| 180million Write Off on 21:08 - Nov 9 with 4757 views | barbicanranger |
Working in the transaction market, I assume this to mean one of two things:
i) To mitigate FFP legislation and have no debt on the balance sheet they have converted their debt to shares, leaving the club debt-free. The shares would typically be converted equally / pro-rated based on who the debt is owed to (e.g. TF 30%, Amit 30%, etc.), therefore it would dilute the shareholdings the same way, more shares of less value individually but probably more or less the same ownership structure. It would just mean they paid a hell of a lot for the club.
ii) They are looking to sell the club, I feel this is less likely option as debt is typically excluded from most transactions anyway and would be easy to clean up through a sale as the buyers would assume the Company debt free and the existing owners would be liable to settle the debt. [Post edited 9 Nov 2015 21:09]
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| 180million Write Off on 21:14 - Nov 9 with 4717 views | Northernr |
On the face of it, whether it's to facilitate a sale or not, fair play to them. Their mistakes, their liability, not QPR's. |  | | |
| 180million Write Off on 21:15 - Nov 9 with 4712 views | ingeminate |
| 180million Write Off on 21:08 - Nov 9 by barbicanranger |
Working in the transaction market, I assume this to mean one of two things:
i) To mitigate FFP legislation and have no debt on the balance sheet they have converted their debt to shares, leaving the club debt-free. The shares would typically be converted equally / pro-rated based on who the debt is owed to (e.g. TF 30%, Amit 30%, etc.), therefore it would dilute the shareholdings the same way, more shares of less value individually but probably more or less the same ownership structure. It would just mean they paid a hell of a lot for the club.
ii) They are looking to sell the club, I feel this is less likely option as debt is typically excluded from most transactions anyway and would be easy to clean up through a sale as the buyers would assume the Company debt free and the existing owners would be liable to settle the debt. [Post edited 9 Nov 2015 21:09]
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Does this mean that the club is no longer in loads of debt - I.e one of the main criticisms laid at fernandes is he's saddled us with tonnes of debt. Or could it just be tricky accounting and the debt is still somehow kicking about just under a different name? |  |
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| 180million Write Off on 21:22 - Nov 9 with 4678 views | ThGrimRanger |
I've never got the anti-TF sentiment and hoping this will cool some of the abuse he's been getting. Bad enough they've lost serious wedge but the intentions were and are always good. |  |
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| 180million Write Off on 21:43 - Nov 9 with 4560 views | Suffolk |
Wow! Just wow! |  | | |
| 180million Write Off on 21:51 - Nov 9 with 4515 views | queensparker |
I have no idea of the subtleties or motivations behind this, whether good or bad, but it's cheered me right up.
(And thanks to the more financially literate on the board for their explanations) |  | | |
| 180million Write Off on 21:55 - Nov 9 with 4491 views | NW5Hoop |
You can call it a write off if you like, but it's not. It's a conversion of debt into equity. It now means the club is valued at some colossal sum - £180m plus the value of the original shareholdings. The money they have put in is only written off if they sell for a fraction of their total investment.
If they borrowed, which they certainly did, they still owe money. TF, we know, borrowed against the Air Asia share price, which has gone through the floor. I wouldn't be remotely surprised if the club and its assets are also collateralised.
On the bright side, the debt owed by the club itself to its owners is now massively reduced. And, yes, I bet this is to do with FFP. And I bet the sacking of Ramsey is related to this, in terms of them now feeling they absolutely need PL money if they've done this. |  | | |
| 180million Write Off on 21:58 - Nov 9 with 4473 views | DylanP |
So, as I understand it, converting the debt to shares, means that all shares are worth a little bit less. I mean, if the club is worth 50 million (I am just using that number for ease, not claiming that is truly what it is worth) and there are 50 million shares, then each one is worth 1 pound. If they add another 50 million shares, then each share becomes worth only 50p. So the shares I own, just became worth much less in order to make up for the debt conversation. Of course, as the shares are no longer listed on any stock exchange, they have no formal value, beyond what someone is willing to pay during a particular transaction. Also, getting rid of the debt, increases the base value of the club, so it all probably evens itself out in the end. |  |
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| 180million Write Off on 21:58 - Nov 9 with 4473 views | queensparker |
| 180million Write Off on 21:55 - Nov 9 by NW5Hoop |
You can call it a write off if you like, but it's not. It's a conversion of debt into equity. It now means the club is valued at some colossal sum - £180m plus the value of the original shareholdings. The money they have put in is only written off if they sell for a fraction of their total investment.
