| Interesting Trust Email 20:09 - Jun 29 with 140439 views | Neath_Jack |
Regarding the options open to us.
It's going to cause some massive debate on here i reckon  |  |
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| Interesting Trust Email on 14:10 - Jul 5 with 2298 views | Whiterockin |
| Interesting Trust Email on 14:06 - Jul 5 by Darran |
It is funny mind that the lippiest twáts aren't members and have no interest in standing for election.
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Then again perhaps some turned up last Thursday when others didn't. |  | | |
| Interesting Trust Email on 14:12 - Jul 5 with 2296 views | Vetchfielder |
| Interesting Trust Email on 14:00 - Jul 5 by MattG |
Questions have already been asked about whether the current offer (circa £5½m) will be paid for by the Club or by the Americans (or their consortium) themselves - the best information we have is that it will not be paid for by the Club which is good news.
The likely remedy for the Trust winning a legal battle would be a purchase of the entire Trust shareholding - let's say £22m. Because of the significantly higher cost, it's not inconceivable the Americans could decide to use the Club to fund that purchase. To ensure the money is available, they might reduce spending on players, thereby directly impacting on our chances of staying in the PL.
Totally hypothetical but is it any more or less likely than the Americans funding the full £22m out of their own pockets? |
Thanks for this one Matt. I'd never even thought of the £5M etc coming out of club funds so it's good to know that it wouldn't.
However, I'm astonished that they could potentially pay for the £22M out of club funds. That sounds totally wrong and immoral and you'd have thought there would be a law against doing that. There bloody well should be anyway.
Could you please confirm the names of the parties against which we would be taking legal action? |  |
| Proud to have been one of the 231 |
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| Interesting Trust Email on 14:13 - Jul 5 with 2294 views | Darran |
| Interesting Trust Email on 14:10 - Jul 5 by Whiterockin |
Then again perhaps some turned up last Thursday when others didn't. |
Well if that's aimed at me id already booked to be somewhere several months before it was announced see Butt. |  |
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| Interesting Trust Email on 14:16 - Jul 5 with 2289 views | Whiterockin |
| Interesting Trust Email on 14:13 - Jul 5 by Darran |
Well if that's aimed at me id already booked to be somewhere several months before it was announced see Butt. |
I could understand it if you had booked to see a mega star like Adele but FFS a support act like Cheap Trick. | | | |
| Interesting Trust Email on 14:19 - Jul 5 with 2276 views | Darran |
| Interesting Trust Email on 14:16 - Jul 5 by Whiterockin |
I could understand it if you had booked to see a mega star like Adele but FFS a support act like Cheap Trick. |
Bollox. | |
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| Interesting Trust Email on 14:38 - Jul 5 with 2247 views | max936 |
| Interesting Trust Email on 14:16 - Jul 5 by Whiterockin |
I could understand it if you had booked to see a mega star like Adele but FFS a support act like Cheap Trick. |
 And from the photo he put up the place was empty  |  |
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| Interesting Trust Email on 14:40 - Jul 5 with 2239 views | Darran |
| Interesting Trust Email on 14:38 - Jul 5 by max936 |
And from the photo he put up the place was empty |
Were you at the Forum then? | |
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| Interesting Trust Email on 14:42 - Jul 5 with 2225 views | max936 |
| Interesting Trust Email on 14:12 - Jul 5 by Vetchfielder |
Thanks for this one Matt. I'd never even thought of the £5M etc coming out of club funds so it's good to know that it wouldn't.
However, I'm astonished that they could potentially pay for the £22M out of club funds. That sounds totally wrong and immoral and you'd have thought there would be a law against doing that. There bloody well should be anyway.
Could you please confirm the names of the parties against which we would be taking legal action? |
Do the trust know who all the members of the syndicate are? if not then, that should be sought before anything else and I'd find it incredible if they don't. | |
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| Interesting Trust Email on 14:45 - Jul 5 with 2212 views | Todger |
| Interesting Trust Email on 14:12 - Jul 5 by Vetchfielder |
Thanks for this one Matt. I'd never even thought of the £5M etc coming out of club funds so it's good to know that it wouldn't.
