Takeover 'stalemate' sez Radio Sheff

Question still stands though Dave, how much is a business worth that doesn't make any money and doesn't own any property?

 

I was told that a general rule of thumb is that a profit making business is worth roughly its assets plus three times its annual turnover. I might be way out though.Plus the rules for football clubs might be quite different.

 

With its only assets having nominal values based on contracts.

 

Would you rather pay £1m for the football club (with no land & buildings) or £7m for the football club with land and buildings?

For your £1m you get a football club which is established in the second tier of English Football. Assuming you want to buy a football club, you could start with a non-league club, which would cost very little. You could then build it up by investing in it and over the years it could eventually be good enough to play in the 2nd tier. How much would your investment be, to enable you to match the current position of BFC. Much more than £1m, I would suggest.

Now, let us consider the second proposal that you spend £7m to buy the club and its land and buildings. What do you want the land and buildings for. If your intentions are honourable you want them to play football on (i.e. not to build houses upon). OK, you can pledge the land and buildings against a loan, which you will pay interest upon, but you cannot obtain a larger sum than you have already spent, so why would you want to.

The only reasons to invest in football is either,

a. Vanity Investment
Look how important I am, I own this place.

b. To make money by selling the club on when it is promoted to the Premier League
Just one year in the top division gives the football club 6 years of guaranteed support from the Premier League. Anyone who read the article on Portsmouth, which I posted the other day would be able to see how they have been robbed by their owners. The owners of Manchester United have left that club owing £500 million.

Mr Cryne is right to be ultra cautious in his dealings with prospective buyers. If they walk, then we should assume that they were not the right investors for the future of our football club, and not that they have walked because Mr Cryne has imposed unreasonable conditions.

 

How much for Leeds?

 

very good post

 

Weren't £20 million?

Uncle Ken has thrown in Riddys old coloured goldfish too.

 

Does ken actually own anything?

 

Yes. No. Not sure.

 

3rd reason, you're a genuine fan with a lot of money and you'd like to see the club returned to its assets as per pre-admin. You then control all aspects of the business and aren't at the behest of your landlord(s)

 

It's a right game of chess, buying a football club innit?

 

It's a rum do, that's for sure.

 

There is no reason to suspect that our landlords have anything but the best interests of BFC at heart. Equally, there is no reason to believe that the people wishing to take the club over are genuine fans. I simply cannot see why it is necessary for a club to own land. As for the buildings, they can only be used as a stadium, and there are no other takers in the town for a stadium of the size of Oakwell. It is pure sentimentality to believe otherwise.

 

If you approach it with your view that landlords = good, new owners = bad then it's a non argument. However I'll go back to my original point - If I were a fan with the means to buy BFC I'd want the whole kit & caboodle. You say sentimentalism, I say control of assets and destiny.

So the stadium can't be knocked down and rebuilt ? With BMBC 50 % owners it opens up a massive tract of land from Ponty road to harbro Hills for developement.


One other thing, if you own the club only, then what's to stop an MK Dons scenario ? ie the new owners take BFC off somehwere they think they'll attract bigger crowds, leaving Oakwell and the town behind ? Could happen anyway, but if you've paid just for players contracts, more of an attractive proposition.

 

Some years ago, there was a council proposal to open up land from Pontefract Road to Harborough Hills via the top side of the brewery. It was turned down by the government on appeal who believe that the land should remain green belt. Admittedly, that situation could change, but I doubt where the access would be along Grove Street because it is so narrow.

I am sure that you would make an extremely good owner, and I would be the last person to tell you how to spend your money. However, if I was the new owner, which is about as likely as me being the first man on Mars, I would rather invest the £6m on something that could have a more immediate payback.

 

out of interest is there a link about talks having stalled, cant find anything