New beginnings - 25% Truth, 80% Bollocks

[Peter Venkman]

Because like every other criminal he doesn’t give a shit about his victims.

Except most criminals don't have about 25,000 victims!

[ron dodgers]

It's just business, happens all the time, unfortunately

[Bennett]

He’s paid off £6.8m of debt, as well as picking up other costs. Would suggest that he’s got “near” the £7m number.

It could be my interpretation that's off here, but I don't think that's accurate.

From the AB minutes:
Chairman Clem Morfuni has to-date injected c£6m into Swindon Town, to help stabilise the club finances.
The accounts will reflect that this is owed back to him, however no interest will be due, and there is no timeframe for repayment

The debt exists, it's been transferred to CM.
(I'm not saying there's anything wrong with this or that there are nefarious actions afoot. Just looking to clarify understanding)

[Posh Red]

It could be my interpretation that's off here, but I don't think that's accurate.

From the AB minutes:
Chairman Clem Morfuni has to-date injected c£6m into Swindon Town, to help stabilise the club finances.
The accounts will reflect that this is owed back to him, however no interest will be due, and there is no timeframe for repayment

The debt exists, it's been transferred to CM.
(I'm not saying there's anything wrong with this or that there are nefarious actions afoot. Just looking to clarify understanding)

I think you are correct, the football club owes Clem the money, but as the current owner he effectively owes it to himself. I’m assuming he is only likely to want it back if/when he sells up.

The point was the the clubs external debt has been reduced by £6.8m since July 21 and that has (predominantly) been funded by Clem.

It was to answer the suggestion by Rob that Clem hadn’t got near the £7m he said that he had to put into the club.

[Robinz]

So what are you saying.
Morfuni purchased the club for an amount reported to be in the region of 250k.
And then its claimed loaned the club 7 million to pay off debts.?
So in reality Morfuni has purchased the club as a going concern for 7.250 million debt free.
Well established football club with a solid supporter base of 9000 for 7.25 million. This going concern has the security of a 50% ownership in the ground.
There are players currently on the books with a value such as Hutton RHM and others. Other PE from Scott Twine and Wakelyn future Say in total 1.5 million
Based on the above
Has he or has he not got a good buy here

[joeydubya]

Clem "will not take a penny from the club"

Chris Kiely provides data and recruitment services. Sandro Di Michele was hired as a technical director presumably to support those services. Adam Hart provides S&C services, after the rest of the team have gone to Crawley.

How much does the club pay for these services, and also - why?

[Nemo]

Those are all services that a club at our level would reasonably want to have. If it paid something around market rate for them then that's fine, right?

The only questionable "hire" in terms of whether the club needs one would be our Chief Sustainability Officer... but I assume that's an unpaid role, considering it also appears to come without influence or work attached.

[joeydubya]

Of course. But do many clubs have the data management guy loaning them a few million in a pinch?

[RobertT]

Of course. But do many clubs have the data management guy loaning them a few million in a pinch?

Which is precisely why the terms of the loan would be very important to question if you were the Trust and looking into the finances, as was agreed.  What we know is that shares exchanged hands and the Memorandum and Articles of Association were updated at the same time - which means the rules for running the business were changed.  It's no unreasonable to think both are linked.

Even then, the fact someone stands to make money if we make money, you can kind of live with - you'd want the club to state clearly the position and how it benefits the club, to avoid the appearance of any Power style book keeping.

I am not saying Clem hasn't put his own money up, I am just saying the only evidence we have of the trading/operating position, financially, currently does not support a statement of losing 500k-1m per year.  And if we are indeed now losing that amount, in year three, after increases in Revenue from the POwer period (peak Power period) and reduction in squad size this season, it begs the question how is that now being funded if Clem had reached his limit?  I was trying to say that Clem himself may have confused trading position with cash position - where he has to keep paying off that remaining external debt.

[Power to people]

Which is precisely why the terms of the loan would be very important to question if you were the Trust and looking into the finances, as was agreed.  What we know is that shares exchanged hands and the Memorandum and Articles of Association were updated at the same time - which means the rules for running the business were changed.  It's no unreasonable to think both are linked.

