Discussion in 'Coventry City General Chat' started by I was eleven in 87, Feb 9, 2019.
I believe there are several inaccuracies in the article - well I’ve only read the first bit on the opinion of the benefits of purchase of the Higgs shares to me wholly misleading and innacurate. Also the question of Higgs shares being worthless. They were as the actions of the subsequent purchasers proved yet Mr Johnson believes a private enterprise would have paid £6.5 million for them on a less than 50 year lease
The thing I cannot get my head round is if Mr Johnson is not happy with the outcome or the behaviour - as wasps have exhibited even worse behaviour to drive a better outcome
That is a question not an answer.
Where is your analysis? That is if you have even read that JHW article, certainly took me well over an hour to get through it
It’s starting - it’s already started but when the author cannot even get his name right you become somewhat curious
Lol, you don't actually think I am David Johnson.
This article is just an opinion piece based on quotes. The rather long turgid interpretation of Lucas is just that - interpretation - I have a very different interpretation as you i am sure would expect
Sure, lets hear it.
Perhaps you’d like to comment on my other observations first
No thanks. Crack on.
Not sure you are being serious are you? He won't be able to, he will just act dumb.
Lot of fiddling going on here while Rome is burning . Looking at the situation of the parties involved Sisu own my club and as custodians they are responsible for my club I don't see( maybe there has) any offer being made by them to try and break the situation just because Wasps don't want to talk does not stop them from making an offer . As for Wasps I think they hold all the cards and have no intention of paying any and from there point of view why should they ? They are the only 2 involved. What would be interesting to see is Wasps make an offer of a reasonably low deal with out the legals and a higher offer with .As from there point of view I'm lead to believe they have spent something like £300,000 on the current case and chances of recovering that are nil I would have thought.
No I’d like you to answer some questions
You declare 100% accuracy
So can you confirm the formula price was £6.5m at the point of takeover. Can you also confirm with the purchase price what the club would have actually have been entitled to interns of F and B income. When I say club I mean the club and not a shareholding in ACL
The reality is this;
The price (I think it was higher at the time) was a grotesque over valuation
The club would still have had to have paid £1.3 million rent a year
The F and B share was a share for ACL I’m compass and I can see no mechanism that I done would or could have gone to the club
The purchase of these shares would have meant a minority boardroom interest which meant none of the above could have been remedied
The share valuation was on a pitiful lease period which again makes the purchase price laughable
The purchasers of the shares were buying into half the debt
Wasps would NEVER have paid even £2 million for the Higgs shares in isolation as they were worthless on their own
Can you point any inaccuracies in the above?
Shockingly the rent was based on circa £800k annual cost of running Highfield Rd, ignoring the income the club had full access to there.
The idea that the council saved the club is nonsense, CCFC Holdings still had the right way beyond the time the council took over the arena project to buy Highfield Rd back. They sold that right in 2004/05. Derek Higgs was an approx 50% shareholder in CCFCH
The Captain has left the building
It was also based on what we were paying when we left. By that time we were paying a large annual penalty for not having vacated the ground at the time promised when it was sold and rented back.
The formula price was the maximum price, lower offers could be offered and accepted. The original SISU/Higgs deal was not a formula price.
50% is not a minority shareholder, and both shareholders would hold a veto. A good place to be in to negotiate a new rent deal.
The Council were going to extend the lease to 125 years for no extra payment, as part of the original SISU/Higgs deal.
Thought I'd give it a go but there was so many inaccuracies in the opening section alone I lost the will to live.
Dubious factually to say the least. Wasps claim they will not talk unless legal action is dropped however there is nothing in the slightest stopping them. They claimed the same last season and then changed their minds.
Johnson states these claims are not supported by the facts, that is factually incorrect.
Is there a single person who believes SISU will stop legal action? Equally it was stated by the council, on more than once occasion and with no ambiguity, that the sale to Wasps would not proceed without assurances CCFC would not be adversely affected.
Seems to have missed the role the council, who were telling us at every opportunity how disgraceful it was for a club to be playing away from its traditional home location, played in moving a rugby club halfway across the country.
Would also be interested to know how legal action at the time of the sale to Wasps threatened their survival. What legal action was being taken against Wasps prior to them purchasing the Ricoh? And even if that was the case surely serious questions to be asked of Wasps owners for putting their own club at threat?
So you agree then that the suggestion from Johnson that SISU should have paid the formula price for ACL with the existing lease is laughable.
Certainly, and it doesn't appear that either of the shareholders were expecting the formula price to be paid.
We’ve had this discussion before and 50% shareholding gave a minority number of directors on the board
The only observation I can make is that this is the only subject you ever discuss on here
No business would have bought the Higgs share - that’s the point it was worthless and it’s why wasps purchased the council share - Higgs would always then do what they were told.
