Derby owe US investment group £15m

Leeds did similar some years ago ( it was borrowing against future ST sales instead of future TV revenues) and they went so close to going completely bust.
 
Lemmy_kilmister said:
Interesting to read that clubs are borrowing money in advance of TV deal money. Apparently it's commonplace.

Derby County: US investment group reveals £15m debt owed by Championship club - https://www.bbc.co.uk/sport/football/58814150
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It’s interesting that it says the stadium has been used as collateral for the loan when they sold the stadium to another company to avoid FFP sanctions. I wonder how that deal was structured and whether they valued the stadium at £80m.
 
Thanks and just read thru MSD's financial statements - balance sheet date 31-Dec-2020. The loans to football clubs are only disclosed in aggregate. Derby isn't named, only that a club who they loaned £15 million to has gone into administration after the balance sheet date. MSD have not made an provision for losses on their loan to Derby. They judge that it is more than sufficiently covered by the collateral that they hold.

Similarly, Burnley is not named, so no indication of the amount(s) loaned to BFC. Equally, no disclosure of interest rates.

One of the difference between banks and finance entities such as MSD is that the banks are regulated and must meet regulated capital requirements. This leaves a gap in the markets where MSD and the like can lend because they aren't subject to these capital requirements. Why the difference some may ask: (1) banks hold deposits from customers and (2) large banks are significant enough to the financial systems to create knock on financial problems should a bank fail - 2008 and all that.

MSD is Michael Dell's entity - and Mr Dell and his fellow investors can afford to take a hit if they get things wrong.
 
Abel Tasman said:
Presumably they would have arranged a professional valuation with a “forced sale” basis - in other words how much would the ground be worth on the basis of no football being played there.
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Didnt Morris claim the value had increased so much because it could be used for lots of things - not just football. I guess we will find out now if that was true Maybe Gibson will offer the Riverside as a ground share option, as it will at least look familiar for the players to perform there!

Some teams that have been locked out of their stadiums have played a fair distance from home eg Brighton spent a while at Gillingham.
 
Arsenal have already deferred the millions they're owed by Derby for Bielik, I expect plenty of interested parties will be postponing collection to ensure Derby continue as a functioning club.

Which I'm more than happy to happen as long as they actually get their punishment for cheating.
 
Lemmy_kilmister said:
Interesting to read that clubs are borrowing money in advance of TV deal money. Apparently it's commonplace.

Derby County: US investment group reveals £15m debt owed by Championship club - https://www.bbc.co.uk/sport/football/58814150
Click to expand...
If you follow PriceofFootball on twitter, you'll see most do it. We had a loan from some Australian company the year we went up to cover the TV money payments in advance. Loads used the same company, but they've stopped doing football loans now. Was some weird company name like KangarooLoans or something like that, sounded like a payday loan company.
 
free_pint said:
If you follow PriceofFootball on twitter, you'll see most do it. We had a loan from some Australian company the year we went up to cover the TV money payments in advance.
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It's debt factoring, not a loan. Companies sell debt to a company to get (say) 97% of the amount owed straight away. MFC has been factoring transfer fee receivables for years.
 
If Derby fold another little bit of our national game will die with it.
I can see only a handful of very rich professional clubs being left.
I give it 20 years and then the game we love is finished.
Replaced with a super league.
No fan wants that.
But businessmen do and football belongs to them now.
 
Smoginexile said:
If Derby fold another little bit of our national game will die with it.
I can see only a handful of very rich professional clubs being left.
I give it 20 years and then the game we love is finished.
Replaced with a super league.
No fan wants that.
But businessmen do and football belongs to them now.
Click to expand...
Disagree. If Derby fold it is because they will have been guilty of such financial mismanagement and rule bending that they will have gambled away their future and lost.
 
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