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Parma Ham's gone mouldy

Mark Attanasio

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   On 11/11/2022 at 18:45,  Parma Ham's gone mouldysaid: 

We talk about ‘corporate leverage’. Who has it, when and why. 

Timing when you ‘exercise your leverage’ is an art. I would bet good money that Attanasio is a master. 

In that sense the tables are not turning, they have already turned.

Parma 

 

 

   On 11/11/2022 at 18:41,  ricardo said: 

Attanasio struck me as a man who is unlikely to countenance mediocrity or drift. I suspect we will quickly see sparks fly if we fail to move forward.

Just further to this @ricardo from your AGM thread. 

Attanasio’s primary source of wealth and access to possible further funding comes from Crescent Capital Group.

It probably hasn’t escaped the attentions of @PurpleCanary @shefcanary @essex canary and others that Crescent Capital Group typically focuses its operations on the less traditional, higher-risk, higher yielding forms of alternative investments. 

To simplify they go into companies and places that more traditional scale lenders would not touch, investments or funding that these traditional lenders may wish to exit, or areas of finance excluding stocks, bonds and cash.

There are areas of operation including distressed securities -lending from other institutions that they-are consider(ed) distressed and-or at risk of bankruptcy. Or lending where collateral may be weak or even unsecured financial products (‘lending on belief’). 

That Attanasio used the term ‘win…winning …winner’ several times in his short AGM speech might well be indicative. His business approach seems to rather vault over ‘prudence with ambition’ or ‘self-sustainability’ into a wilder jungle whereby forensic homework, granular market knowledge and a huge belief in the superior skills, knowledge and judgment of yourself and your team over the market is used to drive decision-making. 

His jovial appearance, accommodating nature and laid-back approach is no doubt genuine. Though his business acts and operates at the high risk sharp end. His skills are hiding in plain sight. 

Your statement is - I think - prescient. And not far into the future either. Now is the time to exercise that corporate leverage. 
 

 

Parma 

Edited by Parma Ham's gone mouldy
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Then again, how he runs his businesses doesn't seem to tally with the gradual improvements noted with the Milwaukee Brewers, which does seem more "slow but steady wins the race". I think you might see some out-of-the-box ways of increasing revenue, but not necessarily in terms of compromising financial security with the club itself.

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In the Masterclasses we talked about the very finest defenders seeing danger half a second later than others. 

This might appear counter-intuitive at first glance - indeed many may have referred to Ferdinand as ‘casual’ in the early days - though it isn’t. 

Mark Attanasio and his team MUST be good at this, or they would not survive and flourish in the niche ‘alternative’ financial sector they are in (as described above). 

Thus - in a sporting sense -  scale ‘traditional’ financial institutions may be characterised as ‘safety-first, back-of-row-z’ defenders. Taking no chances, though not being very progressive with the ball either. Thinking only of defending, rather than ‘defending is also attacking’ as Guardiola has said. 

This is where the high yield gains are. In the margins. Panning for gold in the juicy rejects bins of the large traditional international finance companies. 

The key point is that Mark Attanasio asks ‘what is risk?’ for a living

He - and his company - have finer antennae than others, they react later to financial risk and data than others, sort through it even more forensically. See where others panicked a little too soon. 

My guess is that he has seen something similar at Norwich. That - for not a huge amount more money - he can take reasonable risks that have decent odds on producing attractive yields in a sporting sense. Of course perhaps in a financial sense somewhere further down the line (if you are a trustee it is not who you sell to, it is who they sell to). 

In our terms, only a Buendia, a Skipp and an Eriksen away from attractive success. 

He likes those odds. 

Two schools of thought I suppose. Shame Delia couldn’t get lucky and make it work at the top level. And wish he had been here sooner. 

Parma 

@PurpleCanary

@shefcanary

@essex canary

@BigFish

@Petriix

@GMF

Edited by Parma Ham's gone mouldy
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28 minutes ago, Parma Ham's gone mouldy said:

The key point is that Mark Attanasio asks ‘what is risk?’ for a living

If you listen to his interviews, I feel that he separates between his 'day job' and personal interests in the Brewers/Norwich.

