Shall We Eliminate The Debt - Just Like Cardiff

[YankeeCanary 0]

It sounds so easy....the way that Cardiff are saying they are eliminating their debt in the highlighted article.

http://soccernet.espn.go.com/news/story?id=386994&cc=5739

Okay, I''m not entirely convinced but the report that outside investors are willing to enter into a deal that will "clear the Cardiff debt" and likely give the green light for squad strengthening ( several million pounds ) and stadium expansion to 30,000 does beg a question or two.

Most of the focus on significant change in ownership ( particularly from foreign investment ) has revolved around top clubs in the Premiership ( and a few not near the top ). However, is that same outside investment now increasingly turning its attention to clubs outside of the Premiership with good future potential? Using the article on Cardiff as an example, what are outside investors seeing for future rewards that are causing them to gamble on a large investment? The reward of Premiership participation must far outweigh the risk to their investment. Are such investors approaching Norwich City and, if so, how much would it take to tempt Delia and Company given our debt of 18 million versus the 24 million for Cardiff?  If we are not prepared to go for such a deal, should it arise, then if those investors find willing parties in other clubs who succumb to the temptation, won''t that make the task of promotion for Norwich City even more of a hurdle than otherwise would have been the case?

What are your thoughts, other than that same old chestnut of  "I don''t want Norwich City to fall into the hands of a foreign investor....we''re better staying where we are as a nice family club".

[Rudolph Hucker 0]

I have wondered about new and significant investment at Norwich for some time, Yankee.

According to Paul (the policeman''s friend) Rankin''s attendance charts Norwich are the 14th best supported Club in England and I suspect we are capable of being in the top 10 with greater ground capacity.

It is time IMO for further investment as we come to the end of parachute payments and contracts and with St. Pete''s certain desire to add to his squad.

I wonder if there is demand for a new share issue, perhaps linked to Board representation by fans consortiums?

I bet those Irish fella''s who owned and sold Man U made a tidy profit. Why shouldn''t City attract investment too?

[Cluck 0]

I''m inclined to think Delia should cough up some real money to rebuild the team. If she claims to be so in control of affairs at Carrow Road.....then that is her duty. For all of her ''investment'' claims......what can we as ordinary ''plebs'' see after 10 years?

When you look at the debt....then view what is running around on the pitch.......it seems pretty obvious where the income has been allocated.

It''s all very well some saying that corporate leisure is vital for the future.......but I haven''t paid good money to produce a state of the art restaurant complex. I want to see a decent football team.....and I''m becoming increasingly worried that the haven''t a clue as to how to balance both sides of things.

[Bury Green 0]

Yankee , what a good post this is just the sort of thing that needs asking.

 

Over their ten year reign I think it is fair to say Smith & Jones have become somewhat savvy in manipulating the predominance of the clubs support into believing how hard up the club is.

 

The benefits of this strategy are many; expectations don’t get too high and importantly act as the perfect ruse to manage the supply and demand equation between ground capacity and demand from supporters and thus the perfect excuse to keep the capacity pegged at around 25,000.

 

However a dip into the annual accounts and indeed the clubs ongoing strategy of sweating the property assets affectively reveals a rather different reality.  The club will have borrowings of £13m but it also has a hugely positive balance sheet so what is the problem with having this scale of borrowing? Primarily cash and the ability to service the debt but they would also have you believe the only way we were able to afford Dean Ashton nearly two years ago was by Geoffrey Whatling estate waving its loans to the club!  Oh really?

 

The true litmus test of Smith & Jones true ambitions will come I believe when the planning consent for the next tract of land owned by the club is obtained.  Once again this will raise many millions of pounds even after all the various handouts landowners have to shell out back to the government have been made but what will they do with it? 

 

There are I believe only two options, either they will reduce the clubs debt so enhancing its balance sheet worth and their 51% (or thereabouts) shareholding or they will commit to a second tier on the City Stand.  The second option could well enhance this shareholding as well but represents a far greater gamble and is not something I would expect them to do.

 

Time will tell but the observant amongst you may have noticed that a new road is being formed up across the car park to the rear of the South Stand and I just wonder in my cynical mind whether they already have a planning consent and have conveniently forgotten to tell their fellow share holders?

 

To conclude, I believe they are both very well intended but ultimately lack the ambition and resources to establish the club back in the top flight, where that might come from of course is a completely different matter.

 

“Roman who?  Oi dusnt loik them foreign types boh”

[Mello Yello 2,588]

I''m wurkin all ''ours so I can take me missus into Delilahs trendy restyrunt for some horse de louvres an'' creme de la costly crumble an'' arsti spewmandy......It''ll be well wurf it if the munny guz towardz a new stroiker an'' payin'' for Pawl Mcvee''s haircut.

