[Archived] Unsustainable Rovers

[RevidgeBlue]

2 hours ago, TBTF said:

was that not the point Rev? It stopped them having to put any more money in which I would have thought at least merited a discussion rather than outright lies from V's. The biggest turnoff was probably that they wouldn't have been able to trouser £10million from hanley and Duffy sales with Senaca in control

I'd never really thought of it like that. It wouldnt stop them still theoretically  having to fund 49% of any ongoing losses though. And at t the end of the day we'd still be losing c 1m p.a. initially even with Seneca in operational control so there's no guarantee players still wouldnt have to be sold to plug the debt. 

Funnily enougj I've been thinking about this today. If a second relegation is confirmed everyone needs to stepup.  Protests and attempts to engage in meaningful dialogue with the owners need to be stepped up and not let up.

If there's anyone out there looking at taking us over I'd hope they'd also step up as opposed to waiting for us to fail first. I've never understood why the Seneca proposal supposedly entailed taking over overall control of the Club. If I was financially independent and could afford it I'd offer to work for the Club for nothing in the hope I could make a slight difference. Now no investor is going to want to get involved without the possibility of a financial return at some point but thinking aloud could a third party tweak the Seneca idea in a way that might make it more acceptable to Venky's for example? What if instead of gaining control the carrot for the investors was some form of return on investment instead? Or why could they not get involved in exchange for operational control and 49% equity?

Either way circumstances change all the time and if we go down the Club will be worth substantially less than it was in the Championship. I hope any interested parties will either come forward for the first time or renew their interest accordingly.

 

[Mercer]

4 minutes ago, RevidgeBlue said:

I'd never really thought of it like that. It wouldnt stop them still theoretically  having to fund 49% of any ongoing losses though. And at t the end of the day we'd still be losing c 1m p.a. initially even with Seneca in operational control so there's no guarantee players still wouldnt have to be sold to plug the debt. 

Funnily enougj I've been thinking about this today. If a second relegation is confirmed everyone needs to stepup.  Protests and attempts to engage in meaningful dialogue with the owners need to be stepped up and not let up.

If there's anyone out there looking at taking us over I'd hope they'd also step up as opposed to waiting for us to fail first. I've never understood why the Seneca proposal supposedly entailed taking over overall control of the Club. If I was financially independent and could afford it I'd offer to work for the Club for nothing in the hope I could make a slight difference. Now no investor is going to want to get involved without the possibility of a financial return at some point but thinking aloud could a third party tweak the Seneca idea in a way that might make it more acceptable to Venky's for example? What if instead of gaining control the carrot for the investors was some form of return on investment instead? Or why could they not get involved in exchange for operational control and 49% equity?

Either way circumstances change all the time and if we go down the Club will be worth substantially less than it was in the Championship. I hope any interested parties will either come forward for the first time or renew their interest accordingly.

 

I think that's a naïve question.

In broad and basic terms, ultimate control comes through the shareholders and no savvy consortium (which effectively Seneca would be) would be prepared to invest heavily with Venky's retaining a majority shareholding.  Given Venky's track record with Rovers, it would be sheer madness.

I think it's broadly understood the Seneca proposal:

• Capped Venky's existing debt
• Gave Seneca the majority shareholding with full operational control
• Provided 'substantial' investment to move the club forward in addition to funding future losses
• Gave Venky's a real hope that at least part of their investment to date might, at some future point, be of value and recoverable should the club get back to the PL 

I think the Seneca proposal was fair and sensible.

As things stand, I think the only way Venky's will recover any sizeable chunk of their investment is to liquidate the club and its assets.

 

[RevidgeBlue]

6 minutes ago, Mercer said:

I think that's a naïve question.

In broad and basic terms, ultimate control comes through the shareholders and no savvy consortium (which effectively Seneca would be) would be prepared to invest heavily with Venky's retaining a majority shareholding.  Given Venky's track record with Rovers, it would be sheer madness.

