I thought that the lead piece in the programme about the new organisational arrangements and the new funding scheme at the club gave a reasonably clear outline of what was intended. Admittedly, only 40 per cent of the Addickted buy the programme. Even so, I am surprised that in some quarters the announcement has been interpreted as a sign of a boardroom split or power struggle or a conspiracy against the fans.
Having decided not to go down the takeover route, the club sensibly decided to take a look at its organisational structure. The workload associated with football matters has gone up in recent years so it seems a good idea to let Richard Murray focus on that while Richard Chappell takes responsibility for future strategic direction of the company.
On the financial side, the short-term debt in the form of overdraft and loans is being transferred into the form of convertible bonds which will eventually become equity. Given the credit crunch and the fact that banks are much more reluctant to lend to Championship than to Premiership clubs, this again seems sensible. The directors came to our rescue with loans last summer with emergency loans and these will now be paid back. Some people object to the directors receiving interest on the loans, but I don't hire my money out for free (or even at base rate), so why should they?
I am actually feeling more optimistic about the long-term future of the club than since the departure of Curbs when it appeared that not enough replacement planning had been done. This in spite of recent disappointments on the pitch. The long-term organisational and financial structure of the club appears to be well thought out and as secure as possible. After a fallow period, the Academy is producing some promising players, note the success of our reserve side. And I like the present blend of players that we have and, above all, I think Pards is getting it right.
While I would like us to go up, I hope that we could stay up. The first year could be painful. I was talking to a sports consultant today who had asked for my help with some modelling of promotion and relegation effects that he was doing. In the course of our discussion, he commented that for most promoted clubs, the first year in the Premiership was to be endured rather than enjoyed. Very true.
6 comments:
I'm also feeling more positive than I was a week ago. I'm no financial expert, but I feel the way the club are dealing with the debt, and the transparency of the process, is what I've come to love and respect in Charlton and its Board.
On aesthetic grounds I'm happy to. I asked myself would I want to be in Watford's or Stoke's shoes today? No.
They might be seven points ahead of us, but I can't believe football like that is a future investment. Bolton's survival in the Premier buck my argument - but their home gates support it.
I believe in the SAP approach - be it promotion this season or not.
Pembury Addick
I agree with Pembury Addick. However, I would argue that should Watford or Stoke win promotion, the £30m windfall would make them able to secure a strong financial future irrespective of the performances on the pitch. I hate to admit it, but promotion, from a finaicial perspective, can be the be all and end all.
Wyn
At last, one of the few Addicks I know who has actually read the annoucements from the club, rather than "reading between the lines" and creating ridiculous theories re Boardroom splits etc.
THe situation does seem to have stabilised. If as prudent a club as ours (the Dowie era an aberration) needs a cool 20 mil just to stay in the game - in the Championship, mind, not even the Prem - then it's no wonder that so many others have succumbed. The riches of the Prem are a myth - the dough is real enough but so are the absurd transfer fees, the barrowloads of money tipped at players' and agents' feet. Onward for sure and upward maybe !!
What you write about the bond issue seems to make sense and a restructuring of the club's debt does too. My only note of concern is that the bond issue aims to raise up to £20m of which around £14m has been underwritten by five current directors. By implication the company hopes to attract a significant injection of cash from outside. Given that the bond issue is intended both to repay recent loans and to provide working capital for the company during the remainder of the current season, what are the implications of a failure to raise the full amount? I assume that as the loans to be repaid total £11m the company is covered if only £14m is raised. But does this mean that despite the changes since relegation - and transfers income - the club is still losing significant sums on an ongoing basis?
My forecast is that there will be a further injection of cash from someone not already on the board and it could be from a very interesting source. Watch this space. I don't know what the current cash flow position of the club, but I do not think that we are losing major amounts of cash. Good home attendances like those against Palace and Watford help and we would get some cash from taking part in the play offs.
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