Birmingham City - shit or bust

[Gritt23]

good point ,well made. it is a massive struggle to make a decent go of it in the prem , we should , with our catchment and proposed capacity do ok ......i emphasize ok....will we ever compete with the likes of the current top 6 ..??.....as much as it hurts to say it ..........well ,i won't.think the sensible ones here will get what i'm on about.

I know what you are getting at.

The dangers are that once you go down the silly route of spending teams just dig a deeper and deeper hole until you either become an establish Premier side, or you go into admin. Birmingham this season, possibly Bolton next, and clubs like Leeds and Pompey previously, find themselves relegated with so much debt that teh only way they can turn it around is to gamble EVEN MORE money in the hope rthat they only have to survive for one year on parachute payments before they get back to £50m+ in the Prem again.

We cannot end up like that because it will catch us out eventually. I'm just so pleased we do not appear to be doing such things. Blackpool had a year in teh Prem, kept the wages sensible and made solid profits from the season that can help them continue to build the club sensibly. That's how it should be done.

 

[Kalimantan Gull]

I know what you are getting at.

The dangers are that once you go down the silly route of spending teams just dig a deeper and deeper hole until you either become an establish Premier side, or you go into admin. Birmingham this season, possibly Bolton next, and clubs like Leeds and Pompey previously, find themselves relegated with so much debt that teh only way they can turn it around is to gamble EVEN MORE money in the hope rthat they only have to survive for one year on parachute payments before they get back to £50m+ in the Prem again.

We cannot end up like that because it will catch us out eventually. I'm just so pleased we do not appear to be doing such things. Blackpool had a year in teh Prem, kept the wages sensible and made solid profits from the season that can help them continue to build the club sensibly. That's how it should be done.

Blackpool did well out of their one year, Reading and Hull out of their two years, we'll probably be like those clubs - to start with. Birmingham on the other hand had several seasons in the prem, 7 out of 9 seasons before this one with a couple of top-half finishes. At what point do you stop accumulating profits and start spending it on improving the team and pushing on?

same for Bolton, West Ham, and for Portsmouth and Leeds a few years back. Perhaps the answer is that it is impossible for any club outside the top 6, without massive pockets or a big stadium filled with 35,000+, to even attempt to compete in the premier league without getting in financial trouble. Shame.

 

[Alex Alex Dawson oo! oo!]

Blackpool did well out of their one year, Reading and Hull out of their two years, we'll probably be like those clubs - to start with. Birmingham on the other hand had several seasons in the prem, 7 out of 9 seasons before this one with a couple of top-half finishes. At what point do you stop accumulating profits and start spending it on improving the team and pushing on?

same for Bolton, West Ham, and for Portsmouth and Leeds a few years back. Perhaps the answer is that it is impossible for any club outside the top 6, without massive pockets or a big stadium filled with 35,000+, to even attempt to compete in the premier league without getting in financial trouble. Shame.

I think you'll find that it was Owen Oyston, the club owner, who did well - £11M personally from the year in the Premier League.

Actually, Pool paid Oyston more than £23m - Blackpool FC - Blackpool Gazette

Then again, if he's been investing his own money in the club for years, why not take some back?

 

[Gazwag]

Not quite. Each club gets £48m over 4 years, split £16m, £16m, £8m, £8m

Hull and Burnley, relegated in 2010, will get £8m this summer. Middlesbrough were relegated in 2009, so they get their last £8m this summer.

Brum and Blackpool will get £16m again this summer.

I was basing my figure on Where the money went: Premier League prize and TV payments for 2011-12 Sporting Intelligence

But you are ignoring the fact that most of those clubs (with the exception of Wolves, Burnley and Blackpool) have player wages that consumed a massive proportion of their income including £40m of annual TV money. Getting relegated doesnt mean you dont have to pay those players wages anymore, and if they are on long contracts you are screwed unless you go straight up.

I realise this of course, its was the "free" money aspect I was commenting on when they go down.

