The NSWE Board

[Risso]

It doesn't make sense that they'd want to sell so soon into the Premier League journey.  Sawiris celebrates like an absolute madman when we score/win a game at VP.

[tomav84]

would it not be the grealish money? it's standard practice that transfer fees are paid in installments and clubs take out loans against the future fees

[WHY]

2 minutes ago, Risso said:

It doesn't make sense that they'd want to sell so soon into the Premier League journey.  Sawiris celebrates like an absolute madman when we score/win a game at VP.

How often does Sawiris attend games at VP. I didn’t think he attended many games which in truth I’ve always thought was odd, considering he lives in London.

[Risso]

1 minute ago, tomav84 said:

would it not be the grealish money? it's standard practice that transfer fees are paid in installments and clubs take out loans against the future fees

Nope, secured against PL reward money.

[DevonIsAPlaceOnEarth]

Probably doesn’t mean a great deal, the arrangement of overdraft facilities provides more liquidity of sorts in the short term.

Nassef made an absolute fortune during Covid, so I doubt he’s particularly worried about our relatively small profit/loss account compared to his huge multinationals. 
 

My guess would be that this is nothing more than a company taking advantage of a vastly improved credit rating, and securing a debt facility it would previously be unable to obtain. Good business practice.

[sharkyvilla]

Thank **** I dropped out of my accountancy apprenticeship. 

[Xela]

1 hour ago, Follyfoot said:

. The interest payable will be five or six basis points above base minimum

No chance. Tier 1 lender and a strong business backed by billionaires. Probably not even 2 over base. 

[Villa_Stateside]

Guys this normal practice in premier league. This is most likely us just getting the Grealish money early,.

We need cash flow and owners clearly see a opportunity to get good terms on a loan.

I can’t overstated enough. The loan means nothing but good news for the club. We mostly likely have good credit now. So the owners don’t have to use their own money. which by the way is wasteful as that can earn you a return of 5-10 percent. When loan would cost you maybe 2 percent. 
 

I have been waiting for this to happen as good health sign of the club. Banks like us again 
 

 

 

Edited September 9, 2021 by Villa_Stateside

[Villa_Stateside]

4 hours ago, Follyfoot said:

It is on Companies House, Just checked it out

Basically an all monies charge 

Was highly dubious myself to be honest especially as all introduced capital was converted to shares before. 
 

The tap is now off

The Tap is flowing nicely. 
 

The tap is getting upgraded

[CVByrne]

11 hours ago, BleedClaretAndBlue said:

What happened to the NSWE thread? Its gone?

 

This makes total sense. Injecting capital into Villa was only NSWE way to cover losses. Given the future cashflows from revenue growth via TV money, the Jack Grealish money and new kit sponsors we would not need new equity injections due to those future cashflows. Furthermore given the inflationary environment we are now moving into it's wise to get loans as the future value of those cashflows you will receive could/will be lower due to higher inflation. I'm sure Villa can get a loan with a net negative real interest rate (interest we pay - cpi).

So basically this is just good business given the current economic environment. It makes more sense to get a loan than for NSWE to inject any cash just to cover cashflow differences.

 

[CVByrne]

10 hours ago, Follyfoot said:

I agree but it is a totally different working strategy than previous years, why pay interest if not necessary 

The reason - an I know this will be hard to understand - is that debt is better than cash atm. If I take a loan of 100m and pay say 1.5% interest on that loan over 5 years. If the consumer price index for inflation averages at 3% in that time. The value in terms of purchasing power of the money I pay back drops 3% per year while I pay 1.5% interest per year. So I'm net positive in real terms. So taking out a loan "earns" Villa money essentially if they spend it now an pay it back later.

What would be much worse would be if the owners put cash in this year and next year, then with our future cash flows we ended up cash rich in the years afterwards. We'd then lose the value of that money, we' pay tax on that profit and we would then pay Dividends to our Owners to take excess cash out. FFP is our constraint not cashflows. 

