Cullum (again I am afraid)

[nutty nigel 7,536]

That''s a good point Judge. If I remember rightly at the AGM Delia said that new investment was welcome whether it meant they remained majority shareholders, minor shareholders or gone completely. So this Cullum issue gets clearer and clearer doesn''t it[:S]

And Keelans Glove - To my knowledge Delia hasn''t put any value on her shares but the board valued the unissued shares at £30 in line with their 16m valuation of the club. I may be wrong about this but I''m still under the impression that individuals share holdings would still be a private sale at a price to be agreed by both parties. I doubt the private sales between Chase and Watling and then Watling and Smith&Jones were made in line with the boards valuation of the club.

I believe Bobert is right in that if Cullums offer involved a new share issue the club would have to get this ratified at the AGM or an EGM. I am not sure about the law regarding who could underwrite it. I am honest enough to say that getting much deeper into this is beyond the knowledge of this toiletcleaningbingocallingbartendering unqualified football fan.

And the other point I made is very much an issue for me. How does the club sustain the player budget that is suddenly increased by 20m in one year. We had enough problems getting over the loss of 7m parachute payments. A one off payment of 20m would be used best by paying off the debt. In my humble opinion.

 

[Desert Fox 0]

[quote user="Bobzilla"]Just suppose that someone offered you money to do up your house, but in return he could do what he wanted with it. Would you take them up on that offer? What if he bulldozed your house and relocated it elsewhere? Its your house (you paid good money for it, and have not got anything back) but you have no control. That, to me, would be unacceptable. There are, and were, no guarantees of PC acting in the best interests of the club or its owners, and not in his own interests (you forget he has significant UK businesses that might benefit in some way from NCFC). Whilst I may not like the end result of the stalemate, I cannot blame Delia for not wanting to deal on PCs terms.[/quote]

Bobzilla,

Nice analogy, but in reality it is more like the house is falling apart and the guy that is doing the house up wants a pro-rata share in the house (which will increase in value as a result of being done up) rather than doing it up for free, which is what a £20 investment in the club without equity would amount to. I am not pro or anti-Cullum, just keen to point out the facts.

[Grando 260]

Please stop with the "if someone offered you x for your house analogies"...

The fact that Delia and Michael haven''t even met with Cullum is the thing that stands out for me and shows their contempt/fear. If they''d met him and had talks, then decided the deal wasn''t right they''d have more of a leg to stand on, but it does not look like that happened.

(Cue someone saying how do you know it didn''t happen blah, blah, blah - I guess we''re going to have to agree to disagree. I can''t see why you''re so desperate to cling to this Delia-Michael saviour myth though...)

[Desert Fox 0]

[quote user="nutty nigel"]

And the other point I made is very much an issue for me. How does the club sustain the player budget that is suddenly increased by 20m in one year. We had enough problems getting over the loss of 7m parachute payments. A one off payment of 20m would be used best by paying off the debt. In my humble opinion.

[/quote]

NN,

I agree about paying of the debt as this would relase £3.5M interest payments per annum to invest every year in the team and any revenue from non-football investments would flow stright to the team as there would be no associated debts to repay. Furthermore, if we did have £20M to spend, a good proportion of this would be wasted as selling clubs would inflate their prices (e.g. the Chelsea/Man City experience). Finally, I would not trust Roeder with that kind of kitty.

[Beauseant 0]

[quote user="Grando"].. The fact that Delia and Michael haven''t even met with Cullum is the thing that stands out for me and shows their contempt/fear. If they''d met him and had talks, then decided the deal wasn''t right they''d have more of a leg to stand on, but it does not look like that happened. (Cue someone saying how do you know it didn''t happen blah, blah, blah - I guess we''re going to have to agree to disagree. I can''t see why you''re so desperate to cling to this Delia-Michael saviour myth though...)[/quote]

 

Hmmmm

 

And I don''t personally see,nor ever have, [;)] D&M as saviours. See how easy it is to confuse fact and fiction?

[Grando 260]

Sorry, so they''ve met and talked it through have they?!

