Tony Xia (no longer involved with AVFC)

[snowychap]

20 minutes ago, TRO said:

Snowy,

Can you answer this....particularly as the main theme of our problem is cash flow.....and murmurings of not getting money out of china, seems to have raised its ugly head.

Where is the substantial deposit in a UK bank The owner is purported to have undertaken to satisfy the League of a fit and proper person, when he took over Villa?.....Would that money not have helped in our hour of need or is it just pie in the sky?.....and if so, what was the league satisfied with?

I have as much of an idea as anyone, i.e. not a great deal. I'm no authority on what is going on with Villa and I don't claim to be. All I was trying to do in the previous few pages was explain some of the numbers in the publicly available documents.

If you were to push me for a guess about it, these would be my musings (and this is no comment on whether or not this money was there):

Was the money just there to prove that the funds were available for the purchase? I don't see that it would be reasonable to expect any organization to keep a large amount of cash on deposit to draw down on if needed but otherwise not be working for them. Assuming that Xia is straight up and all that he claimed about himself is true then it wouldn't surprise me at all if money is moved from one part of an organization to another (given that the Villa would merely be a part of a much wider group).

I admit that there were things that I didn't like about Xia from the off which made me a little skeptical but I still don't know whether those suspicions are well-founded or not. When we get more information, or merely as time plays out, we should get a clearer picture, hopefully. I hope my skepticism was wrong. Whatever the case, I think the situation highlights issues with Chinese ownership, though - by which I mean things like opacity, indirect influence of CCP policy, &c.

[Hoof hearted]

Sat in the airport waiting for my flight to Venezuala, I'm about 15 pages behind, and this thread is really really boring. Go enjoy your summers boys and girls, Tony (like Jack) is going nowhere.

[paul1984]

2 hours ago, hippo said:

Sadly new or existing its still debt - its something any new owner will have to service. 

No doubt but it firstly it isn't the fault of the current owner and secondly in our current predicament it really matters what the terms are to service it which we don't know.

 

[blandy]

15 hours ago, paul1984 said:

Xia can put up to 39m into the club over 3 years.

This is a complete misunderstanding. It’s not true at all. The 39 million figure is the maximum total FFP losses permitted over the period covering next season and the previous two. There’s no figure for how much any owner can put in to a club.

Many expenses are not included in the FFP calculations. From memory, Things like community work, youth development, stadium work, training facilities etc. etc.  So those things can be funded by an owner, or from operating income, or from debt, or from any number of sources, essentially without limit.

The 39 million FFP limit is nominally about not permitting the club to go silly on players, endangering the long term future in a gamble to get promoted. The FFP figure to the end of this season, btw, was much larger because it included one seasons worth of allowable losses under prem. calculations. We know that next season the TV money drops by about 18 million and the FFP allowance by another 20 or so (approx). So we know that next season alone we need to somehow find around 40 million quid in savings on costs (wages), or in income from somewhere (player sales).

Returning to the owner, we know that that the club has laid people off, sacked the CEO, ended catering contracts, failed to pay bills on time, publicly announced struggles with meeting FFP, declared sizeable losses in the accounts. We know that the owner has taken steps to either facilitate a buy out or to let others take a stake in the club. We know that no one has done either of those things, to date. We know that the owner gambled on getting promoted, and lost. We know that costs are too high, income too low and the club is skint and the owner has vanished, and is probably not in a position to continue as the owner for much longer without wrecking the club completely. It’s all very Leeds.

[eholm]

9 minutes ago, blandy said:

This is a complete misunderstanding. It’s not true at all. The 39 million figure is the maximum total FFP losses permitted over the period covering next season and the previous two. There’s no figure for how much any owner can put in to a club.

Many expenses are not included in the FFP calculations. From memory, Things like community work, youth development, stadium work, training facilities etc. etc.  So those things can be funded by an owner, or from operating income, or from debt, or from any number of sources, essentially without limit.

