The Everton Board Thread 2015/16 [ Not takeover related ]

[USABlue]

Not totally convinced of that.

I reckon the realistic ( ie market ) equity value is likely to rise for a couple more years ( classic bubble in many ways ), but the boards view of the value will still be above that so they'll keep hanging on for just a bit more profit ( greed basically )

I'm also pretty much convinced that within five or six years we'll either have new owners or the existing ones will be diluted.

Doubtless I'll be vaulted on this by someone in 2020/21 !

For me, the weird thing is that the asture businessmen on the board can't see the reality. In some ways I can understand Earl, because Everton is a relatively small part of his empire, but the only explanation for Bill I can come up with is he's so in love with being Chairman of his club that he's full on in ostrich mode.

think that's it honestly. Heart over head. Must be a great feeling owning your boyhood club and he's probably wanting to hold on as long as he can

 

[degsy]

Where's Adversus when you need him ffs !

I get your point but you're oversimplifying things. Yes, relatively Everton will be less investable. All other things being equal that would, or should, mean a drop in equity value, but you're ignoring the fact that, on average, all Premier League clubs are likely to increase in value so the sector is likely to outperform. The other thing that may well influence Everton's equity is that while it's in the Premier League and vaguely competive, it's one of the few clubs left that is realistically available for purchase.

I know I'm stating the obvious and trying to teach me gran how to suck eggs but, even so ... Rule #1 of the markets, they always overshoot on the up and overcompensate on the downs.

All you say makes perfect sense from a business and accountancy perspective, but you're pretty much ignoring the emotional side of investing in a football club in that it's a rich mans plaything which is almost impossible to justify in terms of profit or ROCI / ROCE.

TL;DR ?

I'm clueless really.

As are most of us.

I think the whole Everton, and by association the whole Business, Sky, PL ball game has too many of Rumsfeld's known unknowns etc. and is well beyond those who are supposed to know, never mind BK.

Football is a business, but it's an entertainment business. yet at the same time it is so UNlike any other business in the financial / Industrial / entertainment world as to be a 1 off...like Topsie it just growed.

You, The Esk, me, everyone, can only identify Isolated individual pieces of the whole jig saw...

This is all I could write before my head shut down with the complexity of trying to put things in some sort of order, somebody needs to stamp on the butterfly to stop any more chaos.

At the moment the rising tide is lifting all boats, some more than others and the board don't have to do nowt except make sure that the same rope that ties us to the dock / PL gets a bit longer every season lets us float ( tread water ) and not help to drag us under.

Unless there is one of those Unknown Unknowns lurking out there, like a falling tide or 'an offer you can't refuse'... or even god forbid, health issues.

The WILL be change, there always is...eventually. When, where, what who knows, just like how for better or worse it will effect us.

*looks nervously over shoulder at the Hereford Thread.

 

[Moonlight dribbler]

The BU had no membership it was a select number of 'officers' it as never an open forum for ideas to move the club forward. It was borne out of a desire to oust the board by any means, driven primarily by the remnants of keioc

Think they just want an ambitious, forward thinking board that give the fans hope of winning trophies. Wake me up when Kenwright and cronies do any of the above...

 

[Foot Long Hot Dog]

Polite question, what was Keith Harris doing for Bill Kenwright?

Representing the club in trying to sell it apparently. He didn't hand it over to him and tell him to dispose of it, there's a distinct difference

 

[evo1878]

Lets be totally honest about this. Even if there was a link, the only way that Earl, or anyone else, could materially benefit would be if the interest being charged was above market rates.

Put it this way, if you've got 20 million quid burning a hole in your pocket, then you make it work for you. It'd be very easy to generate a return of 5 to 6% on that with very little risk involved. Vibrac charged us 8.8% in 2013/14. Even if you assumed we were being screwed for an extra 1.5% then, on 20 million that's only 300k.

300k's a lot to you and me but Earl and Green have net worths of roughly 5 billion and 240 million USD respectively, so it's chicken feed to them. I'm not saying it's impossible, but it does seem unlikely.

@Woolly Blue - thanks for that mate. For some reason I thought the VIBRAC interest rate was around 17.8%. But if its only 8.8% then there's nothing to complain about and my suspicion is answered in a positive way. Put your way it's like borrowing off a mate cos you can't go to a bank and making it worth your mate's while cos of the risk?

 

[magicjuan]

Representing the club in trying to sell it apparently. He didn't hand it over to him and tell him to dispose of it, there's a distinct difference

You mean like a 3rd party broker acting 'under instruction' (Kenwright's words), much like Amanda Staveley, to find a buyer at a set price, as discussed by Harris himself?

 

[Woolly Blue]

@Woolly Blue - thanks for that mate. For some reason I thought the VIBRAC interest rate was around 17.8%. But if its only 8.8% then there's nothing to complain about and my suspicion is answered in a positive way. Put your way it's like borrowing off a mate cos you can't go to a bank and making it worth your mate's while cos of the risk?

If Earl was involved in Vibrac in any way then, yea, that's a decent analogy.

However, if he was involved in Vibrac then he should declare that he's an interested party. The argument made by many, revolves round the address used by Vibrac being linked to Earl. Given his wealth, I'd be very surprised if he was hiding a link to an interested party for the sake of ( at most ) a few hundred k per year.

Off hand I can't remember the interest rate Vibrac have charged other football clubs, but I'm pretty sure the rate we're being charged is in the same ballpark. If I was a director of a football club and was also involved in Vibrac I'd either :-

• Declare that interest and take any flak on the chin ( especially if I was on the other side of the Atlantic ) or
• Avoid lending to the club I'm a director of and lend to someone else instead

Businessmen don't make millions by being nice, but they tend not to be stupid.