If they borrowed, which they certainly did, they still owe money. TF, we know, borrowed against the Air Asia share price, which has gone through the floor. I wouldn't be remotely surprised if the club and its assets are also collateralised.
On the bright side, the debt owed by the club itself to its owners is now massively reduced. And, yes, I bet this is to do with FFP. And I bet the sacking of Ramsey is related to this, in terms of them now feeling they absolutely need PL money if they've done this. |
So, if they need that PL money so badly, and they don't get it, what happens next?
(Because let's face it it isn't going to happen this year) | | | |
| 180million Write Off on 22:12 - Nov 9 with 4372 views | BostonR |
| 180million Write Off on 21:08 - Nov 9 by barbicanranger |
Working in the transaction market, I assume this to mean one of two things:
i) To mitigate FFP legislation and have no debt on the balance sheet they have converted their debt to shares, leaving the club debt-free. The shares would typically be converted equally / pro-rated based on who the debt is owed to (e.g. TF 30%, Amit 30%, etc.), therefore it would dilute the shareholdings the same way, more shares of less value individually but probably more or less the same ownership structure. It would just mean they paid a hell of a lot for the club.
ii) They are looking to sell the club, I feel this is less likely option as debt is typically excluded from most transactions anyway and would be easy to clean up through a sale as the buyers would assume the Company debt free and the existing owners would be liable to settle the debt. [Post edited 9 Nov 2015 21:09]
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A spot-on post of the situation. Would I be right in thinking that this Board have substantial funds to call on given the size of the two write-offs? Is there an eye on the long-term development opportunities at Old Oak Common, hence their reasoning for staying involved? |  | | |
| 180million Write Off on 22:43 - Nov 9 with 4238 views | PunteR |
Blimey..
Is this what all chairmen of football clubs do? |  |
| Occasional providers of half decent House music. |
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| 180million Write Off on 23:00 - Nov 9 with 4164 views | BrianMcCarthy |
Have been thinking about this all day and just cannot see a downside. This is a huge day for the club, regardless of their motivation. Huge. |  |
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| 180million Write Off on 23:08 - Nov 9 with 4133 views | PunteR |
| 180million Write Off on 23:00 - Nov 9 by BrianMcCarthy |
Have been thinking about this all day and just cannot see a downside. This is a huge day for the club, regardless of their motivation. Huge. |
There's got to be a catch. There's always a catch.
Does it mean they will now stop spending on the club? | |
| Occasional providers of half decent House music. |
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| 180million Write Off on 23:12 - Nov 9 with 4120 views | QPRMUSO |
I thought these guys were good guys. Maybe the TF haters now will back off. | | | |
| 180million Write Off on 23:12 - Nov 9 with 4120 views | queensparker |
| 180million Write Off on 23:08 - Nov 9 by PunteR |
There's got to be a catch. There's always a catch.
Does it mean they will now stop spending on the club? |
That might be a blessing in disguise, given how the whole "spending" thing worked out | | | |
| 180million Write Off on 23:21 - Nov 9 with 4080 views | BrianMcCarthy |
| 180million Write Off on 23:12 - Nov 9 by QPRMUSO |
I thought these guys were good guys. Maybe the TF haters now will back off. |
Most people who criticised Fernandes have done since specific reasons, and may have also praised them for other specific reasons. 'Haters' is strong in my view.
Fernandes has made a lot of mistakes and - at least until this point - has jeopardised the financial health, if not the very existence of our club. To my mind, the level of scrutiny has been softer and milder than it could have been. | |
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| 180million Write Off on 23:34 - Nov 9 with 4020 views | barbicanranger |
| 180million Write Off on 21:58 - Nov 9 by DylanP |
So, as I understand it, converting the debt to shares, means that all shares are worth a little bit less. I mean, if the club is worth 50 million (I am just using that number for ease, not claiming that is truly what it is worth) and there are 50 million shares, then each one is worth 1 pound. If they add another 50 million shares, then each share becomes worth only 50p. So the shares I own, just became worth much less in order to make up for the debt conversation. Of course, as the shares are no longer listed on any stock exchange, they have no formal value, beyond what someone is willing to pay during a particular transaction. Also, getting rid of the debt, increases the base value of the club, so it all probably evens itself out in the end. |
Yes, that's right mate. | | | |
| 180million Write Off on 23:44 - Nov 9 with 3980 views | barbicanranger |
| 180million Write Off on 21:55 - Nov 9 by NW5Hoop |
You can call it a write off if you like, but it's not. It's a conversion of debt into equity. It now means the club is valued at some colossal sum - £180m plus the value of the original shareholdings. The money they have put in is only written off if they sell for a fraction of their total investment.