The 39 million FFP limit is nominally about not permitting the club to go silly on players, endangering the long term future in a gamble to get promoted. The FFP figure to the end of this season, btw, was much larger because it included one seasons worth of allowable losses under prem. calculations. We know that next season the TV money drops by about 18 million and the FFP allowance by another 20 or so (approx). So we know that next season alone we need to somehow find around 40 million quid in savings on costs (wages), or in income from somewhere (player sales).

Returning to the owner, we know that that the club has laid people off, sacked the CEO, ended catering contracts, failed to pay bills on time, publicly announced struggles with meeting FFP, declared sizeable losses in the accounts. We know that the owner has taken steps to either facilitate a buy out or to let others take a stake in the club. We know that no one has done either of those things, to date. We know that the owner gambled on getting promoted, and lost. We know that costs are too high, income too low and the club is skint and the owner has vanished, and is probably not in a position to continue as the owner for much longer without wrecking the club completely. It’s all very Leeds.

Sums up our precarious situation very succinctly. Great post mate.

[wilko154]

1 hour ago, blandy said:

This is a complete misunderstanding. It’s not true at all. The 39 million figure is the maximum total FFP losses permitted over the period covering next season and the previous two. There’s no figure for how much any owner can put in to a club.

Great post! 

Do you know if the owner is allowed to put money into the club to cover bills such as HMRC & player wages?

What I am getting at is, is there any possibility that the press rumours of Xia putting in 5 million per month to keep us running are actually true? Or would this not be allowed under FFP rules?

I would think that Xia has only been doing it for the last few months when the clubs money dried up... but again is that something an owner is actually allowed to do under FFP?

[blandy]

1 hour ago, wilko154 said:

Great post! 

Do you know if the owner is allowed to put money into the club to cover bills such as HMRC & player wages?

What I am getting at is, is there any possibility that the press rumours of Xia putting in 5 million per month to keep us running are actually true? Or would this not be allowed under FFP rules?

I would think that Xia has only been doing it for the last few months when the clubs money dried up... but again is that something an owner is actually allowed to do under FFP?

FFP sets limits on the overall allowable amount of losses relating to the things you mention. It doesn’t “prevent” an owner putting in money, but what it does do is say that (I paraphrase) you can’t get round the rules by putting in money  - i.e. just because you injected money to cover it, doesn’t mean that our sporting league accepts you buying Ronaldo and paying him gazillions more than the club could otherwise afford is ok. Have a points deduction and a fine.  FFP explicitly rules out paying bills by the owner being excluded from the costs - i.e. you can do it, but can’t count it as income in the FFP calculations.

so while an owner can put in however much he or she wants, the club can’t spend it all on wages and taxes and get round FFP . But they could spend it all on youth development, community scheme, stadium development or other areas excluded from FFP calculations.

snowy posted a few pages back on the last set of accounts  the club was losing millions a month, and this last season our income dropped (smaller parachute payments) so the situation is unlikely to have completely gone away. Clearly it hasn’t, as we’ve been struggling to pay bills and suppliers etc.

An owner can put money in, but if it is being used to fund wages and tax bills, then FFP excludes it and that means potential trouble  if you yahoogle “EFL profit and sustainability rules appendix F” you should get to what FFP treats as included and excluded from the calls, in terms of owners funding.

edit: one further thing, permitted losses per season (13 million) is reduced to 5 million if the owner doesn’t invest. Any loss between the 5 and 13 million figure can be covered off by owner buying equity, (but not by lending money).

 

[Only2McInallys]

The reported losses of 4-5 million a month are obviously an exaggeration .Why is there no mention about our income?The money we are probably owed on transfers at beginning of Xias first season ,Gollinis recent transfer4.5 million,parachute payment 18 million,Efl money ,shirt sponsorship money,money from Wembley play off finals and season ticket sales.

[HanoiVillan]

11 minutes ago, Londonastonvilla said:

The reported losses of 4-5 million a month are obviously an exaggeration .Why is there no mention about our income?The money we are probably owed on transfers at beginning of Xias first season ,Gollinis recent transfer4.5 million,parachute payment 18 million,Efl money ,shirt sponsorship money,money from Wembley play off finals and season ticket sales.