[macdougalls perm 0]

[quote user="Grando"]Please stop with the "if someone offered you x for your house analogies"... The fact that Delia and Michael haven''t even met with Cullum is the thing that stands out for me and shows their contempt/fear. If they''d met him and had talks, then decided the deal wasn''t right they''d have more of a leg to stand on, but it does not look like that happened. (Cue someone saying how do you know it didn''t happen blah, blah, blah - I guess we''re going to have to agree to disagree. I can''t see why you''re so desperate to cling to this Delia-Michael saviour myth though...)[/quote]

Who''s clinging to the Delia saviour myth? Certainly not me. I''m just saying that it might be sensible to exercise a little caution when assessing the claims of a man who has obviously been immensely successful in an arena where spin and manipulation are part of the required tool box.

[Grando 260]

Was I saying they should categorically accept whatever offer he put to them? No, just the much-repeated point that they need to talk to him and find out what that is.... Not holding my breath though.

[blahblahblah 2]

[quote]Who''s clinging to the Delia saviour myth? Certainly not me. [/quote]

I am I am I am !  Over here !

For it sayeth, in Delias'' How to Cheat at The Bible, that in the beginning was the word, and the word was "Shiraz".]

Right, now we''ve got that sorted, Who''s clinging to the "Delia - Evil Overlord" myth ?  They''re just a couple of rich people who took up a hobby, and it went a bit wrong.  Get over yourselves !

[macdougalls perm 0]

[quote user="blahblahblah"]

[quote]Who''s clinging to the Delia saviour myth? Certainly not me. [/quote]

I am I am I am !  Over here !

For it sayeth, in Delias'' How to Cheat at The Bible, that in the beginning was the word, and the word was "Shiraz".]

Right, now we''ve got that sorted, Who''s clinging to the "Delia - Evil Overlord" myth ?  They''re just a couple of rich people who took up a hobby, and it went a bit wrong.  Get over yourselves !

[/quote]

[:D]

[Beauseant 0]

[quote user="Grando"]Sorry, so they''ve met and talked it through have they?![/quote]

I don''t know, any more than you know for certain that they haven''t, which is pretty much the point I was making earlier.

[Desert Fox 0]

BBB,

Agree with your post.

The key question is that now that it has gone ''a bit wrong'' which exit strategy are they going to choose and when. This will go a long way towards how they will be remembered.

[nutty nigel 7,536]

[quote user="Desert Fox"][quote user="nutty nigel"]

And the other point I made is very much an issue for me. How does the club sustain the player budget that is suddenly increased by 20m in one year. We had enough problems getting over the loss of 7m parachute payments. A one off payment of 20m would be used best by paying off the debt. In my humble opinion.

[/quote]

NN,

I agree about paying of the debt as this would relase £3.5M interest payments per annum to invest every year in the team and any revenue from non-football investments would flow stright to the team as there would be no associated debts to repay. Furthermore, if we did have £20M to spend, a good proportion of this would be wasted as selling clubs would inflate their prices (e.g. the Chelsea/Man City experience). Finally, I would not trust Roeder with that kind of kitty.

[/quote]

Yes and the player budget would then be sustainable every year. The biggest financial problems at football clubs are always caused by unsustainable player budgets caused by loss of revenue. It''s the same whether it''s ITV Digital, Parachute Payments or 20m billionaire investments. Only Smith&Jones have sustained their investment over any period in time to keep this club afloat. Fans don''t have to "thank God for Delia and Michael" or even be grateful, but to be ungrateful is just plain wrong.

 

[T 190]

[quote user="KeelansGlove"]

With respect T it is not as clear cut as you make out. If PC had put 20M into the club for new shares and gained control Delia and Michaels shares would have been devalued as would my own. If this investment would have meant that we became a premier league club even a smaller one the valuation could be into the sorts of figures quoted for Newcastle and Spurs , lets say 100M with the potential for shares to double or more in value allowing Delia and Michaels shares to be worth more than they are now and if there were to be any potential takeover in the future as we know any potential buyer would be duty bound to make an offer for all shares.

