Ricoh Lease... (1 Viewer)

[Voice_of_Reason]

Just wondering if Wasps could sell the lease to pay off it's debt ? I assume that all leases are transferable ? It would be amusing if Wasps sold the lease to Sisu and the present situation was reversed with Wasps renting the Ricoh from Sisu. It would be interesting to see how much the lease is worth... it would be difficult to place a much higher value than Wasps paid for it surely ?

 

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[Magwitch]

Just wondering if Wasps could sell the lease to pay off it's debt ? I assume that all leases are transferable ? It would be amusing if Wasps sold the lease to Sisu and the present situation was reversed with Wasps renting the Ricoh from Sisu. It would be interesting to see how much the lease is worth... it would be difficult to place a much higher value than Wasps paid for it surely ?

I’m sure they could sell to anyone, would that be a good or bad thing though.

 

[skybluetony176]

Can I get in an early “SISU are the only show in town”.

 

[SBAndy]

You’d have to think the price at this time would be at least the £35m bond secured against it, otherwise the security would become unenforceable. In theory, yes it is saleable. In practice, no buyer would go near it.

 

[Philosorapter]

You have to remember the valuation Is based off a rugby and football club playing there. The point being if London Wasps sold the lease would they still be playing in Coventry or be following the cash?

Wasn't the value of The Arena et al once reported at around £7m empty?

I'm guessing the value could be much less now with no business events or sporting attendance's in the immediate future.

 

[Paxman II]

Even if the lease was fully asignable the landlord (Council) must approve it and can attach conditions. Those conditions however must be considered reasonable.
It's a good point though - is the 250 year lease asignable? Never really gave it much thought before.

 

[frattonskyblue]

Even if the lease was fully asignable the landlord (Council) must approve it and can attach conditions. Those conditions however must be considered reasonable.
It's a good point though - is the 250 year lease asignable? Never really gave it much thought before.

I'm not sure it would be in SISUs interests to buy the lease it that way (on the unlikely event that the option was there). It would be more beneficial to buy from the administrator if the worst was to happen to ACL, and then I'm not sure that the council has any say in who picks up the lease.

I posted this a while back in the Wasps section. It is my interpretation of the prospectus.

Wasps downward spiral...

 

[HuckerbyDublinWhelan]

I'm not sure it would be in SISUs interests to buy the lease it that way (on the unlikely event that the option was there). It would be more beneficial to buy from the administrator if the worst was to happen to ACL, and then I'm not sure that the council has any say in who picks up the lease.

I posted this a while back in the Wasps section. It is my interpretation of the prospectus.

Wasps downward spiral...

I thought in this situation the lease reverts back to the council?

 

[Deleted member 2477]

The title of this post reminds me of a cet click bait title

 

[oldskyblue58]

I would think the lease could be sold. It would have to be sold at market value. They could for example sell in a lease back arrangement, often done by selling to a pension scheme.

Last valuation was £51m 31/03/2019. I wouldn't think that in current circumstances it is still worth as much

The Rugby club has a 50 year lease i believe on the 250 year lease owned by ACL. so they probably dont need a lease back arrangement

What they originally paid for it is irrelevant.

They would need to clear the bond debt of £35m if it was sold.

CCC would have to give their permission but that can not be unreasonably with held.

A third party owning the stadium would not necessarily mean a cheap deal for CCFC if they decided to come back. Wasps rugby already have their lease.

 

[HuckerbyDublinWhelan]

Surely buying the lease would be a non starter with the EC complaint still ongoing

 

[oldskyblue58]

it is certainly a problem yes................... but perhaps thats why the complaint is there in the first place?

 

[covcity4life]

Can't find a wiki page for ricoh lease. Who does he play for? Trust the recruitment team though

 

[better days]

I would think the lease could be sold. It would have to be sold at market value. They could for example sell in a lease back arrangement, often done by selling to a pension scheme.