However, I'm astonished that they could potentially pay for the £22M out of club funds. That sounds totally wrong and immoral and you'd have thought there would be a law against doing that. There bloody well should be anyway.
Could you please confirm the names of the parties against which we would be taking legal action? |
I think the point is that once they have taken the Trust out totally then virtually any future dividend becomes theirs so they could pay the Trust out and then take a wacking dividend to cover it. They could do exactly the same if they bought part of the Trust shareholding but then they would have to share that dividend with the Trust residual shareholding. |  | | |
| Interesting Trust Email on 14:51 - Jul 5 with 2191 views | max936 |
| Interesting Trust Email on 14:40 - Jul 5 by Darran |
Were you at the Forum then? |
I wasn't no as I was on lates, you know what my family life is like as well, but I'd be happy to offer any help as and when I'm able, fair enough? | |
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| Interesting Trust Email on 14:54 - Jul 5 with 2179 views | Darran |
| Interesting Trust Email on 14:51 - Jul 5 by max936 |
I wasn't no as I was on lates, you know what my family life is like as well, but I'd be happy to offer any help as and when I'm able, fair enough? |
Well yes but I wasn't goading you you were goading me.
And whilst we are at it I can't recall seeing you at one going back over a decade. #cock | |
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| Interesting Trust Email on 15:45 - Jul 5 with 2122 views | MattG |
| Interesting Trust Email on 14:12 - Jul 5 by Vetchfielder |
Thanks for this one Matt. I'd never even thought of the £5M etc coming out of club funds so it's good to know that it wouldn't.
However, I'm astonished that they could potentially pay for the £22M out of club funds. That sounds totally wrong and immoral and you'd have thought there would be a law against doing that. There bloody well should be anyway.
Could you please confirm the names of the parties against which we would be taking legal action? |
I haven't got access to the QC documents from work so can't confirm at the moment - apologies for that but Ux may be able to advise if he checks in again. |  | | |
| Interesting Trust Email on 15:51 - Jul 5 with 2107 views | DafyddHuw |
| Interesting Trust Email on 14:00 - Jul 5 by MattG |
Questions have already been asked about whether the current offer (circa £5½m) will be paid for by the Club or by the Americans (or their consortium) themselves - the best information we have is that it will not be paid for by the Club which is good news.
The likely remedy for the Trust winning a legal battle would be a purchase of the entire Trust shareholding - let's say £22m. Because of the significantly higher cost, it's not inconceivable the Americans could decide to use the Club to fund that purchase. To ensure the money is available, they might reduce spending on players, thereby directly impacting on our chances of staying in the PL.
Totally hypothetical but is it any more or less likely than the Americans funding the full £22m out of their own pockets? |
If you think that the Yanks are capable of such a dastardly act, why do you feel it's a good idea to build bridges with them?
By your own admission, you're saying that they have the p[otential to stab us in the back (again) at any moment.
Know your enemy. Or more to the point, realise that your enemy is your enemy, and treat them accordingly. |  | | |
| Interesting Trust Email on 15:57 - Jul 5 with 2094 views | Nookiejack |
| Interesting Trust Email on 14:45 - Jul 5 by Todger |
I think the point is that once they have taken the Trust out totally then virtually any future dividend becomes theirs so they could pay the Trust out and then take a wacking dividend to cover it. They could do exactly the same if they bought part of the Trust shareholding but then they would have to share that dividend with the Trust residual shareholding. |
Yes exactly the same as when the 'Drag' Rights are taken up and Trust sells entire stake - new owners can leverage the club and take out a whacking great dividend.
There is no difference between the options in respect of influence (the Trust eventually sells given the Drag rights have been conceded) and protections (leverage can be put on the club in both options).
The key decision is does one think we will be relegated (which could cause a downward spiral) before the Yanks can sell at a profit.
For me there is a much higher chance of relegation - which leads to the decision to take legal action
So then you have to think what are the chances in court. They seem to be very strong although always a chance of losing.
So on both counts for me the decision has to be legal action.
Finally from a moral point of view why haven't the Yanks made exactly the same offer to the Trust as they made to the Selling Shareholders?