 

[Peever]

I think you'll find that it was Owen Oyston, the club owner, who did well - £11M personally from the year in the Premier League.

Actually, Pool paid Oyston more than £23m - Blackpool FC - Blackpool Gazette

Then again, if he's been investing his own money in the club for years, why not take some back?

I remember reading the uproar from Blackpool supporters about the money he took. Once they started to breath they realized just that....he took back some of what he had put in. It is possible to go into the Prem and not get into financial shit....Wolves are a prime example. But to be fair the passive "living withing means" approach has got them relegated.


Villa supporters thoughts on Blues situation when away to Norwich

 

[Alex Alex Dawson oo! oo!]

I remember reading the uproar from Blackpool supporters about the money he took. Once they started to breath they realized just that....he took back some of what he had put in. It is possible to go into the Prem and not get into financial shit....Wolves are a prime example. But to be fair the passive "living withing means" approach has got them relegated.

Quite, some Brighton supporters may like to remember that BHA owes our chairman a few bob more than Blackpool FC has ever owed Oyston.
Thought you may be interested in a story about some Villa supporting friends of ours from Melbourne. I first met them when Rob worked with my wife in the early 80's and we've kept in touch, visited each other etc after he and his wife moved to Australia with Glaxo in 1989. We're meeting up with them on Saturday whilst they're cruising around the canals of Birmingham to celebrate the manager's departure; however, the primary reason they're in the UK is to renew their season tickets. That's 23 years in Australia and x2 Villa STs each and every year.

 

[Peever]

Quite, some Brighton supporters may like to remember that BHA owes our chairman a few bob more than Blackpool FC has ever owed Oyston.
Thought you may be interested in a story about some Villa supporting friends of ours from Melbourne. I first met them when Rob worked with my wife in the early 80's and we've kept in touch, visited each other etc after he and his wife moved to Australia with Glaxo in 1989. We're meeting up with them on Saturday whilst they're cruising around the canals of Birmingham to celebrate the manager's departure; however, the primary reason they're in the UK is to renew their season tickets. That's 23 years in Australia and x2 Villa STs each and every year.

Good story that is. Someday id like to have my own purchased at VP as well even though I live far away. That is sometime away though

 

[severnside gull]

Interesting that Erik Husskelepp did well on loan at Birmingham but they have sent him back to Portsmouth - word is, not so much the fee which is invariably paid in stages, but because they can't pay his wages over the summer. You'd have to laugh if Pompey couldn't offload him and had to stump up his wages and Blues then got him in September

That aside, the loan fee helped Pompey stay afloat but they still owe the best part of £1m to Bari for his initial transfer so Husskelepp could be available at a decent price. Pompey played him centrally but he is best as a winger in the Buckley mould with a bit more height and power and could be a good addition (as a direct replacement for Hoskins assuming he is going to move on) if we are not going to go with a traditional front man (as I am absolutely convinced, Gus originally intended).

 

[severnside gull]

Auditors raise questions about Birmingham City FC's accounts - Top Stories - News - Birmingham Mail

Auditors essentially saying that the accounts are wrong and that the club may well be operating whilst bust - the FL have to act on this surely as it is entirely contrary to their rules.

Worst set of audit statements I have ever seen and I'm told that the holding company accounts which are still being witheld are even worse and leave questions about Director's actions

 

[severnside gull]

Birmingham have sold Jordan Mutch to Cardiff today for a cut price £1.2m.

Mutch was a player who represented Blues' future along with the likes of Nathan Redmond and to have sold him at all, never mind so cheaply and to natural Championship rivals, must mean that they are in need of immediate cash income. Next week's contracted £10K rise in Nicola Zigic's weekly wage may be a big part of the problem. He has been touted everywhere and no-one values him at anything like his now £70K a week earnings at Birmingham.

