Mike Ashley

[TRon]

Going over old ground here, but can anybody explain to me why there appears to be this mass assumption that whatever debt gets paid off will be taken off the asking price? It doesn't make any sens to me at all in the real world, where a company's value is based on its assets and profitability mainly. The assets remain the same, and the company would be more profitable for the debt repayments to take place, no?

 

The club's not worth 300m.

 

Huh?

 

My point is this: why would a company with 100 million in debt and posting yearly losses be MORE valuable to a prospective buyer than one (same assets) with no debts and posting a 20 million or so yearly profit?

 

Can see your point but I think the key to this is that it has always been assumed that Ashley would aim at least to get back what he had spent on the club. So say he spent £140 million buying it and then put another £110 in as loan, he's out of pocket by £250 million. So if he's selling the club then the assumption is he's want that sum (at least) for the club to cover his costs. On the other hand if he ever manages to recover all of the debt out of the clubs cash flows then he would only be out of pocket  by £140 million. So if he sold the club at that point for say £200 million he's made a £60 million profit overall. And potentially therefore the asking price for the club could be less without the debt. I don't know if that helps...

 

He could, say in 5 years have the debt cleared by running us on the bare minimum...Once its all paid off, why sell?  Could be a nice little earner and free sponsorship for his flagship company.  The club (business) has paid for itself and is now passing profit his way without having to do much.  The next TV deal will only get bigger imho...BT are going to push sky and with the economy slowly picking up it could be a good earner for Ashley.

 

He could be here 20 years or more.

 

I've been saying that for a while. If you have a business earning you twenty mil a year, why would you get rid?

 

The sale value would massively go up.

 

My point exactly. A profit making advertisement vehicle for his primary concern, and as if that's not enough, he gets to take the p*ss out of us, who dare(d) call him names. With more money coming into the game, the asking price will only go up as lins as we're in the Premiership, hence our obvious "ambition"..

 

Again, if he really wanted to use the football club to advertise his brand, wouldn't a successful football club be a much better advert? That's the reason the bigger brands tend to pay big money to the more successful clubs.

 

He bought arguably one of the five biggest clubs in England at that time at a fraction of the cost of the others.

 

You can't really compare to the others as there was never really any hard interest in anyone buying Newcastle. Plenty looked at the books and decided despite being a fraction of the cost it was still too expensive.

[timeEd32]

Some of you guys talks as if Newcastle is guaranteed to stay in the EPL, or even guaranteed to get promoted the next year post relegation... So those £20 million figures or something you talk about are only valid under certain circumstances - circumstances which are well on their way to disappear as they are in the hands of a clueless Kinnear, leading an even more clueless Pardew' who's trying his hardest to convince 11 players to stand up for a regime that's at best decribed as <insert fitting words> …

 

This is why he won't stay forever. It's too risky and he knows it. If relegation didn't exist we'd be fucked. We may also be fucked because of it. Basically we're just going to take it from all sides as long as he's here.

[Unbelievable]

Going over old ground here, but can anybody explain to me why there appears to be this mass assumption that whatever debt gets paid off will be taken off the asking price? It doesn't make any sens to me at all in the real world, where a company's value is based on its assets and profitability mainly. The assets remain the same, and the company would be more profitable for the debt repayments to take place, no?

 

The club's not worth 300m.

 

Huh?

 

My point is this: why would a company with 100 million in debt and posting yearly losses be MORE valuable to a prospective buyer than one (same assets) with no debts and posting a 20 million or so yearly profit?

 

Can see your point but I think the key to this is that it has always been assumed that Ashley would aim at least to get back what he had spent on the club. So say he spent £140 million buying it and then put another £110 in as loan, he's out of pocket by £250 million. So if he's selling the club then the assumption is he's want that sum (at least) for the club to cover his costs. On the other hand if he ever manages to recover all of the debt out of the clubs cash flows then he would only be out of pocket  by £140 million. So if he sold the club at that point for say £200 million he's made a £60 million profit overall. And potentially therefore the asking price for the club could be less without the debt. I don't know if that helps...

