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Author Topic: Guochuan Lai  (Read 1091570 times)

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Offline BB74

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Re: Guochuan Lai
« Reply #75 on: February 17, 2015, 02:30:24 PM »
Milan Mandaric is back in the market after selling Sheffield Wednesday ;D

Offline stoxman

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Re: Guochuan Lai
« Reply #76 on: February 17, 2015, 03:43:33 PM »
I am pretty sure that Tata or any other global company would not buy us purely to build brand awareness. Sponsorship is one thing ownership is a whole different ball game and unless there was a strategic fit and the prospect of profit it would not not happen.

I think it is easy to overstate the value of the Premier League as a branding vehicle looking at the current shirt sponsors there are only a handful of Global Brands represented and most of those are associated with the top 6 or 7 clubs. If there was real bang for buck in this the smaller teams would be sponsored by global brands rather than obscure betting sites and pay day lenders.

Like it or not any investor will look at the club and the likelihood of making money from it. I can buy a hell of lot of brand awareness for £40m which incidentally is way below the price that JP will be looking for as it is not even equivalent to a year's turnover on the current media contract let alone  the next one.

Sorry Stand, that's not the way that most companies behave. The vast majority OWN as little as they possible can. That is why most do not own the stores they trade from, the cars that their senior staff drive etc. They prefer to rent, outsource as much as they can to keep their own balance sheet efficient and the business focused on what they are good at. Running a football company isn't in any way core to Tata and I would be amazed if they devote not just £100m+ of capital but also management time when they could easily just spend £3m and get all the image rights with none of the hassles.  Also, with companies such as Tata (and I personally know them very well), they have individual country businesses to consider. I own a business that has a lot of sponsorship from them but it doesn't just come from the head office; the local business heads are quite autonomous and have a lot of say in how money is spent. The business head for Australia might love the idea of sponsoring Albion and the head for Dubai might not. Top down sponsorships don't just get parachuted down to the regions.

Rich individual or investment buyer; not a corporate buyer.

Offline seteefeet

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Re: Guochuan Lai
« Reply #77 on: February 17, 2015, 03:48:58 PM »
Sorry Stand, that's not the way that most companies behave. The vast majority OWN as little as they possible can. That is why most do not own the stores they trade from, the cars that their senior staff drive etc. They prefer to rent, outsource as much as they can to keep their own balance sheet efficient and the business focused on what they are good at. Running a football company isn't in any way core to Tata and I would be amazed if they devote not just £100m+ of capital but also management time when they could easily just spend £3m and get all the image rights with none of the hassles.  Also, with companies such as Tata (and I personally know them very well), they have individual country businesses to consider. I own a business that has a lot of sponsorship from them but it doesn't just come from the head office; the local business heads are quite autonomous and have a lot of say in how money is spent. The business head for Australia might love the idea of sponsoring Albion and the head for Dubai might not. Top down sponsorships don't just get parachuted down to the regions.

Rich individual or investment buyer; not a corporate buyer.
So what's in it for any investor Stox? I must admit, I have been a bit flippant on this thread because I don't really understand the ins and outs of investments. I thought investors were only interested in making healthy returns and can't see how they would do that.
Can you give us, in laymen's terms, what might be attractive to a potential investor and what might put them off? What's the most likely scenario (IYO) and how it would affect the club as we see it?

Offline stoxman

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Re: Guochuan Lai
« Reply #78 on: February 17, 2015, 04:37:40 PM »
I believe that West Brom's most recent revenue was circa £70m. £53m of broadcast money. £7m commercial. £7m gate receipts. It has been reported that the most recent deal is a 70% increase in broadcast rights. There is little detail as to exactly how the new money will be shared inside the PL or outside in trickle down payments to the FL, payments to elite development etc.  To keep it simple, let's assume that Albion's broadcast money rises by 70% to £90m. Assume that the gate receipts and commercial revenues don't change (given the amount of TV money, it frankly doesn't matter whether I turn up singing COYB and buying a pie or not...).