If you have read any media reports on our situation, you have probably read that we have brought forward any transfer income we could. All of the other monies you mention are dwarfed by our outgoings.

I would really encourage you, and anyone else feeling a sense of panglossian optimism, to bear in mind this paragraph, which lays out our situation quite succinctly:

3 hours ago, blandy said:

Returning to the owner, we know that that the club has laid people off, sacked the CEO, ended catering contracts, failed to pay bills on time, publicly announced struggles with meeting FFP, declared sizeable losses in the accounts. We know that the owner has taken steps to either facilitate a buy out or to let others take a stake in the club. We know that no one has done either of those things, to date. We know that the owner gambled on getting promoted, and lost. We know that costs are too high, income too low and the club is skint and the owner has vanished, and is probably not in a position to continue as the owner for much longer without wrecking the club completely. It’s all very Leeds.

None of this would be happening if there were actually sources of income that people were just forgetting to discuss or something (?)

[Only2McInallys]

WWe have just had severe cash flow issues.I know we asked for Westwood transfer money early what about the other transfers?Our wage bill will drop next month by 15 million I just don't see any mention of money coming in only going out.The sums may not be huge individually but our losses per month would seem be 1 - 1.5 million

[TheEgo]

18 hours ago, paul1984 said:

We'll see.

Not really we'll see is it. You said No chance we spend 4/5m each month on income, just that basically calculation alone shows it's more than probable the 4/5m figure bandies around is pretty close.

[TheEgo]

14 hours ago, snowychap said:

I have as much of an idea as anyone, i.e. not a great deal. I'm no authority on what is going on with Villa and I don't claim to be. All I was trying to do in the previous few pages was explain some of the numbers in the publicly available documents.

If you were to push me for a guess about it, these would be my musings (and this is no comment on whether or not this money was there):

Was the money just there to prove that the funds were available for the purchase? I don't see that it would be reasonable to expect any organization to keep a large amount of cash on deposit to draw down on if needed but otherwise not be working for them. Assuming that Xia is straight up and all that he claimed about himself is true then it wouldn't surprise me at all if money is moved from one part of an organization to another (given that the Villa would merely be a part of a much wider group).

I admit that there were things that I didn't like about Xia from the off which made me a little skeptical but I still don't know whether those suspicions are well-founded or not. When we get more information, or merely as time plays out, we should get a clearer picture, hopefully. I hope my skepticism was wrong. Whatever the case, I think the situation highlights issues with Chinese ownership, though - by which I mean things like opacity, indirect influence of CCP policy, &c.

I think this is an excellent and fair/balanced post.  All Xia had to do was show proof that the money was there to fund the club (with regards to the reported large sum in a uk account) As said it was either then moved around (Samuelson was heavily involved with advising on this) to other businesses outside of the UK or wasn't real to start with if you believe certain version of events. I too have no idea on if it was there to start with, I know it isn't now for sure. 

Sadly the FA ask you to present proof, but then don't do an awful lot of work to verify the legitimacy of it all, which is a major flaw in the owners and directors test. I'd say this. Samuelson and Banfill approached Xia with this opportunity to buy Villa, CS was massively involved in all aspects and was to be vice/deputy Chairman until he FAILED the owners and directors test. That only should immediately set some alarm bells ringing (plus a quick google re court cases involving him) Given he was THE guy who put it all together.

 

[hippo]

42 minutes ago, Londonastonvilla said:

WWe have just had severe cash flow issues.I know we asked for Westwood transfer money early what about the other transfers?Our wage bill will drop next month by 15 million I just don't see any mention of money coming in only going out.The sums may not be huge individually but our losses per month would seem be 1 - 1.5 million

other than season ticket sales what incomings do you feel are being omitted?