 

He could, say in 5 years have the debt cleared by running us on the bare minimum...Once its all paid off, why sell?  Could be a nice little earner and free sponsorship for his flagship company.  The club (business) has paid for itself and is now passing profit his way without having to do much.  The next TV deal will only get bigger imho...BT are going to push sky and with the economy slowly picking up it could be a good earner for Ashley.

 

He could be here 20 years or more.

 

I've been saying that for a while. If you have a business earning you twenty mil a year, why would you get rid?

 

The sale value would massively go up.

 

My point exactly. A profit making advertisement vehicle for his primary concern, and as if that's not enough, he gets to take the p*ss out of us, who dare(d) call him names. With more money coming into the game, the asking price will only go up as lins as we're in the Premiership, hence our obvious "ambition"..

 

Again, if he really wanted to use the football club to advertise his brand, wouldn't a successful football club be a much better advert? That's the reason the bigger brands tend to pay big money to the more successful clubs.

 

He bought arguably one of the five biggest clubs in England at that time at a fraction of the cost of the others.

 

You can't really compare to the others as there was never really any hard interest in anyone buying Newcastle. Plenty looked at the books and decided despite being a fraction of the cost it was still too expensive.

 

How does that work? My original point was he bought one of the biggest clubs in the league at a fraction of the cost of the other top clubs, which made it attractive to him as a advertising vehicle that paid for himself, and where the fans wouldn't demand the investment required to compete at the highest level, as we weren't exactly successful before he came in. It was a perfect acquisition from his perspective. If he was interested in winning things and willing to spend big money, he probably would have looked elsewhere, like the others you refer to did.

[Unbelievable]

Some of you guys talks as if Newcastle is guaranteed to stay in the EPL, or even guaranteed to get promoted the next year post relegation... So those £20 million figures or something you talk about are only valid under certain circumstances - circumstances which are well on their way to disappear as they are in the hands of a clueless Kinnear, leading an even more clueless Pardew' who's trying his hardest to convince 11 players to stand up for a regime that's at best decribed as <insert fitting words> …

 

This is why he won't stay forever. It's too risky and he knows it. If relegation didn't exist we'd be f***ed. We may also be f***ed because of it. Basically we're just going to take it from all sides as long as he's here.

 

If anything, the relative ease of coming back up last time may have made him more reckless, not less. Besides, why spend or sack your manager in the summer in preparation of the new season, when you have January to get some business done if you really have to.

[merlin]

Some of you guys talks as if Newcastle is guaranteed to stay in the EPL, or even guaranteed to get promoted the next year post relegation... So those £20 million figures or something you talk about are only valid under certain circumstances - circumstances which are well on their way to disappear as they are in the hands of a clueless Kinnear, leading an even more clueless Pardew' who's trying his hardest to convince 11 players to stand up for a regime that's at best decribed as <insert fitting words> …

 

This - if people do continue to drop their Season tickets and support falls, Pardew or JFK stay and the club goes down, he only has one season to protect the TV income....all highly possible right now.

[Guest Roger Kint]

Going over old ground here, but can anybody explain to me why there appears to be this mass assumption that whatever debt gets paid off will be taken off the asking price? It doesn't make any sens to me at all in the real world, where a company's value is based on its assets and profitability mainly. The assets remain the same, and the company would be more profitable for the debt repayments to take place, no?

 

The club's not worth 300m.

 

Huh?

 

My point is this: why would a company with 100 million in debt and posting yearly losses be MORE valuable to a prospective buyer than one (same assets) with no debts and posting a 20 million or so yearly profit?

