Wolves are for sale and Darlo wants some smooth thighs

[Tredman]

I was wandering around outside Bournemouth's ground a few weeks ago (on a non-match day) - there really is very little space to expand, unless they want to go higher. The training facilities were next to the ground and laughable - but behind one of the goal ends, so couldn't be used to expand.

 

[Deutsch Wolf]

Well investing in the academy and training facilities would be a limited way of turning that TV money into a fixed asset. But how many people buy a football club thinking to make a profit in the first place?

You don't. At best you pick a relatively distressed one up for cheap, fix a load of the internal problems (spending your own money in the process), then sell it on at a higher net value. Mandaric has done that at least twice and the Pornodwarves did it at Blues, while they'll also personally pocket a load of the funds from selling off Upton Park knowing that the club has effectively been given a brand new ground for a piffling cost. None of that applies to Wolves.

Personally I don't know why you'd bother buying a club like Wolves without personal emotional attachment. The exception I suppose would be if you'd acquired your wealth in dubious circumstances overseas and wanted to transfer your assets out of reach of seizure. Of course you wouldn't necessarily want people like that involved, and when they do enter the picture they can be very flaky (see failed takeovers at Sheff Wed and Reading, as well as the litany of crooks who owned Pompey post-Mandaric).

 

[Papper]

You don't. At best you pick a relatively distressed one up for cheap, fix a load of the internal problems (spending your own money in the process), then sell it on at a higher net value. Mandaric has done that at least twice and the Pornodwarves did it at Blues, while they'll also personally pocket a load of the funds from selling off Upton Park knowing that the club has effectively been given a brand new ground for a piffling cost. None of that applies to Wolves.

Personally I don't know why you'd bother buying a club like Wolves without personal emotional attachment. The exception I suppose would be if you'd acquired your wealth in dubious circumstances overseas and wanted to transfer your assets out of reach of seizure. Of course you wouldn't necessarily want people like that involved, and when they do enter the picture they can be very flaky (see failed takeovers at Sheff Wed and Reading, as well as the litany of crooks who owned Pompey post-Mandaric).

You can't knock the ability of the Pornodwarves to recruit the right people at the right time to do the job. How they got £80M for BCFC is pure genius I'm afraid.

 

[Deutsch Wolf]

Oh, I don't knock them in that sense. I can't stand the pair of them or Brady on a personal level, but they've been in the football business for the best part of 25 years and they're massively up on the deal - and where they left Blues was far elevated from where they found them. However they brazenly didn't give a toss who they sold the club on to, so long as they shelled up the money, which is why Blues are where they are now.

 

[Paddingtonwolf]

No - that was Carson Yeung wanted to pay it because he was a) remarkably stupid, and b) crookedly laundering money.

The pornos got very lucky, and then used that to get even luckier in negotiating the stadium deal for the "good of West Ham" while gaining a lovely chunk of valuable real estate in a part of London that is finally going up in value.

 

[Deutsch Wolf]

The pornos got very lucky, and then used that to get even luckier in negotiating the stadium deal for the "good of West Ham" while gaining a lovely chunk of valuable real estate in a part of London that is finally going up in value.

I'm not so sure the last bit is luck. They spotted an opportunity and our government/those who run London (which basically equates to the same thing at the moment) are an absolute shambles. That's a mark of people who are good at business ramraiding a bunch of openly clueless fools. It's a great deal for West Ham and for the owners of the club personally.

 

[Paddingtonwolf]

Apart from the fans who really weren't keen on the move. Getting a bigger stadium in London for a peppercorn rent doesn't come along every week, and I don't blame them for taking the opportunity. Also, I would rather West Ham took the stadium in Stratford rather than Spurs who were interested and are nowhere near geographically.

Being equitable, they should have allowed a ground share with Orient who got badly shafted over the whole affair.

 

[leedswolf]

Good stuff, but..................

 

[nimrod]

No - that was Carson Yeung wanted to pay it because he was a) remarkably stupid, and b) crookedly laundering money.

The pornos got very lucky, and then used that to get even luckier in negotiating the stadium deal for the "good of West Ham" while gaining a lovely chunk of valuable real estate in a part of London that is finally going up in value.

Carson really couldn't have done any proper DD on Blues so they were definitely lucky in that respect. from what I recall just before the deal they signed a management agreement between themselves and Blues for a fixed period. Exactly the sort of thing that a proper DD process would pick up and kick out. Instead the new owners tried to challenge it out after they signed the deal and iirc they lost. ridiculous.

 

[DejaVuWolf]

One small consideration that has been overlooked so far..... exchange rates.

 

[Deleted Cyber]

Its all a bit pot luck. A billionaire who passes all tests but fails to invest is no good to us either.See Villa

 

[MARKakaJIM]

Lerner invested plenty, O'Neill spent most of it on shit though and never managed to crack the top four despite the massive speding, so he lost interest.

 

[Paddingtonwolf]

One small consideration that has been overlooked so far..... exchange rates.

Okay, I'll bite.

If you were a billionaire and wanted to make an interest rate killing, the last thing you would do is buy a football club. You would take a long or short position on the currency in question and then cash in when the exchange rate moves as you predict. Why spend millions to buy an asset to do that? Makes absolutely no sense, especially as you could resolve and take profit from about 100 long or short positions settled in 24 hours each on a currency exchange in the time it takes to do the due diligence on a small transaction.

 

[Johnny75]

Lerner invested plenty, O'Neill spent most of it on $#@! though and never managed to crack the top four despite the massive speding, so he lost interest.

He got divorced too. That's pretty much why he sold the Browns and has put little into Villa, understandable really.

 

[Tony Towner]

One small consideration that has been overlooked so far..... exchange rates.

Depends where they are from though. As of today a European investor at 1.37 would see it as poor. A US (or Chinese, who only really deal in USD) at 1.46 would see it as decent

 

[Paddingtonwolf]

But why spend money on an asset to crystallise your position. Just buy or sell sterling.

 

[Tony Towner]

I was coming from the position of someone that is looking to get into football club ownership, rather than someone that's looking to make speculative money and where it would be 'value' at the moment and where it wouldn't exchange rate wise

 

[Paddingtonwolf]

Well in that case, an exchange rate is going to be profoundly irrelevant. In the time it takes to buy, hold, and then divest of a football club most currencies will just bumble on in a broadly similar level of relative values. Currency speculation is usually a short term play.

 

[Tony Towner]

From memory £ vs Euro this time last year around 1.2 now 1.37. Vs $ around 1.54 now 1.46

 

[Paddingtonwolf]

Maybe so.

However the point is this.

I want to buy an asset. It is in Britain and I am in a different currency area. It is now at £30m (say). I want to buy in Yuan. If, during due diligence, there are big currency moves, then the price in sterling could go up against my yuan. As I haven't signed a contract.

In your situation, if I had £30 million worth of Euro to invest in a similar time, I could have taken a short position over a longer period. If I had that much, a broker would be found who could play. So I sell £30 million sterling at 1.2 to get 36m Euro. Now I convert my position back and my 36m Euro gets me something like £32m and a bit sterling. Pay the broker commission and walk away with probably a million profit.

Why buy a club?