Pogue Mahone
The caf's Camus.
That's what I don't understand.But how the hell are they ever going to pay off 500m+ in 2017 unless they sell the club??
It's also why I wouldn't touch those bonds with a barge-pole.
That's what I don't understand.But how the hell are they ever going to pay off 500m+ in 2017 unless they sell the club??
Aye its a right pain sometimes.That's what I don't understand.
It's also why I wouldn't touch those bonds with a barge-pole.
So without his sale we would be talking about another loss.The profit in the accounts was almost all due to the sale of Cristiano Ronaldo for £80m to Real Madrid before the summer.
It will almost certainly reduce our annual interest bill.so this is official now? Interesting
Figure seems to be confirmed at £500m but no word as yet on how much interest they are offering. Clearly it wouldnt make any sense to do this unless it reduced our annual interest bill. I assume the bonds will replace the PIKs and some of the senior debt.
Sell the club or take more bonds out.It will almost certainly reduce our annual interest bill.
It will also, presumably, commit them to paying out over half a billion in cash in another 5 years time. How on God's green earth are they gonna manage that?
needless to say its still reduces the interest repayments compared to the current lot.AFAIK only the 175 million PKI's have 14% interest payments on them. The interest rate on the rest of the debt (around 423 million) is around 2-5%.
Who knows? They will have to look at the market in 5/6 years time and assess which is their best option at that time.It will almost certainly reduce our annual interest bill.
It will also, presumably, commit them to paying out over half a billion in cash in another 5 years time. How on God's green earth are they gonna manage that?
He moved officially there on the 1st of July, the contract was signed before though iirc. Therefore, the fee might have been paid in June by Real MadridWasn't Ronaldo sold in July though? So why would the fee be included if the accounts are only to the end of June 2009?
It might be a stupid question, but I did get a D in business.
They have made us a laughing stock and treat fans like we are stupid, time to goWho knows? They will have to look at the market in 5/6 years time and assess which is their best option at that time.
Anyway, assuming they can pull this off (we have no idea thus far who they are offering the bond to), it will reduce the short term pressure on the club so it is a positive move.
Not sure why you say that?They have made us a laughing stock and treat fans like we are stupid, time to go
they'll refinance the same as they are doing now I reckon. They'll be hoping for a rather large change in the financial markets over the next 8 years. IIRC, the debts as they were had to be repayed by 2017 anyway, according to the repayment schedule, so little has changed apart from a hopefully reduction in interest repayments and one more refinancing option crossed off the list.That's what I don't understand.
It's also why I wouldn't touch those bonds with a barge-pole.
I think it all depends what covenants are attached to it.Not sure why you say that?
The bond issue will be a good thing for the club if they can pull it off.
Even if they are, as long as the overall interest bill is lowered then it would be a good thing - wouldnt you agree?I think it all depends what covenants are attached to it.
We may find the criteria not much different to the PIKs.
That's not possible. Interest collected from the money we'd put away in that savings account would be minuscule compared to the one required to make the bond interest payment.Going by the rest of thread and my minimal knowledge It seems to me it goes something like this.
Think as bonds as loans. The only difference is that instead of 14% interest on 3 different loans each year (each loan valued at close to 275 million quid each) the bond is issued by investors/banks allowing us to wipe away those loans. What this does is remove any outstanding debt United has with current creditors and removes the 14% interest payments. Instead we are left with interest repayments of something like 5% based on each bond issued. so instead of paying something like 70 million pounds on interest each year, its around 25million 'massive difference'. I may be wrong in thinking, but at the end of bond lease, the repayments are made in full. What I see United doing is in part investing that money saved from paying interest repayments in to a high interest savings account '12-13%' and adding every year to increase profitability on the interest return. Effectively you could make enough to pay the Bond interest of each year using the interest made from the money in the high interest savings account. My old school has one massive bank account 'in the order of 30 odd million dollars, and the interest made on that account alone paid for the schools scholarships.
Taking out a bond is not a conservative financial decision for two reasons:But how the hell are they ever going to pay off 500m+ in 2017 unless they sell the club??