 

Can see your point but I think the key to this is that it has always been assumed that Ashley would aim at least to get back what he had spent on the club. So say he spent £140 million buying it and then put another £110 in as loan, he's out of pocket by £250 million. So if he's selling the club then the assumption is he's want that sum (at least) for the club to cover his costs. On the other hand if he ever manages to recover all of the debt out of the clubs cash flows then he would only be out of pocket  by £140 million. So if he sold the club at that point for say £200 million he's made a £60 million profit overall. And potentially therefore the asking price for the club could be less without the debt. I don't know if that helps...

 

He could, say in 5 years have the debt cleared by running us on the bare minimum...Once its all paid off, why sell?  Could be a nice little earner and free sponsorship for his flagship company.  The club (business) has paid for itself and is now passing profit his way without having to do much.  The next TV deal will only get bigger imho...BT are going to push sky and with the economy slowly picking up it could be a good earner for Ashley.

 

He could be here 20 years or more.

 

I've been saying that for a while. If you have a business earning you twenty mil a year, why would you get rid?

 

When you're a billionaire I would think there are faster ways to make money than put your money in a football club.

 

Undoubtedly. But at the minute, and for the foreseeable, we're making him £20mil a year. 

 

We arent making him £20m a year though at the minute. He may be repaying himself ££ but thats like saying you going to the cashpoint is making you money

[AyeDubbleYoo]

Mike Ashley seems fairly unlikely to 'make' any money from owning us TBH, unless a money-crazed buyer pops up. He's already many millions down. Obviously he has benefited in other ways, the promotion of SD etc.

 

As Roger says, you would be silly to invest a football club if your main objective was to make money. It's incredibly expensive, the return on investment is hard to predict, there are much better ways to invest the amount of money Mike Ashley had.

[loki679]

Mike Ashley seems fairly unlikely to 'make' any money from owning us TBH, unless a money-crazed buyer pops up. He's already many millions down. Obviously he has benefited in other ways, the promotion of SD etc.

 

As Roger says, you would be silly to invest a football club if your main objective was to make money. It's incredibly expensive, the return on investment is hard to predict, there are much better ways to invest the amount of money Mike Ashley had.

 

From what we've heard the main objective was to promote SD and in that it's been very successful.

[Beren]

Intrinsically very difficult to quantify the benefit derived from his advertising/marketing at the club, tbh. I was always taught that if you pay 50p to two different marketing companies, you don't know to which company the sale is attributable.

 

Maybe he didn't go here purely for the money, but it seems pretty damn likely that money is his only real concern now as far as the club is concerned.

[AyeDubbleYoo]

Mike Ashley seems fairly unlikely to 'make' any money from owning us TBH, unless a money-crazed buyer pops up. He's already many millions down. Obviously he has benefited in other ways, the promotion of SD etc.

 

As Roger says, you would be silly to invest a football club if your main objective was to make money. It's incredibly expensive, the return on investment is hard to predict, there are much better ways to invest the amount of money Mike Ashley had.

 

From what we've heard the main objective was to promote SD and in that it's been very successful.

 

I guess so, but then again, what does £200m+ in marketing buy you? Sponsorship of the Premier League? Set up your own TV channel? Billboard advertising at every ground in the country?

 

I still think Mike Ashley's original motivation was just to fulfill an ambition of owning a club, have some fun on the side, and then also to promote his goods overseas. Problem is that everything went to shit so quickly.

[Toonpack]

Mike Ashley seems fairly unlikely to 'make' any money from owning us TBH, unless a money-crazed buyer pops up. He's already many millions down. Obviously he has benefited in other ways, the promotion of SD etc.

 

As Roger says, you would be silly to invest a football club if your main objective was to make money. It's incredibly expensive, the return on investment is hard to predict, there are much better ways to invest the amount of money Mike Ashley had.

 

From what we've heard the main objective was to promote SD and in that it's been very successful.

 

I guess so, but then again, what does £200m+ in marketing buy you? Sponsorship of the Premier League? Set up your own TV channel? Billboard advertising at every ground in the country?

