Kenny Huang thread - part 2

[coop]

Your right. But Hicks and Gillete will never benefit from all that due to the interest payments going out which should have been used for the transfer budget. And the debt on the club which should have been the new stadium debt.

 

A new owner prepared to pay £400 million for a new stadium will kick start all that.

 

Hicks and Gillete may think that they are clever in adding on the fees to their asking price but thats taking their profit away. They should have taken the £500 million offer from dubai 2 years ago and walked away with £100 million each.

 

The main point am making is that if their is no buyer now there never will be as the debt grows so does the asking price.

 

It does not make sense. They have screwed themselves up. Greed.

 

The club max is only worth £250 million. I can never see someone paying £400million or more. This reflects in why the club as not been sold.

 

It depends on how the debt is allowed to grow.

 

RBS want them off their books because the debt to equity is too low and i would imagine most other banks will see it this way as well.

 

Any other willing lender is going to want a chunk of the debt paying off first before lending the owners the cash.

 

The rumours of BarCap refinancing are just that, rumours.

 

Strange that such a rumour comes out just after Huang withdraws his bid and therefore appear to put pressure on the owners.

 

The thing is if they don't refinance elsewhere or sell the club then the only other option is for RBS to take control of the club but they seem confident they will not need to.

[zigackly]

The club max is only worth £250 million. I can never see someone paying £400million or more. This reflects in why the club as not been sold.

 

Didn't they reject a bid last summer for £450M? Can't remember the exact timing, but since the Dubai bid.

[coop]

Didn't they reject a bid last summer for £450M? Can't remember the exact timing, but since the Dubai bid.

 

No the rumours were they accepted the bid only for the consortium from Kuwait to pull out at the last minute.

[TheHowieLama]

The club max is only worth £250 million. I can never see someone paying £400million or more. This reflects in why the club as not been sold.

 

Analogy would be real estate where there is a rash of short selling as banks cover what is their true bottom line on over leveraged assets. The club selling at 250 does that nicely for RBS and there would be plenty of interest at that number. They are not losing anything by waiting and neither is the eventual buyer.

 

All the increase in revenue discussed above that is based on a new stadium is at least four maybe five years away don't you think?

[zigackly]

No the rumours were they accepted the bid only for the consortium from Kuwait to pull out at the last minute.

 

Still it shows people still value the club higher than the debt ... for now. But the only way you would pay that is if there was a bidding war knowing you can get it cheap in October.

[TheHowieLama]

It depends on how the debt is allowed to grow.

 

 

But the interest is the gravy, not the meat.

[HJohal]

What is worrying is that Hicks & Gillett are willing to play bluff right to the very end - have they got a hand which can trump Broughton & Co?

 

If the endgame is default and Liverpool is to be sold at an auction where the bid is likely to a lot closer to the RBS debt of 237M than the alleged 500M asking price then what is the Americans strategy if the following holds true?

 

- Refinance has been blocked apparently by the board following legal clarity by Slaughter & May.

- The price is likely to drop now that Huang has withdrawn purchase before the transfer window and perspective buyers are now working towards the 6th Oct 2010 timeline.

- Broughton is willing to entertain bids right up to the 6th Oct date in order to avoid action in the courts.

- Broughton, Purslow and Ayre seem to hold the balance of power in this sruggle.

- The eyes of the world and specifically the UK government, RBS and Barcap who are both UK based firms who do not want or need the negative press if things do not work out in a manner where a line can be drawn under the whole affair.

- The credit crunch has left the financial reputation of these LBO kings in the gutter after defaults in a number of their other businesses.

 

I cant see where Hicks & Gillett can go from here - but then again I cant believe they are going to so surrender so meekly after years of bluff ...

[coop]

But the interest is the gravy, not the meat.

 

The interest payments will rise along with the debt.

 

Are you confident we can continue to service these debts.

[Durango]

What is worrying is that Hicks & Gillett are willing to play bluff right to the very end - have they got a hand which can trump Broughton & Co?

 

If the endgame is default and Liverpool is to be sold at an auction where the bid is likely to a lot closer to the RBS debt of 237M than the alleged 500M asking price then what is the Americans strategy if the following holds true?

 

- Refinance has been blocked apparently by the board following legal clarity by Slaughter & May.

- The price is likely to drop now that Huang has withdrawn purchase before the transfer window and perspective buyers are now working towards the 6th Oct 2010 timeline.

- Broughton is willing to entertain bids right up to the 6th Oct date in order to avoid action in the courts.

- Broughton, Purslow and Ayre seem to hold the balance of power in this sruggle.

- The eyes of the world and specifically the UK government, RBS and Barcap who are both UK based firms who do not want or need the negative press if things do not work out in a manner where a line can be drawn under the whole affair.

- The credit crunch has left the financial reputation of these LBO kings in the gutter after defaults in a number of their other businesses.

 

I cant see where Hicks & Gillett can go from here - but then again I cant believe they are going to so surrender so meekly after years of bluff ...

 

I think the Owners aren't as clever as some posters on here make out.

 

If they where that smart they would have took the D.I.C. money 2 years ago,the Cunts have put fuck all in,so they've fuck all to lose.

 

Any savvy/smart buyer would wait until early October to make a move,because without a shred of doubt,as each passing day goes, the less of a asset the Club becomes

[TheHowieLama]

The interest payments will rise along with the debt.

