Financial fair play in the Championship

[davieG]

This panic over the owners is unfounded and frankly ludicrous,¹they are business men, they know how to be successful, and they know how to manage money, they have been aware of the incoming FFP rules and gambled on throwing money at the club to get promotion while they still could, now they will be forced to be more careful with their/our money.

²They are actually restricted from financially mismanaging the club, which means our future as a club is safe, they are still investing in the club, as well as having access to large sums of money available to us in the forms of loans, they are securing big sponsorship deals with King Power and other asian businesses, the kind of deals other clubs in our position cannot make.

1.You could have said that about the many owners of all the other clubs that have gone into administration so it clearly doesn't guarantee success at running a football club only time will tell if the Thai's will be.

2. How are they currently restricted the FFP rules do not exist yet?

[Lobsterboyuk]

1.You could have said that about the many owners of all the other clubs that have gone into administration so it clearly doesn't guarantee success at running a football club only time will tell if the Thai's will be.

2. How are they currently restricted the FFP rules do not exist yet?

1. Fair point - but the Raksriaksorns are owners of legitimate business empire, e.g Gaydamek at Portsmouth did not have this pedigree - seems more he was a playboy wasting daddie's money for his own entertainment - none of which could be levelled at our owners

2. True, but they are imminent so any sensible management team would have a strategy in place to handle them, hopefully with contingency if we fail to get up next season - let's hope that's where Susan Whelan and her team match that expectation

[Captain...]

1.You could have said that about the many owners of all the other clubs that have gone into administration so it clearly doesn't guarantee success at running a football club only time will tell if the Thai's will be.

2. How are they currently restricted the FFP rules do not exist yet?

1. As Lobsterboy said they have earnt rather than inherited their money, and have done so by expanding and creating business interests, not in the case of Abrahmovich who did so on the back of oil, which lets be honest doesn't really require much business knowledge to make money from oil.

2. Sorry I should have put they will be restricted by it when it comes in, so any panic over their spending is pointless.

[davieG]

1. Fair point - but the Raksriaksorns are owners of legitimate business empire, e.g Gaydamek at Portsmouth did not have this pedigree - seems more he was a playboy wasting daddie's money for his own entertainment - none of which could be levelled at our owners

2. True, but they are imminent so any sensible management team would have a strategy in place to handle them, hopefully with contingency if we fail to get up next season - let's hope that's where Susan Whelan and her team match that expectation

1. As Lobsterboy said they have earnt rather than inherited their money, and have done so by expanding and creating business interests, not in the case of Abrahmovich who did so on the back of oil, which lets be honest doesn't really require much business knowledge to make money from oil.

2. Sorry I should have put they will be restricted by it when it comes in, so any panic over their spending is pointless.

1. Many of the clubs that have gone into administration were bought and managed by legitimate successful businessmen.

2. Any sensible owners would but until events prove it we don't know if they are sensible or not, after all Captain you referred to their gambling on Sven and splashing the cash, deliberately planned before the FFP came otherwise surely it wouldn't have been a sensible action and this is what is causing the panic re their spending. Which begs the question how much damage has that done to them?

For all the arguments about the rights and wrongs of their ownership and approach to managing LCFC no one knows the reality of the situation and arguments can be put on both sides.

They may have valid reasons for keeping things close to their chests but from experience I do not put my trust in anyone I don't know and will always be wary and questioning of anyone I haven't yet learn't to trust.

[Lobsterboyuk]

For all the arguments about the rights and wrongs of their ownership and approach to managing LCFC no one knows the reality of the situation and arguments can be put on both sides.

They may have valid reasons for keeping things close to their chests but from experience I do not put my trust in anyone I don't know and will always be wary and questioning of anyone I haven't yet learn't to trust.

Can't disagree with that - top and tail is we don't know

As if the on-pitch drama wasn't enough

[Captain...]

1. Many of the clubs that have gone into administration were bought and managed by legitimate successful businessmen.

2. Any sensible owners would but until events prove it we don't know if they are sensible or not, after all Captain you referred to their gambling on Sven and splashing the cash, deliberately planned before the FFP came otherwise surely it wouldn't have been a sensible action and this is what is causing the panic re their spending. Which begs the question how much damage has that done to them?

For all the arguments about the rights and wrongs of their ownership and approach to managing LCFC no one knows the reality of the situation and arguments can be put on both sides.

They may have valid reasons for keeping things close to their chests but from experience I do not put my trust in anyone I don't know and will always be wary and questioning of anyone I haven't yet learn't to trust.

Every decision you make is a gamble, in business in life, the strategy was clear with Sven when he first came, we were not going to get promoted with the team he inherited, we needed serious re-building and January is not a good time to do that, we couldn't risk buying premiership quality players on inflated prices and prem wages without a guarantee of promotion, they had 2 options start an expensive re-build in jan or exploit the loan market to get a quick promotion, but with no long term costs, they had a budget for that season that they could afford to lose, if the gamble paid off then it would have benn worth it, if it didn't they had a fix on what they would lose and wouldn't get saddled with prem wages in the championship, and the re-build could start in pre-season, a much better time to buy players than in Jan.