IF we now assume that the cost base doesn't change, Albion's very small profit of circa £1-2m per annum suddenly becomes circa £40m per annum because ALL of the extra TV money (another £37m) goes straight to the bottom line.   

The crucial, crucial point is of course cost control. The £40m profit won't happen if agents just push up their players wages pro rata. That may seem far fetched but remember that in 1992 the average PL wage was only £1200 per week. Wage inflation has been enormous and there is no reason why we couldn't see hikes that soak up all of the fresh cash if Chairmen are weak enough.

However, all that a new owner would need to do is say no.  There will only be 500 players on premier league contracts due to the limit of 25 squad players. If Brunt's agent comes asking for a 50%, 60%, 100% pay rise the new owner just says "no, thank you, please go elsewhere and ask one of 19 other owners for that money"  There are only 475 other well paid PL contracts out there. Either Brunt stays and accepts not having a massive pay rise or goes. If he goes we offer Brunt's current package to the best Championship, Scottish, European and (where possible) non-EU players. Brunt's current package would be a massive pay rise for almost any other player and we would have no problem filling our squad with grateful and very committed players. Therefore it unquestionably IS possible to keep our variable costs fixed. 

All of our other fixed costs (ground, maintenence, office, etc) is going to be pretty small compared with our variable costs and these should be genuinely fixed costs anyway. The grass isn't going to cost more to cut following the Sky deal....

Hopefully I have proved that Albion COULD make £40m per annum in the PL.

Of course, if we are paying a smaller wage bill, we might struggle and a long term stay in the PL can't be guaranteed in any investment model that we build. That's ok. Let's assume that just through luck we have 2 years in the PL. Let's also assume that we have two years of break-even following relegation (which seems reasonable as JP's current cost base as appropriate drop-down clauses to avoid financial implosion if we were relegated. There is also the chance that future parachute payments are increased).  Let's also assume that post relegation WBA still has some value and could be sold for £5m.   We therefore have £80m of free cash from 2 years of profits and a stub value of £5m.   

Most banks will lend despite the fickle nature of football clubs. Look at most PL clubs and they have £60-100m of net debt. Swansea and Albion are rare examples of clubs without debt.  Given the cash flows yet to come, I see no reason why any bank wouldn't lend £60m to someone (and by that I mean an individual, fund, corporate structure) who was willing to put up £10m of their own money. This would be a Loan To Value of 85% and given the cash flows, acceptable to most banks. The net interest margin might be LIBOR +7% (that appears about right looking at the interest bills and outstanding debt of other PL clubs) and therefore an interest bill of circa £4m per year.  Knock that £4m off the £40m profit (EBIT for you accountants) and you have a £36m profit before transfer profits/ losses. As you have only put up £10m of your own cash that represents a pre-tax 260% per annum return and you would have recovered your own cash after 4 months.  A sensible banker will ask for the debt to be paid down and that might limit the cash that you could take from the business but one look at the indebtedness of clubs shows that banks don't actually get repaid whenever there is cash in the pot.

So, what does it mean for an investor? They could put up little cash, pay JP a very full price (remember that Lerner was reported to be willing to take less than £100m for Villa and I would suggest that they are a bigger club than us). They could take a dividend of £30m+ per annum for a couple of years and if it all goes to s41t then they can just walk away.  It is honestly a very compelling opportunity for the right investor.

As a supporter, it is of course potentially dangerous. I'm not saying that this is going to happen or even very likely but believe me, the maths work very well.

Offline Albionic

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Re: Guochuan Lai
« Reply #79 on: February 17, 2015, 04:47:24 PM »
I don't understand what is in it for the banks other than the libor +7% though !
Esp if the debt isn't re-paid.
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Offline AlbionFan

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Re: Guochuan Lai
« Reply #80 on: February 17, 2015, 05:46:27 PM »
I believe that West Brom's most recent revenue was circa £70m. £53m of broadcast money. £7m commercial. £7m gate receipts. It has been reported that the most recent deal is a 70% increase in broadcast rights. There is little detail as to exactly how the new money will be shared inside the PL or outside in trickle down payments to the FL, payments to elite development etc.  To keep it simple, let's assume that Albion's broadcast money rises by 70% to £90m. Assume that the gate receipts and commercial revenues don't change (given the amount of TV money, it frankly doesn't matter whether I turn up singing COYB and buying a pie or not...).