When it comes to sports his wife and children are heavily involved and without doubt show a more passionate approach, as he explained with his wife's interest in what The Nest does and comparing that to the work she started by donating to charities around Milwaukee:

i.e. https://youtu.be/_-3GjXG8Hbo?t=1446

Could be wrong here, but I see his sports interest as being a break from the 'day job' and more about his money and not the investment of others.

Edited by Google Bot
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I thought Crescent Capital just primarily purchases/underwrites and packages up sub prime and distressed debts as an investment opportunity to financial institutions, nothing 'left field' or unusual about it all, neither is it particularly high risk.

The financial crisis of 2008/09 was caused primarily because some unscrupulous financial institutions were packaging up and selling these types of debts as AAA grade / low risk investments, largely without suitable punishment or consequence.

I still don't see any link at all between Crescent Capitals activities and Norwich City Football Club, people seem to be buying into the idea that we can somehow tap into their clients funds, we can't... that is frankly ludicrous. 

The only link between Crescent Capital and Mark Anastasio that might be relevant is that the latter might have more appetite to invest more of his personal wealth into our club if the former, his primary business, remains in good shape and performs well.

There is no magic money tree at Crescent Capital or any means through which they can misappropriate clients funds, Anastasio has invested in Norwich City football club not Crescent Capital, they are two distinct entities.

Besides, he's a co-founder of Crescent Capital, and the other co-founder who remains in the business hasn't bought any Norwich City shares.

He'll probably get fed up with Norwich fans talking about Crescent Capital all the time, did Newcastle fans look at the Fraser Group accounts to see how much money could be directed from Fraser Group to Newcastle? No, they didn't, because it would be a ludicrous proposition and Fraser Group has many shareholders, Fraser Group didn't own Newcastle United... Mike Ashley did. 

Edited by TeemuVanBasten
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@Parma Ham's gone mouldy I’ve not had an opportunity to investigate Mark Attanasio’s business in the US, but it would be worth a “deep dive” in an attempt to determine MA’s possible motives, or otherwise.

It would be interesting to find out the actual corporate structure behind the Brewers and how that compares / contrasts to his day to day business activities. Understanding that may give additional insight on his likely intentions, but he doesn’t strike me as the type to view his sports ventures as just a bit of fun, or some sort of philanthropic act.

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42 minutes ago, GMF said:

It would be interesting to find out the actual corporate structure behind the Brewers and how that compares / contrasts to his day to day business activities. Understanding that may give additional insight on his likely intentions, but he doesn’t strike me as the type to view his sports ventures as just a bit of fun, or some sort of philanthropic act.

Even if he did view sports ventures as a bit of fun, it would be very unusual if he changed his modus operandi for his hobby from that of the day job. Everyone has the expectation that what has worked before, will work again. I suspect @Parma Ham's gone mouldy is correct and he is seen something cheap in City that has a low risk downside but a lucrative or enjoyable upside.

 

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7 minutes ago, BigFish said:

Even if he did view sports ventures as a bit of fun, it would be very unusual if he changed his modus operandi for his hobby from that of the day job. Everyone has the expectation that what has worked before, will work again. I suspect @Parma Ham's gone mouldy is correct and he is seen something cheap in City that has a low risk downside but a lucrative or enjoyable upside.

 

Michael Bailey has previously suggested that the MF shareholding cost MA about £3.5m - if so, that’s approximately £30ish per share. I have no idea where he got that info from, or, indeed it’s accuracy.

The conversion of the C-preference shares to 10% of the ordinary shareholding, well north of £100 a share, but throw into the mix the possible future acquisition of D&M’s shares, probably for something similar to the initial purchase, then the average share price tumbles considerably.

I leave it to others to decide if that’s a good deal, or not. 😉

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43 minutes ago, BigFish said:

Even if he did view sports ventures as a bit of fun, it would be very unusual if he changed his modus operandi for his hobby from that of the day job. Everyone has the expectation that what has worked before, will work again. I suspect @Parma Ham's gone mouldy is correct and he is seen something cheap in City that has a low risk downside but a lucrative or enjoyable upside.

