PIF, PCP, and RB Sports & Media

[Yorkie]

@Phoenix711 posted a good article which explained how Man City did it the same way.

 

https://www.theguardian.com/football/2010/aug/26/manchester-city-sheikh-mansour

[Scoot]

22 minutes ago, Yorkie said:

@Phoenix711 posted a good article which explained how Man City did it the same way.

 

https://www.theguardian.com/football/2010/aug/26/manchester-city-sheikh-mansour

[Abacus]

35 minutes ago, HaydnNUFC said:

 

Can someone explain what this means to dummies? What have they done or trying to do and how have they done so?

It's been set out well above.

 

You should ignore Kieran Maguire's summary on this on that tweet - he's basically just making a joke there.

 

Any company (like NUFC) can raise cash by issuing and then selling more shares in itself, either to new investors, or to existing ones.

 

This will be to an existing investor, since there's no way anyone else would pay £40m for a single share.

 

It just means the club needed cash, and this is just one common way of doing that, rather than taking out a loan.

 

We don't know what that cash was for - my guess above was re the recent transfers.

[RS]

Somewhere there’s a “grumpy old man’s” dog currently taking a hell of a kicking!

 

 

Edited February 4, 2022 by RS

[Phoenix711]

7 minutes ago, Scoot said:

 

Abacus explains it well but to put it in lay terms, if you want to buy something on Amazon you could use a credit card or debit card. The former you don't have the money but will pay it back with interest later, the latter, you have the money in your bank account.

 

Newcastle's owners basically used a debit card and need to put some money in the account (as abacus said, probably for transfers). You might wonder aren't the owners losing money? Technically no because they convert the cash they put into equity but in reality they are in the short term.

 

In contrast, Man Utd's owners, the Glazers, use a credit card for everything and saddle the debt onto Man Utd account and because of Man Utd commercial success, use that to pay off the interest. This is what annoys a lot of Man Utd fans. I've over simplified it but that's the general gist.

[Jackie Broon]

2 hours ago, Abacus said:

I think the nominal value of the share is 5p, not 50p. Not that it really matters.

 

It's also right that this will have nothing to do with FFP, but I think it might be related to our recent transfers.

 

If I had to guess, many of those transfers will have needed an up front cash payment, as well as later installments.

 

So, it could just have been to cover that short term cashflow need. Issuing 1 share (presumably to PIF) would also barely affect the existing 80:10:10 ownership structure.

 

I think it does make a difference for FFP to some extent, because FFP only allows losses of up to £15m per season unless those losses are covered by "secure funding", the limit goes up to £115m over three seasons if those losses are covered.

 

One of the forms of "secure funding" is "contributions that an equity participant has made by way of payments for shares through the Club’s share capital account or share premium reserve account".

[et tu brute]

Isn't the fellow from Saudi Golf, heavily tipped to be being made a Director in the near future?

[Abacus]

1 hour ago, Jackie Broon said:

 

I think it does make a difference for FFP to some extent, because FFP only allows losses of up to £15m per season unless those losses are covered by "secure funding", the limit goes up to £115m over three seasons if those losses are covered.

 

One of the forms of "secure funding" is "contributions that an equity participant has made by way of payments for shares through the Club’s share capital account or share premium reserve account".

Interesting point. 

 

I was originally saying that this particular thing isn't really an attempt to get around the rules on FFP, since it has no relationship to your profit or loss in general.

 

And I do apologise to my friends, family and this forum for being tediously interested in this kind of thing 😂

 

 

Edited February 4, 2022 by Abacus

[Fantail Breeze]

2 hours ago, HaydnNUFC said:

 

Can someone explain what this means to dummies? What have they done or trying to do and how have they done so?

 

Creative accounting. A bit like Mike used to do, but this is to put money into the club rather than siphon it out.

[MagCA]

51 minutes ago, et tu brute said:

Isn't the fellow from Saudi Golf, heavily tipped to be being made a Director in the near future?

yes. it's with the PL now.

[number9shirt]

I look forward to welcoming him to the board...in 18 months.

[NE27]

2 hours ago, number9shirt said:

I look forward to welcoming him to the board...in 18 months.