IF we now assume that the cost base doesn't change, Albion's very small profit of circa £1-2m per annum suddenly becomes circa £40m per annum because ALL of the extra TV money (another £37m) goes straight to the bottom line.   

The crucial, crucial point is of course cost control. The £40m profit won't happen if agents just push up their players wages pro rata. That may seem far fetched but remember that in 1992 the average PL wage was only £1200 per week. Wage inflation has been enormous and there is no reason why we couldn't see hikes that soak up all of the fresh cash if Chairmen are weak enough.

However, all that a new owner would need to do is say no.  There will only be 500 players on premier league contracts due to the limit of 25 squad players. If Brunt's agent comes asking for a 50%, 60%, 100% pay rise the new owner just says "no, thank you, please go elsewhere and ask one of 19 other owners for that money"  There are only 475 other well paid PL contracts out there. Either Brunt stays and accepts not having a massive pay rise or goes. If he goes we offer Brunt's current package to the best Championship, Scottish, European and (where possible) non-EU players. Brunt's current package would be a massive pay rise for almost any other player and we would have no problem filling our squad with grateful and very committed players. Therefore it unquestionably IS possible to keep our variable costs fixed. 

All of our other fixed costs (ground, maintenence, office, etc) is going to be pretty small compared with our variable costs and these should be genuinely fixed costs anyway. The grass isn't going to cost more to cut following the Sky deal....

Hopefully I have proved that Albion COULD make £40m per annum in the PL.

Of course, if we are paying a smaller wage bill, we might struggle and a long term stay in the PL can't be guaranteed in any investment model that we build. That's ok. Let's assume that just through luck we have 2 years in the PL. Let's also assume that we have two years of break-even following relegation (which seems reasonable as JP's current cost base as appropriate drop-down clauses to avoid financial implosion if we were relegated. There is also the chance that future parachute payments are increased).  Let's also assume that post relegation WBA still has some value and could be sold for £5m.   We therefore have £80m of free cash from 2 years of profits and a stub value of £5m.   

Most banks will lend despite the fickle nature of football clubs. Look at most PL clubs and they have £60-100m of net debt. Swansea and Albion are rare examples of clubs without debt.  Given the cash flows yet to come, I see no reason why any bank wouldn't lend £60m to someone (and by that I mean an individual, fund, corporate structure) who was willing to put up £10m of their own money. This would be a Loan To Value of 85% and given the cash flows, acceptable to most banks. The net interest margin might be LIBOR +7% (that appears about right looking at the interest bills and outstanding debt of other PL clubs) and therefore an interest bill of circa £4m per year.  Knock that £4m off the £40m profit (EBIT for you accountants) and you have a £36m profit before transfer profits/ losses. As you have only put up £10m of your own cash that represents a pre-tax 260% per annum return and you would have recovered your own cash after 4 months.  A sensible banker will ask for the debt to be paid down and that might limit the cash that you could take from the business but one look at the indebtedness of clubs shows that banks don't actually get repaid whenever there is cash in the pot.

So, what does it mean for an investor? They could put up little cash, pay JP a very full price (remember that Lerner was reported to be willing to take less than £100m for Villa and I would suggest that they are a bigger club than us). They could take a dividend of £30m+ per annum for a couple of years and if it all goes to s41t then they can just walk away.  It is honestly a very compelling opportunity for the right investor.

As a supporter, it is of course potentially dangerous. I'm not saying that this is going to happen or even very likely but believe me, the maths work very well.

You've obviously given this some considerable and serious thought and have produced a very good read and an imaginative hypothetical mathematical model.

However, like most things financial in life there is a myriad of unpredictable variables that can and will adversely effect likely and predicted outcomes. And you have allude to a few e.g. players wages and the possible impact on the clubs future profit potential.

