Farhad Moshiri

[bring the ghost on]

But how would he do that if we're left with a mountain of stadium debt to pay off and all our assets secured by outside parties?

Moshiri's vision is obviously that the stadium debt is incurred for a long-term reward (i.e. greater gate receipts, commerciality, greater attraction to players, growth in his shares) rather than to incur debt which no third party buyer will ever want to take on.

It is not in Moshiri's interest to saddle the club with debt which has no benefit attached to it, I struggle to understand why you think this is the case. If the benefit of the stadium debt is that the club moves forwards commercially, then he will find a willing buyer when he wants to exit and will have seen the value of his shares grow. If it doesn't, he'll have a hard time realising his investment.

Thats worse off than we were when he arrived from a governance perspective.

Not really. From a balance sheet perspective, we'll have a significant amount of debt off-set against a significant asset, but we'll have greater income for the reasons mentioned above. The debt isn't ideal (far from it) but stadiums aren't gifted to clubs unless they're very lucky. We aren't fortunate enough to be in that position.

I appreciate a chance has to be taken by the club but I'm unconvinced that what's being proposed thus far is in the long term interests of Everton.

You could be right, but even you are recognising that sometimes risk needs to be taken in business to move things to the next level.

We can stand still and stay at Goodison and go nowhere, or we can take on an expensive project with risk attached where we at least try to achieve greater things. I'd rather the latter, personally.

 

[Toffeelover]

But we're already up to £500M as an estimate and there isn't even a PP asked for yet! Most clubs in recent years state an initial cost and you can add 100% on that as a final cost.

The pressure will be for a statement on that site and the costs will go through the roof. Trouble is, Moshiri wont give a flying one because he wont be around to see the club pay it off.

One thing to point out Dave, Mosh is a billionaire where did you go wrong?

 

[davek]

Moshiri's vision is obviously that the stadium debt is incurred for a long-term reward (i.e. greater gate receipts, commerciality, greater attraction to players, growth in his shares) rather than to incur debt which no third party buyer will ever want to take on.

It is not in Moshiri's interest to saddle the club with debt which has no benefit attached to it, I struggle to understand why you think this is the case. If the benefit of the stadium debt is that the club moves forwards commercially, then he will find a willing buyer when he wants to exit and will have seen the value of his shares grow. If it doesn't, he'll have a hard time realising his investment.

His vision is to get a stadium built and sell his shares at a profit; his justification would be that he'd been here 5/6/7 years and done the heavy lifting in terms of organising a stadium build. He wont care about how the stadium debt is taken on board by a new owner...and there'll be no shortage of buyers for a PL club with a stadium at that location - it would be a very prestigious asset to own. His successors will take the club on if the industry is secure as a whole and simply play the same game as Moshiri: hold on to the club until they can sell on at a profit. The club still pays the debt during all this - the one constant.

You say that Moshiri has no intention of saddling the club with debt, but that's exactly what loaning the money to build a circa £600M stadium will entail. All the projections on commercial revenue from it are speculative. Again, the one constant will be that millstone debt to pay off.

Take the step of a new stadium by all means, but find a partner or build it for much less elsewhere or scrap it. They are the three reasonable possibilities we have. The irresponsible one is to force the club to pay for BMD stadium themselves - a task that would be hard enough for one of the biggest commercial clubs in the world, never mind hand-to-mouth existence Everton.

 

[roydo]

Has anyone ever built anything of scale without borrowing a few bob?

 

[Eggs]

His vision is to get a stadium built and sell his shares at a profit; his justification would be that he'd been here 5/6/7 years and done the heavy lifting in terms of organising a stadium build. He wont care about how the stadium debt is taken on board by a new owner...and there'll be no shortage of buyers for a PL club with a stadium at that location - it would be a very prestigious asset to own. His successors will take the club on if the industry is secure as a whole and simply play the same game as Moshiri: hold on to the club until they can sell on at a profit. The club still pays the debt during all this - the one constant.

You say that Moshiri has no intention of saddling the club with debt, but that's exactly what loaning the money to build a circa £600M stadium will entail. All the projections on commercial revenue from it are speculative. Again, the one constant will be that millstone debt to pay off.

Take the step of a new stadium by all means, but find a partner or build it for much less elsewhere or scrap it. They are the three reasonable possibilities we have. The irresponsible one is to force the club to pay for BMD stadium themselves - a task that would be hard enough for one of the biggest commercial clubs in the world, never mind hand-to-mouth existence Everton.

..you comment as though you have spoken with a Moshiri and know his plans (his vision is to build a stadium and sell his shares at a profit). I’m not saying you’re wrong, but I think it would read better if you clarified that this is your opinion.

Moshiri is 62 and very wealthy. I’m not sure he’d want to wait 7 years to realise a profit, surely there’s easier ways of him doing this. I make no predictions because I simply don’t know.

 

[roydo]

..you comment as though you have spoken with a Moshiri and know his plans (his vision is to build a stadium and sell his shares at a profit). I’m not saying you’re wrong, but I think it would read better if you clarified that this is your opinion.

Moshiri is 62 and very wealthy. I’m not sure he’d want to wait 7 years to realise a profit, surely there’s easier ways of him doing this. I make no predictions because I simply don’t know.

Deffo less risky ways mate.