Every ickle helps........even if it''s costly![:P]

[The Voice of the Thorpe Area 0]

I think you''ve all forgotten that NCFC has actually already gone through this process of ''eliminating the debt'' (not all of it, granted), when in ''97 Delia and co came and saved us. Do we need it to happen again? I''m not sure, you look at the clubs'' finances, and compared to many clubs, we are pretty stable. We have paid out a hell of a lot in the last 2 years in terms of a championship club, and the wage bill (Hucks, Earnie, etc) must be quite big. Then you look at the 600k+ is cost to get rid of Nigel, and also how Mumby has said that Grant will have dosh to spend in January, I am not sure whether we desperatly need a big investment. Obviously, if someone came in with a bit a cash, you''d take it, as anyone would.

But, football today is littered with debt. Our 15 or so million pound debt is tiny compared to many.

Also, is money always good? Take Chelsea, no home defeat in 2 years, and many of their fans get bored of going to home games. Lots of money could also result in our club (like any other) losing its'' identity. Personally, I''m no big fan of over-paid, over-dramatic foreign imports- they ruin the english game. You can bet anything you like that out goes the English players, in come the foreign numpties. 2 good examples of this is at Hearts, where Rix resigned because the foriegn owner took over team selection, and also West Ham, where until the Argies arrivived, they were doing fine.

Instability could be a big problem as well. How long until Abramovich gets bored at Chelsea, leaves, and then they are in big trouble. This could so easily happen with any foreign investor.

Lastly, do we want our club to be run by non-fans? We are lucky (and I know others will disagree here) but as we have true fans running our club, not just Delia and co, but also the thousands of fans who actually have shares, we know that the club''s best interests are at heart of whose running it, not just how big the cheque will be that they recieve every year.

For me, as long as fans stay loyal, bringning in the money, and the board invest and attract sponosoring effectively, I am sure that we will be alright money-wise, and thus, we will be a successful club.

[Mr.Carrow 394]

    "Paid out a hell of a lot in the last 2 years" TVOTTA? Apart from Earnshaw who have we paid good money for? By my fag-packet calculations we are about 8 million in profit in the transfer market since relegation! And most of those departed were the higher earners. Yes we have "fans" in charge of the club but unfortunately they are part of the predominant group for whom City are a nice little country club who are constantly trying to punch above their weight against those nasty big clubs like Cardiff, Coventry, Palace, Brom etc. Of course its a minor irritating inconvenience that we already attract crowds well above those clubs (and most others) and, with a bigger ground, would be higher still......

[Rudolph Hucker 0]

I like to think our Board have learned a lesson about the small club thing by appointing Grant.

[Buncey 1]

Why did we sell out for a hotel when we could have built an added corner of around 2,000 more seats?  Assuming that they are sold out for every match and we play say 25 home matches, and the average price of a ticket they sell is £20. That'' 2,000 x 25 x 20. Thats a million pounds and i think thats how much we sold that piece of land for, i can''t seriously see us not selling under 90% of the tickets in any match for years to come (unless we were to get relegated but still we''d sell lots of tickets). Just seems like a lack of ambition.

[Rudolph Hucker 0]

Bearing in mind a gap has to be left in the Jarrold between home and away who exactly would be able to completely fill a corner between The barclay and The Jarrold?

[canary cherub 1]

Bury, did you say borrowings of £13m?  It sounds as though you''ve seen the 2006 accounts.  I assume "borrowings" is a euphemism for debt?  At the end of last season ND said the debt was close to £20m.  If you''re right, presumably that means the parachute money has been used to reduce it. 

If so, I haven''t got a major problem (provided they''re not reducing it now only so that they can borrow up to the hilt again), but it would be nice if they''d told us sooner why there was no money for players in the summer.  Why do they insist on hiding everything, even things that don''t need to be hidden?  

They need to think very carefully indeed about investing another £9m at the present time on increasing the capacity.  Big gates will not automatically make us a big club.  It will only make money for the club once it has paid for itself.  I think we should wait until the other stands have got a bit closer to paying for themselves and/or we are surviving in the Premiership before going any further.  Where''s Prudence when we need her?

If they don''t invest more on the team, gates could actually be lower than they are now, because spare capacity means that people won''t have to renew to avoid the risk of missing out if we have a good season.  It would give the fans a bit more clout and I''m all in favour of that, but at what cost?

 

[Faded Jaded Semi Plastic SOB 1,234]

Fellas - Your calculations appear to miss a very important element - the cost of building and maintaining the "infill". The club got money from the sale of the land and will also get revenue from the hotel.

