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Bank debt gone; Apparently...
Topic Started: Feb 7 2014, 09:59 AM (5,455 Views)
Naebody
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Twat
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You lot are weird. Why would you want Dundee FC dead? We're in the ideal situation at the moment: we have an inept nemesis. The only way it could be better is if we literally owned them. It'd double revenue at a marginal cost, because there would be a United game both home and away every week. The financial argument is irresistible.

Okay, so it's probably not sensible to challenge UEFA's laws about owning two clubs. But what if we somehow convinced Dundee FC to share a stadium, sack all its players and take our entire reserve side on week-to-week loans? Would that break any laws?
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reekie
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I'm not entertaining this folly (although I agree that an inept nemesis, as is currently, is amost perfect) but I do wonder what that Dundee (United reserves) FC would look like?

McGovern
Ballantyne Harwood Souttar Spark
Petrie Montgomery
Connelly Smith Fraser
Moore

Perhaps a little unfair to lump Souttar and Aidan in with the other Under-20's but, hey, they'll need a little experience to carry them through.
They'd play nice football, no doubt, but they'd get kicked off the park I fear.
The big question is...would they beat the wee team from across the road?
Probably. So it's a "yes" from me.
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vvhatsthatonyourback
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Naebody
Jul 28 2014, 06:45 AM
Okay then, Mr WhatsThatOnYourBackIfThatReallyIsYourName ... What would you do with ~£3m?
Maybe buy a warehouse of Nike product and try to shift it over the internet?
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Setenza
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Knitting with only one needle
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Thompson says bank commitment gone.

Quote:
 
Thompson said: “What I have done over the last few weeks is renegotiated that and, as of today, that obligation to the bank has gone.

“That means that any player we now sell the full amount will come to the club.

“The final payment was made today and they are out of things now. I would say that is a real milestone in the history of Dundee United.”

Thompson added there should only be £1 million or less of “soft” debt owed by this time next year, putting United in an extremely healthy finacial position indeed.


So the transfer agreement has gone, not sure if it's been replaced by something, but should make things simpler...
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Morvant's Finest
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That's pretty good news, no?

Though a bit of a pain in the a*se that ST went and renegotiated the details of a deal that we spent so long discussing.... :fisted:

Will be interesting to hear whether we still have an overdraft facility with the Bank for the lean years or will that be effectively provided by the 'soft loan' lenders??
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Naebody
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Setenza
Sep 2 2014, 01:05 PM
Quote:
 
Thompson said: “What I have done over the last few weeks is renegotiated that and, as of today, that obligation to the bank has gone.

“That means that any player we now sell the full amount will come to the club.

“The final payment was made today and they are out of things now. I would say that is a real milestone in the history of Dundee United.”

Thompson added there should only be £1 million or less of “soft” debt owed by this time next year, putting United in an extremely healthy finacial position indeed.

Eh?

What's been renegotiated? And why?

Have United paid less than the maximum ~£4m payoff previously agreed? Or more? Or something else entirely?

After telling us one thing, then changing it to something entirely different, then seemingly meeting the terms of that entirely different thing in full, we're now told that a third unexplained thing has happened. And, after weeks of hard negotiation, this third thing has resulted in precisely the same outcome as the second thing.

Well done, baldie. Help yourself to another bourbon cream.
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Cobardon
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I thought this was interesting on the website though.

5600 is a very good total of season tickets for a club like United.
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Morvant's Finest
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Tommy McLean
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Cobardon
Sep 2 2014, 10:19 PM
I thought this was interesting on the website though.

5600 is a very good total of season tickets for a club like United.
Indeed Cob, that's very impressive and it hasn't taken the kind of massive price reduction that people constantly say has to be implemented to get people attending football again in the mythically huge numbers we enjoyed in the 1980's.

Difficult to find numbers for other clubs easily but that will definitely compare favourably to the likes of Motherwell, St Johnstone and Kilmarnock etc.
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Naebody
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Bump.

Results to June 2014 show a £100k operating loss, which seems to be our usual level now, and a £1.3m of exceptional gain. I'd guess half of that is the Johnny Russell fee. Anyone know what the rest might be? An "exceptional gain relating to the exit of banking arrangements with the Bank of Scotland" doesn't really explain it.

ETA: oh! It's the haircut on the debt, of course! So, assuming the £750k for Russell's booked as an exceptional, that's a writeoff of £550k or thereabouts. Assuming £4.4m of debt was bought back, that'd be a 12% haircut -- which takes us back to page 2 of this thread.



