Out of the Icelandic frying pan

We may soon be out of the Icelandic frying pan, but until we have a clue about the details of the takeover we cannot know where we have landed.

How long will it take for us to learn the level of debt the takeover resulted in? My bet is that there will be an avalanche of rumours on that topic when the takeover is done as all the losing parts will try to brand the winner a potential catastrophe. But the truth will probably not be public until the financial report on this period is published – if even then.

It's far from certain that the debt we are so concerned about will go away with new owners. This bidding war has certainly done nothing to help. One thing that has been clear through all this is that the bidders have had a hard time convincing Rothshilds (Straumur/CB holdings) that they have enough dosh. As the banks have been heavily involved in the discussions one can also conclude that the new owners are taking over these loans in one way or the other, rather than just paying them off. This means that the banks wants to make sure that the new lot are financially solid enough to service the loans. Based on what the banks think about the new owners they may also want to renegotiate the terms.

Martin Samuels wrote in an interesting piece the other day that "...right now we are mistaking the failures of individual clubs for a malaise in English football as a whole" and I agree that there have been several big mistakes, but I like the "financial doping" metaphor used by the All Party Parliamentary Football Group to describe some of the big clubs way of running their clubs. It gives these clubs advantages in the short run albeit by risking their long term health.

I will be a bit more worried if Tony Fernandes, Intermarket or Cellino makes the deal (for this kind of problems that is,, I agree there are other concerns with the others). We know they don't have the cash to just buy the Club and pay off the loans and so how would they finance it? Loans? Investors? Probably loans secured by so called investors. This is when you build insecurity into the club (lex Glazer). On the upside the timing is probably to any new owners advantage. Even though I think that as an investment a football club will always be risky and, in an ordinary - non football inclined - investors view, suboptimal. But the risk of the finances of the world bringing the new owners down á la BG doesn't seem that big (famous last words?).
But then there is always going to be businessmen in trouble. Especially those heavily in to risk ventures, airlines for instance.
I’m not quite sure if this applies to Cellino as he seems to have come in late and with a bid that appears to have been accepted more or less right away, but my guess is that it does. He is not wealthy in the Sheikh Mansour sense of the word.

But please don't brand me anti Fernandes because I am a bit worried about where he will take us. My concern is about every future owner, even though G&S knows about the reality of owning a club and may be less prone to "do an Eggy".
Having owners that are genuine supporters are obviously also a good thing, whether they need to fly to the home games or not, but if they need to stretch their funds too far to get possession I rather they didn't.

As a burnt child I’d really want to stay clear of the fire, or at least know if I'm in it as quick as possible.


Anonymous said...

This is so fukking boring no just want the deal over and done with so Zola has some dosh. What a shambles this club is

Joppe - said...

I know what you mean

Anonymous said...

Things take time when you are going to spend £100m to buy a bankrupt company ! This is business not football.

One thing no one has yet said about Fernandes is that he currently sponsors the Premiership Referees !

This means that if he takes over, we will either win the League next season, or is more likely we will get SUED again.

Anonymous said...

i think we have had enough of all this take over crap..rumour and counter rumour...lets hope the team ...remember who they are!?..turn up today at villa..just give a performance..thats all i ask..

Joppe - said...

I think we are all a bit tired of this mess but as it's the single most important thing this season I think it's fair to keep an eye on it.

Anonymous said...

yep ..your right joppe...hopefully we will see a result one way or another very soon...but as for today ...3 points please

Anonymous said...

we need to focus on supporting the team,the financial bollox is for someone else to sort out. support the club,chest,colours ,not the owners. COYI! gött e d då,WH!

Joppe - said...

But with that kind of reasoning the football is also for someone else to sort out. Or are you in the squad?

Anonymous said...


after reading ur prof i get that u r keen on the money issue,and nowdays its all about that.nevermind the football its all politics,eh.

well, it used 2 b the beautiful game,but maybe only 4 those who can afford it...

Joppe - said...

Barca plays a beautiful game and Millwall doesn't. I think it may be a correllation with money in there somewhere.

I confess to being interested in the running of the Club as this is what will decide if the next Rios/Lampards/J. Coles and Defoes will stay and if we will improve or worsen the squad during the transfer windows. This will affect how we play the game and how enjoyable it will be to watch.

Paul said...

Interesting post, as usual.

I think you're right to highlight that that this is probably a problem that most, if not all, the prospective owners have in common

Bubbleview has been a nice antidote to the 'Sullivan will get it!' 'Fernandes will get it!' stuff in the papers

it's easy to agree that football is the main thing but i'm interested in the running of the club because, as Joppe suggests in his comment, this is where the future of the club is decided. We probably know better than most clubs that if the club is not well run we don't win matches.

[message to the Bubbleview team - I would like to include your RSS feed on beam.to/westhamutdnews it's a feed that combines different news sources, would you like to be on it?]

Joppe - said...

Cheers Paul, appreciated.
And yes why not? We'd be glad to be on it.