I think it's broadly understood the Seneca proposal:

• Capped Venky's existing debt
• Gave Seneca the majority shareholding with full operational control
• Provided 'substantial' investment to move the club forward in addition to funding future losses
• Gave Venky's a real hope that at least part of their investment to date might, at some future point, be of value and recoverable should the club get back to the PL 

I think the Seneca proposal was fair and sensible.

As things stand, I think the only way Venky's will recover any sizeable chunk of their investment is to liquidate the club and its assets.

 

I'll have to agree to disagree. If it would be naive for Seneca to accept only a 49% stake then surely it would be equally naive for Venky's to hand over a 51% stake? No - one knows the fine detail of the Seneca proposal  but as I understood it, it wouldnt cap Venky's losses and when any pot of investors money ran out after 3 seasons or so any decision regarding the Club would be completely out of their hands.

If we go down Id say all bets are off and the situation should be viewed completely afresh anyhow.

[Mike E]

2 minutes ago, RevidgeBlue said:

I'll have to agree to disagree. If it would be naive for Seneca to accept only a 49% stake then surely it would be equally naive for Venky's to hand over a 51% stake? No - one knows the fine detail of the Seneca proposal  but as I understood it, it wouldnt cap Venky's losses and when any pot of investors money ran out after 3 seasons or so any decision regarding the Club would be completely out of their hands.

If we go down Id say all bets are off and the situation should be viewed completely afresh anyhow.

I'd consider it this way... which is better? Option 1 or 2?

1. This basket case, with £100m+ of debt, cluelessness from ownership and right through the board, no prospect of investing in the playing squad, £6m of cuts coming regardless (presumably more if relegated due to having even less income), potential selling up of a first class academy/training ground plus land, or...

2. Venky's debt is capped, £60m investment over several seasons, restructuring of board including fan engagement (the Ians), next season's '£6m in cuts' turned into an opportunity to restructure the playing squad as it's covered by the first £6m of investment. From Venky's POV, they no longer have to add to their substantial debt through the club and would have written assurance that the club debt (theirs) would be serviced in the event of good fortune.

All sounds good to me and worst case scenario is another hefty chunk of debt and probable administration, which is our best case scenario now imo.

The only differences between the two are 2 has a plan, renewed hope, fresh ideas, whereas 1 is... this.

[RevidgeBlue]

Where has the suggestion that Venky's exposure would be capped suddenly come from? Are you saying the offer was they'd inject 60m over a specified period AND pay any further losses incurred in the meantime as well?

My understanding was they'd inject an unspecified "capital contribution" (might be 60 m might not) into the Club over a specified period in a chuck the kitchen sink type attempt to get into the Premiership but I assume the existing debt would be Venky's own and any debt incurred after they got involved would be split pro rata in accordance with their respective shareholdings.

Otherwise all they'd really be doing is paying off Venky's future debts for them and there'd be little benefit for them or us on the field.

[Stuart]

http://m.bbc.co.uk/sport/football/39554486?ns_mchannel=social&ns_campaign=bbc_match_of_the_day&ns_source=facebook&ns_linkname=sport

Could you imagine Desai ever saying this? This is the behaviour of normal sensible owners. Does anyone think less of her? I certainly don't. Very sensible, honest position to take.

If you can't stand the heat then don't drag the club to hell with your ego.

[broadsword]

6 hours ago, RevidgeBlue said:

I'll have to agree to disagree. If it would be naive for Seneca to accept only a 49% stake then surely it would be equally naive for Venky's to hand over a 51% stake? No - one knows the fine detail of the Seneca proposal  but as I understood it, it wouldnt cap Venky's losses and when any pot of investors money ran out after 3 seasons or so any decision regarding the Club would be completely out of their hands.

If we go down Id say all bets are off and the situation should be viewed completely afresh anyhow.

From what I recall, Mercer is right in saying that venkys debts would be capped. 

I don't think it would be native of them at all. They're going to have to pay back that money somehow. They have a choice of either soldiering on accumulating larger debts or they could turn off the debt tap and let someone run it for them who could give them a chance to get their money back. Worst case scenario is that they don't get their money back. But at the moment the worst case scenario is a lot worse than that. 