I think if you were a potential investor and needed a little more investment to purchase WBA and you took this proposal to the Dragons Den, I'd be amazed if any of the Dragons would back you. There is too much risk, IMO in your model. In theory it looks good, but putting it into practice would be a different matter altogether.

ps I know nothing about accountancy, this is just a layman's opinion. But well done on a thought provoking post
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Offline stoxman

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Re: Guochuan Lai
« Reply #81 on: February 17, 2015, 06:37:51 PM »
With regards to what does the bank get, a 7% net interest margin is very juicy. Personally I wouldn't want to lend to football clubs (other than where I get first charge over a property asset worth more than the debt!) but banks LOVE lending to them. Just look at the table below to see the loans that have already been advanced. Not all of this will have come from banks but a lot has. Also take a look at the European scene where the debts are even higher and even more is from banks.  Currently most banks are probably under geared and would like to lend more. They are happy to advertise small business loans at 7% to businesses with far less predictable cash flow than an established Premier League football club...

http://www.theguardian.com/news/datablog/2014/may/01/premier-league-club-accounts-debt-wages

With regards to the Dragon's Den, they are looking at very different investments that are FAR higher risk than Albion could be. They are often backing pure venture capital with no assets, short trading histories, negative cashflow and a lot of capex yet to be done. Albion SHOULD be very profitable and certainly profitable enough to return an investors capital relatively quickly.

To be clear, I'm not saying any of this is easy or likely. It isn't. Banks might say no. Hedge funds would supply capital but at far worse terms for the investor (the Glazers were paying circa 15% PIK loans to the hedge funds when they bought Man Utd). There are a hundred reasons why an investment model such as this might not be practical when someone got down to the fine details of due diligence.  Someone asked me whether it was POSSIBLE to make an investment case out of buying, gearing and stripping cash from the Albion and at a high level I believe it might be...

Offline Albionic

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Re: Guochuan Lai
« Reply #82 on: February 17, 2015, 08:16:27 PM »
Sorry, i didn't make my question clear, i fully appreciate that 7% is very attractive in "usual" circumstances but in a high risk situation such as football, why is it that banks LOVE lending them capital ? Does a bank have an ego?
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Offline stoxman

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Re: Guochuan Lai
« Reply #83 on: February 17, 2015, 08:33:21 PM »
It really comes down to an assessment of risk. You may think of football as risky but banks generally don't view football as risky. Think of it this way- most have been around for 100+ years. Many have property asset backing. Most have (absurdly) loyal customers. Very, very few have gone bust in living memory. A large percentage of their revenues are guaranteed in advance by a wealthy central body. How many industries can claim those factors?  Yes, clubs may lose money at a P&L basis in a particular year but the club doesn't disappear. Banks don't have to write off non-performing loans against football clubs because there is a decent chance of repayment.

Believe me, I have seen far riskier things backed by banks on interest margins that I personally regarded as absurd.

Offline Albionic

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Re: Guochuan Lai
« Reply #84 on: February 17, 2015, 08:40:24 PM »
when you couch it those terms it makes a lot of sense. Thanks for the explanation (in terms I can understand.)
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Offline AlbionFan

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Re: Guochuan Lai
« Reply #85 on: February 17, 2015, 08:42:44 PM »
It really comes down to an assessment of risk. You may think of football as risky but banks generally don't view football as risky. Think of it this way- most have been around for 100+ years. Many have property asset backing. Most have (absurdly) loyal customers. Very, very few have gone bust in living memory. A large percentage of their revenues are guaranteed in advance by a wealthy central body. How many industries can claim those factors?  Yes, clubs may lose money at a P&L basis in a particular year but the club doesn't disappear. Banks don't have to write off non-performing loans against football clubs because there is a decent chance of repayment.

Believe me, I have seen far riskier things backed by banks on interest margins that I personally regarded as absurd.

