Cardiff

<table class="forumline" cellspacing="1" cellpadding="3" width="100%" border="0"><tbody><tr><th class="thRight">Message</th></tr><tr><td class="row1" style="width: 150px" valign="top" align="left"><span class="name"><a name="14286" />carton</span>
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Joined: 26 Dec 2006
Posts: 105
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</td><td class="row1" style="width: 100%; height: 28px" valign="top"><table cellspacing="0" cellpadding="0" width="100%" border="0"><tbody><tr><td style="width: 100%"><span class="postdetails">Posted: Wed Aug 15, 2007 9:02 am<span class="gen"></span> Post subject: langston, the debt and the future</span></td><td valign="top"> </td></tr><tr><td colspan="2"><hr /></td></tr><tr><td colspan="2">

<span class="postbody">As a chartered accountant I have spoken on this forum about the financial situation of Cardiff many times over the past few months.I have to admit that the latest bombshell of Cardiff,s &pound;31m debt to Langston comes as a surprise,because of statements made by Ridsdale since acquiring control of the club, and particularly having regard to the last audited accounts.
I am going to reply to my own questions in the hope that the current situation can be explained as I now see it.
QUESTION.
HOW DID THIS DEBT ARISE?
ANSWER
Sam did not put a lot of his own money into Cardiff,but borrowed initially on bank overdrafts.When the bank put pressure on the club about four years ago Sam negotiated a &pound;20m loan with Citibank Finance. This loan was repayable and Cardiff experienced severe difficulty in repaying the agreed amounts and operating a club that was successful on the field but running at a loss financially.
He then successfull negotiated a new loan of &pound;24m.This loan was in the form of loan stock and was raised from what we now know to be a Panamanium registered company based in Switzerland.Sam,s actual involvement with this Company is still not publically known.
The advantage of this loan was that the club did not have to start to repay anyof it ,including interest until apparently December 2006.The loan itself was taken out on the 30 September 2004 .
The interest chargeable was 7% per annum until January 2008 when it would increase to 12% per annum.
The whole loan including interest was to be repaid by 31 December 2011.
QUESTION
WHY IS THE LOAN NOW &pound;31m
ANSWER
Because of the interst charges being added on and no repayments having been made since it was taken out.
QUESTION
WHY THE CONFUSION NOW ABOUT THIS DEBT
ANSWER
Because Ridsdale gave the impression that when the takeover from Sam took place the whole debt had been taken over by Sam as part of the agreement for future rights on the new Stadium eg naming rights
QUESTION
WOULD THE STADIUM PROJECT HAVE GOT OFF THE GROUND IF THE DEBT HAD NOT APPARENTLY BEEN REPAID
ANSWER
I don,t know. However the gift of land and other money by Cardiff Corporation was based on cash flow forecasts which probably assumed the debt had been cleared .
QUESTION
WHY ARETHE LAST AUDITED ACCOUNTS TO 31ST MAY 2006 NOW APPARENTLY WRONG
ANSWER
Two reasons .
Firstly interest on the debt was not charged through the accounts If it had been charged it would have turned the profit for the year of &pound;1,112,829 into a loss of &pound;648014
Secondly the accounts include the following statement under the heading of post Balance Sheet events. 'The club was successful in renegotiating the size and terms of the Langston Loan Stock in November 2006.This restructuring has resulted in the loan note capital and interest being written down to &pound;15m with effect from 4 May 2007.There will be no repayment or interest for a minimum ten year period'
It now appears that the above statements are incorrect If this is the case then it is a very serious matter.
QUESTION
WAS RIDSDALE A PARTY TO THE ABOVE
ANSWER
Yes. The accounts were not signed off until 16th May 2007. The above statement is included in the Directors report which was signed by Ridsdale as the named director.
In today,s Western Mail Ridsdale suggests a distance between himself and the auditors Chantrey Vellacott DFK LLP referring to them as Hammans auditors. He obviously cannot get away with that.
QUESTION
WILL CARDIFF FACE LIQUIDATION
ANSWER
No. Langston has stated that they want to change the Board not liquidate the Club. With the proposed ground probably reverting to Cardiff Corporation if the club is liquidated this would definitely not be in Langstons interest
Predictions
The board will be forced to resign
Langston will convert their loan note debt into equity, thereby obtaining control of the club
Sam Hamman,s influence will return

WHO ARE WORRIED THIS MORNING
Mr Ridsdale, Cardiff Corporation, the Auditors, Principality Building Society to name but a few.
HOWEVER Cardiff City football Club will continue and may become stronger as a result of all this I hope so anyway</span></p>

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<span class="postbody"><font size="3">This all seems pretty level headed and informed until the very end where the writer reverts to blind optimism.</font></span></p></td></tr></tbody></table></td></tr></tbody></table>

 

Obviously you chose not to reveal that the author is a jack and whilst he does appear to know his stuff will structure the format and conclusions according to his agenda.

It's a power struggle at the end of the day and SH has just put his cards on the table.

http://icwales.icnetwork.co.uk/0600...objectid=19633922&siteid=50082-name_page.html

 

I suspect Riddy is having a bit of Deja Vu

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I "chose not to reveal" him as a Jack?

Yes, I also chose not reveal his shoe size and grandmother's maiden name. We're best mates me and wotsit, we tell each other everything.</p>

Reading that last paragraph Idon't know how you can claim rival bias. It smacks of hope over reason, sure it's not you?</p>