Even then, the fact someone stands to make money if we make money, you can kind of live with - you'd want the club to state clearly the position and how it benefits the club, to avoid the appearance of any Power style book keeping.

I am not saying Clem hasn't put his own money up, I am just saying the only evidence we have of the trading/operating position, financially, currently does not support a statement of losing 500k-1m per year.  And if we are indeed now losing that amount, in year three, after increases in Revenue from the POwer period (peak Power period) and reduction in squad size this season, it begs the question how is that now being funded if Clem had reached his limit?  I was trying to say that Clem himself may have confused trading position with cash position - where he has to keep paying off that remaining external debt.

It would be good to know the terms of the loan's, is there an agreed repayment date with a certain level of interest attached ? assume that when Clem pays these off that will be more money owed to him, so will end up acceding the £7m.

I wonder if any of the money we have received for player sales have gone / are going to repay any of the debt owed to Clem, to bring that down, he does not strike you a someone who has millions lying around he must have a ceiling without having to use external borrowing, I know there are still a couple of historical debts owed to the FL but the appear to be being paid slowly.

[Batch]

the Memorandum and Articles of Association were updated at the same time - which means the rules for running the business were changed. 

Can anyone summarise the changes in laymans terms? I'll try and look later if not.

[RobertT]

You'd need a contract/business law expert to be honest - needless to say there were a lot more words in the newer version, including the addition of Pre-emption rights - although I didn't see anything like values in this lot.  I don't know if there would be other contractual documents in existence alongside this, the Companies House bit only requires certain docs to be registered.

You couldn't read, I don't think, and spot any obvious 'Ah Ha's"

The Pre-emption rights for example, is likely just a sensible way of protecting your investment as non-controlling interest shareholder.  It gives them the right to bid/match (I think) any potential purchases of Clems shareholding.

My interest was peaked more by the fact they were updated at the time of the Loan - suggests it's a bit more nuanced than handing over some cash and getting some Shares as security.  For starters, the lack of any notification of debts being secured means that it's not technically that type of deal.  The shares did change hands - they are not being held for security, legally.  They are now owned by the new investors - there may also be a loan agreement in place somewhere, details of which are not public.

[RobertT]

It would be good to know the terms of the loan's, is there an agreed repayment date with a certain level of interest attached ? assume that when Clem pays these off that will be more money owed to him, so will end up acceding the £7m.

I wonder if any of the money we have received for player sales have gone / are going to repay any of the debt owed to Clem, to bring that down, he does not strike you a someone who has millions lying around he must have a ceiling without having to use external borrowing, I know there are still a couple of historical debts owed to the FL but the appear to be being paid slowly.

Yes, the loan terms are important, especially given the scale.  On paper, it seems like the share ownership change was made in the Holding Co.  We do not know where and how the cash was funneled, did they loan the Holding Co which in turn loaned the STFC business the money to settle the  Debentures? or was it recorded as a Share Capital investment? Or a mix of both?  If the Holding Co loaned the money through, on what terms?  And so on.  It's not like it is a few grand, it's near 3m and caused 22% of the Shareholding to exchange hands and put the new Shareholders in the driving seat for any potential future change in ownership (if I understand things correctly).

[Batch]

Thanks Rob

[STFC_Manc]

Yes, the loan terms are important, especially given the scale.  On paper, it seems like the share ownership change was made in the Holding Co.  We do not know where and how the cash was funneled, did they loan the Holding Co which in turn loaned the STFC business the money to settle the  Debentures? or was it recorded as a Share Capital investment? Or a mix of both?  If the Holding Co loaned the money through, on what terms?  And so on.  It's not like it is a few grand, it's near 3m and caused 22% of the Shareholding to exchange hands and put the new Shareholders in the driving seat for any potential future change in ownership (if I understand things correctly).

I would hope it wasn't £3m for 22% or that would put the value of STFC at c£14m! We aren't likely to find out until the accounts are out.