, and they've been cut off at the knees.

Deleted member 5849 · Oct 22, 2013

shmmeee said:
Get back to the Ricoh on preferential terms while we're where we are commercially, that allow us to continue this path, and we could easily be looking at a Championship club with gates of 20k again in a couple of years. In some ways I hope to god we don't get promoted this season, because by far the biggest benefit is the feelgood factor and increased attendances that come with a successful season, and they've been cut off at the knees.

Isn't this always the problem how it's set up though, just because of the existence of ACL if not owned solely by the club?

The club does well, ACL casts envious glances and starts thinking hang on, are we really charging them enough for what they're getting out of it?

The club does badly and, well... you know the rest!

And then if ACL is owned solely in the club, the above conversation starts again wrt the rent ACL pay for their existence!

As an aside, I know Risdale is lambasted just about everywhere, but his finest achievement was probably keeping Cardiff afloat, still with rights to a new ground.

And even then an old debt to Hammam lurked in the background, threatening to take back...

fernandopartridge · Oct 22, 2013

Deleted member 5849 said:
Isn't this always the problem how it's set up though, just because of the existence of ACL if not owned solely by the club?

The club does well, ACL casts envious glances and starts thinking hang on, are we really charging them enough for what they're getting out of it?

The club does badly and, well... you know the rest!

And then if ACL is owned solely in the club, the above conversation starts again wrt the rent ACL pay for their existence!

As an aside, I know Risdale is lambasted just about everywhere, but his finest achievement was probably keeping Cardiff afloat, still with rights to a new ground.

And even then an old debt to Hammam lurked in the background, threatening to take back...

Haven't Cardiff got debts of £100m + hanging over them, both from old and new regimes?

Dhinsa's_Millions · Oct 22, 2013

shmmeee said:
Dammit, stop dragging me into these arguments

Sisu stopped paying the rent. That started the admin process. They knew all along that that debt would be called eventually, in fairness to ACL they took a lot longer than most creditors would.

And again, the club has never been in admin, just a property subsidiary. We should never have lost the 10 points last season and the ones this season are nothing to do with the admin, but to do with the deal Otium made with the FL (as stated by the FL), hence why they have stated that even if the CVA gets accepted we wouldn't get our points back.

(I know you didn't say this bit, just putting it out there).

Anyway, what's done is done, let's look forward.

Totally agree!

SISU's plan was to distress ACL. They knew Yorkshire Bank were going to call the loan on ACL but weren't expecting the council to step in with the money to fund the loan and therefore reduce the repayments on the stadium. They expected ACL to default and for them to pick it up on the cheap but that didn't happen so they withdrew rent and threatened to liquidate!

shmmeee · Oct 22, 2013

Deleted member 5849 said:
Isn't this always the problem how it's set up though, just because of the existence of ACL if not owned solely by the club?

The club does well, ACL casts envious glances and starts thinking hang on, are we really charging them enough for what they're getting out of it?

The club does badly and, well... you know the rest!

And then if ACL is owned solely in the club, the above conversation starts again wrt the rent ACL pay for their existence!

As an aside, I know Risdale is lambasted just about everywhere, but his finest achievement was probably keeping Cardiff afloat, still with rights to a new ground.

And even then an old debt to Hammam lurked in the background, threatening to take back...

To some extent, the council have to accept that the local football team, especially a League team, deserves preferential treatment. That niggles because it's public support of a private company, but then I'd say that's why we need to look at how football teams are governed in this country. But the long and the short of it is a successful team means a lot to a city and that should be recognised.

I'd be happy if the club were never charged rent and could use the income from the entire complex on their books, just paid match day costs perhaps. If this was public and the club kept ticket prices reasonable because of it, you could see a fanbase far more supportive of both the team and the complex as a whole. I know a fair few people who would spend more at the ground if the club benefits, but there's no need to give away a golden goose for the club to get what it needs.

Deleted member 5849 · Oct 22, 2013

fernandopartridge said:
Haven't Cardiff got debts of £100m + hanging over them, both from old and new regimes?

They have.

They're not necessarily a good example for the long term, but my point was more they steered through choppy waters and still owned their primary geographic asset at the end of it all.

Here's another example of how headline skews actual content, btw!

http://www.goal.com/en-my/news/3890...ardiff-owner-vincent-tan-writes-off-club-debt

Sure he writes off debt... but he's only writing off the interest!

And what kind of business is it that needs a loan of *over* £50mil anyway?!?

Deleted member 5849 · Oct 22, 2013

shmmeee said:
To some extent, the council have to accept that the local football team, especially a League team, deserves preferential treatment. That niggles because it's public support of a private company, but then I'd say that's why we need to look at how football teams are governed in this country. But the long and the short of it is a successful team means a lot to a city and that should be recognised.

I'd be happy if the club were never charged rent and could use the income from the entire complex on their books, just paid match day costs perhaps. If this was public and the club kept ticket prices reasonable because of it, you could see a fanbase far more supportive of both the team and the complex as a whole. I know a fair few people who would spend more at the ground if the club benefits, but there's no need to give away a golden goose for the club to get what it needs.

Yep, I mentioned elsewhere, but our current landlords have a 150 year lease, £1 a year (well, I assume that's what the typo means ). Ultimately that means Northampton Town benefit, can effectively look forward with security... but there is at least a hold back that should they wish to do something with the stadium the council don't like, as ultimate landlords they can stop that.

Basically though in all normal circumstances, the council should never need to do that though!

That said, Highfield Road was supposed to be protected by covenants, and look how well that turned out!

mark82 · Oct 22, 2013

shmmeee said:
Lots of talk on here about "the club and stadium must be united" for the club to be healthy going forward.

I don't see any of the options being talked about as making our situation any better. Let's say (best case scenario) CCC gift the Ricoh to Sisu, even with a clause stating it must be tied to the club.

The club is currently £60m in debt. This will give the club an asset worth roughly that amount, problem solved right? Wrong!

Any sale of the club would then require someone to pay, say £60m to clear the Sisu debt and buy the club. We now owe £60m to the new owner, and have charges on the club meaning that ARVO are entitled to our assets should we go bust.

Let's say the club build a new stadium at the cost of £25m (low estimate). We're not £85m in debt and in the same situation.

We all want CCFC back in Cov, but we also want a CCFC for our children and grandchildren to "enjoy" like we have. While this debt is hanging around our neck we will not move forward.

Personally, the only way out I see is liquidation or a proper administration (one involving the club, not a property subsidiary).

Yes it would mean a penatly/starting lower down the leagues, but it would mean a chance at a proper future, whether through fan ownership or another owner, we will not move forward while the legacy of Richardson and McGinnity looms over us.

I know a lot would balk at the idea of wishing for liquidation, so I ask: What is your solution for a CCFC that is strong long into the future? Can we ever be sustainable in this current form?

Agree. The only way to make the club sustainable is to start again. Maybe Sisu/ACL will solve a problem between them if the club don't come back to Coventry.

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