If they borrowed, which they certainly did, they still owe money. TF, we know, borrowed against the Air Asia share price, which has gone through the floor. I wouldn't be remotely surprised if the club and its assets are also collateralised.
On the bright side, the debt owed by the club itself to its owners is now massively reduced. And, yes, I bet this is to do with FFP. And I bet the sacking of Ramsey is related to this, in terms of them now feeling they absolutely need PL money if they've done this. |
I wasn't aware that he borrowed to buy the club? - I thought they formed a consortium and pooled their cash to invest.
If he did borrow and it was in their names then I guess the lender would ask them what security he has and he would say I own a house here, some shares here and QPR and they have a stadium in west london worth X. But there are other shareholders like the mittals that own 30% of the club and therefore the ground and it would get very i) messy if it came to Armageddon to sort that out; and ii) not sure a bank would be comfortable lending with that. But I'm purely speculating at this point as I didn't know they borrowed to buy / fund the club. | | | |
| 180million Write Off on 23:52 - Nov 9 with 3961 views | PunteR |
I don't hate TF, but his latest tweet about us fans managing expectations infuriated me.
I've been quite vocal on here about my opinions on TF and the board but if they get our club back on track I'll hold my hand up and give them credit.
I'm still very sceptical. Maybe I shouldn't be. | |
| Occasional providers of half decent House music. |
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| 180million Write Off on 00:14 - Nov 10 with 3920 views | barbicanranger |
I think it goes to Northernr's point above, which is if you are going to run the club recklessly you should not walk away leaving it in debt, that you created, owing to you. I'm pretty sure the previous owners of Pompey did exactly that - shut the club down because they couldn't get the debt they created back out of it. The reason being is that at the end of the day the true owners of the club, the fans, are here forever and they have to suffer the consequences of this kind of mismanagement. If what TF and co have done is convert the debt to equity and accepting the hit then IMO it is commendable but also it is how it should be; they gambled and it didn't work out. | | | |
| 180million Write Off on 01:01 - Nov 10 with 3856 views | timcocking |
Nice one Tone, cheers mate.
(plenty of 'em will continue to b!tch and whine though, it's all they ever do. (The younger generation; weak as p!ss.)) |  | | |
| 180million Write Off on 01:07 - Nov 10 with 3849 views | LazyFan |
| 180million Write Off on 21:14 - Nov 9 by Northernr |
On the face of it, whether it's to facilitate a sale or not, fair play to them. Their mistakes, their liability, not QPR's. |
As long as when they sell e do not get a leveraged buy out like the Glazers did with Man Utd.
For our little club this would mean the next debt would indeed not be paid off and wipe us out.
Here is hoping the Mittals make the others an offer.
zzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzzz |  |
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| 180million Write Off on 01:47 - Nov 10 with 3797 views | qpr1976 |
| 180million Write Off on 23:00 - Nov 9 by BrianMcCarthy |
Have been thinking about this all day and just cannot see a downside. This is a huge day for the club, regardless of their motivation. Huge. |
Indeed, and yet if so, you'd think they'd be making a bit more of it officially, rather than just letting local press report it via Companies House & fans forums ?
Much as I hope you're right Brian, I remain sceptical..... | | | |
| 180million Write Off on 05:53 - Nov 10 with 3701 views | CanadaRanger |
IF - and it is an enormous IF - in some future alternate universe like possibility - the club became hugely Manchester United-ish profitable, the club could buy back shares, offering every shareholder the same price per share. Until then, if no debt is being carried, then there is no interest on debt either! That is huge for the club as market interest on a huge sum could equal gate receipts over a season.
As someone else said, "Wow, just wow!"... |  | | |
| 180million Write Off on 07:05 - Nov 10 with 3615 views | DWQPR |
Another consideration is that with QPR Holdings Ltd now being a debt free entity it may be far more attractive to the OOC Development Corporation in terms of the club's bid to get involved with all of this and secure the land they require to build a new stadium and other facilities. Certainly the club is far more attractive as a business partner than they were as an entity with £180 million of debt. | |
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