Genuine Question-SISU (2 Viewers)

Pusb1 · Jun 22, 2020

So i recall at the time of purchase, SISU openly stated we were a shorter term project, with the intention of progressing us to the top Tier (operation premiership) before selling us on to make profit for their investors.

Approximately 5-6 years ago? I recall a then notorious Tim Fisher interview stating he was having to beg SISU's investors to continually invest in the club, as there was a risk they would withdraw all backing of the team. I'm sure our Tim scaremongered any antisisu protests and suggested this could lead to liquidation

When we were relegated to league two, again there was pressure for SISU to sell, to which Tim again stated that it would be silly to sell the club "at the bottom" and suggested sisu would entertain this once we are on an upward trajectory.

What now is the aim of sisu? The hope we fluke a promotion to the top tier to sell us? Clearly their investors will eventually want a return- especially as it was noted their continued reluctance to invest and thus without a stadium, which no serious investor or theirs will support a new building of- what remains their end game?

Sky Blue Pete · Jun 22, 2020

Pusb1 said:
So i recall at the time of purchase, SISU openly stated we were a shorter term project, with the intention of progressing us to the top Tier (operation premiership) before selling us on to make profit for their investors.

Approximately 5-6 years ago? I recall a then notorious Tim Fisher interview stating he was having to beg SISU's investors to continually invest in the club, as there was a risk they would withdraw all backing of the team. I'm sure our Tim scaremongered any antisisu protests and suggested this could lead to liquidation

When we were relegated to league two, again there was pressure for SISU to sell, to which Tim again stated that it would be silly to sell the club "at the bottom" and suggested sisu would entertain this once we are on an upward trajectory.

What now is the aim of sisu? The hope we fluke a promotion to the top tier to sell us? Clearly their investors will eventually want a return- especially as it was noted their continued reluctance to invest and thus without a stadium, which no serious investor or theirs will support a new building of- what remains their end game?

My feeling is that the city and the club have got to her and she wants to pass on something better to the next caretaker of the city’s football club. I accept Sisu have a lot to do to prove this opinion to the majority of our support. And without a home I’m not sure there’s any return for their investors coming any time soon

CanadianCCFC · Jun 23, 2020

No one would buy the club right now even if SISU wanted to sell. A promotion would obviously change that, or perhaps a cheap, opportunistic purchase of the Ricoh.

clint van damme · Jun 23, 2020

CanadianCCFC said:
No one would buy the club right now even if SISU wanted to sell. A promotion would obviously change that, or perhaps a cheap, opportunistic purchase of the Ricoh.

or a viable long term deal at the Ricoh though that's probably even less likely than a new stadium.

IrishSkyBlue · Jun 23, 2020

Does anyone know roughly how much we are worth without a stadium and what we would be worth with one in the championship or the premiership wold there be a huge difference is selling price for sisu? im gonna take a complete guess here below:

championship with stadium: £30 million
championship no stadium: £15 million

premiership with stadium: £60 million
premiership no stadium: £40 million

Magwitch · Jun 23, 2020

We are worth what any would be buyer would be prepared to pay, I don’t think the ground comes into it that much a deal for that could and would be worked out after. Of course though the present owner or is it owners hold all the cards. It’s hard to value but I would guess around 30 million

ccfcway · Jun 23, 2020

IrishSkyBlue said:
Does anyone know roughly how much we are worth without a stadium and what we would be worth with one in the championship or the premiership wold there be a huge difference is selling price for sisu? im gonna take a complete guess here below:

championship with stadium: £30 million
championship no stadium: £15 million

premiership with stadium: £60 million
premiership no stadium: £40 million

well, making an assumption sisu would want their money back, we are at least 20m in the hole before we start. only asset is the players, and being generous and saying the squad is worth £20m, that brings to what we were prob worth to someone who doesnt have a great interest in ccfc. £0

Mr Panda · Jun 23, 2020

At this point I want SISU to see it through, get a good, fair deal at the Ricoh/win the European case/begin building a stadium... whatever their intention is.

I'd feel a bit downbeat if after all this we're taken over by someone who has no obstacles in their path to a deal with Wasps, but it's a deal in which we're getting bent over a table again.

