“SISU have never taken any money out of CCFC” – INCORRECT
- Since 2008 the accounts of the football club (pre and post the administration) show a number of occasions where the loans have decreased in value. This does not mean that SISU Capital Limited has taken funds directly from the CCFC companies but the investors (the original funds, ARVO & SISU Master Fund) must have.
- In 2011/12 the loans were repaid by 1.125m (pre administration)
- 2013/14 & 2014/15 ARVO converted some its loan to preference shares. After the administration the owners transferred the old losses of the previous CCFC companies to OEG before converting them to preference shares totalling £60.9m. This was not new money.
- 2016/17 part of the loans from SISU Master Fund (£1.03m) received 2016 and 2017were repaid by £112k
“SISU do not put any money in to the club” – INCORRECT
- It is not true to say SISU have not put any money in recently. In 2015/16 SISU Master Fund made a loan of £530K and in 2016/17 £500k (part repaid in same year). In those two years the club only balanced the cashflow because of those loans (ie what was spent was balanced by what was received including the loans)
- Had SISU not put those sums into the club then Otium/CCFC would not have been able to pay its bills and could have become insolvent
- Up until 31/05/2017 ARVO had put £8.65m funds into OEG/CCFC. Of that £2m was prior to OEG becoming OEG/CCFC and £1.5m funded the purchase of the CCFC assets from the administrator.
“SISU are paid large amounts of interest on the loans” – INCORRECT
- There are loan agreements with ARVO and SISU Master fund that mean Otium/CCFC is charged interest on the sums outstanding
- Over 98% of the interest on loans provided by shareholders or SISU has never been paid out.
- The interest charge is legally due but Otium/CCFC has no way of paying those sums, it simply hasn’t had money in the bank to pay it.
- The loan interest is not paid or written off but added to the total debt each year
- There were relatively small amounts of interest paid over, in 2017 £39k 2016 £25k
- Otium/CCFC owed a total of £5.63m interest outstanding as at 31/05/2017
- The interest charge cannot be ignored when calculating the OEG/CCFC profit in any year of financial statements “because they are due to the owner”. The loans & interest are fundamental to the ability of the company to keep going and are legally payable
“SISU are paid the administrative expenses shown in the accounts” – INCORRECT
- Administrative expenses are a category of expenses and costs that is required by the Companies Act 2006 to be disclosed. It includes depreciation, audit fees, rental costs of land or equipment but it also includes costs like rates, insurance, light & heat, Repairs, registrations, certain wages, director’s remuneration etc. No different to most companies
- In 2017 the total of administrative expenses was £1.57m. Of which Depreciation was £140k Audit £27k Rent or lease costs £656k, Directors remuneration £176k. Leaving £570k spent on the other overheads
- The administrative expenses are broadly similar to other clubs of similar size that publish a breakdown
“Tim Fisher is not paid by CCFC” – UNKNOWN
- There is director’s remuneration disclosed in the 2016 & 2017 financial statements. But no disclosure as to who
- During 2016 & 2017 Marc Venus was a director of Otium/CCFC so any remuneration could only relate to him.
- Remuneration of £175K it is stated was paid to third parties on behalf of the Directors
“CCFC is self sufficient”- INCORRECT
- As shown previously this is not the case because in 2016 and 2017 financial statements a SISU controlled entity has had to put just over £1m in to OEG/CCFC. If it were self sufficient there have been no requirement to do so
- OEG/CCFC does rely on the match day, commercial and player sale incomes to operate and survive. However the financial statements to 31/05/2017 disclose this was not enough and loans were required from the owners.
“the auditors sign the accounts off” – CORRECT BUT
- The auditors sign off their opinion of the financial statements.
- The director signs off the accounts before the auditors can sign
- The directors must be satisfied that for a period of at least 12 months from the date of signature that the company is a going concern. That means the company has the ability to trade as a football club (eg a home ground) and can fund it so it can meet its debts as they fall due.
- The auditors examine the accounts and make their own independent assessment whether they show true & fair view and a company that is a going concern as described by the director for the 12 months from date of signature. If they do not agree they are required to publish an adverse audit report and to state why.
- A written assurance from the owners that they intend to continue to fund or source funds is not a guarantee to do so and is not legally binding
- Financial statements are filed with Companies House and the EFL by 28th February each year
INSOLVENCY
“SISU will put us in to administration again” - UNKNOWN
- It is only one of several possibilities available. What happens will depend on what suits SISU and its investors best. It is far from a certainty.SISU have a duty to act in the best interests of their investors first and foremost.
- The directors must act in the best interest of OEG. But also have a duty to consider the interests of the shareholders
- As the part owners and by far the biggest creditor ARVO control would control any insolvency. ARVO is controlled by SISU
- You do not need to go in to administration to dissolve or liquidate a company
- Administration costs are high and such an action would weaken the control SISU have.
- Assets of a distressed company are often sold at under true value
- If Wasps became an unpaid creditor of OEG they could petition the courts for administration, but control of the process would be taken over by SISU
- There is no evidence that OEG/CCFC are not paying their liabilities as they fall due
- There is no evidence that the owners will not continue to support OEG
- There is no evidence that OEG is insolvent.
SKY BLUE TRUST
“the Sky Blue Trust want to force the club to go into administration so they can take over” – INCORRECT
- There is simply no legal mechanism by which the Trust can do this. It is impossible.
- OEG/CCFC going in to administration does not even guarantee that the Trust could be involved in the club going forward or the rescue package.
- Insolvency is one of the scenarios that the Trust has made contingency plans for so that they can react promptly to it, as it has for no ownership change, new owners, fans ownership or the worst outcome of no club at all.
- The phoenix club scenario is the very last resort to keep a team at all in Coventry and only after all other options have been exhausted and failed.
- The first target is a successful CCFC in Coventry
“The Trust just want a seat on the board as an ego trip”
- The Trust objectives are set out in their constitution, Details can be found here
-
Sky Blue Trust - Constitution & Rules
- The EFL & FA are promoting the better representation of fans
- The Trust website publishes details of their ideas for fans involvement. Details can be found here
Sky Blue Trust - Fan Ownership: Q&A
- Even with 100% ownership it would not mean that the Trust would be running the club on a day to day basis.
- The Trust has taken suitable professional advice and appointed advisors where appropriate in making the plans for the various scenarios that could be possible
- Trust board members are unpaid elected volunteers who bare their own expenses
The Ricoh
“Wasps bought the stadium and paid £20m for it” NOT CORRECT
- On 8th October 2014 Wasps bought the CCC 50% interest in ACL. On 14th November 2014 Wasps bought the AEHC 50% interest in ACL
- The sale was two separate purchases of roughly £2.77m each. The cost of purchasing a company is the cost of purchasing the voting shares.
- That put the sale value of the shares in ACL at £5.54m at that time
- Included in the ACL assets at the dates of the deals was the stadium lease valued under the ownership of CCC & AEHC at approximately £18.3m. Included in the liabilities at the dates of sale was a loan due to CCC of £14.3m
- The CCC loan remained outstanding and payable by ACL before and after the sale went through and was not cleared until Wasps completed refinancing in May 2015.
- Wasps paid only for the ownership of the shares. Then provided finance from a bond loan to repay the CCC loan. One loan replaced by another loan.
- On 29th January 2015 Wasps signed a lease extension to 250 years at a cost of £1m. The new lease and the original lease remain charged as security for the Wasps Bond issue
