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Everything posted by Badger

  1. Yes - it would be fantastic to follow them around Europe. Hopefully they will wait for the pandemic to finish before qualifying though!
  2. This, however, is a far better statement! Perhaps win rather than just get to the final?
  3. As players compete in empty stadiums, clubs shun flashy signings and once-fat TV revenues shrink, an unlikely new force has emerged in English football: a US firm that invests some of PC pioneer Michael Dell’s fortune. Over the past year, MSD Partners has lent almost £80m to Premier League team Southampton, provided funding for the £200m takeover of rival Burnley and made a loan to Derby County, a historic English club. MSD’s first foray into English football predated the pandemic, but the crisis has helped forge an opportunity for the investment firm as the sport confronts an unprecedented financial crisis and other lenders retreat. The Premier League, the world’s richest football competition, estimates that every month without fans in stadiums collectively costs English teams £100m. “Clubs need cash and MSD has cash,” said Kieran Maguire, a football finance academic at the University of Liverpool and author of The Price of Football. “Commercial banks won’t touch football clubs. It’s perceived as high risk.” MSD, which recently hired senior Goldman Sachs banker Gregg Lemkau to lead the firm, is not the only financial institution barrelling into the sport. Private equity firms are trying to buy into Serie A, Italy’s top football division. Founded in 2009, MSD manages about $15bn, with investments spanning public equities, real estate, private equity and credit. As well as investing some of Dell’s wealth — and working alongside the tech entrepreneur’s family office — it also manages substantial amounts for other investors. Helping bankroll the owners of sports teams is not new to MSD. The firm counts US National Hockey League clubs the St Louis Blues and the Dallas Stars among its borrowers. In 2017, it was part of the financing for the $1.2bn purchase of baseball team the Miami Marlins by a consortium including Derek Jeter, one of the sport’s most celebrated players. MSD Partners has lent £80m to Premier League team Southampton © Andy Rain/AFP/Getty The fresh source of funding for English football has been embraced by an industry that high street lenders had largely steered clear of even before Covid-19. Since the crisis, Arsenal and Tottenham Hotspur, two of the “Big Six” teams in the Premier League, have borrowed nearly £300m at ultra-low interest rates from an emergency lending scheme run by the Bank of England. But smaller Premier League clubs and those in lower leagues have complained about the struggle to secure financing. MSD’s willingness to extend loans for longer periods has increased their appeal. Historically, loans to clubs have often been relatively short-term or subject to annual renewal, especially for those outside the upper echelons of the Premier League. The firm has lent about £170m in total to English clubs, according to a person familiar with the matter. “Typically banks provide short-term working capital cash flow. These guys are longer term strategic money,” said a banker with knowledge of MSD’s operations. “For the most part they don’t finance purchases, they just provide long-term stable funding . . . they provide something that doesn’t exist.” That, however, comes at a price. The latest accounts for St Mary’s Football Group, the holding company for Southampton, showed that the £78.8m loan, which is due for repayment in 2025, carries an annual interest rate of 9.14 per cent. That interest rate is in line with what MSD has charged other clubs, according to people familiar with the matter. While MSD is writing cheques during a historic crisis for the sport, there are fears that the steep costs attached could prove punishing for the borrowers. Confidence in English football The English Football League, which runs the professional divisions below the Premier League and was last year seeking funds to help stricken clubs, explored financing from MSD, among others, but ultimately borrowed £75m through the BoE’s facility. “We’re not paying 9 per cent”, said one of the EFL’s top executives. MSD’s push into English football has been spearheaded by Robert Platek, a former fixed-income portfolio manager and the firm’s global head of credit, and managing director John Licciardello. It began with Newcastle United, the team owned by UK retail billionaire Mike Ashley. When the possibility of a transaction involving Newcastle fell through, MSD was approached about the north-east team’s local rivals Sunderland, a club whose struggles were captured by Netflix documentary Sunderland ‘Til I Die. Although MSD opted against a deal, a group of partners at the firm made a loan to Sunderland in 2019, according to two people familiar with the matter. Recommended Football World’s richest football teams set to miss out on €2bn revenue The firm, which is run out of offices in New York and Santa Monica, California, is confident that English football’s local appeal and global reach will emerge largely unscathed from the pandemic. Despite the crisis, MSD has not ratcheted up interest rates compared with loans it made before the crisis, according to a person familiar with the matter. Mel Morris, the owner of Derby County, told the Financial Times that clubs were confronting a dearth of financing options, especially those that did not qualify for the government’s coronavirus emergency loan schemes. “We took out a loan with MSD while the pandemic was raging,” said Morris, who made some of his fortune from the Candy Crush video game and late last year reached an agreement in principle to sell the club. “In strange times thank heavens people like MSD do exist because they’ve certainly helped us get through a sticky patch.” As well as investing some of Michael Dell’s wealth, MSD manages substantial amounts for other investors. MSD can require clubs to put up considerable assets as security for the loans, including property. Derby’s Pride Park stadium is part of the security for the loan, Morris said. The spectre of having to call in a football club’s loan or seize assets has long been a deterrent for commercial banks considering financing teams, according to Maguire of the University of Liverpool. “From a reputational perspective commercial banks don’t want to take that on and put themselves in an awkward position of calling in the debt and weaponising the fan base,” said Maguire. Weekly newsletter Scoreboard is the Financial Times’ new must-read weekly briefing on the business of sport, where you’ll find the best analysis of financial issues affecting clubs, franchises, owners, investors and media groups across the global industry. According to people familiar with the matter, MSD has no interest in taking over any of the teams it has lent to, a view echoed by Morris, who recalled being visited by Dell himself in Derby in the early 1990s when one of his business ventures was a customer of the PC maker. MSD’s most recent wager on English football was sealed on New Year’s Eve, when it helped fund US investment firm ALK Capital’s purchase of Burnley, a fixture of the Premier League for the past five seasons. Alan Pace, managing partner of ALK and a former chief executive of US Major League Soccer team Real Salt Lake, told the FT last month that the financing for the takeover was “very reasonable and we feel that it’s sustainable” and that MSD was a “brilliant partner”. If MSD’s burst into English football gathers further pace, the pressure to continue to live up to that billing will grow.