[davieG]

Every decision you make is a gamble, in business in life, the strategy was clear with Sven when he first came, we were not going to get promoted with the team he inherited, we needed serious re-building and January is not a good time to do that, we couldn't risk buying premiership quality players on inflated prices and prem wages without a guarantee of promotion, they had 2 options start an expensive re-build in jan or exploit the loan market to get a quick promotion, but with no long term costs, they had a budget for that season that they could afford to lose, if the gamble paid off then it would have benn worth it, if it didn't they had a fix on what they would lose and wouldn't get saddled with prem wages in the championship, and the re-build could start in pre-season, a much better time to buy players than in Jan.

I was assuming the gamble you referred to was the large outlay on transfer fees and wages during the close season, I certainly did not view getting the loanees in as gamble rather the opposite in fact.

The gamble was allowing Sven's summer team building only to chicken out after just a few months leaving us with many players unsuitable for Pearson type management.

[Captain...]

I was assuming the gamble you referred to was the large outlay on transfer fees and wages during the close season, I certainly did not view getting the loanees in as gamble rather the opposite in fact.

The gamble was allowing Sven's summer team building only to chicken out after just a few months leaving us with many players unsuitable for Pearson type management.

In my view it was a gamble in that it left us needing to massively rebuild in the close season if we didn't get up. Of course it was a gamble to sack Sven, especially with the possibility of MON maybe clouding their judgement, but whether we would be better off now or not by keeping Sven I don't know, but I think they saw Sven as not producing the results despite heavy investmet, saw players picking up big pay packets and not even looking close to playing, and I wouldn't be surprised if before Sven was sacked there was a conversation about January Targets and it became apparent that Sven would just result in them losing more money with no noticeable improvment in performance. Of course that is just speculation, but it wasn't just our uninspiring performance on that cost Sven his job but it was for financial reasons too. It may have been a gamble, but like I said everything is, we could have given Sven another month but no improvement would have meant potentially bringing a manager in during the transfer window. I think it was a case of sack Sven now and give the new man a chance to assess for Jan and improve the squad and have a chance of getting some form together and win promotion or stick with Sven until the end of the season. They made their decision and I think it would have been a greater gamble to back Sven for another transfer window, but we will never know how it would have panned out with Sven for the whole season.

[davieG]

In my view it was a gamble in that it left us needing to massively rebuild in the close season if we didn't get up. Of course it was a gamble to sack Sven, especially with the possibility of MON maybe clouding their judgement, but whether we would be better off now or not by keeping Sven I don't know, but I think they saw Sven as not producing the results despite heavy investmet, saw players picking up big pay packets and not even looking close to playing, and I wouldn't be surprised if before Sven was sacked there was a conversation about January Targets and it became apparent that Sven would just result in them losing more money with no noticeable improvment in performance. Of course that is just speculation, but it wasn't just our uninspiring performance on that cost Sven his job but it was for financial reasons too. It may have been a gamble, but like I said everything is, we could have given Sven another month but no improvement would have meant potentially bringing a manager in during the transfer window. I think it was a case of sack Sven now and give the new man a chance to assess for Jan and improve the squad and have a chance of getting some form together and win promotion or stick with Sven until the end of the season. They made their decision and I think it would have been a greater gamble to back Sven for another transfer window, but we will never know how it would have panned out with Sven for the whole season.

You've already alluded to how difficult it is to improve the squad during the January window so Sven had little choice but use loanees to improve the squad and it nearly worked. We'd have needed to massively rebuild in the summer with or without those loanees so I don't see how it was a risk, surely a bigger risk would have been to do nothing or sign players without knowing what league you were going to be in when the summer came.

The second part of your reply is mostly conjecture so I don't really want to get into a debate about that.

[Captain...]

You've already alluded to how difficult it is to improve the squad during the January window so Sven had little choice but use loanees to improve the squad and it nearly worked. We'd have needed to massively rebuild in the summer with or without those loanees so I don't see how it was a risk, surely a bigger risk would have been to do nothing or sign players without knowing what league you were going to be in when the summer came.

The second part of your reply is mostly conjecture so I don't really want to get into a debate about that.

True but Sven took no time to assess the squad we had, he got rid of solid performers from the season before, Berner, Fryatt, Hobbs, Weale, Morrison, Waghorn were all capable of performing at that level and we didn't need the volume of loanees we got in, by the end of the season he knew no more about the squad than when he arrived, if he had gone for quality over quantity and players were brought in to complement the squad and not replace it we would have been better off now, but if we had got promoted we would have signed Yakubu and Naughton, maybe Mee.