Isn't that indicative that they think the Trust can be walked over - so have just treated the Trust with contempt? | | | |
| Interesting Trust Email on 15:58 - Jul 5 with 2090 views | londonlisa2001 |
| Interesting Trust Email on 15:45 - Jul 5 by MattG |
I haven't got access to the QC documents from work so can't confirm at the moment - apologies for that but Ux may be able to advise if he checks in again. |
The people usually named are the shareholders (or anyone else) that have acted unfairly. The company itself will also be named, but it is nominal.
Incidentally, they can't decide to have the club pay out. The judge decides, and it is rarely the company itself, although the company can be instructed to pay the costs of the aggrieved party (the Trust).
So the only realistic mechanism to get the club to pay, which has been mentioned, is the use of future dividends, which can only, of course, be paid out of distributable profit, so good luck with them doing that in the event of relegation. | | | |
| Interesting Trust Email on 17:15 - Jul 5 with 2027 views | max936 |
| Interesting Trust Email on 14:54 - Jul 5 by Darran |
Well yes but I wasn't goading you you were goading me.
And whilst we are at it I can't recall seeing you at one going back over a decade. #cock |
No goading on my part either you cock
Correct on the 2nd part too just to make you happy | |
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| Interesting Trust Email on 18:51 - Jul 5 with 1965 views | Shaky |
| Interesting Trust Email on 11:39 - Jul 5 by Uxbridge |
Last reply from me for the day ... I should actually do some work.
To answer your question, I think it very much depends on what you want to get out of it all. If you're looking solely to maximise the Trust's bank account, which I think it's fair to say is your principal criteria, then I can see the logic of your calculations. I don't really agree with the weighting you are putting onto things, but that's all subjective. If I was looking at it solely in that way, I'd still probably err towards the offer TBH, as I'd also look at the worst case scenarios of both.
I'll walk through my decision making process. In an ideal world the Trust could have got all the protections it wanted - non-dilution, veto rights, proper protection for our view of how the football club should have been run. Wasn't happening, so we need to look at which of the options best suit our interests.
Let's look at the offer. It provides money up front, which'll take the Trust funds to around £6m (before tax, which'll be around 20% ... nobody's really talking about that). That could be used for numerous things, one of which is protecting against dilution (you're looking at a factor of 6.21 at which they'd need to issue shares before the Trust couldn't participate) if that is the best use of the funds. It may not be, and we could be better served keeping that money for other purposes. That's for another day. That pot could also double if other conditions are met.
A big concern has always been how unprotected the Trust's shareholding is. Much talk of control premiums but a minority stake is always worth significantly less, pro rata, than a majority one. No arguments there. The Tag along rights will mean that stake is worth the same, pro rata, as the Americans. That's a big thing. They'll be betting on the club being worth considerably more than what they paid for it.
The real fly in the ointment for me has always been the drag rights. The fundamental principle of the Trust was to ensure we had a stake in the club. This puts it at risk, and I don't like it. Some will vote against the deal on that basis alone, and I completely get it.
I won't comment on the 20% clause because I think it's meaningless in its current form, and I don't find the HJ clause as emotive as others - he's a shareholder today so a small bump in that doesn't really matter, if we're taking emotion out of it.
Moving on to the legal action ... the good news is that it's a strong case. If it wasn't, we'd be in real trouble. It's winnable and the Trust has significant funds to fight it. That's the good side. The down side is all too obvious. It will affect the club, probably delay some decisions such as stadium expansion (if that's even imminent), and it'll certainly impact the involvement with the Trust in the club. Some may dismiss this already but I don't. Then there's the case itself - which isn't predictable. If we win then things are relatively hunky dory for the Trust, but losing would be an absolute nightmare ... no funds, a minority stake with no protections, no say in anything. Goodnight Irene.
However, let's look at the probable outcome of winning the case. The probable result of that is the Trust sells its shares in its entirety. After tax, you're probably looking at £16-£17m in the bank. Not an unhealthy chunk of change. That fundamental aim of securing football in the city is looking pretty good now. The price of course is that the Trust then has zero say in the running of the club. For how long then becomes key, and we simply don't know. You talk about taking over the whole club in the doomsday scenario, but when is that? 5 years? 10 years? 20 years? We don't know. That pot isn't enough to fully take over a relatively solvent Championship club, which in all likelihood is what we'd be if we got relegated.