It may be the norm for individuals to have control in football clubs but it is not neccesarily the case for other businesses , a shareholding reflects the value of the company and if Norwich City are not succesful this value goes down, regardless of if the shareholding is a majority or minority.

The alternative will probably be sharply reducing revenues due to falling season ticket demand and possible administration which correct me if im wrong would wipe out any value to the shares at all.

I am still not sure if any meeting has ever taken place face to face (the club have been careful to keep this from us) which is one of my main issues with this whole affair. If Mr Cullum had been asked to come to Carrow Rd for a game and discussions had been held at length and no compromise could be found then fine I would have had more respect for Delia and Michael. Perhaps they could have convinced him to buy a percentage of the shares they own whilst creating new shares to cover the balance.

We will never know , and whilst there is always the outside chance Orville will find someone to give them an escape route can anybody really say being owned by some billioniare who doesn''t know where Norwich is would be preferable to having Cullum on board with Delia and Michael ?

Anybody who can honestly say we are in better shape now than we were when they arrived, please enlighten me. 

[/quote]

Is that with respect as in no respect? Basically you are proposing some kind of deferred contingent consideration which I''ve suggested before only based on PC selling his business. Your suggestion is if PC agreed that he would do what it takes to bank roll promotion, and that they agreed that they could find a buyer on promotion and that they would sell on promotion then they would get their money back To use the dreaded house anology it is like saying I will pay for your house when I''ve done it up and sold it. Theoretically possible but normally on a business deal you want a clean exit because otherwise there is too much uncerntainty. As I said before the offer would be rejected in any business deal. PC has said football clubs are not viable businesses so he is saying why pay for it. He may well be thinking no one would be willing to pay for the club and the existing shareholders can not fund the club for ever so why pay if I can pick it up for free in the future. Basicly he was saying you take nothing on the club at least for now and I will take over the up keep of the business. I think everyone in the Delia/MWJ position would reject the offer in the hope of finding an offer where they recover some cash unless they feel particularly generous to billionaires. Likewise, I have no reason to believe PC is an asset stripper and he is also taking a rational negotiating position as the current shareholders are. I''m not sure how interested PC really is and he could of taken over from the Turners if he was that concerned. I live in hope though however remote that he is playing a longer game. Taking away emotion both parties are acting reasonably and rationally.

[Desert Fox 0]

NN,

I agree with both you and Blahblahblah. Delia is not the devil incarnate; she is essentially an amateur who is dabbling in her hobby. This comes across in two respects.

Firstly, they have made some pretty bad footballing decisions (e.g. not buying Ashton sooner, appointment of managers etc).

Secondly, and perhaps more critically, their business strategy to use property development as a substitute for either radically reducing net costs (which you have rightly pointed out have been materially affected by lost TV revenues) or securing new investment has gone tits up, to put it bluntly. This is likely to be the driver of their undoing.

In both cases I don’t doubt that they had the best intentions, however, this should not excuse the fact that they got some fairly big decisions wrong and that the fans will collectively suffer as a consequence. So, I would say lets not be ungrateful for trying, but equally let’s not be happy about where they have taken us.

They probably have no more than three months left to cement a favorable legacy with the fan base. From then onwards, it will go downhill fast. Let’s hope they do not screw up their next big decision!

 

[blahblahblah 2]

[quote user="Desert Fox"]

NN,

I agree with both you and Blahblahblah. Delia is not the devil incarnate; she is essentially an amateur who is dabbling in her hobby. This comes across in two respects.

Firstly, they have made some pretty bad footballing decisions (e.g. not buying Ashton sooner, appointment of managers etc).

Secondly, and perhaps more critically, their business strategy to use property development as a substitute for either radically reducing net costs (which you have rightly pointed out have been materially affected by lost TV revenues) or securing new investment has gone tits up, to put it bluntly. This is likely to be the driver of their undoing.