Edited by Naebody, Jan 5 2015, 06:21 PM.
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Setenza
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Knitting with only one needle
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Another small positive which should only be good. Things do seem well balanced at the moment in terms of finances and the playing squad.

And it means we can pay for the likes of Telfer without too much sweating.


Combined with Aberdeen's debt restructuring, Hearts feeling positive and other clubs cutting their debts, things seem a bit more realistic and sensible in terms of clubs financial actions. Although will see if that holds if someone thinks they can catch Celtic.
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Setenza
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Interview with Thompson where he updates everyone on the debt situation.

Quote:
 
Thompson revealed that United would be moving to pay back soft loans to their friendly creditors to a 
considerable degree, thus edging ever closer to the long-term goal of a debt-free declaration.

...

“I am still sitting with a six-figure loan so to question my commitment to United is unfair.

...

A chunk of the Celtic money will be used to pay back the friendly creditors who enabled United to become free of bank debt.

Thompson said: “I can’t say precisely what percentage of the soft loans will be getting paid back but it will be huge.

“Our ambition is to be completely debt-free and we will continue to strive towards that.

...

“We have brought in three international players (Paul Dixon, Ryan McGowan and Henri Anier) as well as other exciting talent. We have now spent, since last summer, around £400,000 in transfer fees.

...

He said: “We are investing £300,000 in the GA Engineering Arena, with fantastic contributions from ArabTRUST and the Federation.




So it sounds like we've not cleared the 'soft' loans yet, and won't with the expected income from the celtic sales.

We still owe money to Thompson.

But instead of clearing the debt, we're spending a decent chunk of money on players and a pitch.
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Setenza
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In the Courier, Thompson says:

Quote:
 
“Once all the transfer fees are in - and they won’t all be in for a few months yet - we will be down to about £1.3 million of debt,”


I wish I could be bothered doing the sums to figure out if that's good or not.
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Conan the Destroyer
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Setenza
Mar 4 2015, 11:27 AM
In the Courier, Thompson says:

Quote:
 
“Once all the transfer fees are in - and they won’t all be in for a few months yet - we will be down to about £1.3 million of debt,”


I wish I could be bothered doing the sums to figure out if that's good or not.
Excellent, sounds like we can look forward to the next player who attracts a bit of attention being sold with the usual alacrity.
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Naebody
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Setenza
Mar 4 2015, 11:27 AM
I wish I could be bothered doing the sums to figure out if that's good or not.
Oh god. Oh god oh god oh god oh god oh god oh god oh god oh god oh god oh god .....

In February 2014, United said it had bought £4.7m of bank debt for £1.45m. Thompson's references to "soft loans" since then have suggested they were to cover this £1.45m, so let's start the calculations from there.

As part of the debt repurchase, the bank was given rights to future transfer income of between £0.25m and £2.4m.

Gauld's upfront transfer fee was ~£2.2m.
Robertson's transfer fee was ~£2.85m.
Transfer fees for Armstrong and GMS were ~£2m.

That's £7m. After VAT, that's £5.6m.

Net off the bank's transfer fee agreement at the maximum rate and that leaves a £3.2m surplus.

Going by Thompson's latest comment, the soft loans (assuming they're ex bank debt) will have been reduced by £150,000 by the time all transfer fees are received. Rounding down throughout to be ultra cautious (because interest needs paid and contract lawyers aren't free), that still leaves a ~£3m surplus.

The club tends to run an operating loss of £100,000 a year on a wage bill of around £3.5m. Given all this has happened in just over a year, it's quite difficult to understand where a ~£3m surplus might have gone.

The most plausible reading of the above, I guess, is that there were "soft" loans outstanding even before United did the bank debt buyback. However, the idea that the club owed ~£3m to parties unidentified in previously undisclosed agreements (on top of the £4.7m owed to the bank!) would open up a whole new can of WTF.
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Morvant's Finest
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Tommy McLean
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Top work Naebs :hat:

Innaresting figures there....

You can knock off 10% of Robertson's fee for a start (http://www.heraldscotland.com/sport/football/300k-robertson-boost-a-cut-above-for-queens-park.24865122

Could it be that other payments are due to be paid in installments? The Goodwillie deal was certainly done that way: http://www.dailymail.co.uk/sport/football/article-2106000/Blackburn-deny-missing-David-Goodwillie-payment.html
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