[TheEgo]

47 minutes ago, Londonastonvilla said:

WWe have just had severe cash flow issues.I know we asked for Westwood transfer money early what about the other transfers?Our wage bill will drop next month by 15 million I just don't see any mention of money coming in only going out.The sums may not be huge individually but our losses per month would seem be 1 - 1.5 million

We asked for Sanchez, Gil and Im not 100% but Gollini too ALL at a reduced rate. We have already borrowed against the parachute payments, it's GONE....SPENT. I read the figures to include income, so after looking at income and expenditure we are short by 4/5m a month. If you read back on the thread you'll see this covered in great length 

[Jareth]

6 minutes ago, TheEgo said:

We asked for Sanchez, Gil and Im not 100% but Gollini too ALL at a reduced rate. We have already borrowed against the parachute payments, it's GONE....SPENT. I read the figures to include income, so after looking at income and expenditure we are short by 4/5m a month. If you read back on the thread you'll see this covered in great length 

I'm not going to dispute any figures as I don't have any evidence to present a counter argument - I would like to know though, how if we had spent effectively two seasons money in one season and now the piggy bank is stuffed full of IOUs, how on earth did we comply with FFP who would have seen our projected spend this season? We should already have received a huge penalty surely? Given the losses of the past seasons the margins this season gone would have been tighter than ever. Or have I got that completely wrong (it happens frequently). 

[TheEgo]

13 minutes ago, Jareth said:

I'm not going to dispute any figures as I don't have any evidence to present a counter argument - I would like to know though, how if we had spent effectively two seasons money in one season and now the piggy bank is stuffed full of IOUs, how on earth did we comply with FFP who would have seen our projected spend this season? We should already have received a huge penalty surely? Given the losses of the past seasons the margins this season gone would have been tighter than ever. Or have I got that completely wrong (it happens frequently). 

I don't really know. I'd say that the money we have borrowed against since May......may fall into the next FFP year? I honestly don't know, but I know the payments have been requested and paid early so we could pay bills and keep operating.

It boils down to this in my opinion. Cash flow issues. Now that is either because of Xia having difficulty getting it out of China OR He doesn't have actual cash and only assets (or worst case far less assets than we were lead to believe) The cash flow problems are irrefutable, the rest is opinion, rumor and speculation at this point.

[mykeyb]

I may be over simpifying this but 5 million a month is 60 million quid a year. Our turniver was something like 70 off million from my dodgy memory. Clearly we cannot have spent 130 million so will be very interested to see how and where the money has gone.

It's hard to decide who is worse Lerner or Xia

[hippo]

59 minutes ago, Jareth said:

I'm not going to dispute any figures as I don't have any evidence to present a counter argument - I would like to know though, how if we had spent effectively two seasons money in one season and now the piggy bank is stuffed full of IOUs, how on earth did we comply with FFP who would have seen our projected spend this season? We should already have received a huge penalty surely? Given the losses of the past seasons the margins this season gone would have been tighter than ever. Or have I got that completely wrong (it happens frequently). 

Its losses over a 3 year period - so you can do what u like in years 1 and 2 - so long as by the 3rd year you aren't averaging above £13m per year losses.

[Jareth]

12 minutes ago, hippo said:

Its losses over a 3 year period - so you can do what u like in years 1 and 2 - so long as by the 3rd year you aren't averaging above £13m per year losses.

I don’t think that’s quite right. Meaning, it's always the season you're in, plus the previous 2's losses. 

Edited June 23, 2018 by Jareth

[TheEgo]

28 minutes ago, mykeyb said:

I may be over simpifying this but 5 million a month is 60 million quid a year. Our turniver was something like 70 off million from my dodgy memory. Clearly we cannot have spent 130 million so will be very interested to see how and where the money has gone.

It's hard to decide who is worse Lerner or Xia

I'd factor this in. any debt Lerner created he payed back himself and it never adversely affected the club. We have no idea where and how Xia's debt has been borrowed from and the T&C's involved. For me, I always think Lerner cared. he just had too much going on elsewhere and should have sold us 4 years earlier. He left us without debt (apart from the overdraft) I'm not yet convinced (if ever) Xia actually cares that much.