 

If he wanted something cheap, surely he would have bought the binners? 😉

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4 minutes ago, Nuff Said said:

If he wanted something cheap, surely he would have bought the binners? 😉

But he wanted to buy a football club…

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46 minutes ago, GMF said:

Michael Bailey has previously suggested that the MF shareholding cost MA about £3.5m - if so, that’s approximately £30ish per share. I have no idea where he got that info from, or, indeed it’s accuracy.

The conversion of the C-preference shares to 10% of the ordinary shareholding, well north of £100 a share, but throw into the mix the possible future acquisition of D&M’s shares, probably for something similar to the initial purchase, then the average share price tumbles considerably.

I leave it to others to decide if that’s a good deal, or not. 😉

Indeed @GMF


I have referred multiple times in the past to ‘the elephant in the room’ of the asset gain - intentional or otherwise - of Delia & Michael’s shareholding. 

I am in the corporate finance world and this was always going to be an issue. One way or the other. 

They had either:

1. made a paper fortune and not leveraged it even for a new training ground 

2. decided to ‘hand it on’ as a trustee type, without ‘claiming the gain’ , though thus leaving the benefit for the new incumbent to win 

3. at the same time diluted everybody else’s value  via their ‘generosity’

I imagined a mechanism whereby had they realised the gain, they might have incorporated some form of fan ownership or Barca membership-style scheme. 
 

This would have been a wonderful legacy, though fabulously generous and not at all expected or obligated. 

Taking full whack would look like profiteering - particularly while Tifosys bonds had to be issued and funded by the fans to replace the training ground portacabins. 

These paper gains can be leveraged. 

Or you take a halfway house of ‘not a huge sum’ though someone ‘with the interests of the club at heart’ who will ‘drive it forwards’ (what else would you say?). 

You wait 25 years for another Delia, then none come along at once.

Parma 

Edited by Parma Ham's gone mouldy

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@Parma Ham's gone mouldy to be honest they have probably benefited, like many owners, from “simply being in the market” of club ownership, especially in the Premier League, where the media rights have grown exponentially.

Clearly, it’s a matter of personal choice as to whether they wring out every penny, or go for a softer deal at some point in the future.

Personally, I’d be more concerned with who they sell to, rather than any potential profit. 

Edited by GMF
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Well the C Pref's issued to Attanasio effectively valued the club at £100m. So Smith & Jones stake is thus £51m giving them roughly a £50m profit (in lieu of someone confirming what Watling pocketed). That's an average gain per annum just under £2m. I'd argue on that basis it would be difficult to deny them the opportunity of cashing in at full value. But no doubt others on here would not, although they'd celebrate their departure.

I am somewhat bemused (nay, frustrated especially with regard to City Stand) however that they haven't leveraged this holding in the past to accelerate improvements both on and off the pitch. I still feel as long as they keep on good talking terms, Attanasio will buy out Smith & Jones at full value (they may retain a small residual holding for them and nephew), sooner rather than later. And then the action will begin. 

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5 hours ago, GMF said:

@Parma Ham's gone mouldy I’ve not had an opportunity to investigate Mark Attanasio’s business in the US, but it would be worth a “deep dive” in an attempt to determine MA’s possible motives, or otherwise.

It would be interesting to find out the actual corporate structure behind the Brewers and how that compares / contrasts to his day to day business activities. Understanding that may give additional insight on his likely intentions, but he doesn’t strike me as the type to view his sports ventures as just a bit of fun, or some sort of philanthropic act.

How many people are truly philanthropic? Maybe some of the mega mega wealthy?

Without knowing what price MF has had for his shares it is impossible to assess how philanthropic or otherwise he has been in the final analysis. Same logic for S&J.

As for MA his investment strategy as detailed here reads like a Special Situations Fund and as such seems wise. Perhaps it has parallels in football too in that the more Buendias we can unearth the better off we will be.

 

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Tonight's news is interesting with the Glazers at ManUre calling in advisers to look for a sale. Coming so shortly after FSG doing the same at Liverpool, is it just coincidence? Has the American interest in the EPL reached a zenith and they have identified the financial killing has ended? How will this impact Attanasio's plans? I think its true to say it will be rather unsettling for the bosses at EPL if not Attanasio.