Grendel · Jun 23, 2020

The club is worth a nominal pound

shmmeee · Jun 23, 2020

Sisus intention is clearly to exhaust all avenues to reverse the Ricoh sale and strong arm the council into a good deal. The question is when that merry go round ends where will the club be on the pitch? Can we be sustained at this new level in Brum until that happens? I’d imagine there’s still some business brain left in Joy and there’s a point where the costs outweigh the returns but maybe were beyond that.

Sky Blue Harry H · Jun 23, 2020

IrishSkyBlue said:
Does anyone know roughly how much we are worth without a stadium and what we would be worth with one in the championship or the premiership wold there be a huge difference is selling price for sisu? im gonna take a complete guess here below:

championship with stadium: £30 million
championship no stadium: £15 million

premiership with stadium: £60 million
premiership no stadium: £40 million

I think there would be a huge difference between the two scenarios (i.e. PL versus Championship) If we were to get into the PL we would be guaranteed parachute payments for the following seasons (even if immediately relegated), so the income difference would be enormous. Estimated additional value of promotion from the Championship is £170M, with £290M if you avoid relegation the following season.

mrtrench · Jun 23, 2020

I think that a football club is largely intangible as an asset, so people who buy are doing so for emotional reasons and not for a big return financially. It's all very well looking at the income from the Premiership but is it realistic to think that this would lead to a large profit? I don't think so: most clubs end up spending most (or more than all) of it just to stay there. If you don't spend it you'll almost certainly go down and your maximum return is two or three years of £170m (taking the number from Harry above). The only tangible part of it is the real estate.

I think this was always more than 50% a real estate project for SISU, which they have blown. With a ground picked up cheap and a team in the Premiership it would be more attractive to people who want to own a football club for the bragging rights at parties on their yacht. It's possible that such a buyer would consider buying without a ground but would instantly want to buy the ground back - and hence deduct that from the price they are prepared to pay*. With the ground picked up cheap they'd pay the full whack - and much of that would be the discount that SISU gleaned on the Ricoh.

* I think this because it would be much less prestigious to own a homeless football club - downright embarrassing to some, I imagine. The only chink I see is that some may want the kudos of turning a club around.

shmmeee · Jun 23, 2020

mrtrench said:
I think that a football club is largely intangible as an asset, so people who buy are doing so for emotional reasons and not for a big return financially. It's all very well looking at the income from the Premiership but is it realistic to think that this would lead to a large profit? I don't think so: most clubs end up spending most (or more than all) of it just to stay there. If you don't spend it you'll almost certainly go down and your maximum return is two or three years of £170m (taking the number from Harry above). The only tangible part of it is the real estate.

I think this was always more than 50% a real estate project for SISU, which they have blown. With a ground picked up cheap and a team in the Premiership it would be more attractive to people who want to own a football club for the bragging rights at parties on their yacht. It's possible that such a buyer would consider buying without a ground but would instantly want to buy the ground back - and hence deduct that from the price they are prepared to pay*. With the ground picked up cheap they'd pay the full whack - and much of that would be the discount that SISU gleaned on the Ricoh.

* I think this because it would be much less prestigious to own a homeless football club - downright embarrassing to some, I imagine. The only chink I see is that some may want the kudos of turning a club around.

On the other hand what better vanity project than building a new ground?

mrtrench · Jun 23, 2020

shmmeee said:
On the other hand what better vanity project than building a new ground?

I agree - some would like that. I just think most people prefer less hassle and to have the finished product. I think SISU thought that too.

Speedies_Chips · Jun 23, 2020

Pusb1 said:
So i recall at the time of purchase, SISU openly stated we were a shorter term project, with the intention of progressing us to the top Tier (operation premiership) before selling us on to make profit for their investors.

Approximately 5-6 years ago? I recall a then notorious Tim Fisher interview stating he was having to beg SISU's investors to continually invest in the club, as there was a risk they would withdraw all backing of the team. I'm sure our Tim scaremongered any antisisu protests and suggested this could lead to liquidation

When we were relegated to league two, again there was pressure for SISU to sell, to which Tim again stated that it would be silly to sell the club "at the bottom" and suggested sisu would entertain this once we are on an upward trajectory.

What now is the aim of sisu? The hope we fluke a promotion to the top tier to sell us? Clearly their investors will eventually want a return- especially as it was noted their continued reluctance to invest and thus without a stadium, which no serious investor or theirs will support a new building of- what remains their end game?