Is that still better than the alternative? That partly comes down to how you value the involvement of the Trust today. Some think there is no point in the Trust being there now as it can simply be overruled. True enough, however I'd say the existing relationship that has been developed has significant value, particularly in ensuring that the club is run a manner that looks after the long term interests of the fans. The Trust may be overruled, but being involved is surely better than not.
There's also the not inconsiderable consideration of how this affects the club. Let's be honest, we're the ones who care what happens to the club. They've got money in it, but it's not their way of life. Legal action will impact things in the short term at the very least. It makes relegation more likely. How much is open to question, but uncertainty is likely to result in a poorer playing squad than certainty would. Funnily enough, this isn't on my top 3 factors, but for many it'll be #1, #2 and #3.
There is of course the much maligned third option. Keep the status quo. Keep the current relationships, but the Trust will forever remain a minority shareholder with a stake being kept with no real consideration for its financial value. The Trust is also in a very weak position in terms of a future share issue, and there's little scope to react to any future financial apocalypse.
This has been pretty much dismissed on this site, however I have a hunch it's much more prevalent out there than anyone here is appreciating ... it's certainly one that the Trust has been getting a lot of questions about. I fully expect a sizeable amount of the vote will err towards this side.
So, my rationale.
I don't like the status quo as the Trust has precious little room to manoeuvre, so reluctantly I shall have to vote against that.
So I have to weigh up the other two options - is the probable prospect of something from £18m-£23m in the Trust bank and the guaranteed exit of the Trust from any real relationship with the club enough to risk the downsides and risks (to the club and Trust) of legal action, and also better than £4-6m in the bank now, potentially another £4-6m if conditions are met, the continued involvement with the club for as long as the current ownership structure is in place and peace in our time. True, the future beyond that is not well known, but if the Trust is jettisoned then - which is not guaranteed - there's a further lump sum of anything from £0 to £20m or so in that future too.
It's a judgement call for sure. On the above rationale, I err towards the deal. I'd be a damn sight happier about it without drag along rights though. [Post edited 5 Jul 2017 11:48]
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I am certainly no expert in tax, but isn't the Trust a registered charity? You sure they would pay 20% CGT on the stake in the club? |  |
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| Interesting Trust Email on 18:59 - Jul 5 with 1956 views | Shaky |
| Interesting Trust Email on 15:58 - Jul 5 by londonlisa2001 |
The people usually named are the shareholders (or anyone else) that have acted unfairly. The company itself will also be named, but it is nominal.
Incidentally, they can't decide to have the club pay out. The judge decides, and it is rarely the company itself, although the company can be instructed to pay the costs of the aggrieved party (the Trust).
So the only realistic mechanism to get the club to pay, which has been mentioned, is the use of future dividends, which can only, of course, be paid out of distributable profit, so good luck with them doing that in the event of relegation. |
I believe the action is against the company, although individual shareholders may also be named additionally.
However, the remedy of enforced purchase is likely to be remedied against the shareholders individually.
Where this becomes blurred is that following any judgment to purchase the Trust's stake the UK LLC becomes a ~90% shareholder in the club, and at that point the two are substantially identical. | |
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| Interesting Trust Email on 19:20 - Jul 5 with 1930 views | MattG |
| Interesting Trust Email on 15:51 - Jul 5 by DafyddHuw |
If you think that the Yanks are capable of such a dastardly act, why do you feel it's a good idea to build bridges with them?
By your own admission, you're saying that they have the p[otential to stab us in the back (again) at any moment.
Know your enemy. Or more to the point, realise that your enemy is your enemy, and treat them accordingly. |
It's not necessarily about stabbing anyone in the back - it might just be the easiest way for them to raise those kinds of funds. Remember the Glazers' leveraged buy-out of MUFC? | | | |
| Interesting Trust Email on 19:23 - Jul 5 with 1921 views | Shaky |
| Interesting Trust Email on 14:12 - Jul 5 by Vetchfielder |
Thanks for this one Matt. I'd never even thought of the £5M etc coming out of club funds so it's good to know that it wouldn't.
However, I'm astonished that they could potentially pay for the £22M out of club funds. That sounds totally wrong and immoral and you'd have thought there would be a law against doing that. There bloody well should be anyway.
