So, how much does somebody have to stump up ??

[Smirking_Saint]

So, little confused.

 

I think i am understanding where it is but need to ask to make sure.

 

Whoever buys the club, do they have to be able to buy the club AND clear all of the debts.

 

Or

 

Are they able to pay something for the club as long as the administrators are satisfied whomever buys the club are fit and able to take it forward.... i.e able to cope with debts and not just bring the club back to it's knees within a few months ??

[NickG]

the club is worthless.

 

the buyer would need to make/show the club can be viable.

 

at the moment we are not

 

to be viable the debts have to be manageable - not cleared

 

the size of the debts could well be renegotiated / restructured.

 

The short answer is I don't know! But probably neither does anyone else, it will be down to the administrators to look at the debts and any potential buyer to come up with a plan to go forward.

 

My guess is the club will be available for nominal fee - often £1 - but able to reduce mortgage and overdraft to a level div 1 football could sustain -possibly with injection of £20-30million

[Smirking_Saint]

cheers, thought this would be the case but wondered if the debt HAD to be wiped or just the proof that it CAN

[hypochondriac]

But is the debt not part of the parent company which has gone into admin thus wiping the debts? Have we not established that the club is a seperate entity and if so what debts are assosciated with it (especially if the stadium and therefore the majority of debt is seperate.)

Edited 3 April, 2009 by hypochondriac

[SaintBobby]

But is the debt not part of the parent company which has gone into admin thus wiping the debts? Have we not established that the club is a seperate entity and if so what debts are assosciated with it (especially if the stadium and therefore the majority of debt is seperate.)

 

This is sort of true from what I can gather, hypo.

 

But - without getting into the legal technicalities (which are beyond me), the issue is whether SFC is a "going concern".

 

The debts are not "wiped", it's the job of the administrator to appease the creditors and dispose of assets.

 

SFC is one of the assets.

[brightspark]

My guess is the club will be available for nominal fee - often £1 - but able to reduce mortgage and overdraft to a level div 1 football could sustain -possibly with injection of £20-30million

 

So that means around 1.5% of what is needed has been "promised" on the sticky thread. As much as it's an awesome effort, if that figure is true, it proves how hard it is going to be to find a decent buyer who the fans are likely to respect.

[um pahars]

So that means around 1.5% of what is needed has been "promised" on the sticky thread. As much as it's an awesome effort, if that figure is true, it proves how hard it is going to be to find a decent buyer who the fans are likely to respect.

 

NickG's igure is way over the top. We're not looking for a £30m investment.

[NickG]

it may well be - as said above my £20m was a guess

[modern matron]

the club is worthless.

 

the buyer would need to make/show the club can be viable.

 

at the moment we are not

 

to be viable the debts have to be manageable - not cleared

 

the size of the debts could well be renegotiated / restructured.

 

The short answer is I don't know! But probably neither does anyone else, it will be down to the administrators to look at the debts and any potential buyer to come up with a plan to go forward.

 

My guess is the club will be available for nominal fee - often £1 - but able to reduce mortgage and overdraft to a level div 1 football could sustain -possibly with injection of £20-30million

 

I presumed that the stadium and overdraft were debts of SLH rather than SFC. If this is so then SFC does exist but obviously without a stadium.

 

As a subsidiary club it can continue while it pays it's debts. The problem is that it too will become insolvent without any injection of cash hence the plea both for big attendances and a buyer by the end of the season when revenue will dry up. Presumably this will affect the 10 points ie if SFC remains out of administration.

 

This is both worrying and confusing...

[Fan The Flames]

We don't need 30 million, we only have a debt of 4.4million and a mortgage on the ground. The debt only needs to be reduced so our out goings can be met by our income. Wipe our our overdraft plus a few million and we can start servicing the mortgage and cover the out goings again.

 

If we go under because of this small amount of debt I will be astonished. I'm doing the lotto tonight and if I win I will pay the overdraft, job done and back to the business of staying up.