 

[Peever]

 

[Lady Whistledown]

Loving the outfits in there

 

[severnside gull]

If you are opposed to football being used as a medium for international money laundering this article makes almost joyous reading

Birmingham City: The Birmingham Mail demands answers from the Blues board - Top Stories - News - Birmingham Mail


When Birmingham City won the Carling Cup against all odds, it was the finest achievement in their history.
Relegation from the Premier League followed, Alex McLeish quit, the break-up of the Wembley squad began and Blues were plunged into financial turmoil.
Another summer later and Blues, after a near-miss in the play-offs, are managerless, the money woes have intensified and player sales are continuing.
That Carling Cup success, and even the fantastic Europa League adventure, are fading memories that have given way to grave concerns about the state and future of the St Andrew’s club.
The shock sale of Jordon Mutch, one of Blues’ bright young stars, following on from the departure of popular manager Chris Hughton, coupled with all the other off-field problems, has understandably left supporters at breaking point.
There is a fear Blues could be going backwards to the dark days of the 1980s unless the club changes hands or the current crisis can be somehow arrested.
For that reason the Birmingham Mail calls upon Carson Yeung, Peter Pannu, Vico Hui and the board of parent company Birmingham International Holdings Ltd (BIHL) to lift a veil of secrecy and silence from Hong Kong and provide supporters with answers and assurances.

Ten questions from Birmingham Mail readers

Dear Mr Pannu,
There is growing unease among Birmingham City fans regarding the financial stability and long-term vision for their football club, particularly after the departure of manager Chris Hughton to Norwich City and the sale of Jordon Mutch to Cardiff City.
Fans have been contacting the Birmingham Mail in large numbers, asking the newspaper to attempt to seek answers to key questions regarding the club.
We hope you, or a member of the Birmingham City board, can find time to answer these questions for publication in the Birmingham Mail at the earliest opportunity.
The ten key questions that Blues fans would like answering are:

1. Just how bad are the finances and is administration a possibility?

2. When will BIHL file their overdue accounts and the Football League transfer embargo be lifted?

3. Are Carson Yeung and BIHL actively trying to sell the club and if so, are they in negotiation with any group or individual at present?

4. What has happened to the mystery investor who had been ‘identified’, as written about in your programme notes in May?

5. What are the short, medium and long term plans for Birmingham City?

6. Is money raised by Blues going to Hong Kong to pay off Carson Yeung’s and BIHL’s debts?

7. Why were the rights to cash generated by the Xtep kit deal transferred to a subsidiary of BIHL on the basis of an informal agreement?

8. Why have there been no public statements by Carson Yeung and Blues chairman and BIHL chief executive Vico Hui about Blues’ current predicament?

9. How many players are likely to be sold this transfer window and can the club guarantee that, after Jordon Mutch’s exit, fellow rising stars Nathan Redmond and Jack Butland will not be moved on?

10. Will the new manager be given the necessary resources to improve the squad to make Blues genuine promotion contenders?

I look forward to your response.

Yours sincerely

David Brookes

Editor-in-Chief, Trinity Mirror Midlands

Editor, Birmingham Mail

Blues are expected to announce their new boss imminently, with Lee Clark to succeed Hughton. And a new sponsorship deal is in the pipeline.
But the underlying problems remain.
Yeung, the Blues president and major BIHL shareholder, faces a court battle in November after being charged last summer with alleged money laundering. His assets have been frozen and he is currently fighting to keep his home in Hong Kong after defaulting on a loan took out against it to prop up Blues and BIHL.
Auditors issued a ‘disclaimer of opinion’ on Blues plc accounts for 2011 and it was stated in the directors’ report that Blues would have to sell players in order to stay as a going concern through to next summer.
When Yeung completed his £81.5 million takeover of Blues in October 2009 the catchphrase was ‘we are family’.
That Blues family is fractured - and that’s why answers are needed.