Could you please confirm the names of the parties against which we would be taking legal action? |
You have to go in to this with your eyes wide open, and accept that if the Trust sells its stake under whatever circumstances (litigation or subsequently via the drag-along provision) the new owners will own substantially 100% of the club.
In that situation whether they take the money out of their own pockets or the club's is to a large extent irrelevant (although the judge could well order any amounts paid by the shareholders directly). The two situations are substantially identical.
What matters is whether those pockets collectively have any money in them and their level of commitment to the business. | |
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| Interesting Trust Email on 19:57 - Jul 5 with 1884 views | MyFinalHeaven |
| Interesting Trust Email on 11:39 - Jul 5 by Uxbridge |
Last reply from me for the day ... I should actually do some work.
To answer your question, I think it very much depends on what you want to get out of it all. If you're looking solely to maximise the Trust's bank account, which I think it's fair to say is your principal criteria, then I can see the logic of your calculations. I don't really agree with the weighting you are putting onto things, but that's all subjective. If I was looking at it solely in that way, I'd still probably err towards the offer TBH, as I'd also look at the worst case scenarios of both.
I'll walk through my decision making process. In an ideal world the Trust could have got all the protections it wanted - non-dilution, veto rights, proper protection for our view of how the football club should have been run. Wasn't happening, so we need to look at which of the options best suit our interests.
Let's look at the offer. It provides money up front, which'll take the Trust funds to around £6m (before tax, which'll be around 20% ... nobody's really talking about that). That could be used for numerous things, one of which is protecting against dilution (you're looking at a factor of 6.21 at which they'd need to issue shares before the Trust couldn't participate) if that is the best use of the funds. It may not be, and we could be better served keeping that money for other purposes. That's for another day. That pot could also double if other conditions are met.
A big concern has always been how unprotected the Trust's shareholding is. Much talk of control premiums but a minority stake is always worth significantly less, pro rata, than a majority one. No arguments there. The Tag along rights will mean that stake is worth the same, pro rata, as the Americans. That's a big thing. They'll be betting on the club being worth considerably more than what they paid for it.
The real fly in the ointment for me has always been the drag rights. The fundamental principle of the Trust was to ensure we had a stake in the club. This puts it at risk, and I don't like it. Some will vote against the deal on that basis alone, and I completely get it.
I won't comment on the 20% clause because I think it's meaningless in its current form, and I don't find the HJ clause as emotive as others - he's a shareholder today so a small bump in that doesn't really matter, if we're taking emotion out of it.
Moving on to the legal action ... the good news is that it's a strong case. If it wasn't, we'd be in real trouble. It's winnable and the Trust has significant funds to fight it. That's the good side. The down side is all too obvious. It will affect the club, probably delay some decisions such as stadium expansion (if that's even imminent), and it'll certainly impact the involvement with the Trust in the club. Some may dismiss this already but I don't. Then there's the case itself - which isn't predictable. If we win then things are relatively hunky dory for the Trust, but losing would be an absolute nightmare ... no funds, a minority stake with no protections, no say in anything. Goodnight Irene.
However, let's look at the probable outcome of winning the case. The probable result of that is the Trust sells its shares in its entirety. After tax, you're probably looking at £16-£17m in the bank. Not an unhealthy chunk of change. That fundamental aim of securing football in the city is looking pretty good now. The price of course is that the Trust then has zero say in the running of the club. For how long then becomes key, and we simply don't know. You talk about taking over the whole club in the doomsday scenario, but when is that? 5 years? 10 years? 20 years? We don't know. That pot isn't enough to fully take over a relatively solvent Championship club, which in all likelihood is what we'd be if we got relegated.
Is that still better than the alternative? That partly comes down to how you value the involvement of the Trust today. Some think there is no point in the Trust being there now as it can simply be overruled. True enough, however I'd say the existing relationship that has been developed has significant value, particularly in ensuring that the club is run a manner that looks after the long term interests of the fans. The Trust may be overruled, but being involved is surely better than not.