[The Voice of the Thorpe Area 0]

[quote user="Mr.Carrow"]    "Paid out a hell of a lot in the last 2 years" TVOTTA? Apart from Earnshaw who have we paid good money for? By my fag-packet calculations we are about 8 million in profit in the transfer market since relegation! And most of those departed were the higher earners. Yes we have "fans" in charge of the club but unfortunately they are part of the predominant group for whom City are a nice little country club who are constantly trying to punch above their weight against those nasty big clubs like Cardiff, Coventry, Palace, Brom etc. Of course its a minor irritating inconvenience that we already attract crowds well above those clubs (and most others) and, with a bigger ground, would be higher still......[/quote]

Earnie 3m

Hughes 750k

Etuhu 500k

Colin 300k

Robbo 50k

Croft 750k

Plus signing on fee, wages, agents, over 6 million. Quite alot for a championship club.

 

[YankeeCanary 0]

VOTA ( I dub you this Sir Knight to allow you to eliminate the unnecessary "the''s" in your long-winded name ):

If you could find a way of getting past your "all things foreign" phobia, you might be able to assist in turning this thread into an interesting discussion. The key point I was making was that the reward of Premiership participation must be becoming so attractive from an investment standpoint that it far outweighs the risk of the investment ( depending upon what numbers are agreed upon of course ). Now, when it comes to a good deal, it does not matter one iota ( apart from your phobia ) if an investor is a foreigner or a "blue-blooded" Brit.....a good deal is a good deal and there will always be people on the lookout for such opportunities unless, of course, you somehow think that being British is a weakness leaving one lacking in investment skills. One would have to think, given our support level and other redeeming features of the club that we might, at least, be picked up on the radar screen of investment opportunity.

Now, the reason for my response to you is this. All your good points taken into consideration, with respect, you say you are sure we will be a successful club. Would you be good enough to define what "success" means to you. Does it include gaining promotion this season and demonstrating actions that gives us a reasonably good chance of sustaining that level? If not then, as many have realised, the pressure for us to release the higher valued/paid players will be significant ......Or, should my point prove to be accurate, i.e. if Norwich fails to accept/seek further investment that just achieving promotion ( never mind investing to sustain Premiership participation ) might be a bridge too far and, if this resulted in plodding along in the Championship for a few seasons more, is that successful enough for you? Just curious. 

  

[Mr.Carrow 394]

    But a quite a small propertion of what we have received. Dont forget we `lose` a players wages once he is sold and we have shipped out plenty more than we`ve brought in. Earnie is bound to be on a fair wack, but it wouldnt suprise me if the other 5 earn less than Ashton and Greens wages combined.

[blahblahblah 2]

[quote]They need to think very carefully indeed about investing another £9m at the present time on increasing the capacity.  Big gates will not automatically make us a big club.[/quote]

I totally agree megson - that money could be used very effectively on the pitch in January, should we be in a position to push for promotion.  Premiership sides have smaller gates than us, but make more money as a result of TV income.

 

[The Voice of the Thorpe Area 0]

[quote user="YankeeCanary"]

VOTA ( I dub you this Sir Knight to allow you to eliminate the unnecessary "the''s" in your long-winded name ):

If you could find a way of getting past your "all things foreign" phobia, you might be able to assist in turning this thread into an interesting discussion. The key point I was making was that the reward of Premiership participation must be becoming so attractive from an investment standpoint that it far outweighs the risk of the investment ( depending upon what numbers are agreed upon of course ). Now, when it comes to a good deal, it does not matter one iota ( apart from your phobia ) if an investor is a foreigner or a "blue-blooded" Brit.....a good deal is a good deal and there will always be people on the lookout for such opportunities unless, of course, you somehow think that being British is a weakness leaving one lacking in investment skills. One would have to think, given our support level and other redeeming features of the club that we might, at least, be picked up on the radar screen of investment opportunity.

Now, the reason for my response to you is this. All your good points taken into consideration, with respect, you say you are sure we will be a successful club. Would you be good enough to define what "success" means to you. Does it include gaining promotion this season and demonstrating actions that gives us a reasonably good chance of sustaining that level? If not then, as many have realised, the pressure for us to release the higher valued/paid players will be significant ......Or, should my point prove to be accurate, i.e. if Norwich fails to accept/seek further investment that just achieving promotion ( never mind investing to sustain Premiership participation ) might be a bridge too far and, if this resulted in plodding along in the Championship for a few seasons more, is that successful enough for you? Just curious. 

  

[/quote]

To me, success to NCFC means to establish ourselves as a premier league side, to get promoted within the next 2 years, and stay there. ie do a Charlton. I do not consider ''plodding along in the championship'' to be success, as I hope nobody else does! The point I was trying to make is that you do not need a wealthy investor to be an established premier side. Take Charlton; no wealthy foriegner, but a successful side (when Dowie gets it sorted they will do well).