Last valuation was £51m 31/03/2019. I wouldn't think that in current circumstances it is still worth as much

The Rugby club has a 50 year lease i believe on the 250 year lease owned by ACL. so they probably dont need a lease back arrangement

What they originally paid for it is irrelevant.

They would need to clear the bond debt of £35m if it was sold.

CCC would have to give their permission but that can not be unreasonably with held.

A third party owning the stadium would not necessarily mean a cheap deal for CCFC if they decided to come back. Wasps rugby already have their lease.

Always enjoy your posts OSB58
Wasps are in an extremely precarious position (as are many other clubs in both rugby and football)
Financial sharks are always on the lookout for injured prey
Others have speculated that SISU might have bought some of the bonds at distressed prices but other vultures might also smell an opportunity

 

[shepardo01]

I heard, and it was also posted on here at some point that an events management company (AIG?? AEG??) were/have been interested in the Ricoh.
Be typical City if Wasps do go bust and the Council "conveniently prefer" this type of business as new leaseholders... (or whatever they would be)

 

[better days]

I heard, and it was also posted on here at some point that an events management company (AIG?? AEG??) were/have been interested in the Ricoh.
Be typical City if Wasps do go bust and the Council "conveniently prefer" this type of business as new leaseholders... (or whatever they would be)

That's AEG
They transformed the Millennium Dome into the O2
They took it from a white elephant to one of the most successful venues in the world

 

[Nick]

Wasn't it sisu who were going to bring them in?

 

[Lord_Nampil]

Wasn't it sisu who were going to bring them in?

yup.......

 

[chiefdave]

I heard, and it was also posted on here at some point that an events management company (AIG?? AEG??) were/have been interested in the Ricoh.
Be typical City if Wasps do go bust and the Council "conveniently prefer" this type of business as new leaseholders... (or whatever they would be)

You're thinking of AEG, SISU wanted to bring them in to run the non-football side of things (ie manage the stadium bowl and arena). I suspect had that happened we would have eventually ended up with AEG as club owners - they have a track record of owning teams that play in their venues and they also have a track record of turning them into winning teams. They're co-founders of the MLS, currently own LA Galaxy and LA Kings (NHL ice hockey) among others. So if they did end up owning the Ricoh I don't think it would be bad news for us. The money it would take to buy us is peanuts to them.

Have a look at their website, its pretty depressing in a Bullseye 'take a look at what you could have won' way.
Home | AEG Worldwide

AEG is probably the only company you could bring in to operate the arena that could take acts away from the NEC, their music division is huge. Basically if you're an arena / stadium level act you're either with AEG or Live Nation.
AEG Presents | Artists

 

[SBAndy]

May be wrong but weren’t AEG involved in the NEC/NIA at some point?

 

[TTG]

Oh I was thinking that we were linked with a player called Ricoh Lease.

 

[duffer]

Oh I was thinking that we were linked with a player called Ricoh Lease.

That’s Rick O’ Leese you’re thinking of, Irish U21 striker, plays for Bohemians. Brilliant stats on FM, I’d heard we were interested too.

 

[mark82]

I would think the lease could be sold. It would have to be sold at market value. They could for example sell in a lease back arrangement, often done by selling to a pension scheme.

Last valuation was £51m 31/03/2019. I wouldn't think that in current circumstances it is still worth as much

The Rugby club has a 50 year lease i believe on the 250 year lease owned by ACL. so they probably dont need a lease back arrangement

What they originally paid for it is irrelevant.

They would need to clear the bond debt of £35m if it was sold.

CCC would have to give their permission but that can not be unreasonably with held.

A third party owning the stadium would not necessarily mean a cheap deal for CCFC if they decided to come back. Wasps rugby already have their lease.

£51m in 2019. Not bad for something they paid £20m for. What's that, about 150% ROI?

 

[Grendel]

I think the


£51m in 2019. Not bad for something they paid £20m for. What's that, about 150% ROI?