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8 minutes ago, shefcanary said:

Tonight's news is interesting with the Glazers at ManUre calling in advisers to look for a sale. Coming so shortly after FSG doing the same at Liverpool, is it just coincidence?

My first thoughts are if there's some anti super league developments behind the scenes which has scuppered long-term plans.  Or, ahead of the world cup clubs like Liverpool and Man Utd are prime for middle east investment - couldn't be a better time to put them in the shop window, perhaps?

Both clubs will get sold down the river, given the chance.

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20 minutes ago, Google Bot said:

My first thoughts are if there's some anti super league developments behind the scenes which has scuppered long-term plans.  Or, ahead of the world cup clubs like Liverpool and Man Utd are prime for middle east investment - couldn't be a better time to put them in the shop window, perhaps?

Both clubs will get sold down the river, given the chance.

You're probably right, both owners hoping to strike while the iron is hot! Neither owner will be worried about who takes over! 😉🤔

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1 hour ago, shefcanary said:

Tonight's news is interesting with the Glazers at ManUre calling in advisers to look for a sale. Coming so shortly after FSG doing the same at Liverpool, is it just coincidence? Has the American interest in the EPL reached a zenith and they have identified the financial killing has ended? How will this impact Attanasio's plans? I think its true to say it will be rather unsettling for the bosses at EPL if not Attanasio.

The Glazers have never shown the slightest sign that owning Man Utd was about anything other than making money. It could have been a rugby league club or even a company making widgets as far as they were concerned.

There is an interesting discussion about Attanasio and his motives and possible modus operandi. But there seems no doubt that even if he is in it to make money (which he probably is) he is also in it because he is genuinely attracted to Norwich City and gets a kick out of being involved in its future.

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14 hours ago, PurpleCanary said:

The Glazers have never shown the slightest sign that owning Man Utd was about anything other than making money. It could have been a rugby league club or even a company making widgets as far as they were concerned.

There is an interesting discussion about Attanasio and his motives and possible modus operandi. But there seems no doubt that even if he is in it to make money (which he probably is) he is also in it because he is genuinely attracted to Norwich City and gets a kick out of being involved in its future.

I would suggest that Ineos and Sir Jim Ratcliffe breaking cover made this a when, not an if. 

A golden opportunity to cash in the win.

The Glazers haven’t looked too eager, though ‘Ronaldo blah…rebuilding job blah….football changing blah’  offers them a sweet window.

Parma 

Edited by Parma Ham's gone mouldy
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15 hours ago, shefcanary said:

Well the C Pref's issued to Attanasio effectively valued the club at £100m. So Smith & Jones stake is thus £51m giving them roughly a £50m profit (in lieu of someone confirming what Watling pocketed). That's an average gain per annum just under £2m. I'd argue on that basis it would be difficult to deny them the opportunity of cashing in at full value. But no doubt others on here would not, although they'd celebrate their departure.

I am somewhat bemused (nay, frustrated especially with regard to City Stand) however that they haven't leveraged this holding in the past to accelerate improvements both on and off the pitch. I still feel as long as they keep on good talking terms, Attanasio will buy out Smith & Jones at full value (they may retain a small residual holding for them and nephew), sooner rather than later. And then the action will begin. 

This is the elephant that has wandered around the Norwich room, leaving only feint footprints.

As others have said, I have zero criticism if they take full dollar. 

However not leveraging it surely de-facto treats it as a personal gain, not a club one (I of course recognise that it IS a personal one).

Trotsdem, there it is. 

Parma 

Edited by Parma Ham's gone mouldy
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I’m no economist but it seems to me that if you want to make money and if you want to make it quick, then football is not the obvious path to take. Leaving aside the fact that football isn’t really big money in terms of global opportunities, my take is other motivations are at hand, and these are not necessarily transparent. Football does offer a fairly unique vehicle into a community and into a network of contacts than can enable more than the obvious wealth, status and power. 

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I'm really not sure about this. I understand these things from the cash trumps all viewpoint but also can easily see another way. I'll be amazed if Delia and Michael were to take the full dollar for themselves. There's always been a cynical view on here about the amount of money ending up in 'Delia's purse'. Of course the truth is nothing has yet. 