[Cluck 0]

[quote user="blahblahblah"]

[quote]They need to think very carefully indeed about investing another £9m at the present time on increasing the capacity.  Big gates will not automatically make us a big club.[/quote]

I totally agree megson - that money could be used very effectively on the pitch in January, should we be in a position to push for promotion.  Premiership sides have smaller gates than us, but make more money as a result of TV income.

 

[/quote]

It is indeed time to have a serious injection of capital if this club is become ''successful''. The current Board do in their own words view us as ''little old Norwich'' and ''chugging along'' is pretty much their idea of things.

I mentioned Mandaric some time back and got quite a hammering.....but a look at a rising Cardiff proves that ''out of towners'' can move a club forward nicely. The fact that Delia is this ''fellow supporter'' doesn''t wash with me at all I''m afraid. We need an ambitious figurehead now to look at what goes on on the pitch .... not just at periferals.

There are plenty of clubs in the hands of outsiders....and many of them are doing nicely. Whoever actually owns the bricks and mortar is pretty irrelevant......as long as the team we pay well to see plays decent football ....the crowd will be happy.

The Premiership is a huge financial draw for investors nowadays.......and unlike many clubs, Norwich City has genuine potential. So what''s wrong in taking a calculated risk and ''going for it'' in earnest?.....Personally if we are just going up for another pasteing like last time.....I''d rather not bother. The fans are groaning for success and somehow Peter Grant must be backed to produce it.

The Board hung Worthington out to dry........Let''s hope Peter Grant gets more luck...........

[ManchesterCanary 0]

Take a look at this Yankee, from the political economy of football website...

Fourteen months after US financier Malcolm Glazer and his family took over Manchester United in a hotly contested takeover battle, the club''s improving financial prospects have been reflected in a £660m debt reinfinancing deal. The deal will cut the club''s annual interest bill and strengthen the Glazer family''s grip on the club. A spokesman for the Glazers said the amended structure would continue to provide manager Alex Ferguson with ''sufficient funds in the transfer market''. The Financial Times, citing people familiar with the package, said the club''s annual interest charge would fall to £62m, compared to £90m under the old deal. It said overall borrowings would rise to £660m from £580m, but the club had halved to £135m the amount they owe in the form of higher risk payment-in-kind notes.

Kind of puts things into perspective...interestingly they still have sufficient funds for transfers...

[YankeeCanary 0]

Thanks for your response VOTA.

A couple of further thoughts. With regard to your comments on Charlton, you may be correct and they will turn it around but I won''t be at all surprised if they don''t. I still am trying to understand the Alan Curbishley decision to leave. Yes, he was there a long time but, at his age, you would have thought that he would have been in a excellent position to pick his time to leave when the right opportunity presented itself if change was his motivation. A bit of a coincidence that he leaves without being triggered to do so by another opportunity and Charlton find themselves in the position they are.

The other comment I would add is look at the situation at Manchester City. John Wardle is making it clear that if there are investors willing to step up to the plate he is willing to step aside if it is in the best interests of the club. Understand please, this in not an anti-Delia rant. Simply a recognition that any organisation in any field has to take stock of where they are, where they want to be, and whether the present resources are in step with the size/potential/support level of the club or, indeed, lagging in the potential.

We all have points of view about these situations and, of course, we are not all going to agree. How I arrive at my view is by looking at the performance of an football club over a longer term period, observing their decisions when opportunity presents itself and also observe whether that organisation is leading, maintaining or lagging the growth potential. My assessment is that Norwich City FC, having had one relatively unsuccessful season in the Premiership over what is now going to be the past eleven seasons are, at best, in a maintain mode and argumentatively, are lagging their potential. I believe that it is more than likely that the next several seasons will result in more of the same unless there is a more open approach to look toward the market investment opportunity presenting itself now because of the increasingly significant financial reward associated with Premiership participation. Is there risk....always. Are some times better than others to take the risk...yes. Now, in my view, is such a time, which is why I believe some clubs are demonstrating their willingness to be open to the possibilities such as is being expressed by John Wardle.   

[Rudolph Hucker 0]

Good debate Yankee; but it is so obvious you enjoy this aspect of football more than the game itself. What a dull fellow you are.

[BlyBlyBabes 0]

Interesting stuff. One point, however.

We should seek to re-establish ourselves at the top level (or whatever the marketers call it), rather than establish ourselves. We were there for 21 years between 1972-1995.

We do not really need to learn from Charlton, We did it ourselves.

That''s why I was so pleased that Dave Stringer was involved in the selection of a new manager.

OTBC.