Anyway, assuming we'll be taking out another short-term loan, the MR01 / MR04 forms will turn up at companies house soon so we should know fairly shortly if we're still using Vibrac ( though it'll be a bit longer till we know how much we loan this time ).

 

[evo1878]

In order to persuade the owner of equity in a company to sell his or her stake in the company you have to do one of two things.

(i) Offer a price in excess of their expectation of the value of the equity, or
(ii) offer an exchange of equity for a currency of greater value - ie persuade the owners that the cash you offer now is greater than the future cash value of the equity.

(i) is usually expensive and (ii) whilst cheaper, much more difficult to achieve.

In the case of Everton the argument must be that cash received now has greater value than cash received in the future.

Why? Because without investment the equity value of Everton can only fall in the future.

100% correct and i have worked successfully on many corporate M&A deals in the past. Your point about reaching the point of value inflection is particularly pertinent. Most business owners are so attached to their business that they are blind to when their equity has reached or gone beyond this point. I think in Everton's case last season was the season when we finally went past it - possibly never to return.

Leaving the false economies of the TV money and stadium issues aside (because i think you've argued those points well and correctly mate), the only other way to add equity value to any business is through a) increasing customers b) getting those customers to spend more and c) getting them to spend more frequently. The Everton Board have not achieved any significant growth in this direction for many years despite numerous opportunities.

Having reached the point of inflection, do you agree that the only kind of owner for Everton is someone who is happy to own the badge as opposed to someone who needs / wants to make a serious amount of money? If you do agree, then for me sadly there is far greater value to be had by someone buying a Nottingham Forest, Sheffield United, Birmingham City, or a Bristol City (i.e. historic club, big local population / fanbase, 2 teams in the city) currently in a lower league and investing to take them into the Premier League with the sole aim of keeping them there. If you are an international investor then you'd look to other leagues (there are less and less of them) where it is not dominated by the same 2-4 champions league teams each year and buy a team in that league. In the long term, because the standards ae rapidly improving, the match day experience is second to none, and every team has a realistic chance of winning the league each year i really think the MLS is going to outperform the Premier League in 10 years time.

 

[ToffeeDan]

IIRC Earl is the big problem as he won't countenance a sale while he's happy collecting his repayments. Not sure of the details but I'm sure it is a sticking point in any possible sale. (ok, I'm not totally sure on the background here but, like Kitbag and the ground catering nothing should ever surprise us when it comes to the tricks the board have pulled to sit on their backsides and prevaricate).

 

[The Esk]

Having reached the point of inflection, do you agree that the only kind of owner for Everton is someone who is happy to own the badge as opposed to someone who needs / wants to make a serious amount of money? If you do agree, then for me sadly there is far greater value to be had by someone buying a Nottingham Forest, Sheffield United, Birmingham City, or a Bristol City (i.e. historic club, big local population / fanbase, 2 teams in the city) currently in a lower league and investing to take them into the Premier League with the sole aim of keeping them there. If you are an international investor then you'd look to other leagues (there are less and less of them) where it is not dominated by the same 2-4 champions league teams each year and buy a team in that league. In the long term, because the standards ae rapidly improving, the match day experience is second to none, and every team has a realistic chance of winning the league each year i really think the MLS is going to outperform the Premier League in 10 years time.

Good post mate!

I still believe there'a lots of reasons why buying Everton makes sense even if the capital commitment to wholly develop the club is huge.

I also believe there are enough billionaires out there to find one who would like to take the project on for a raft of reasons.

A premier league club is a trophy asset for many overseas investors/buyers, it offers so much more than just a football club which might or might not make you money.

A club like Everton offers even more given our history, our reputation and stature in the game and yes, the city in which the club exists.

There's an opportunity for someone to buy the club, make it a footballing success once more, regenerate a historic area of what is still a global city, and become part of the what I would call " the northern powerhouse" of football.

Imagine selling the idea that there are 4 world class clubs all within 30 miles of each other, each club with its own very distinct history and personality but 4 of the most famous names in world football.

With investment, a competitive team, our local support base, the building of a truly world class stadium, the development of the area surrounding the club, Everton could sit and enjoy the benefits of being in the most powerful football region in the world, full of history, next to the very roots of association football and the football league.

We should be part of a global attraction, attracting football fans from all corners of the globe

Boy I wish our Board had some vision.

 

[ToffeeDan]

One of the biggest problems we will always face is recognition. You only have to travel less than a mile from Goodison Park to recall that someone stole part of our identity way back when and, to make matters worse, named themselves after what is now considered a world-class city.

 

[Lids1978]

That BK fella had plenty to say last summer in the media after a good season yet is as quiet as a mouse this year. Fella needs to make some sort of a statement regarding signings and what's available to spend. Beyond a joke at this stage his lack of communication.

 

[The Esk]

One of the biggest problems we will always face is recognition. You only have to travel less than a mile from Goodison Park to recall that someone stole part of our identity way back when and, to make matters worse, named themselves after what is now considered a world-class city.

Totally disagree mate, for the vast majority of our history we have been a bigger and more successful club, it's only a period in the 70's, and some cup success in recent times that differentiates our successes.

We've a history and reputation, a standing in the game they will never have, we just need to tell the world.

 

[Dario Terracotta]

Totally disagree mate, for the vast majority of our history we have been a bigger and more successful club, it's only a period in the 70's, and some cup success in recent times that differentiates our successes.

We've a history and reputation, a standing in the game they will never have, we just need to tell the world.

They're only here because of us esk

 

[deipnosophist]

We are a club with hamstring issues in the physio room.
And a club whose Board leaves us hamstrung

perhaps we should rename ourselves Soft Tissue Everton