 

I still think Mike Ashley's original motivation was just to fulfill an ambition of owning a club, have some fun on the side, and then also to promote his goods overseas. Problem is that everything went to s*** so quickly.

 

I think that's the truth of it, he's now in a place where it's absolutely no "fun", in fact he probably hates it, the stick he gets, the agents and all the shit that goes around (who's fault that is, is irrelevant) and continuing, with any ambition, is likely to be nothing but very expensive. I reckon he's got to the stage of "fuck it" to the point that he wants his wedge back asap at which point he'll get shot if he can, but until then it won't cost him a penny if he can possibly avoid it.

 

We're screwed in the meantime.

 

Bit like buying your dream house but then finding out it's a total money-pit and the neighbours hate you.

 

[merlin]

Mike Ashley seems fairly unlikely to 'make' any money from owning us TBH, unless a money-crazed buyer pops up. He's already many millions down. Obviously he has benefited in other ways, the promotion of SD etc.

 

As Roger says, you would be silly to invest a football club if your main objective was to make money. It's incredibly expensive, the return on investment is hard to predict, there are much better ways to invest the amount of money Mike Ashley had.

 

From what we've heard the main objective was to promote SD and in that it's been very successful.

 

I guess so, but then again, what does £200m+ in marketing buy you? Sponsorship of the Premier League? Set up your own TV channel? Billboard advertising at every ground in the country?

 

I still think Mike Ashley's original motivation was just to fulfill an ambition of owning a club, have some fun on the side, and then also to promote his goods overseas. Problem is that everything went to s*** so quickly.

 

.....and whose fault was that..

[Unbelievable]

I find it hard to fathom anybody could still be so naive as to believe his reason for buying the club was just to have a bit of fun. As long as he doesn't invest significantly in the footballing side of the business, which it doesn't look like he will, the club does stand to make a significant profit with the added TV revenue (20 million per season is not an unreasonable estimate). A profit making advertisement vehicle in the Premiership, on which he will get at least his money back when he eventually sells. What's not to like?

[Guest bimpy474]

He bought us to try to get his shop chain into Asia, that's just imo like.

[LRD]

He bought us to try to get his shop chain into Asia, that's just imo like.

 

Think he's targeting Europe more than anything. Good luck trying to sell his wares with those cheap replicas going around in Bangkok.

[The College Dropout]

Yep. Running on the bones risks relegation. He'll aim to lower the debt in hopes it boosts the sale chances and make it more attractive to investors.

Any business that runs on limited investment will struggle to keep turning tidy profits.

[Doug]

I am convinced he just wants as much money back from the club as he can get. He is taking far too long though over doing it, probably his revenge for the abuse.

He is draining the passion and life from this great institution by his appointments and policies and I for one cannot wait to see the back of him.

I would rather we were in a lower league without Ashley, playing with 11 men from these isles rather than have to follow the likes of his only 'signing' Remy.

 

 

[AyeDubbleYoo]

Mike Ashley seems fairly unlikely to 'make' any money from owning us TBH, unless a money-crazed buyer pops up. He's already many millions down. Obviously he has benefited in other ways, the promotion of SD etc.

 

As Roger says, you would be silly to invest a football club if your main objective was to make money. It's incredibly expensive, the return on investment is hard to predict, there are much better ways to invest the amount of money Mike Ashley had.

 

From what we've heard the main objective was to promote SD and in that it's been very successful.

 

I guess so, but then again, what does £200m+ in marketing buy you? Sponsorship of the Premier League? Set up your own TV channel? Billboard advertising at every ground in the country?

 

I still think Mike Ashley's original motivation was just to fulfill an ambition of owning a club, have some fun on the side, and then also to promote his goods overseas. Problem is that everything went to s*** so quickly.

 

.....and whose fault was that..

 

Mainly his obviously, doesn't change the effect though.