There's also the not inconsiderable consideration of how this affects the club. Let's be honest, we're the ones who care what happens to the club. They've got money in it, but it's not their way of life. Legal action will impact things in the short term at the very least. It makes relegation more likely. How much is open to question, but uncertainty is likely to result in a poorer playing squad than certainty would. Funnily enough, this isn't on my top 3 factors, but for many it'll be #1, #2 and #3.
There is of course the much maligned third option. Keep the status quo. Keep the current relationships, but the Trust will forever remain a minority shareholder with a stake being kept with no real consideration for its financial value. The Trust is also in a very weak position in terms of a future share issue, and there's little scope to react to any future financial apocalypse.
This has been pretty much dismissed on this site, however I have a hunch it's much more prevalent out there than anyone here is appreciating ... it's certainly one that the Trust has been getting a lot of questions about. I fully expect a sizeable amount of the vote will err towards this side.
So, my rationale.
I don't like the status quo as the Trust has precious little room to manoeuvre, so reluctantly I shall have to vote against that.
So I have to weigh up the other two options - is the probable prospect of something from £18m-£23m in the Trust bank and the guaranteed exit of the Trust from any real relationship with the club enough to risk the downsides and risks (to the club and Trust) of legal action, and also better than £4-6m in the bank now, potentially another £4-6m if conditions are met, the continued involvement with the club for as long as the current ownership structure is in place and peace in our time. True, the future beyond that is not well known, but if the Trust is jettisoned then - which is not guaranteed - there's a further lump sum of anything from £0 to £20m or so in that future too.
It's a judgement call for sure. On the above rationale, I err towards the deal. I'd be a damn sight happier about it without drag along rights though. [Post edited 5 Jul 2017 11:48]
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"That pot isn't enough to fully take over a relatively solvent Championship club, which in all likelihood is what we'd be if we got relegated."
This is simply not true. Championship clubs don't cost that much. Roland Duchâtelet bought Charlton for just £14m back in 2014. It wasn't like they were in heavy debt either. And mind you, this is a London club that owns its 27,000 all seater stadium AND training ground. |  |
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| Interesting Trust Email on 20:16 - Jul 5 with 1848 views | londonlisa2001 |
| Interesting Trust Email on 18:51 - Jul 5 by Shaky |
I am certainly no expert in tax, but isn't the Trust a registered charity? You sure they would pay 20% CGT on the stake in the club? |
The Trust is a Cooperative and Community Benefit Society according to its accounts. Previously an Industrial and Provident Society.
Some have charitable status for tax purposes and some don't. I had assumed that the Swans Trust did, simply because there has been no provision for corporation tax on any profits made in any year as far as I can see from a quick glance at the accounts. | | | |
| Interesting Trust Email on 20:17 - Jul 5 with 1846 views | Vetchfielder |
Thank you Lisa and Shaky | |
| Proud to have been one of the 231 |
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| Interesting Trust Email on 20:23 - Jul 5 with 1839 views | londonlisa2001 |
| Interesting Trust Email on 18:59 - Jul 5 by Shaky |
I believe the action is against the company, although individual shareholders may also be named additionally.
However, the remedy of enforced purchase is likely to be remedied against the shareholders individually.
Where this becomes blurred is that following any judgment to purchase the Trust's stake the UK LLC becomes a ~90% shareholder in the club, and at that point the two are substantially identical. |
They are substantially identical, other than they can still only pay dividends from distributable reserves. As you have pointed out previously, there aren't many of them and if they cut costs / sold players to maximise profit, they would run a huge risk of relegation, hence low turnover / lack of distributable profit. Also their shares would then be worth a fraction of current value.
They could go the route of management fees, although ironically that could be constituted as unfair prejudice against the remaining minority.
Company law stops the worst excesses of them treating their own / the club's assets as fungible. | | | |
| Interesting Trust Email on 20:37 - Jul 5 with 1807 views | DafyddHuw |
| Interesting Trust Email on 19:20 - Jul 5 by MattG |
It's not necessarily about stabbing anyone in the back - it might just be the easiest way for them to raise those kinds of funds. Remember the Glazers' leveraged buy-out of MUFC? |
Yeah, I remember the Glazers - th people who bought the club with MUFC's money (pretty much). Nice people. Exactly the sort I'd like owning my club.
Remeber Newton Heath? | | | |
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