Scrutable

El Pollo Diablo wrote: Tue Apr 20, 2021 6:41 pm Well, it would appear that of the twelve clubs, Chelsea and Man City are the two with the deftest conscience.

Gfamily wrote: Tue Apr 20, 2021 7:36 pm

El Pollo Diablo wrote: Tue Apr 20, 2021 6:41 pm Well, it would appear that of the twelve clubs, Chelsea and Man City are the two with the deftest conscience.

The knockout stages came earlier than expected

paraphrased from someone else's tweet

Trinucleus wrote: Tue Apr 20, 2021 5:08 pm Many years ago, Chesterfield went through an interesting period:

Hello, I'd like to buy your club

Great

Thing is, at the moment my sports empire hasn't got enough cash, can you lend me the money please

No problem

The deal went through, as obviously the Football League confirmed he was a fit and proper person to own a football club

The guy was later sent to prison for fraud

dyqik wrote: Tue Apr 20, 2021 4:55 pm

JQH wrote: Tue Apr 20, 2021 4:52 pm

El Pollo Diablo wrote: Tue Apr 20, 2021 1:21 pm
Indeed, whilst legal and apparently not corrupt (though it has an air of it), the fact that the Glazers were able to get finance to buy Manchester United's shares using the club's assets which they didn't yet own as security is f.cking insane and should've been illegal*.

*I may have portions of this wrong but that was my understanding at the time

I got a loan to buy my flat by putting up the flat I didn't yet own as security for the loan. I'm not sure you could criminalise the Glazers' actions without abolishing mortgages.

In practice, it's fairly easy to avoid that problem, as real estate has a very different legal status to a publicly traded corporation.

TopBadger wrote: Wed Apr 21, 2021 1:39 pm

dyqik wrote: Tue Apr 20, 2021 4:55 pm

JQH wrote: Tue Apr 20, 2021 4:52 pm

I got a loan to buy my flat by putting up the flat I didn't yet own as security for the loan. I'm not sure you could criminalise the Glazers' actions without abolishing mortgages.

In practice, it's fairly easy to avoid that problem, as real estate has a very different legal status to a publicly traded corporation.

This practice is also common in M&A... IIRC its called a leveraged buyout... the asset/business being bought becomes the collateral (or at least the lions share of it) for the loan.

Buyers like it because it lowers the cost of entry to the market (few businesses can complete a take over in cash), banks like it because they get to charge interest on the loan. Its essentially a form of risk/reward sharing.

tom p wrote: Wed Apr 21, 2021 2:45 pm

TopBadger wrote: Wed Apr 21, 2021 1:39 pm

dyqik wrote: Tue Apr 20, 2021 4:55 pm

In practice, it's fairly easy to avoid that problem, as real estate has a very different legal status to a publicly traded corporation.

This practice is also common in M&A... IIRC its called a leveraged buyout... the asset/business being bought becomes the collateral (or at least the lions share of it) for the loan.

Buyers like it because it lowers the cost of entry to the market (few businesses can complete a take over in cash), banks like it because they get to charge interest on the loan. Its essentially a form of risk/reward sharing.

Except there's no real risk to the buyer. The company you have bought assumes the debt. If your new company gets declared bankrupt, it's probably some patsy you put in as director who will be barred from company directorship for a year or two, rather than you. You didn't pay anything to own the company, so you, the buyer, lose nothing (other than the fees you paid to arrange the finance, but you will surely have claimed those back by milking the company you bought straight away).
The banks might have some risk (although they will own various assets if it goes wrong and will get most of their money back), but they are willingly going into this deal and (should) know what they are doing.
The only real risk is entirely transferred to the employees (and, in the case of a football club, to the fans), who will be the only parties to really lose out if it goes tits-up and who don't have any say in the matter.

tom p wrote: Wed Apr 21, 2021 2:45 pm Except there's no real risk to the buyer. The company you have bought assumes the debt. If your new company gets declared bankrupt, it's probably some patsy you put in as director who will be barred from company directorship for a year or two, rather than you.

Grumble wrote: Thu Apr 22, 2021 5:50 am I’m delighted to see Stockport getting in on the action.

https://www.thedailymash.co.uk/sport/sp ... 0419207270

Martin_B wrote: Thu Apr 22, 2021 6:22 am

Grumble wrote: Thu Apr 22, 2021 5:50 am I’m delighted to see Stockport getting in on the action.

https://www.thedailymash.co.uk/sport/sp ... 0419207270

Blatant anti-Woking FC bias!

Millennie Al wrote: Thu Apr 22, 2021 1:43 am

tom p wrote: Wed Apr 21, 2021 2:45 pm Except there's no real risk to the buyer. The company you have bought assumes the debt. If your new company gets declared bankrupt, it's probably some patsy you put in as director who will be barred from company directorship for a year or two, rather than you.

That very much depends on the deal you set up. Any lenders involved may have required personal guarantees or external collateral. This may work like when you get a mortage loan for your house. If the bank forces a sale to recover its debt, you personally still owe it for any shortfall (though in America they have "no recourse" loans for your home where you cannot be liable for shortfall). Generally, the sort of people who do big business deals and appear to be very wealthy have most of their assets used as collateral in a complicated dependency between the different things that they are doing, which is why if one part of their empire goes bad the whole thing collapses and they make it to the newspapers.

El Pollo Diablo wrote: Tue Apr 20, 2021 6:41 pm Well, it would appear that of the twelve clubs, Chelsea and Man City are the two with the deftest conscience.