[UV]

I don't care what he said to Hall to persuade him to sell quickly when others were sniffing around, it's pretty obvious he just bought the club to quickly flip for a profit. TV revenues were going up £10m that year and buyers were snapping up clubs left right and centre. He thought that by superficially tarting up the club a bit by claiming to have sorted out its finances, putting in place a great new continental DoF structure and a talismanic manager, enthusing the supporters, he'd be able to sell it off for a decent profit no bother. The person he put in charge of the club was a lawyer who specialises in buying and selling large companies ffs.

 

Llambias even admitted he was trying to sell the club before any trouble, within months of buying it.

 

He also made a shocking claim in a meeting with fans last month that Keegan’s second coming as Newcastle manager in 2008 came about ­because he was the preferred choice of potential Arab buyers. He revealed: “Mike (Ashley) was selling to the Arabs and they ­wanted Kevin Keegan.

 

“The Arabs wanted him, the fans wanted him — perfect!”

 

Unfortunately for him and us the financial crash put paid to that plan though, so he has had to settle for plan B since then which is to run the club like his other brand acquisitions, ie for the sole benefit of his baby Sports Direct. Having moved onto plan B though, if he can continue to run the club at a break even level or even at a profit while getting free advertising and revenue for selling club branded merchandise through Sports Direct (how much of that does the club see I wonder?), why should he sell?

 

[mofo]

Any chance we could change the topic title to "Mike Ashley is a wanker" even just for a day to make me feel better??

[NewJerseyMag]

Feels like the Seymour/Westwood era.

 

At least the ground looks good, with the exception of the tacky SD s**t.

[Exiled in Texas]

Ashley is a business man - not a fan. 

He makes his decisions looking at the balance sheet not the pitch, so he has a different focus to the fans. He wants to make money (either for NUFC or for SD) and how he does that does not necessarily mean that the quality of the product on the field has to be good.

 

If Ashley thinks that SD is getting value from their brand exposure through NUFC, then he is probably content with the arrangement.  The difference is that fans are only interested in the product put forth on the field, and we don't value the SD advertising (especially as it doesn;t show up on the balance sheet at NUFC).

[LoveItIfWeBeatU]

http://www.thejournal.co.uk/sport/football/football-news/tarnishing-newcastle-uniteds-reputation-sad-5821252

 

The tarnishing of Newcastle United's reputation is a sad and sorry state of affairs

31 Aug 2013 08:21

 

Newcastle United are a mere 72 hours away from the ignominy of living down to Tyneside’s subterranean expectations of their summer business.

 

 

 

To only bring in one loan signing in a summer where football is awash with new-found TV riches is some achievement, but they are on the brink of managing it. Perhaps Joe Kinnear can add it to that gold-plated CV of his.

 

There is a bigger narrative that is building steam here, though: one that won’t even be halted by desperate, last-ditch business before Monday’s late-night deadline. This has been the summer when the steady and unmistakable tarnishing of Newcastle United’s reputation has begun to build a toxic momentum.

 

That is not a sentence that anyone would write lightly.

 

There is so much about the club that swells the breast with pride: from the superb work of their Foundation to the stoic dedication of the many club employees who do their best to uphold the finest traditions of Tyneside’s most storied institutions.

 

Take, for example, the way Morecambe officials talked about Newcastle on Wednesday night. In the hushed shadow of the stands at Globe Park it was possible to hear Shrimps employees hailing the club as a “class act”.

 

Little things like supplying a signed shirt for a charity auction might not find their way on to a balance sheet but they ensure the club is in surplus with many in the game.

 

What a shame that the owner and his anointed director of football have singularly failed to live up to the standards set by those who see the club’s crest as standing for something more than a meal ticket back into the game or a vehicle for their already successful sportswear business.

 

What a shame that neither man appears to grasp the responsibilities they have in their privileged positions or understand that they are accountable to the thousands who will file through the gates this afternoon.