I think everybody knows that the answer to question 4 is that there never was a potential investor
The answer to question 6 is almost certainly "yes" and the answer to question 7 lies in the answer to question 6.
Their "owner" Carston Yeung , seems likely to have never had money to invest - not his own money anyway - and whilst the reported £81.5m takeover fee is exaggerated, there is a rumour that someone forgot to do their due diligence and even at a substantially lower price they were seriously ripped off by Gold, Sullivan et al who it is suggested may have cleared millions from the club's accounts between doing the deal and handing over the keys.


If only similar questions had been asked of other clubs in the past or indeed were being asked of some clubs now

 

[CHAPPERS]

Well done, the FA.

 

[severnside gull]

Fascinating response from Peter Pannu on behalf of BCFC Board (well, he is the Board along with Carson Yeung's young son who has no employment, let alone business, background)

http://www.birminghammail.net/news/top-stories/2012/06/26/birmingham-city-peter-pannu-

Peter Pannu has stated that it is 'understood' that Vico Hui has resigned as chief executive of BIHL. He also made it clear that Nathon Redmond and Jack Butland were not for sale.
I understand many fans have raised queries on the accounts and I wish I was in a position to discuss these fully but unfortunately for legal reasons I am not able to go into minute details. However I will address this matter in a broad brush fashion.
I have recently returned from Hong Kong where I looked into the repeated delay in the publications of the BCFC accounts when I knew they had been prepared by the club for the group quite some time back (in September 2011). I can confirm that since becoming a director at BCFC on July 2011 I had raised queries with our auditors and the group board on various matters which were unsatisfactorily answered.
The queries related to the Xtep deal, the accounting treatment and details of an unannounced "counter sponsorship" arrangement between BIHL and the sponsor as personally handled by Mr Vico Hui and Miss Pauline Wong. Further points were raised regarding the selling of merchandise in China at the sponsor's stores with modified BCFC logos.
Unfortunately I can't go into further details at this moment in time due to legal reasons, however, I hope that full details will become clear in the future.
A BCFC board meeting was also called by me on 22 June 2012 which Mr Hui failed to attend to answer all queries raised.
The year end accounts to June 2011 showed a loss of £12million. We are currently preparing the accounts for the year end June 2012 and we shall be revealing substantial profits for that period. All money generated at the club remains with us to set off earlier losses. Debts owed to Carson Yeung and BIHL still stand at the original figure.
Credit will go to all my staff for working hard to achieve this result under very trying circumstances.
I have met with some of the BIHL board members and given them an update of the financial situation we face. I have also had to deal with certain internal matters within the group. I have spent considerable time seeking directions and impressing upon the BIHL board the need to raise further finances once the parent company's shares are re-listed.
My remit now is to maintain the club on a self sustainable basis which we have been doing since relegation in May 2011.
There was talk in the media about administration for the whole of last season but we will be reporting profits. In the mean time, suitable buyers will be sought and we shall address the issues that need to be resolved in Hong Kong when more funds are made available to us.
Nevertheless, and honestly speaking, media doom and gloom is scaring away all potential investors initially identified in the process.
I am informed that BDO HK (BIHL's auditors) are working hard to conclude the parent company's accounts following the publication of the BCFC accounts. As I am not on the BIHL board I can't provide any further details.
It is now understood that there will be some restructuring of the board in Hong Kong as a result of internal reviews and due to the matters I have raised.
It is understood that Vico Hui has resigned from the BIHL board and his resignation has been accepted. This will take effect from the July 1 2012. It is unclear if he will also resign from the BCFC and BC PLC boards but further changes may occur and in which case will no doubt be communicated as appropriate.
Prospective buyers are continuing to maintain a close rapport with the club but there is so far no meaningful deal in place for the board's consideration. One thing I can say is that any new buyer will be following closely the support fans give to the club and the current owners. I am sure they will understand the passion of our supporters but I hope that there is no adverse impact on the endeavours to seek a suitable buyer.
The board shall endeavour to ensure that the club survives and proceeds as a going concern. While attempts will be made to generate further revenue to ensure the club's financial survival, the competitiveness of the squad will be maintained where possible.
Jordon Mutch's deep desire to move to Cardiff and be reunited with Malky Mackay was granted and at the same time the deal was deemed a very good one for the club with a substantial up-front payment and a heavy sell-on clause.
I'd like to make it clear that Jack Butland and Nathan Redmond are not for sale unless we are subject to an eye-popping offer. While the decision to sell Mutch was not taken lightly, it was felt replacements could be sought for the midfielder but our intention is to keep hold of other talented gems we have.
Our supporters should be reassured that the club will not accept any derisory financial offers for any of our key players, as has been suggested, but equally we are required to make sound and balanced financial decisions which we accept are not always going to be popular. After all, this is a business.
I am sure no one wants the club to go into administration, particularly when my remit is for the club to be self sufficient.
It is hoped that a new manager will be installed very shortly and he will be given all the available support to build the squad by bringing in necessary replacements to continue to play entertaining and competitive football.
Please get behind him and show him your full support. During the recruitment process, I studied supporter opinion to the potential candidates and the chosen one will be received well by the majority.
We have presented all the facts and projected financial results for the 2011/12 season to the Football League and are awaiting news on the lifting of the transfer embargo. In any event, the embargo does not cripple the club's activities but just requires the club to seek approvals in our transfer activities.
Season tickets is one area where I cannot force any of you to come and part with your money. I suppose all of you are making similar careful financial considerations. Despite all the predicaments I have mentioned above and the lack of financial support from the Far East and any financial institutions, we have been operating as a self sufficient club for some time and despite these challenging times have enjoyed an exciting season of football.
While the club has naturally had to take measures to reduce its costs, no attempt has been made to pass on the financial pressure to any of our supporters which I hope has been shown by the price freeze on season tickets. I am alive to the concerns of our supporters and hope this has displayed that we do not take the magnificent support you have shown for granted.
I can only hope that you will work with us through this period and continue to support the club, your new manager and your team.
I will try my best to maintain a competitive team and to instil a very enthusiastic manager. I am confident that things will improve and we will continue to soldier on together.
Please continue your support and take note of any deadlines that may cause you to miss out on the financial benefits of purchasing a season ticket. The arrangements for 0%finance are also still available. I hope we can all come together for a successful 2012/13 campaign.