[NickG]

think that fair - as others have clarified the debts are not the clubs but they suffer so in effect need them reduced to survive

[John B]

It is not just clearing the debt it is about making expenditure roughly equal income

 

And what if we got relegated?.

 

 

It certainly is going to be difficult to get a buyer I would have thought before they know what league we will be playing next season

Edited 3 April, 2009 by John B

[um pahars]

it may well be - as said above my £20m was a guess

 

Even £20m is way too far north.

[slickmick]

We don't need 30 million, we only have a debt of 4.4million and a mortgage on the ground. The debt only needs to be reduced so our out goings can be met by our income. Wipe our our overdraft plus a few million and we can start servicing the mortgage and cover the out goings again.

 

If we go under because of this small amount of debt I will be astonished. I'm doing the lotto tonight and if I win I will pay the overdraft, job done and back to the business of staying up.

 

 

Thats how I see it. An initial couple of million to reduce the debts and proof that you can cover the running costs, which I would guess to be no more than £500,000 a month over our income. We were running at a loss of about £800,000 a month a year or so ago, so Im hoping £500,000 is the worst case scenario.

Problem could be if we go down a league, are our top earners going to have their wages brought into line with our reduced income?

[CHAPEL END CHARLIE]

I reckon if someone come in with £5m or so , renegotiated the debt with Barclay's /Norwich Union (somethings always better than nothing after all) and we just might have a viable long term business . In the grand scheme of things this is not a lot of money which should give us grounds for believing that a buyer will be found , the fly in the ointment being we're trying to do this in the midst of the worst recession since 1929 !

 

Any new owners will have to find a way of balancing income with expenditure , the player wage bill still has further to fall this summer as the last of the big earners leave giving us a fighting chance of making the 'break-even' point in the foreseeable future . The difficult part is retaining a squad good enough to succeed on the field while simultaneously being cheap enough to keep us in business , that's easier said than done I think we can all agree .

 

Precedent shows that football clubs generally seem to survive this kind of crisis in some form - they're almost indestructible in fact . Let's hope we're not the exception to the rule .

[Morph]

the club is worthless.

 

the buyer would need to make/show the club can be viable.

 

at the moment we are not

 

to be viable the debts have to be manageable - not cleared

 

the size of the debts could well be renegotiated / restructured.

 

The short answer is I don't know! But probably neither does anyone else, it will be down to the administrators to look at the debts and any potential buyer to come up with a plan to go forward.

 

My guess is the club will be available for nominal fee - often £1 - but able to reduce mortgage and overdraft to a level div 1 football could sustain -possibly with injection of £20-30million

 

Lets not forget that it is entirely possible that one party will bid for the club and another separate party will bid for the stadium, however an agreement be put in place for the party buying the club to lease the stadium.

 

Regards

 

 

Morph

[Saint In Exile]

I presumed that the stadium and overdraft were debts of SLH rather than SFC.

 

Is it not the case that the "mortgage" is actually a debt of St Marys Stadium Limited, another wholely owned subsidary of SLH PLC and therefore simply an asset of the holding company in the same way the football club is, and that the repayments are annual and usually covered by advanced season ticket sales?

 

As previously mentioned, Southampton Football Club Limited and St Marys Stadium Limited could, and probably would be sold for a nominal fee.

 

This being the case, then providing the mortgage payments can continue to be met albeit with some possible restructuring, any buyer would need to find the necessary funds to clear the overdraft with Barclays (£4.1m) and provide sufficient working capital to pay a decent pence in the pound value to smaller creditors. The business would then need to ensure that it's operating costs could be met from matchday income, sponsorship and other ancilliary activites.

 

So, rather than needing upwards of £30m are we not looking at a figure more around the £10m mark???

[London Saint]

I wish Richard Branson would buy us out, he has billions and is a Saints fan.

 

That way he can rename us The Virgin Saints!