I think this maybe similar to contractors winning Local Authority contracts. Banks view lending to these contractors as Blue Chip as they know the contractor will be paid in full regularly. So, the Banks know that their investment is virtually guaranteed. Perhaps a simplistic comparison.
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Offline stoxman

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Re: Guochuan Lai
« Reply #86 on: February 17, 2015, 08:50:18 PM »
I think this maybe similar to contractors winning Local Authority contracts. Banks view lending to these contractors as Blue Chip as they know the contractor will be paid in full regularly. So, the Banks know that their investment is virtually guaranteed. Perhaps a simplistic comparison.

Not simplistic at all. Actually a good comparison. Think of the huge mess that a lot of Public Private Partnerships have got into and yet have been regarded as low risk.  A layman's assessment of risk and a banks assessment of risk can be very, very different (and the latter's assessment isn't always right).  The banks lent lots to Lehman, Bear Stearns, Chrysler, GM, Enron, WorldCom, Trump etc and they all went bust.

Offline AlbionFan

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Re: Guochuan Lai
« Reply #87 on: February 17, 2015, 08:56:12 PM »
Hyperthetocally, the Glazers acquired Man United with a debt that is being paid by the club.

Would it be feasible for Albion fans to get together in some sort of co-operative and do something similar?
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Offline stoxman

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Re: Guochuan Lai
« Reply #88 on: February 17, 2015, 09:29:27 PM »
I wasn't close to that one but my recollection was that the Glazers had quite a bit of their own cash in, at least to begin with before they refinanced and even then they still carried some of the debt personally. Might be wrong on that; it's been a while.

Hypothetically, if a supporters consortium could raise £10-20m of equity then yes, it might be possible to do an LBO.  Again I would stress that these numbers ae little more than a guess without knowing what JP wants to achieve, what the new PL revenues look like etc etc.

However, remember my original premise that an investor doesn't care about Albion. If I came in as an investor I would happily swap Foster, Lescott, GMac, Saido, Yacob etc if any of them demanded a wage increase. Would you be happy taking those sort of decisions? Personally I wouldn't as my blood runs blue and white. When you mix business with personal feelings it ends badly....

Offline AlbionFan

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Re: Guochuan Lai
« Reply #89 on: February 17, 2015, 09:38:53 PM »
I wasn't close to that one but my recollection was that the Glazers had quite a bit of their own cash in, at least to begin with before they refinanced and even then they still carried some of the debt personally. Might be wrong on that; it's been a while.

Hypothetically, if a supporters consortium could raise £10-20m of equity then yes, it might be possible to do an LBO.  Again I would stress that these numbers ae little more than a guess without knowing what JP wants to achieve, what the new PL revenues look like etc etc.

However, remember my original premise that an investor doesn't care about Albion. If I came in as an investor I would happily swap Foster, Lescott, GMac, Saido, Yacob etc if any of them demanded a wage increase. Would you be happy taking those sort of decisions? Personally I wouldn't as my blood runs blue and white. When you mix business with personal feelings it ends badly....

Thank you for shedding light on some of the pitfalls of a supporters acquisition. I said in any earlier post on this thread that I would be more than happy for JP to remain as the owner.
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Offline Albionic

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Re: Guochuan Lai
« Reply #90 on: February 17, 2015, 10:48:35 PM »
one final question from me, if I may,
As a finance man, (not a fan) what are your views of JP's tenure?
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Offline stoxman

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Re: Guochuan Lai
« Reply #91 on: February 17, 2015, 11:37:34 PM »
one final question from me, if I may,
As a finance man, (not a fan) what are your views of JP's tenure?

I'm not sure how much JP paid for his shares given the various group structures that were involved and we don't know how much he wants to sell for or will be offered. It is therefore hard to say exactly how well he has done but it's probably fair to assume that he will have made a multi-fold gain and many £10m's. There won't be many assets (equities, bonds, commodities or property) that will have done anywhere near as well.  He has also done it against a backdrop of many other businessmen having lost in football the fortunes they earned in the real world. Remember Simon Jordan p155ing away a phone fortune at Crystal Palace??  JP has taken nice dividends and has probably had far fewer sleepless nights than most other football owners. All in all I think he has done a cracking job for himself.