Picking the bones from it he seems to be saying that they are indeed in deep doo dah financialyl and will sell any player that they get an offer for subject to the usual haggling but mainly subject to a healthy percentage of cash up front . They are haemorraging money to Hong Kong where there have been some distinctly dodgy dealings going on in the holding company. He really doesn't know what is happening and seemingly is being kept out of the loop by those who might. Regardless of this and the fact that their costs are increasing not decreasing, they will report a profit even if their own auditors don't agree with the figures and whilst it may be surprising to any outside observer that they cannot find a buyer despite their desperation to do so, they are clinging on to any chance they get to blame the fans and the press for their failings. They continue to be in real danger of administration (rumour strongly suggests that there is at least one consortium in the wings that will not move in prior to administration as they cannot trust the accounts as a basis for negotiation and wish to take on an investable business not someone else's dubious debts). Smoke and mirrors..........................


EDIT:
Meanwhile this officially sanctioned advert to sell Marlon King has been tactfully placed via SKY Sports News

King attracting interest | Sky Sports

I am lead to believe that selected club chairmen have been made aware of King's potential availability

 

[leigull]

Thanks severnside gull. Interesting reading.

Don't think they've appointed a good manager in Lee Clark either, though maybe he was the best they could get at the moment.

Mutch's comments about his transfer don't sound like he was angling for a move that the report above suggests:

"It was a shock, it came out of the blue,” Mutch admitted to the Birmingham Mail.

“It all happened very quickly. I didn’t ask to leave but Cardiff came in and agreed a fee, and then it was my side of it"