 

Par for the course, as far as PL are concerned

[BeloEmre]

👏👏👏

[Happinesstan]

Cue Mike Ashley telling SD staff that he can't compete with a sovereign nation.

[Hudson]

I’m not sure what the benefits of that are, surely we don’t need to be part of the Living wage foundation as where a very rich business and could pay this without being required to pay this within 6 month of any increase.

 

Just feels like a way for any Corporate entity to pay a low wage and feel good about it. 

[madras]

2 minutes ago, Hudson said:

I’m not sure what the benefits of that are, surely we don’t need to be part of the Living wage foundation as where a very rich business and could pay this without being required to pay this within 6 month of any increase.

 

Just feels like a way for any Corporate entity to pay a low wage and feel good about it. 

I think the living wage is higher than the National minimum wage so they are making a commitment to pay the worst paid staff more........still a very poor rate of pay mind.

[Happinesstan]

It's a good look though. If you want a living wage get a Saudi employer.

[Hudson]

2 minutes ago, madras said:

I think the living wage is higher than the National minimum wage so they are making a commitment to pay the worst paid staff more........still a very poor rate of pay mind.

Yeah the living wage is about 40p an hour more then the minimum wage from April this year.

 

That’s only £16 per week or £832 per year it’s not great and nothing to shout about really. 
 

The only real advantage is that you get the living wage at 18 and not 23 like the minimum wage

[Hanshithispantz]

6 minutes ago, madras said:

I think the living wage is higher than the National minimum wage so they are making a commitment to pay the worst paid staff more........still a very poor rate of pay mind.

 

Aye, it's still a poor wage but atleast it brings people to a level where it's starting to make more sense them going to work than just signing on the dole. I suppose the reason for joining the scheme is ultimately a PR move, but it puts pressure on other businesses to do the same, more so than if we just started paying a fairer wage off our own backs.

 

 

[Hudson]

Just now, Happinesstan said:

It's a good look though. If you want a living wage get a Saudi employer.

Everton and Chelsea do the same.

[Happinesstan]

1 minute ago, Hudson said:

Everton and Chelsea do the same.

It works for Russian oligarchs too. Dunno much about Everton.

[SAK]

2 minutes ago, Hudson said:

I’m not sure what the benefits of that are, surely we don’t need to be part of the Living wage foundation as where a very rich business and could pay this without being required to pay this within 6 month of any increase.

 

Just feels like a way for any Corporate entity to pay a low wage and feel good about it. 

Think it’s more to be accredited by an external body which I would imagine requires auditing to show that we are paying a decent wage. The club could of course do this anyway but I think it’s the accreditation part that’s important to the hierarchy.

[Hudson]

2 minutes ago, Hanshithispantz said:

 

Aye, it's still a poor wage but atleast it brings people to a level where it's starting to make more sense them going to work than just signing on the dole. I suppose the reason for joining the scheme is ultimately a PR move, but it puts pressure on other businesses to do the same, more so than if we just started paying a fairer wage off our own backs.

 

 

I get the point your making, but no business is going to feel pressure because somebody else pays more than them, also it’s been running for over 10 years and only just betters the minimum wage.

 

[Hanshithispantz]

Just now, Hudson said:

I get the point your making, but no business is going to feel pressure because somebody else pays more than them, also it’s been running for over 10 years and only just betters the minimum wage.

 

I'm more onabout businesses in the same space having to catch up. So if Man City and Arsenal, for example were to also join, other teams might follow until every team in the league feels they need to do the same. It may not work like that in reality though, fuck knows.

 

And like £16 a week (minus tax) is objectively not a lot of money, but for someone on the bones of their arse it could deffinitely help. It would probably completely cover any media subscriptions someone would take for example.

 

By no means do I think it's some great, noble thing or out like. It's obviously still appauling

[Stifler]

It’s not much and the living wage needs to be increased, and minimum wage needs to be set at the living wage, but it is something.

I’m sure that I have read that the scheme also covers greater employment na rights as well, and also they can’t get around it by using outsourced labour, because that is calculated as well.