I don't actually recall SISU themselves making that statement. Would be an odd thing to say asd a new owner. I think it was more a case of people predicting what their plan was.

Sky Blue Pete · Jun 23, 2020

shmmeee said:
Sisus intention is clearly to exhaust all avenues to reverse the Ricoh sale and strong arm the council into a good deal. The question is when that merry go round ends where will the club be on the pitch? Can we be sustained at this new level in Brum until that happens? I’d imagine there’s still some business brain left in Joy and there’s a point where the costs outweigh the returns but maybe were beyond that.

We’ve got to be beyond that point surely

Paxman II · Jun 23, 2020

Like any business it's how you run it that counts. The premiership is a pot of gold for some, and a reluctant debt wagon for others trying to keep up with the pack. Small clubs like Burnley can't compete with the likes of Man Utd. If they try then they will be riddled in debt. They don't have 70k in their stands and millions around the world infactuated with the club. So the elite few make lots of money. Well managed clubs also make good money and do not have to try try to keep up with the Jones's. They have good youth systems, buy and develop a player or snap one up before the Man Utd's notice. As a business everyone is extremely high paid from managers to players, and many others bar the tea lady! So yes it pays to be in a higher league. MR's wages will likely double now as will players. But the club has a good model established and it's not all about who can throw the most money at the transfer market.
To get to the question, I have always stated SISU will sell when in a better place. That time may come soon with a long term deal at the Ricoh established (asignabe) and a steady position in the championship maintained. It could all go wrong of course, but I sense the lessons of the last 8 years have been learnt and we will be an attractive proposition for a buyer if we hold steady at least. With a stadium deal in place favourable to the club, and crowds averaging above 18k with potentially sell out crowds, we would be worth at least the debt SISU have always claimed they are owed. Do well and anything else is a bonus. So will WASP use that against us? Not really as any new owner would also want to negotiate or sadly for WASP may build a new stadium, and leave WASP in the cold. So better for WASP to get us tied in sooner rather than later.

Mucca Mad Boys · Jun 23, 2020

Mr Panda said:
At this point I want SISU to see it through, get a good, fair deal at the Ricoh/win the European case/begin building a stadium... whatever their intention is.

I'd feel a bit downbeat if after all this we're taken over by someone who has no obstacles in their path to a deal with Wasps, but it's a deal in which we're getting bent over a table again.

That would essentially be an elongated return to Step 1. The club wasn't viable before SISU came along (a billionaire walked away from investing) and the club needs to have a secure, commercially viable setup if we are to be able to compete in the Championship.

We need either a stake in the RICOH or we need to build our own stadium. Enslaving ourselves to the RICOH is the root cause of our issues, and this predates SISU. When we couldn't afford to construct the stadium, we should've been able to remain at Highfield Road, that option was taken off the table.

mark_ccfc · Jun 23, 2020

No one really knows for sure (except SISU themselves of course) but I imagine they are waiting for the outcome of the complaint to the European Commission. Their next step would depend on the outcome of that.
If the outcome is in their favour you would imagine that would force WASPS out and as shmmeee says they would then try to strngarm the council into a favourable deal on the stadium.
If it doesn't come out in their favour I am not sure - is civil court action still an option for them? Knowing SISU there would be some kind of further legal action to follow.

Deleted member 5849 · Jun 23, 2020

mrtrench said:
I think this was always more than 50% a real estate project for SISU, which they have blown.

I did hear (from *good* sources at the time) that when they came in the plan was simple, spend a bit on players, get us into top flight, sell for a vastly inflated fee. 300% was mentioned as a return, although that might have been stretching it!

Initial plan was high risk, high return. Once that fell through then yes, I'll run with you that the alternative strategies probably came to the fore...

Deleted member 5849 · Jun 23, 2020

shmmeee said:
On the other hand what better vanity project than building a new ground?

The Hoffman Hoffmeister Arena

The Philosopher · Jun 23, 2020

It might just be the time for SISU to cash in their chips.

It’s not implausible now that the net value of the assets (players and Ryton (less mortgage?)) and “golden share” in the Championship might be about equal to the value of their “real” investment (can’t recall, did OSB work this to be £20m?). It might be that someone will hand over £20m in cash knowing they’ve got £20m in assets.