Let's see what happens. I just wish we could find a way to make this into a Rays Funds pledge.

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16 hours ago, shefcanary said:

I am somewhat bemused (nay, frustrated especially with regard to City Stand) however that they haven't leveraged this holding in the past to accelerate improvements both on and off the pitch.

I think this is because the gain remains intangible until taken. It is also personal to the stakeholder rather than the club and doesn't actually change any of the economic fundamentals.

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12 hours ago, essex canary said:

How many people are truly philanthropic? Maybe some of the mega mega wealthy?

Without knowing what price MF has had for his shares it is impossible to assess how philanthropic or otherwise he has been in the final analysis. Same logic for S&J.

As for MA his investment strategy as detailed here reads like a Special Situations Fund and as such seems wise. Perhaps it has parallels in football too in that the more Buendias we can unearth the better off we will be.

 

The context to my statement was in regards to MA, rather than the current owners, or Michael Foulger.

Whatever MA’s reasons for getting involved with NCFC, the circumstances are completely different to the time of D&M’s initial involvement, with Geoffrey, following the dark days of Chase

 

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13 hours ago, Google Bot said:

My first thoughts are if there's some anti super league developments behind the scenes which has scuppered long-term plans.  Or, ahead of the world cup clubs like Liverpool and Man Utd are prime for middle east investment - couldn't be a better time to put them in the shop window, perhaps?

Both clubs will get sold down the river, given the chance.

Yeah the super league was the main chance for serious revenue growth for the top teams. If that isn't happening then this might be the peak of their clubs value. 

The difficulty is who has the money to buy them? Is it going to more Man City/Newcastle type ownership? 

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14 hours ago, shefcanary said:

Tonight's news is interesting with the Glazers at ManUre calling in advisers to look for a sale. Coming so shortly after FSG doing the same at Liverpool, is it just coincidence? Has the American interest in the EPL reached a zenith and they have identified the financial killing has ended? How will this impact Attanasio's plans? I think its true to say it will be rather unsettling for the bosses at EPL if not Attanasio.

Given the new profit and sustainability rules that are coming in, is it not possible that English football will attract a new type of investor - income investors rather than growth. (Assuming that profit is the sole purpose which it probably isn't.) In the "new world" is it realty right to characterize football clubs as a high risk investment? 

Certainly restrictions of expenditure will make it easier for owners to take a steady income from buying football clubs that are reasonably successful with the possibility of capital growth and the attention/ kudos/ "sporting fun" that goes with the investment.

The new rules must also "de-risk" investments in solvent football clubs. With caps on football expenditure, there will no longer be the expectation that owners "give" the clubs tens of millions to get to the next level. It seems to me to be a pretty safe field for new owners. It might also enable us to get a better City stand as surely there is a good business case for this although, given interest rates, not as good as it has been for the previous decade.

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1 hour ago, GMF said:

The context to my statement was in regards to MA, rather than the current owners, or Michael Foulger.

Whatever MA’s reasons for getting involved with NCFC, the circumstances are completely different to the time of D&M’s initial involvement, with Geoffrey, following the dark days of Chase

 

At £30 per share sale price, £20 million for the whole Club, it would seem like philanthropy.  That would be only around 0.6 multiple of 2019 non-patachute Turnover of £34 million compared to Macquire's multiple of 1 to 1.5.

Having pledged most of the parachute money back to the banks perhaps the latter is a true reflection of where we are?

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Does anyone know how much tax they would have to pay on the profit? Not clued up on these type of financial deals. If they do, surely it would be a big chunk or could they gift any profits to a fan trust? 

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25 minutes ago, essex canary said:

At £30 per share sale price, £20 million for the whole Club, it would seem like philanthropy.  That would be only around 0.6 multiple of 2019 non-patachute Turnover of £34 million compared to Macquire's multiple of 1 to 1.5.

Having pledged most of the parachute money back to the banks perhaps the latter is a true reflection of where we are?

You’re focusing on just the income and ignoring the debt. Without knowing the latter, such comparisons are almost meaningless.

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