 

Are you confident we can continue to service these debts.

 

As I said before the page turned, the analogy would be a bank willing to short sale real estate, the most direct example of a single lien holder on an over leveraged asset. Their true bottom line is the principal minus the cost of recovering it. If they can recover it with no additional cost, imo they would.

[Durango]

The interest payments will rise along with the debt.

 

Are you confident we can continue to service these debts.

 

Coop,there comes a time when the asset becomes worth less than liabilities,where well and truly past that stage.

 

What point is there in RBS to keep increasing the debt,when the can't get the original debt

[TheHowieLama]

What point is there in RBS to keep increasing the debt,when the can't get the original debt

 

The only institution who made this a successful business model were/are the Mafia.

[coop]

Coop,there comes a time when the asset becomes worth less than liabilities,where well and truly past that stage.

 

What point is there in RBS to keep increasing the debt,when the can't get the original debt

 

Yeah i know mate hence the reason why i said RBS want out.

 

Also due to this other banks are going to be reluctant to take on the debt as well.

 

People can say about banks pocketing the interest payments but thats fine as long as we can afford them.

[TheHowieLama]

 

People can say about banks pocketing the interest payments

 

Say what? That is their business.

[cochcaer]

I think Huang was just a billy bullshitter to be honest

 

No, you may have seen more robust haggling at a second-hand car dealership, and his website may look like it was coded by Dave Usher and so what if his proof of finances were the word of Jim Boardman and somebody called Bamba... surely you'd sell your house to Kenny Huang?

 

But yep, it strikes me that his bid was similar to that of L4. Scratch the surface and there's fuck all to pin your confidence on.

 

Next bidder please.

[Silly season]

The only institution who made this a successful business model were/are the Mafia.

 

If grand theft auto has taugt me anything about destroying the mafia it's that you need to blow up their compound...

 

What's the address for RBS HQ?

[HJohal]

Coop,there comes a time when the asset becomes worth less than liabilities,where well and truly past that stage.

 

What point is there in RBS to keep increasing the debt,when the can't get the original debt

 

Agreed - I think RBS would be willing to take 90p per £1 for the debt as long as they can find a happy ending here. The perception of the bank can be enhanced more than any marketing campaign could manage if they throw out the Americans and put in new responsible owners. The favourable press coverage would be substantial.

[Durango]

Yeah i know mate hence the reason why i said RBS want out.

 

Also due to this other banks are going to be reluctant to take on the debt as well.

 

People can say about banks pocketing the interest payments but thats fine as long as we can afford them.

 

But that's just it,we can't afford to meet the payments,hence the sale.

 

Hicks and Gillett will play a game of brinkmanship to the end,any smart buyer will eventually go straight to RBS,regardless of what Broughton and Barcap say/think

[llego]

Coop I love you.

[waddy78]

I'm not up on the finance side of things to be honest i don't really understand it all (apart from were up to our eye's in a debt we can't afford)but can't a proposed buyer, buy the debt off RBS the full £237 mil then say to H&G you owe us that money now you've got till xx date to pay if not were foreclosing and taking the club off you? therefore buying the club for £237 million (then obviously the ground and squad strengthening need to be added).I don't know if this could be possible but if RBS are really getting twitchy over their loan then they could be open to some "different" options.

[Delmar]

What is worrying is that Hicks & Gillett are willing to play bluff right to the very end - have they got a hand which can trump Broughton & Co?

 

If you play poker, what do you do yourself? Bluff? Fold? If you are a millionaire in the LBO business, do you get there by folding?

 

I cant see where Hicks & Gillett can go from here - but then again I cant believe they are going to so surrender so meekly after years of bluff ...

 

Lawyer is a businessman's best friend. Good businessmen have many best friends. Hicks has got a previous, see what happened with Texas Rangers. I do not see why a guy in his 70s would suddenly change that terribly much...

[Marko121]

I'm not up on the finance side of things to be honest i don't really understand it all (apart from were up to our eye's in a debt we can't afford)but can't a proposed buyer, buy the debt off RBS the full £237 mil then say to H&G you owe us that money now you've got till xx date to pay if not were foreclosing and taking the club off you? therefore buying the club for £237 million (then obviously the ground and squad strengthening need to be added).I don't know if this could be possible but if RBS are really getting twitchy over their loan then they could be open to some "different" options.

 

 

 

I would suggest that as much as RBS would like to, there is proably a clause saying that they cannot sell the debt to a 3rd party

[waddy78]

I would suggest that as much as RBS would like to, there is proably a clause saying that they cannot sell the debt to a 3rd party

 

Oh well i was hoping a new buyer would buy the debt off RBS then when H&G couldn't pay they'd send around some gangster to smash their knee's in with a hammer or something(ive been watching to many mafia type films i think)

 

[Lee909]

If the overall debt is more than Huang was offering inc payment penalties isnt it within the twats interests to just see out the loan and let Kop holding go into bankruptcy and not pay a penny of the debt ?.

[Delmar]

If the overall debt is more than Huang was offering inc payment penalties isnt it within the twats interests to just see out the loan and let Kop holding go into bankruptcy and not pay a penny of the debt ?.

 

That's when the lawyers come in. It would depend on how the financing in general, the loans, the agreements with banks, all the things that we do not know, are structured. In general, i'd think that nobody wants to go bankrupt. It is not good business.