  4. Interesting argument for those interested in football finance. https://www.ft.com/content/243f4030-aa2f-43c4-be32-723ba868d27a?shareType=nongift
  5. They don't and didnt - what happened before that if WE wanted them, WE had the right to employ them. Just as in so many other areas, it is OUR rights and freedoms that have been removed.
  6. Why do you want to see more British managers - do you think that they are better or play more attractive football? Personally, I think that we benefit from having the best available regardless of nationality.
  7. Yes they do. They are where they are because they play rubbish football and lose a lot of matches. The reason that re where they are is because under previous owners they have been financially irresponsible and tried to buy success. When the gamble failed and the previous billionaire get fed up of subsidizing them they were left in the do do. Be interesting to see if the new owner makes the same mistakes or just builds steadily taking advantage of Sunderland's natural advantages. With decent, financially prudent owners they should be an EPL team.
  8. Exactly this. Form goes in and out over season. There are also potential issues over injuries etc in a very compacted season etc. The season lasts 46 games.
  9. Yep - that's how it tends to go. If you decide to increase the priority you give to defensive solidarity, you decrease the priority given to attack. Always used to annoy me at work when people asked for an increased priority to be given to something without answering where we should reduce priority.
  10. I know that you are just reposting as requested CC (thanks) but this seems highly improbable! For a start of, the referee has hardly any discretion over throw ins and corners.
  11. The Conn article is not the first to find this. The Athletic reported more or less the same a month earlier (see link). I posted it on here on the previous thread about Burnley. It could be that that Conn did a "cut and paste job" on the previous article but given professional reputation and all that is not just as likely that they have the same sources? We also know that "MSD Holdings, the company that has lent to Southampton, Derby and Burnley, itself borrowed money at 9% from Guernsey Stock Exchange last year so presumably will be lending at higher rates than this to clubs to make a return." The Price of Football also retweets someone he follows talking about: "Interesting talk today about owners of newly acquired Premier League scrabbling around to raise £30m (by trying to sell equity stake at far higher valuation). Cash needed to repay debt owed to previous owner. Crazy business." Of course we don't know it's true and we don't know it's Burnley but I wouldn't lend them money!
  12. Exactly PLUS it also has big debts! If Burnley are relegated the matchday revenue does not even cover the interest costs!
  13. It's not at all "amazing:" it is entirely rational and consistent with a general set of beliefs. People like myself are aware that when people talk of "external investment" it is normally a euphemism for borrowing. Borrowing is not in all circumstances a bad thing, but you would want to look at how the money borrowed is spent. In Burnley's case it seems to be that the money borrowed is being used to buy the club in the first place which is particularly dangerous, but in other circumstances it often tends to be spent on risky player acquisitions, which rarely pay off in the long run. Your information about the analytics approach is interesting and if they have great expertise there there might be positive outcome but on then basis of the evidence available thus far it looks like a disastrous deal for fans of Burnley. At present, the cash pile that they had saved for investment including player purchases (not strictly investment) has been used to buy the club, so is likely to lead to less money used in the transfer market rather than the cash ile many assumes arrives with "external investment."
  14. It is a reasonable assumption that ALK had to involve external investors because they didn't have the money themselves - why else would they borrow so much money at so high a rate of interest? They wanted to buy and the previous owners only wanted to sell for a huge amount of money - which they got!
  15. I was tempted to do the same, but I would see it as a high risk loan! (Simple law of economics - the higher the return, the higher the risk).
  16. Nobody knows for certain GPB, but I can't see the logic in borrowing loads of money at 9.5% if you have spare cash to invest.
  17. Dyche was worried about transfer spending because they had £40 million in the bank and couldn't spend it because they were in the middle of a takeover. We don't know for certain yet about external investment, but given the huge amount of money that they have borrowed at 9.5%, it suggests that there won't be too much, why borrow at that rate when you have loads of spare cash to invest? Also remember the £40 million they had saved up was used to pay for the takeover when it could have been spent on players!
  18. What extra money? Burnley had £40 million in the bank before the takeover - this was used to partly fund the takeover itself. So far, the transfer kitty is £40 million lower. Of course, they have made promises - how long do you recommend that Burnley fans hold their breath?
  19. Sorry but that's nonsense, the "outside investment" has mainly been used to buy the club! 1. The old owner has sold the club and made a lorry load of cash. 2. The new owners have put very little of their own money into the deal and have a "no lose bet" on making some money. 3. MSD, who financed most of the deal, lend the money at 9.5% with the debt secured against all the assets including the trademarks/ grounds/ players etc Everyone wins - except of course, the fans! Rather than showing the limitations of the self-funded model, it shows the dangers of external investment!
  20. No - I was just being dumb I also remember that episode of Porridge - regretfully I am not too young.
  21. What an interesting thread - I have found it really difficult to decide. But here goes: 1. John Bond - what a character! He was also the manager that really got us playing good football at a high level (in my lifetime). 2. Dave Stringer. I really wanted to put him first: I think that he was the best ever but he was building on a legacy that Bond (and brown established). 3. Farke. So much to admire: his intelligence, sticking to his principles, promoting young talent and really giving them a chance and some of the football has been simply stunning.
  22. The same applies to almost any loan striker imo. If we loan someone in, we run the risk of hampering the development of our own players.
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