As a supporter I just ask myself a simple question; if I could put all the other league and PL chairmen/owners in a tombola back and draw one out, would I take the chance? Personally I wouldn't. There might be 5% (Chelsea, Man City) who would have done better for us, 5% (Leeds, Pompey et al) that would have been a disaster and the rest would have been a bit worse (Boro, Shef Utd, Shef Weds, Forest, Ipswich, Blues, Charlton etc etc)

« Last Edit: February 18, 2015, 09:28:17 AM by stoxman »

Offline Standaman

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Re: Guochuan Lai
« Reply #92 on: February 18, 2015, 09:55:45 AM »
Thank you Stoxman for an interesting series of posts and by the way my earlier post on the prospect of being bought by a global was saying it was unlikely. However there a few points worth picking up.

I agree with your basic premise that an LBO is possible and given that the club is virtually debt free owns the freehold to both the training ground and the Hawthorns there is plenty of scope for borrowing. I might quibble about your implied interest rate of 7.68% based on the the fact we are not one of the Premier League's blue chips who are pretty much immune from the threat of relegation and that a large part of the current stock of debt in the Premier League is owner debt which is not being serviced on a commercial basis i.e Lerner waived the interest payments on his loans to Villa in order for the club to comply with the FFP regulations.

However the big unknown is the price that Peace wants. With all buy outs there is a simple rule of thumb if the purchaser pays too much for the asset in the first place it is almost certainly doomed to failure and the use of leverage merely accelerates the process.

Blues went for £81m a few years ago and Fulham for £150m recently. Neither sale worked out well for the purchaser but I cannot see Peace letting the Albion go for less than what Blues were sold for on the basis of a turnover which would have been considerably less than our current level. If Lerner is prepared to take £100m for the Villa that would appear to be a distressed seller trying to sell a distressed asset and I suspect the fact there are no takers at that price is because the new owners would be saddled with the Lerner family trust debt which was standing at over £150m which obviously limits the scope for additional borrowing.

From a pure investor perspective Albion with virtually no debt strong operating model (i.e. flex down clauses in player contracts if relegated) are a better buy at £100m than Villa despite their obvious advantage in terms of fan base because without significant investment it is impossible to realise any net gain from it.

 
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Offline koren

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Re: Guochuan Lai
« Reply #93 on: February 19, 2015, 05:39:59 PM »
Peace responds to media speculation

CHAIRMAN Jeremy Peace has clarified his plans for Albion following recent speculation about future investment at the club.

The Baggies were at the centre of weekend reports that the Club had been put up for sale by its chairman of the last 13 years amid claims that a broker had been appointed to seek foreign investment.

Albion this week sent its Annual Report to West Bromwich Albion Group Ltd Shareholders and the Chairman decided this provided a timely moment to bring supporters up to date with his future plans.

Peace explained: "I said then that I was open to proposals regarding investment in the club and would not stand in the way of a new owner providing they convinced me their intentions for the club were in keeping with its traditions and values and their ability to deliver on them was realistic.

"Nothing has changed in that regard. The recent announcement of a new and record media rights deal for the Premier League from season 2016-17 is sure to mean that there is once again huge interest in the brand.

"It was only right and prudent, in my view, that at such a moment we should present the Club to the investment market. I believe it is a sound company – an extremely solid football club with no debt, significant assets, a developing infrastructure and reasons to be confident about the future.

"I have been at the helm for 13 years now and I am proud of what has been achieved in that time. I do not need to remind supporters about the journey we have shared to this point.

"I am happy to continue as we strive to deliver Premier League football whilst growing the Club within our means.

"But equally if there was someone out there willing and capable of taking the club further forward, I would be willing to step aside and negotiate a change of ownership providing it was an investment that was right for the Club."

The financial statement for the Club’s ultimate parent company WBA Holdings Ltd, covering the year ending June 30, 2014, showed Albion remains in robust health.

It reported consolidated pre-tax profits of £14.7m on an income of £86.8m even though overall staff costs continued to increase, to £65.5m which represents more than 75 per cent of turnover.