In both cases I don’t doubt that they had the best intentions, however, this should not excuse the fact that they got some fairly big decisions wrong and that the fans will collectively suffer as a consequence. So, I would say lets not be ungrateful for trying, but equally let’s not be happy about where they have taken us.

They probably have no more than three months left to cement a favorable legacy with the fan base. From then onwards, it will go downhill fast. Let’s hope they do not screw up their next big decision!

[/quote]I''d agree with that - I also doubt though that they will get a sale within 12 months in the current climate.  If I were in their shoes, I''d probably attempt another share issue with the fans, but this time give them proper shares.

[Buncey 1]

This is as I expected.

[blahblahblah 2]

[quote user="Fellas"]This is as I expected.[/quote]We aim to please.  Consider yourself lucky, often we miss !

[Binky 0]

Fed up with reading that Cullum is a great guy and a great fan and a great business man. Who on this board know him or have even met him? How much did he cough up for Lita? He''s supposedly our richest fan but has a funny way of showing it - when we needed some urgent short term funding he went very quiet. Why is the present Board expected either to write off their substantial investment (for the good of the club) but Cullum is not expected to handover a penny (without receiving control of the club)?

He would have probably got my support had he offered to buy out the Smiths - but no, he wanted them to stay in amd effectively hand over their investment to his safe keeping. What guarantee would there have been that he would be more successful?

As for his successful business: I used to have my house is insured with Towergate.Try calling them and getting an kind of answer within 20 minutes.....

[Bassy 0]

I''d agree with that - I also doubt though that they will get a sale within 12 months in the current climate.  If I were in their shoes, I''d probably attempt another share issue with the fans, but this time give them proper shares.

I very much doubt that she & himself would agree to that as it could well dilute the value of their holdings, possibly a major factor in them rejecting Mr Cullums offer to buy a 20 mill tranch of stock.

 

[Desert Fox 0]

T,

 

You said “Taking away emotion both parties are acting reasonably and rationally”.

 

You are absolutely right. The problem is that the fans are piggy in the middle whilst we wait to see who blinks first, which is what this is essentially about if we assume there are no other credible parties.

 

Cullum quite rightly wants control. Delia quite rightly does want to lose control without some compensation to reflect the impact that loss of control would have on her investment.

 

The key question is that this ‘game’ is being played out in a real time scenario where the clubs prospects appear to be deteriorating rapidly. The credit crunch has knackered any medium term hope of a return on the land development and the recession and our continued poor football performance is bound to hit season ticket sales hard.

 

So assuming that Roeder keeps us up (and this is in the balance in my opinion), things could start to fall apart over the summer. I think we are finally nearing the end game and this will be dependent upon Seymour Pierce not unearthing any other credible bidders (say 2 to 3 months).

 

If this is the case, the ball will be back in Delia''s court about how they engage Cullum. If they wait too long their negotiating position will deteriorate. I actually believe (pure unevidenced speculation on my part) that Cullum is gambling on us hitting administration and picking up the remnants on the cheap. But only time will tell.

 

I appreciate that there are lots of ifs and buts. However, the only changes that I can foresee that will avoid the above scenario are other investors emerging (unlikely) or Roeder managing a serious tilt at the play off positions (which is possible given the lack of quality in this division).

[T 190]

DF - agree with that. I would say nearly all owners are amateurs apart from perhaps a few in the premiership eg those who own sports franchises in the US. I agree there are a number of clubs ahead of us financially - eg birmingham; Derby and QPR but there are also a lot struggling financially as we are and we''ve already seen this this is that there is not a big difference between success and failure between the other clubs so fortunes are fickle.

[Tangible Fixed Assets anyone? 0]

[quote user="mr carra"]

He wanted £20m of new shares but he also wanted control, so Delia and MWJ would lose control without selling their shareholding.  That means Cullum could rack up huge debts and render their shareholding worthless without them (as minority shareholders) being able to do anything about it.

[/quote]

Yes their shareholding would become worthless but not for the reason you have given.