The gamble the owners took was to financially back Sven's plan, a couple of loanees would have made a lot of sense, but they should have, in my mind tried to rein Sven in, we didn't need Bruma and PVA and Kamara, at one point we couldn't even play them all as we had exceeded their quota, at that point the owners should have started saying, hang on why are we paying for 6 loanees when we can only play 5 of them. That is probably the only thing I will criticise the owners on, letting Sven go crazy in the loanee market.

Either way it was a gamble, a calculated and sensible gamble, given the choice then of 5 loaness with premiership quality and experience or 1 quality championship signings in January, at the time it would be easy to argue the 6 new players would be better than the 2, but in hindsight how much better would we be now if we had had someone like Curtis Davis marshalling our defence for the last 18 months or (dare I say it) Nicky Maynard up front for the last season and a half.

The other part of the gamble was trusting Sven to get it right which he didn't.

[davieG]

True but Sven took no time to assess the squad we had, he got rid of solid performers from the season before, Berner, Fryatt, Hobbs, Weale, Morrison, Waghorn were all capable of performing at that level and we didn't need the volume of loanees we got in, by the end of the season he knew no more about the squad than when he arrived, if he had gone for quality over quantity and players were brought in to complement the squad and not replace it we would have been better off now, but if we had got promoted we would have signed Yakubu and Naughton, maybe Mee.

The gamble the owners took was to financially back Sven's plan, a couple of loanees would have made a lot of sense, but they should have, in my mind tried to rein Sven in, we didn't need Bruma and PVA and Kamara, at one point we couldn't even play them all as we had exceeded their quota, at that point the owners should have started saying, hang on why are we paying for 6 loanees when we can only play 5 of them. That is probably the only thing I will criticise the owners on, letting Sven go crazy in the loanee market.

Either way it was a gamble, a calculated and sensible gamble, given the choice then of 5 loaness with premiership quality and experience or 1 quality championship signings in January, at the time it would be easy to argue the 6 new players would be better than the 2, but in hindsight how much better would we be now if we had had someone like Curtis Davis marshalling our defence for the last 18 months or (dare I say it) Nicky Maynard up front for the last season and a half.

The other part of the gamble was trusting Sven to get it right which he didn't.

Maybe he had them in with a view to signing them if we got promoted, this would have given him a chance to not only see them in action but how they' fitted in' with the team. It's all very well saying Sven should/shouldn't have done this that or the other but you simply do not know what Terms of Reference and budget he was given by the Thais.

[Captain...]

Maybe he had them in with a view to signing them if we got promoted, this would have given him a chance to not only see them in action but how they' fitted in' with the team. It's all very well saying Sven should/shouldn't have done this that or the other but you simply do not know what Terms of Reference and budget he was given by the Thais.

He definietely did if the reports about the deal with Yakubu were true, IF we got promoted, we didn't that was the gamble, it didn't pay off.

[dave the caveman]

lol

I've worked in finance with venture capitalists,

Wowzers, we have a badass in the building.

I'm not talking about any finer points, but the basic points. How to get money into a football club 101.

You can buy equity, but our owners own 100% of the club, so we can't do that.

You can put money in through sponsorship, which our owners have done.

Or you can issue loans.

If you want to use any other method, good luck with the tax bill.

Taking Chelsea and Man City as examples, most of their money comes in the form of soft loans - loans which are loans on the books but in reality are written off. 40% of investment in premier league football clubs is through soft loans. It is completely normal, indeed necessary in our case, for owners to issue loans.

Of course we don't know if they are soft loans or not, but i suspect they probably are. The only questionable point is the interest. Usually soft loans are interest free. I don't know what to make of that, but any sensible consideration leads to the conclusion that these people are not here to put their reputation on the chopping block for the sake of 8% on a loan. It just doesn't make sense.

I'm not saying the Thai's can't make mistakes, because even with the best intentions in the world they could still make a mess of it, but I think a lot of people on here actually get a bit of a hard-on over the thought that we're being intentionally screwed over by these guys when the fact of the matter is that everything they have done since they have been here suggests that we are not.

[Lobsterboyuk]

You can buy equity, but our owners own 100% of the club, so we can't

Of course we don't know if they are soft loans or not, but i suspect they probably are. The only questionable point is the interest. Usually soft loans are interest free. I don't know what to make of that, but any sensible consideration leads to the conclusion that these people are not here to put their reputation on the chopping block for the sake of 8% on a loan. It just doesn't make sense.

Agree generally with your post but minor point is that they can issue more shares anytime they want (private company so no problem there)

I suspect the are actually hard loans financed through a third party hence the 8% with AFI as the investment vehicle - I.e. leverage but underwritten by Vichai - these details will never be in the public domain because that is commercially sensitive detail - gearing against a 17 million turnover is quite low still