The clause about paying Robinson (£30m) upon reaching the Premiership was always curious to me. Is it still valid by successor company? (Otium) or has it been written off?

IF SISU sell then surely the RICOH then becomes a realistic bet for playing back at next season.

In any case, the Hedge Fund SISU might sell up but continue to pursue the Council (the case would be attached to SISU not the assets they’ve sold by whatever mechanism). They may be able to more easily quantity their losses by showing lost revenue by the council’s actions with a new owner getting better revenue from gates etc.

They may end up with:

Their original investments repaid.
A claim for damages still ongoing (this being their potential reward)
Not having to pay £30m to Robinson, having in mind that the “£200m for reaching the PREM” might not be so easy compared to 10 years ago without chucking on a load more £.

Just speculating in keeping with the thread.

mrtrench · Jun 23, 2020

Deleted member 5849 said:
I did hear (from *good* sources at the time) that when they came in the plan was simple, spend a bit on players, get us into top flight, sell for a vastly inflated fee. 300% was mentioned as a return, although that might have been stretching it!

Initial plan was high risk, high return. Once that fell through then yes, I'll run with you that the alternative strategies probably came to the fore...

That just sounds too naive for what are supposed to be sophisticated investors.

Deleted member 5849 · Jun 23, 2020

mrtrench said:
That just sounds too naive for what are supposed to be sophisticated investors.

Naive? I'd rather see it as high risk v high return and, well, if it doesn't pay off what they're doing now is basically trying to generate something from nothing - they now have a few free hits.

Sky_Blue_Dreamer · Jun 23, 2020

Pusb1 said:
So i recall at the time of purchase, SISU openly stated we were a shorter term project, with the intention of progressing us to the top Tier (operation premiership) before selling us on to make profit for their investors.

Approximately 5-6 years ago? I recall a then notorious Tim Fisher interview stating he was having to beg SISU's investors to continually invest in the club, as there was a risk they would withdraw all backing of the team. I'm sure our Tim scaremongered any antisisu protests and suggested this could lead to liquidation

When we were relegated to league two, again there was pressure for SISU to sell, to which Tim again stated that it would be silly to sell the club "at the bottom" and suggested sisu would entertain this once we are on an upward trajectory.

What now is the aim of sisu? The hope we fluke a promotion to the top tier to sell us? Clearly their investors will eventually want a return- especially as it was noted their continued reluctance to invest and thus without a stadium, which no serious investor or theirs will support a new building of- what remains their end game?

I think they realised the chance of a quick profit had gone when we went down to L2 and the only thing they could do was try and run it more like a long term business (esp with the ongoing court case which I feel was their main motivation for staying for a long while) in the hope the fortunes could turn around and they could sell later. Had the just stopped funding the only people who were owed money were themselves. They had to turn a lot of that 'debt' into equity after admin so the incentive to improve us over time increased

However, it's not like they're not potentially making money off us anyway. They're still plugging the cash shortfall with loans at a decent interest rate so they've got a lot of 'deferred income' in the club.

Biggest mistake they made was cashing in on the signings they made when they took over for a quick profit and never tried to replace them going for frees/loans. Had we kept the likes of Dann and Fox another year with a couple of other additions I really think we could've been challenging.

Sky_Blue_Dreamer · Jun 23, 2020

mrtrench said:
I think that a football club is largely intangible as an asset, so people who buy are doing so for emotional reasons and not for a big return financially. It's all very well looking at the income from the Premiership but is it realistic to think that this would lead to a large profit? I don't think so: most clubs end up spending most (or more than all) of it just to stay there. If you don't spend it you'll almost certainly go down and your maximum return is two or three years of £170m (taking the number from Harry above). The only tangible part of it is the real estate.

Given the amount of cash in the game but also the speed at which it leaves in player/agent pockets I reckon quite a few owners can make a decent buck loaning the club funds at a decent interest rate because as owners there's less chance they'll call it in than an outside creditor.

Quite a few of the owners have then ended up owning the stadium and getting rent from the club for it while they're sitting on a nice piece of real estate which will be worth a few bob.