They paid £6.4 million including the extended lease

 

[mark82]

Actually, technically didn't they pay about £5.5m and the rest of the £20m was taking on a loan. Has the £14m loan now been paid back do we know?

 

[mark82]

They paid £6.4 million including the extended lease

Wasn't it £2.77 million to each of council and AH? So, closer to £5.5m. did they bay the extra million to extend the lease? Trying to remember the detail.

 

[mark82]

Shows what a farce the whole episode was either way.

 

[chiefdave]

Actually, technically didn't they pay about £6.5m and the rest of the £20m was taking on a loan. Has the £14m loan now been paid back do we know?

The loan was paid back by the bond. I know the purchase price was for ACL and the valuation is for the lease but even so it raises a lot of questions for me. Especially when you consider at the time of purchase we were playing there.

There's not a valuation due for a while I don't think but seem to recall the last valuation saw an increase which not at all suspiciously saw them maintain the requirement of the covenant. Suspect that may well be broken when the next valuation comes in. Requires the valuation to be "at least 1.4 times the consolidated financial indebtedness of the Group".

 

[chiefdave]

Wasn't it £2.77 million to each of council and AH? So, closer to £5.5m. did they bay the extra million to extend the lease? Trying to remember the detail.

That's the one. Not a bad deal when you think if we hadn't broken our original lease we'd have paid £65m over 50 years for access on matchdays only with no revenues. Of course we did get an offer to buy access to matchday revenues for a one off payment of £24m.

 

[mark82]

That's the one. Not a bad deal when you think if we hadn't broken our original lease we'd have paid £65m over 50 years for access on matchdays only with no revenues. Of course we did get an offer to buy access to matchday revenues for a one off payment of £24m.

We've pretty much paid more in rent than they paid for the stadium.

 

[mark82]

Maybe we should offer them 11k per year for use of the stadium including F&B. They have effectively paid 22k a year, so half of that for our half usage seems fair.

 

[mrtrench]

Others have speculated that SISU might have bought some of the bonds at distressed prices but other vultures might also smell an opportunity

I realised I knew nothing about the Wasps' bond. So I did some research. It matures in December 2022 and is currently trading at 46.7 - meaning that it yields over 13% as the coupon is 6.5% (based on a price of 100). At that price it's a junk bond - the City expects them to default. It fell as far as 24.8 in March.

I'd need to know much more to know if SISU buying the bond is a good idea. But given their interests in the Ricoh (upon which the bond is secured), it sounds on paper as if it might be a good idea. If they had bought at the nadir (and the fact that it bounced back so quickly implies that someone bought it), they'd quadruple their money in 2022 if it Wasps paid out in 2022 as planned. And if they didn't, I think they could force liquidation and settlement for bond holders. Interesting...

WASPS FINANCE PLC WAS1 Stock | London Stock Exchange

 

[mark82]

Even if you take into account the loan they picked up they've only paid 80k per year over 250 years, so 40k a year including access to F&B seems more than fair to me.

 

[jim20]

That's the one. Not a bad deal when you think if we hadn't broken our original lease we'd have paid £65m over 50 years for access on matchdays only with no revenues. Of course we did get an offer to buy access to matchday revenues for a one off payment of £24m.

This is what angers me most about the whole situation. Yes SISU haven’t acted well, but the club through rent etc have paid for the Ricoh, ACL/ council ripped us off for years which didn’t help the clubs long term financial situation. Then sold the stadium for less the club had paid in rent over the years. The council have been destroying this club for decades, long before SISU came and did any of there damage

 

[Grendel]

Actually, technically didn't they pay about £5.5m and the rest of the £20m was taking on a loan. Has the £14m loan now been paid back do we know?

The deal has always been described as £20m but the £14m was just a funding arrangement switch. If the council were not the lender and the switch was from Yorkshire Bank would anyone have been able to describe it as such?