 

[davek]

Has anyone ever built anything of scale without borrowing a few bob?

Plenty. I'd be interested to know in a football context though how clubs were geared up to balance stadium debt given their ability to pay for it. I doubt too many club's would expose themselves as much as we appear to be doing.

The more I think about it the more I can see how the club will be exploited here. Not only by Moshiri but by the local state. If Everton are the anchor for a huge swathe of a city's regeneration plans then that needs more skin in the game from them than extending their low level of interest on a loan.

 

[davek]

..you comment as though you have spoken with a Moshiri and know his plans (his vision is to build a stadium and sell his shares at a profit). I’m not saying you’re wrong, but I think it would read better if you clarified that this is your opinion.

Moshiri is 62 and very wealthy. I’m not sure he’d want to wait 7 years to realise a profit, surely there’s easier ways of him doing this. I make no predictions because I simply don’t know.

He's human. He'd be motivated by profit and legacy.

He's a bean counter in Usmanov's shadow. He's essentially cut from the same cloth as other dodgy characters coming into our game. They seek profile and legitimacy.

 

[roydo]

Plenty. I'd be interested to know in a football context though how clubs were geared up to balance stadium debt given their ability to pay for it. I doubt too many club's would expose themselves as much as we appear to be doing.

Plenty? Really?

When the details of the funding are finalised, we can then see exactly how it will be structured. But anyone, be they a young couple buying their first home or a billionaire mucking about in football, takes on debt. (Including mega pension property funds).

Its the servicing of said debt, allied to the risk within the industry they operate in thats the issue. Now, granted, English Football Inc is currently in a ridiculous cash rich paddy field, and there is ZERO guarantee that Everton will remain at the top table for ever, but THAT is the calculated risk the financiers, (LCC, Moshiri, TBC) will have to either accept, or walk.

Its scary, but so is life.

 

[davek]

Plenty? Really?

When the details of the funding are finalised, we can then see exactly how it will be structured. But anyone, be they a young couple buying their first home or a billionaire mucking about in football, takes on debt. (Including mega pension property funds).

Its the servicing of said debt, allied to the risk within the industry they operate in thats the issue. Now, granted, English Football Inc is currently in a ridiculous cash rich paddy field, and there is ZERO guarantee that Everton will remain at the top table for ever, but THAT is the calculated risk the financiers, (LCC, Moshiri, TBC) will have to either accept, or walk.

Its scary, but so is life.

But we know the essential architecture of the deal agreed and it's one that has Everton bearing the burden of a huge financial investment.

To me that makes no sense given what other parties involved in Liverpool Waters get out of this for less exposure.

 

[bring the ghost on]

He wont care about how the stadium debt is taken on board by a new owner... His successors will take the club on if the industry is secure as a whole and simply play the same game as Moshiri: hold on to the club until they can sell on at a profit. The club still pays the debt during all this - the one constant.

The club pays the debt, yes, but the club is also getting the benefit of the stadium. I don't see why that it is controversial. Moshiri doesn't take the stadium out of the club at the end of it, if he decides to sell. As you point out - we get a very prestigious asset out of this arrangement.

You say that Moshiri has no intention of saddling the club with debt, but that's exactly what loaning the money to build a circa £600M stadium will entail. All the projections on commercial revenue from it are speculative. Again, the one constant will be that millstone debt to pay off.

No, read my post again, I said Moshiri has no intention of saddling the club with debt which has no benefit attached to it.

You have an idea in your head that Moshiri can rack up as much debt as he wants and simply pass it to the next owners as if it doesn't exist. It's not true - if the club is ravaged with debt and financially unstable, there is no buyer. Moshiri's investment has gone down the pan.

Take the step of a new stadium by all means, but find a partner or build it for much less elsewhere or scrap it. They are the three reasonable possibilities we have. The irresponsible one is to force the club to pay for BMD stadium themselves - a task that would be hard enough for one of the biggest commercial clubs in the world, never mind hand-to-mouth existence Everton.

You're dreaming if you think Everton can fund a new stadium without lending Dave.

 

[roydo]

But we know the essential architecture of the deal agreed and it's one that has Everton bearing the burden of a huge financial investment.

To me that makes no sense given what other parties involved in Liverpool Waters get out of this for less exposure.

No, we dont Dave. Know the detail yet. We know LCC are helping out, which apparently will be of benefit to Liverpool. (sic). We have not got a clue how the balance will be structured.

 

[bluesb1970]

But we know the essential architecture of the deal agreed and it's one that has Everton bearing the burden of a huge financial investment.

To me that makes no sense given what other parties involved in Liverpool Waters get out of this for less exposure.

It makes sense. We have to take on the debt in order to provide the club with better commercial prospects for years to come. Currently we are increasing our commercial activities but still falling behind the top 6 in those terms. By borrowing the money from LCC we can negotiate a better rate than if we go out ourselves to raise the money.

 

[bring the ghost on]

I'd be interested to know in a football context though how clubs were geared up to balance stadium debt given their ability to pay for it. I doubt too many club's would expose themselves as much as we appear to be doing.

Spurs are racking up about £800m costs, mostly leveraged.

 

[roydo]

Spurs are racking up about £800m costs, mostly leveraged.

Dint think the owner, Lewis (?) is digging deep is he? @RobSpurs