The owners will be finding ways to make a profit, don't you worry about that!

sw88 · Jun 23, 2020

‘Operation Premiership’ . Now there’s a term from the past

And to think we are now one step closer to completing it

stevefloyd · Jun 23, 2020

well like it or not Shitsu apart from us playing away from 'home' a couple of times are actually one of our more successful owners, 2 wembley wins 2 promotions and one of our best managers of all time... who would've thought

shmmeee · Jun 23, 2020

Sky Blue Pete said:
We’ve got to be beyond that point surely

Depends what you think the payoff is I guess. I have literally no idea what the figures are for a likely Ricoh purchase after a successful EU complaint, nor what that would bring in in terms of selling the club/making profit over what period. I assume Joy has and for it to be worth the hassle it’s in the tens of millions region. Which means we can do a couple more seasons away depending on crowds and how the Championship changes the economics.

Alan Dugdales Moustache · Jun 23, 2020

Grendel said:
The club is worth a nominal pound

Exactly. We have no assets. We have no stadium. We have players wages to pay , rent to pay etc. If people are banding around numbers of £20-40 million I'd like to know where that actual value is. Nothing tangible I can hang it on.

Irish Sky Blue · Jun 23, 2020

stevefloyd said:
well like it or not Shitsu apart from us playing away from 'home' a couple of times are actually one of our more successful owners, 2 wembley wins 2 promotions and one of our best managers of all time... who would've thought

The fact we have had those two promotions is only as a result of the previous two relegations. Yes, appointing Robins was a masterstroke but came after seven or eight less than successful appointments including the employment of Venus and then Slade. The two spells away from Coventry can be traced directly and indirectly to things that they have done. As owners, is their primary concern the well being of the club or the well being of their investors? I think most of us would agree that it is the latter and that what is best for this group is not necessarily what is best for the club.

Mucca Mad Boys · Jun 23, 2020

Irish Sky Blue said:
The fact we have had those two promotions is only as a result of the previous two relegations. Yes, appointing Robins was a masterstroke but came after seven or eight less than successful appointments including the employment of Venus and then Slade. The two spells away from Coventry can be traced directly and indirectly to things that they have done. As owners, is their primary concern the well being of the club or the well being of their investors? I think most of us would agree that it is the latter and that what is best for this group is not necessarily what is best for the club.

You talk as if the club wasn’t going downhill before SISU arrived. Bear this in mind: the season SISU took over, we survived on GD alone. Had they not took over, we would have went into admin, leading to a points deduction and invariably, relegation to L1.

There’s a reason investors (Alki David and the Leicester owners) passed up on the opportunity to get involved with the club.

Fair play to SISU, they’ve got us back to the Championship. But, they’ve alienated the fans, local government and Wasps (rightly or wrongly). Therefore, they ought to sell the club when the time is right.

Alkhen · Jun 23, 2020

Anyone else think a PL2 might become a factor? Not looked into it recently but I know it's been rumbling on in the background. Could see this recent pandemic focusing a few minds and strengthening the desire from the bigger teams to push it through. It's really crucial we try stay in the Champ for the foreseeable, would hate to miss the cut

Magwitch · Jun 23, 2020

Alkhen said:
Anyone else think a PL2 might become a factor? Not looked into it recently but I know it's been rumbling on in the background. Could see this recent pandemic focusing a few minds and strengthening the desire from the bigger teams to push it through. It's really crucial we try stay in the Champ for the foreseeable, would hate to miss the cut

Has been mentioned recently but it would take a large injection of cash from Sky and what for ? They already televise the championship.

Irish Sky Blue · Jun 23, 2020

Mucca Mad Boys said:
You talk as if the club wasn’t going downhill before SISU arrived. Bear this in mind: the season SISU took over, we survived on GD alone. Had they not took over, we would have went into admin, leading to a points deduction and invariably, relegation to L1.

There’s a reason investors (Alki David and the Leicester owners) passed up on the opportunity to get involved with the club.

Fair play to SISU, they’ve got us back to the Championship. But, they’ve alienated the fans, local government and Wasps (rightly or wrongly). Therefore, they ought to sell the club when the time is right.

It was a Sisu appointed manager who took us very close to relegation that first season. They had the chance when they arrived to turn the fortunes of the club around. Through their own incompetence they failed to do this. My reply was to a poster who put forward the idea that Sisu are perhaps our most successful owners ever. I think the opposite is true.
The question about who Sisu are serving, the club or their investers has been the same throughout their reign, their investers obviously come first, often at the expense of the club.

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