Debt is good in this scenario

[peterw]

I am most certainly not a finance expert and am just guessing...BUT...from an individual perspective the better off financially that you are, the higher the overdraft you may ask for and receive. With Villa getting a lot of money last season from finishing 11th (I'm not counting the Grealish money because we/I don't know how that is being paid but of course its there), we have better revenue streams, better sponsorship deals are we now not a more viable financial big business? With that in mind, it is possible we have just asked for the larger overdraft at a time when there is relatively low interest on those loans or overdrafts. Businesses are savvy with their money so if there is a chance of 'free money' to protect themselves (we could have a crap season) then having this overdraft may help next summer rather than being a pointer towards owners selling up. I genuinely don't know and all it takes is someone with an economics CSE to shoot my opinion down. I would also suggest that the overdraft is for Aston Villa and is a season insurance against the club which is why it is not being used for one of the many tributary companies around Villa.

Also, I can't see this as being a sign of the tap being turned off considering we have had bids of around £60m turned down for Ward-Prowse and Smith-Rowe.

 

 

[sidcow]

Could this be something do do with the construction projects on the horizon? We're due to build a hotel and replace the North Stand.  £45m would seem a reasonable figure for that.

[blandy]

16 minutes ago, sidcow said:

build a hotel and replace the North Stand.  £45m would seem a reasonable figure for that.

reasonable! multiply by many times for that cost.

Looks like an overdraft facility - club running costs are probably around 2 million a week, but income is largely received in lump sums at points of the year - so it's kind of feast or famine - hence the need for the overdraft.

[barry'sboots]

18 minutes ago, sidcow said:

Could this be something do do with the construction projects on the horizon? We're due to build a hotel and replace the North Stand.  £45m would seem a reasonable figure for that.

I doubt an overdraft would be used for long term expenditure such as this.

I suspect that the overdraft may just be the way of balancing out peaks and troughs in the cash flows - ins and outs - over the next twelve months.

[NeilS]

12 hours ago, Risso said:

It doesn't make sense that they'd want to sell so soon into the Premier League journey.  Sawiris celebrates like an absolute madman when we score/win a game at VP.

100% agree, I can't see any sign for the fans to worry at the moment. Why would NSWE be looking to set up a Las Vegas Villans franchise in the MLS a few weeks back, or have planning in for an inner city academy near Villa Park, along with all the investment building the infrastructure of the club to sell up now. It makes no sense. Therefore I am not worried.

I guess one way to look at it is to compare overdraft facilities versus other teams in the PL, what kind of facility do Newcastle Utd or West Ham or Spurs currently operate with? With the big sums of money flying about in transfer fees and wages these days I imagine there can be massive swings in cash flow, that our old £1m facility would not cover. This would save the owners having to inject cash to cover these cashflow pinches.

[withes_shin]

14 hours ago, Jareth said:

Why WHY?

Why Delilah.....

[MaVilla]

16 hours ago, Jareth said:

Why WHY?

 

1 hour ago, withes_shin said:

Why Delilah.....

He's only gone and had his weetabix......

[TRO]

On 13/08/2021 at 11:32, QldVilla said:

I don’t think their going anytime soon, the quotes have been about making the club self-sufficient and you don’t become successful businessmen by selling when you get bored.

They said that about Abramovich, "short stay".....like him or loathe him.....he has stood the course.....I think our boys will do the same.

[TRO]

2 hours ago, NeilS said:

100% agree, I can't see any sign for the fans to worry at the moment. Why would NSWE be looking to set up a Las Vegas Villans franchise in the MLS a few weeks back, or have planning in for an inner city academy near Villa Park, along with all the investment building the infrastructure of the club to sell up now. It makes no sense. Therefore I am not worried.

I guess one way to look at it is to compare overdraft facilities versus other teams in the PL, what kind of facility do Newcastle Utd or West Ham or Spurs currently operate with? With the big sums of money flying about in transfer fees and wages these days I imagine there can be massive swings in cash flow, that our old £1m facility would not cover. This would save the owners having to inject cash to cover these cashflow pinches.

They have weathered the early storm of mundane football so to speak,( trying not to be disrespectful to the championship) now it's show time, why would they up an leave, when its about to get interesting....this is when the fun starts for them.

Edited September 9, 2021 by TRO