They are not. This debt will roll on for a very very long time...But how the hell are they ever going to pay off 500m+ in 2017 unless they sell the club??
It's not my fault!Take a bow Ralphie, the Glaziers have bled us dry
not knowing too much but trying to pay attention to it all, it seems like they are just simply buying time, no?It's not my fault!
Yeah definatly I'm just wondering how much potential power will be given to the note holders should things go tits up.Even if they are, as long as the overall interest bill is lowered then it would be a good thing - wouldnt you agree?
A friend of mine used to work for a small hedge fund company.Yeah definatly I'm just wondering how much potential power will be given to the note holders should things go tits up.
Presumably another hedgefund will come in the snap them up.
These guys seem to be more ruthless than the banks.
For us laymans(me) how do you come up with a figure of 500m + that must be paid back in a few years. Cause if thats the case why would they even bother taking the bonds even with a interest payment of 50m+ per year this still would be cheaper than paying that amount back in a few years.But how the hell are they ever going to pay off 500m+ in 2017 unless they sell the club??
"I don't have any concerns about the financial situation," he said. "There is absolutely no issue at all. I am really confident about that.
Maybe you should read the post I was replying to?For us laymans(me) how do you come up with a figure of 500m + that must be paid back in a few years. Cause if thats the case why would they even bother taking the bonds even with a interest payment of 50m+ per year this still would be cheaper than paying that amount back in a few years.
They were always going to have to refinance as the deadline for the payment of the senior debt is approaching and there's no sign that they're going to be able to pay off any of that. If they get the bonds, I assume that it'll reduce immediate interest on the senior debt (but not the PIKs) and put back the date of payment of the actual loan(?). However, I believe their previous refinancing effort increased the debt. And of course this is all assuming that they can get someone to take the bonds.not knowing too much but trying to pay attention to it all, it seems like they are just simply buying time, no?
It's not exactly a prime location for housing. Stuck in the middle of the Trafford Park industrial estate! I assume they have other plans for that.what about the land near old trafford they bought a while back, on the train line? are they going to make that into something profitable like housing?
So they are going to try and use the bonds - secured against the club - to pay off the PIKs?People with knowledge of the deal said the bond would mean Manchester United was not under the same covenant restrictions as the loans, and would also be able to use up to 50 per cent of its cashflow to pay a dividend to the Glazer family, enabling them to repay a punitive payment-in-kind loan, which carries interest of 14.25 per cent.
Which would suggest that the answer to the question, "do we have money to spend on players?" is "no".Financial Times said:Manchester United on Monday confirmed plans for a bond issue to refinance the football club’s debts, saying it was looking to raise £500m from a senior secured notes offering.
It also revealed it was entering into a new revolving credit facility to allow it to borrow an additional £75m, to be used for working capital and, probably, to help the club to continue buying players.
It does suggest that's the plan, in an indirect fashion. It seems that there are currently covenants preventing them from withdrawing from the club to do that at the moment.So they are going to try and use the bonds - secured against the club - to pay off the PIKs?
I suspect there is a current pot but that £75m will be used for future years transfers.Which would suggest that the answer to the question, "do we have money to spend on players?" is "no".
Im still not really clear on whether this bond issue will be used directly or indirectly to pay off the PIKs - seems to be a bit of conflicting info (as usual)So they are going to try and use the bonds - secured against the club - to pay off the PIKs?
Not necessarily - dont forget that all the info at the moment just comes from a club press release (we will get the indepedant analysis in the coming weeks as the accounts are made public) so I assume they put that in there specifically to try and address fears about future spending.Which would suggest that the answer to the question, "do we have money to spend on players?" is "no".
The bond issue can't be used to pay off the piks And will address the senior debt but the deal negotiated with the bond underwriters seems to allow them to use a proportion of the profits go pay off the piks.Lots of things that don't seem to add up:
- how can the assets be used as security since they're already in hock to the banks
- one article suggested the PIKs were NOT going to be paid off
- the PIKS are secured on Red Football
- is anyone going to buy this bond?