The Chairman added: "The Club continues to fight its ground in an increasingly competitive market.

"The challenge of growing our profile and our support base, to try to keep pace with the advances our competitors make, is one which I feel we tackle with ingenuity and energy.

"As I have remarked before, it gets harder each year and the demands on everyone at the club to over-achieve never diminishes.

"But it is also exciting and fulfilling when you see The Hawthorns brimming with excitement as it was on Saturday afternoon."

Meanwhile, West Bromwich Albion Holdings, which is controlled by Peace and now holds nearly 88 per cent of the club’s shares, is proposing an end to the requirement to hold an Annual General Meeting of the subsidiary Group company.

It is also seeking to remove the limit on the number of directors who can be appointed and also a removal of the limit to increase share capital by more than 10 per cent annually.

These are moves intended to bring Albion into line with similar-sized private companies.

Chief Executive Mark Jenkins acknowledged that some independent shareholders will be disappointed to see the end of the annual AGM but insisted it would not distance the club’s senior officers from supporters.

He said: "We now feel we have far more effective ways of communicating with our fans and shareholders.

"The body of independent shareholders represents an increasingly small number of people and, as I have done in the past, I am more than happy to meet with their representatives periodically to discuss any issues."
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Online gazberg

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Re: Guochuan Lai
« Reply #94 on: February 19, 2015, 05:59:03 PM »
Pre-consolidated profit of £14.7 milloon before tax?  :-X

Financial people what does that mean to the club net (roughly)?

Offline WorcsWBA

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Re: Guochuan Lai
« Reply #95 on: February 19, 2015, 06:37:28 PM »
For those who sometimes question "where's the money gone?", here's the answer! I suspect the profit for 2014-15 will be even higher.

Offline kirk

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Re: Guochuan Lai
« Reply #96 on: February 19, 2015, 06:38:53 PM »
Hyperthetocally, the Glazers acquired Man United with a debt that is being paid by the club.

Would it be feasible for Albion fans to get together in some sort of co-operative and do something similar?

It's already been done. By JP I believe it was 8 million pounds which the club paid back to Barclays.
It's easy to have faith in yourself and have discipline when you're a winner, when you're number one. What you got to have is faith and discipline when you're not a winner.

Offline throstle

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Re: Guochuan Lai
« Reply #97 on: February 19, 2015, 07:06:29 PM »
So now no AGM, another step towards the marginalisation of the remaining small shareholders who JP views as little more than an irritant.

It is not clear to me from the statement whether the removal of the 10% annual limit on increasing share capital applies to WBA Holdings or WBA Group. I think it applies to WBA Holdings, and there will be a reason for this which no doubt will be revealed in the fullness of time. Whatever the reason, I very much doubt it will be for the benefit of the other shareholders.

Offline baggiejohn

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Re: Guochuan Lai
« Reply #98 on: February 19, 2015, 08:23:55 PM »
For those who sometimes question "where's the money gone?", here's the answer! I suspect the profit for 2014-15 will be even higher.


The quoted pre-tax figure of £14.7million is for the holding company. The profit has'nt necessarily all been generated by the football club. If there are other operating companies in the group, they could have contributed to the overall figure.
If it was easy, it wouldn't be Albion

A wise old owl sat in an oak, the more he saw, the less he spoke
The less he spoke the more he heard, why aren't we like that wise old bird?

Offline Standaman

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Re: Guochuan Lai
« Reply #99 on: February 19, 2015, 08:47:27 PM »
The Holding Company doesn't have any other assets other than the club. The profit will probably net down to about £12m. The answer to the question where has the money gone? Wages which have gone up by £10m and Peace has circumvented the Premier League salary cap rules by putting the £6m retained profit back into the wage bill and I am guessing the wage bill has taken another hike this year and if we want to have any chance of retaining Berahino for instance will go up again next year.

Obviously the devil is in the detail but from the headline figures the club is a very attractive proposition as an investment. The problem is that a lot of the profit will have to be ploughed back into the team mostly in wages to keep the club in the Premier League   
Standaman - Born to be a Baggie.