[Football] Southampton supposedly being bought for £100m

[jackalbion]

Seems a steal for a whole city, but I've always preferred Gunwharf Quays for the shopping, and the historic Dockyard is a much better day out, they are probably better off buying Pompey instead.

 

[Lower West Stander]

I'd say that is quite a fair market rate given the risk. It's quasi equity at that level with no prospect of being repaid without the sale of the business or replacement investment from internal or external investors.

Its certainly an equity like return.

But its secured (on something) and on balance sheet. Its also in the operating company. This is a long term liability and that is significantly wider than virtually everything trading in the £ High Yield bond markets.

 

[Creaky]

I'd say that is quite a fair market rate given the risk. It's quasi equity at that level with no prospect of being repaid without the sale of the business or replacement investment from internal or external investors.

It always surprises me how any club manages to obtain a commercial loan at any rate! In almost any other field of business with a similar record of losses and volatile assets banks wouldn’t touch them.

 

[schmunk]

9%! Bloody hell.

That is an unreal rate - especially considering when they took it out. What's it secured on? Can't be St Mary's at that level.

No wonder he wants to sell....

Secured on the ground, training ground, some extra land and the club shop!

https://find-and-update.company-inf.../06951765/charges/myPcrtkEIFCo92v_3ppIiepTSc0

 

[Springal]

Further proof on how lucky we are to have Tony Bloom who is willing to pump tens of Millions of his own cash into the club to keep it running, especially during a pandemic when many clubs are running for expensive loans ...

 

[London Irish]

MSD is Michael Dell right ?

Yes. MSD have arranged loans for quite a few clubs, Burnley, West Ham, Derby and they charge a fair bit for it

 

[London Irish]

Solak will have 80% and previous owner Katharina Liebherr 20%. The Saints fans are hopeful as some finance guy from Brentford with a good track record has also been brought on board

 

[Jim in the West]

Yes. MSD have arranged loans for quite a few clubs, Burnley, West Ham, Derby and they charge a fair bit for it

The level of interest they are charging Southampton is eye-watering....as a comparison to how financial institutions look at football clubs, Spurs have over £1bn of debt, at an average interest rate of 2.7% (none of it via MSD). They recently completed a refinancing of the Covid loan they got from the UK Govt at a rate of (I think) 2.8%. The interest rate on Burnley's MSD debt is between 7.9% and 9.5% (I think there are several tranches). I guess the key issue for lenders is the likelihood of the club being relegated (and hence having trouble repaying the debt).

 

[Anger]

Seems a steal for a whole city, but I've always preferred Gunwharf Quays for the shopping, and the historic Dockyard is a much better day out, they are probably better off buying Pompey instead.

It excludes the University.

It includes Northam though, so when you take that into account then £100m seems fair.

 

[timbha]

Um, yes. That's what I was implying

I know

 

[Springal]

The level of interest they are charging Southampton is eye-watering....as a comparison to how financial institutions look at football clubs, Spurs have over £1bn of debt, at an average interest rate of 2.7% (none of it via MSD). They recently completed a refinancing of the Covid loan they got from the UK Govt at a rate of (I think) 2.8%. The interest rate on Burnley's MSD debt is between 7.9% and 9.5% (I think there are several tranches). I guess the key issue for lenders is the likelihood of the club being relegated (and hence having trouble repaying the debt).

I think your last sentence sums it up. A bit like Barcelona - although their debts of 1Bn Euros or whatever are eye watering, they are a huge club and just needed to re-finance it. Once we get out of COVID etc their revenues will fly back up.

 

[Amexarmadillo]

I’d be worried about this one if I was a saints fan. Feels a long time since they had that owner who genuinely seemed to love the club but passed away.

 

[timbha]

I think your last sentence sums it up. A bit like Barcelona - although their debts of 1Bn Euros or whatever are eye watering, they are a huge club and just needed to re-finance it. Once we get out of COVID etc their revenues will fly back up.

So how do you place a value on their brand?

 

[Wardy's twin]

https://twitter.com/markkleinmansky/status/1478339293596770306?s=21

Being worth 2 Ben White's doesn't seem much (particularly when they let him go originally)

i presume that must include Eastleigh as well for that money ..

 

[Dave the OAP]

Southampton and Newcastle fans in a twatter spat about Mike Ashley.

It’s all about who has the biggest Willy and if this Serbian is a war criminal as opposed to misogynistic women hating Arabs!

 

[Lower West Stander]

Secured on the ground, training ground, some extra land and the club shop!

https://find-and-update.company-inf.../06951765/charges/myPcrtkEIFCo92v_3ppIiepTSc0

That is unreal.

It’s a debenture - so book debts as well.

I’m no expert in football finance but I don’t understand that rate at all given the security package. All I can think is the valuations are low so the LTV is really high….


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[amexer]

So how much is the Albion worth ?

 

[Neville's Breakfast]

https://www.bbc.co.uk/sport/football/59866024

"We are delighted to be able to complete this acquisition as a first step towards execution of our investment strategy.“

No explanation of that investment strategy. I was under the impression that the only money making PL club is Manchester Utd so presumably their ‘investment strategy’ relates more to the assets.

 

[OzMike]

The new owner was robbed !

 

[OzMike]

It reads like it was only one of the shareholders that sold his shares, so not all 100% of the shares were sold, only his percentage.