Of course venkys would have to do due diligence and that's a foreign concept at rovers. But the offer was a no-brainer all day long. 

[47er]

My recollection too. As I recall it, one of the main selling points was that Venkys were guaranteed not to get into any more debt and would not have to finance the the club from that point.

Assumimg the consortium was successful, and with £60M available for transfers I think they would have been, over time Venkys would have got at least a fair proportion of their money back.

Lunacy that they turned it down unless they have so much money it doesn't matter to them.

However that's not the impression they are giving.

 

[Blue blood]

5 hours ago, Stuart said:

http://m.bbc.co.uk/sport/football/39554486?ns_mchannel=social&ns_campaign=bbc_match_of_the_day&ns_source=facebook&ns_linkname=sport

Could you imagine Desai ever saying this? This is the behaviour of normal sensible owners. Does anyone think less of her? I certainly don't. Very sensible, honest position to take.

If you can't stand the heat then don't drag the club to hell with your ego.

Probably because it isn't about ego, but illegality imo. Any sort of business sense would've sold up a long time ago. Pride could have been salvaged - although what pride there is now, or who they are bothered about losing face to by selling is beyond me. The fact that neither have happened suggests strongly that the only reason they're in control is to prevent something coming out.

[Bigdoggsteel]

2 minutes ago, Blue blood said:

Probably because it isn't about ego, but illegality imo. Any sort of business sense would've sold up a long time ago. Pride could have been salvaged - although what pride there is now, or who they are bothered about losing face to by selling is beyond me. The fact that neither have happened suggests strongly that the only reason they're in control is to prevent something coming out.

I would say it a cultural thing. Put it this way, is there any way they can get having not lost a fortune? The answer is no and their pride is leading them to stubbornly hold on and hope things can be turned around. What they don't realise is that football is not like other business and their approach will never work. It is incredibly hurtful and frustrating for us fans. The FA and Walker trust have a lot to answer for. 

[broadsword]

Due diligence must have been a laugh.

Six and a half years of this nonsense now, with no end in sight.

Pain can be tolerated to an extent if you know that it will only last a certain time. THe trooly demoralising thing is, we have no idea if this nightmare will ever end.

[J*B]

Get @#/? Balaji you cock.

[Bigdoggsteel]

45 minutes ago, broadsword said:

Due diligence must have been a laugh.

Six and a half years of this nonsense now, with no end in sight.

Pain can be tolerated to an extent if you know that it will only last a certain time. THe trooly demoralising thing is, we have no idea if this nightmare will ever end.

Small wins/highs gave us some relief ,for example; Kean was sacked, Lambert was appointed, we exited FFP and Coyle was sacked. Apart from that is has been a procession of misery. 

[broadsword]

Some relief? Or some false hope?

[Bigdoggsteel]

Just now, broadsword said:

Some relief? Or some false hope?

A mix of both. Although hope has progressively faded

[TBTF]

12 hours ago, RevidgeBlue said:

Where has the suggestion that Venky's exposure would be capped suddenly come from? Are you saying the offer was they'd inject 60m over a specified period AND pay any further losses incurred in the meantime as well?

My understanding was they'd inject an unspecified "capital contribution" (might be 60 m might not) into the Club over a specified period in a chuck the kitchen sink type attempt to get into the Premiership but I assume the existing debt would be Venky's own and any debt incurred after they got involved would be split pro rata in accordance with their respective shareholdings.

Otherwise all they'd really be doing is paying off Venky's future debts for them and there'd be little benefit for them or us on the field.

I think you need to listen to the Battersby interviews about it from back in May time last year. They are on here somewhere.

But it was not a plan to continue a reckless gamble. They were adamant about getting the Club to operate as far as possible on an even keel. Battersby talked about the folly of signing players on big money/long contracts because all that does is put the Club in difficulty further down the line. I cant remember it all by any stretch but I do recall it was about the most sensible talk to come out of the Club since John Williams. These are not chancers playing an ego game. They genuinely care for the Club and protecting its heritage