Power goes with the majority holding, as soon as Cullum acquires that, Delia''s & MWJ''s holding becomes a minority holding which is worthless. Who would want to buy a minority holding with no power? It has nothing to do with the hypothesis you are suggesting.

[Tangible Fixed Assets anyone? 0]

[quote user="The Lucky Nine"]

So Cullum replies….

 

http://www.eveningnews24.co.uk/content/news/story.aspx?brand=ENOnline&category=NewsSplash&tBrand=ENOnline&tCategory=NewsSplash&itemid=NOED12%20Nov%202008%2017%3A14%3A37%3A417

 

however this all still seems a bit strange.  He wanted £20 million worth of new shares, but our board did not want that, why on earth not! Was it because it would devalue their holding? 

[/quote]

Its to do with Delia''s & MWJ''s share holding.

[blahblahblah 2]

[quote user="Binky"]

As for his successful business: I used to have my house is insured with Towergate.Try calling them and getting an kind of answer within 20 minutes.....

[/quote]

You would have been calling an 0870 number at a guess.  They make a few pence a minute on those numbers, or at least they used to until Ofcom put a stop to it.  So they''ve already got your money up front, and they keep taking pennies off people on hold all day long.  Not great customer support, but every little helps as someone might say.

[Camuldonum 0]

It might be interesting to know the origin of the "Cullum letter" and whether it was in response to the club asking him to declare his situation before the AGM or whether he''d had a call from Mr Harris. I don''t think that has been explained yet.

[KeelansGlove 0]

There is no evidence PC would have to sell his business to fund 20M and the concept is not unlike that of an investment company or to use another analogy "Dragons Den" Delia has invented a spiffing new football club that could go all the way with the right support and investment, why on earth would she want to give away half her company to make that dream a reality ?

of course I can understand that Delia may prefer to sell her shares without making a loss and put it behind her but in the current climate with the current position it is very unlikely that will happen , although it appears due dilligence is now out of the window as long as they have the cash.

It still annoys me that Delia saw no reason to meet with Cullum regardless of the fact he may be the monster some of you seem to think

[Tangible Fixed Assets anyone? 0]

[quote user="Empty Mirror"]

It doesn''t make sense.

If Cullum was offering £20 million for £20 million worth of new shares, why did he talk about Delia and him having had a "wrangle" over valuation but being unable to agree?  That suggested that he was proposing to buy the club, which is certainly what was reported. 

[/quote]

The wrangle over the pre money valuation was necessary in order to determine the value per ordinary share for the £20m investment which in turn tells the world how many shares Mr Cullum would have got for his £20m.

------------------------

''That suggested that he was proposing to buy the club, which is certainly what was reported.''

--> People need to understand that sports journalists are not very good at reporting the financial / business side of the club.

The£20m investment in new shares would have produced a majority holding not  100% ownership.

 

[Tangible Fixed Assets anyone? 0]

[quote user="kdncfc"]

 If I was bunging out 20 million I''d want to make sure it was spent in the right place.

[/quote]

i.e., not on non entertaining tangible fixed assets. The playing side of this club has to recover somehow!

[kdncfc 0]

[quote user="Bobzilla"]Just suppose that someone offered you money to do up your house, but in return he could do what he wanted with it. Would you take them up on that offer? What if he bulldozed your house and relocated it elsewhere? Its your house (you paid good money for it, and have not got anything back) but you have no control. That, to me, would be unacceptable. There are, and were, no guarantees of PC acting in the best interests of the club or its owners, and not in his own interests (you forget he has significant UK businesses that might benefit in some way from NCFC). Whilst I may not like the end result of the stalemate, I cannot blame Delia for not wanting to deal on PCs terms.[/quote]

If you couldn''t afford your mortgage and someone offered to buy your house and offered to help you improve it and share the burden of running it you''d be a fool to turn them down, Delia can''t afford to run the club anymore and without something changing the club will end up in admin and she''ll end up getting nothing back, at least if she''d accepted Cullums offer we would have had a decent shot at getting promoted and she''d potentially end up getting far more money back.