 

The mistakes this summer have been legion, but let’s begin with the pub politics that saw Kinnear get the job in the first place. On a sunny Saturday in June, the owner summoned Derek Llambias and Graham Carr to the Orange Tree pub in Totteridge to be told about Kinnear’s appointment over a pint.

 

This is no way to run a used car lot, never mind a cherished football club that has the emotional and financial investment of thousands in the North East.

 

Where was the due diligence of employing someone with the skills for the job? Where was the studious and careful sifting through the candidates who would no doubt have jumped at the chance to take on such a prestigious role? Drowned at the bottom of a pint pot, it seems. To do all of this hundreds of miles from the city that has St James’ Park deep in its bosom was contemptuous. What happened next was utterly embarrassing.

 

Every businessman in England would grasp that the way Kinnear was approached and then appointed was a recipe for calamity. There are plenty of gifted candidates who would have done the job. Yet Ashley proceeded and didn’t even blink when Kinnear took to the airwaves – ahead of an official club announcement, of course – and proceeded to billow nonsense for 48 hours. At one point he even seemed to suggest he had “more intelligence” than Newcastle’s fans. It was outrageous.

 

The club’s reputation – which had been repaired by the thought that was put into their strategy for the 2011/12 season – felt tarnished by what transpired.

 

For Kinnear it was “water off a duck’s a***”, to use the mangled idiom he uttered in this infamous Talksport interview.

 

Not so for Derek Llambias who, having felt his position was rendered untenable by Kinnear’s appointment, resigned on a point of principle. Carr was talked out of doing the same.

 

Ashley, presumably, felt this was yet another storm of controversy to be weathered. He will be bolstered by the dispatch that despite all of the criticism, the cursing and the cussing the launch of the new strip – adorned with the name of pay-day lending firm Wonga – has been the most successful for three years.

 

What he might not understand is that discontent and disgust has begun to seep into the bone marrow of this city. The people are still proud of Newcastle United – of course they are, hence the shirt sales – but to a man they are not proud of Mike Ashley’s Newcastle United.

 

They cringe when Kinnear misleads. Some local businesses wonder whether they really want to invite clients to watch a team that is owned by a man who plays fast and loose with the devotion of his public. Ashley will be prepared for the criticism on Monday night. If Cabaye goes and there is no replacement, the fury will build. The questions surrounding Kinnear will rise to a crescendo.

 

What will he do? Very little, apart from tell Alan Pardew to get on with it until January when alternatives will be sourced. In the meantime, loan signings are back on the agenda in a move that feels very much like the kind of short-termism the club had talked of burying very recently.

 

They asked for Darren Bent on loan and Demba Ba too, both the footballing equivalent of applying a plaster to a flesh wound. Make do and mend: hardly a strategy to reclaim that lost momentum.

 

It is understood that Kinnear is bemused by the vitriol coming his way. He doesn’t see Newcastle’s current problems as his fault.

 

Fair point, Joe. You haven’t signed any players yet either, though. We were not fooled by the pictures of you smiling next to Loic Remy after a deal that was nearly done in January was finally brokered. So far Newcastle have collected broken promises at the rate of knots, while not even coming close to adding new signings.

 

A judgement is coming his way on Tuesday. Even if Ashley doesn’t hold him to account, the rest of us will.

 

Perhaps the verdict is already in. A couple of weeks ago, a Newcastle supporter called Adam Clery wrote a piece on supporting the club in the Mike Ashley era for the Sabotage Times which must have been difficult to piece together.

 

“This is Newcastle United as it exists under Mike Ashley,” it read. “You either accept things won’t be run they way you want them to be and consign yourself to going along with the sell-to-buy, just-do-enough mantra, or you spend your entire time wasting your energy being angry.”

[Fenham Mag]

About time the press speak up.

[AlanSkÃrare]

Well in Douglas. Now for Pardew as well.