Rusty once claimed that the veto worked both ways and the council were second partners as Higgs owned a pub in the town and could threaten to close it and the council would lose the rent
A highly coherent argument
By that argument the other 50% shareholding also gave a minority number of directors. The shares are equal, and have equal rights. No majority, no minority.
Both sides had the veto. This is something you have agreed with before. I believe the judge in the recent court case said Higgs held the power as they would only sell to Wasps, he'll probably feel foolish if he finds out that you disagree with him.
Do you think Wasps would have purchased Higgs shares in isolation?
The council clearly disagree with you as well
They didn't so I guess not.
If the Council had renegotiated the rent when the club asked them to back in December 2005 then we would probably never have heard of SISU.
I was out. I've just sat down to check the facts but RustyTrombone seems to have answered in the interim.
I was aware that you quoted the formula price from the original option agreement. It was based upon the price the Higgs charity paid for it, which saved the club from admin before the Ricoh was finished. They paid £6.5M (several million of which was writing off Directors debts).
The JR1 judgement by Mr Justice Hickinbotton confirms this in point 8. "The sale agreement had an option, under which CCFC could buy back the shares for an amount to be calculated under a formula based on the sale price and notional interest but with a minimum price of £6.5m".
However as things no one was going to offer that money as a commercial proposition, Manhattan certainly didn't nor did SISU.
Before and in the early months of the rent strike SISU, ACL and Higgs were talking about a deal for SISU to purchase the Higgs 50% share provided SISU discharged the bank loan debt (which they would negotiate down the £22m loan from Yorkshire Bank) and draft Heads of Terms were signed off in Aug 2012. Per point 27. of court judgement "Those more or less reiterated the principles of the SISU plan I have already outlined, i.e. (i) SISU would purchase the Higgs Charity’s share of ACL, (ii) SISU would discharge and write off the Bank loan debt, in return for the lease to ACL being extended to 125 years, and (iii) rent was to be agreed between CCFC and ACL."
So at this point SISU had turned the screw by stopping rent and negotiated and signed a deal in principle but then Sepalla refused to honour the signed of heads of terms and the rent strike continued, the rest is (disputed) history.
Are then agreeing with Grendel that it is nonsense for Johnson to suggest SISU should have paid the formula price?
Would also like to know what interest rate Higgs were using given that they paid £6.5m but the formula gave the buy back price, as confirmed on here by PWKH, in the region of £10m.
The Hill Jimmy Way - a dyslexic group who are keen to see the back of SUSHI
It also ignored the £800,000 included a penalty from the builders for delayed exit something I frequently asked dear old Peter on here - he refused to answer and his army of admirers all gathered round him doffing their caps
HARD-UP Coventry City are trying to renegotiate the deal to rent the Ricoh Arena to help them through their current cash crisis.
Acting chairman Geoffrey Robinson has admitted he is in talks with the Arena company and Coventry City Council as part of his financial restructuring plan for the club.
The Sky Blues are paying £1m a year to rent the new 32,000-seater stadium but Mr Robinson refused to confirm or deny that the club had approached the city council to release some of that cash to pay players' wages.
The money ! from the club's sale of Premier Club memberships to local businesses ! is held in a special account as a guarantee that it will pay its rent to the Arena company. It is understood the council - a major partner in the Arena scheme - would have to approve it being used for any other purpose.
The club is struggling financially as attendances at the Ricoh are not reaching the 23,000 break-even point given by former chairman Mike McGinnity earlier in the season but Mr Robinson categorically denied that the club was heading into administration.
"No, absolutely not," he said.
He said they were in talks with the Arena company, Coventry City Council and the club's bank over the best deal to suit everyone.
But he admitted the club will probably not be coming up with its financial plan for the next three years in time for its December 20 annual general meeting. He has already said the club's accounts will not be ready to be presented to the meeting.
The Coventry North West MP said: "We're in negotiations with all our partners to make sure we have genuinely well-based, profitable future which is what everybody wants.
"We're working on a plan for financial stability of the club and we'll make a statement (about that) as soon as we can.
"The late opening of the stadium caused problems. The point of the discussions is to (secure) the financial stability of the club over the next three years."
Asked if the club had requested a rebate of £1M from the city council, Mr Robinson said: "I'm not making any comment about the state of negotiations."
What he said was there was an option that could have been exercised, he then went on to mention the negotiation I described above, which Sepalla didn't follow through.
All we can say is the negotiation failed and SISU decided instead to go on rent strike, move the club and break the agreement, thus creating an opening for Wasps to come in and conclude a deal.
I don't think the numbers of the original negotiation circa. 2012 have ever been made public, maybe the courts had them but I haven't found them in the court judgements, have you, if you have some numbers I would be interested to hear them.
Separate names with a comma.