New FFP Probe?

[Bozzie]

Madrid and Barcelona have benefited financially in a number of ways from regional , local and National government.
Paying tax at illegal levels.
buying and selling land to the clubs for the benefit financially of the club.
Tv deals massively in their favour.
Direct financial support from politically motivated government.

Can't believe PSG won't start to ask their own questions regarding the way the top two Spanish clubs operate if La Liga continue to intervene.

 

[Prestwich_Blue]

As I know little about finance and loans on this scalee could you tell me.

What % are united likely to be paying on 500 million loan.
Will they be signing off assets against the loans. Ie ground, etc.
Sorry if they are daft questions

They paid around £20m net in respect of financing costs last financial year and the financing is secured on the stadium and other assets.

What we don't know is what's hidden away in the holding companies in Delaware and the Cayman Isles. The Glazers took on some very expensive debt to buy the rags, some of which was personal debt. No one knows what happened to that other than it was paid off somehow.

I also suspect that their United shares are used as collateral to prop up their shopping mall business in some way, which is almost certainly heavily indebted.

 

[asahartford1]

They paid around £20m net in respect of financing costs last financial year and the financing is secured on the stadium and other assets.

What we don't know is what's hidden away in the holding companies in Delaware and the Cayman Isles. The Glazers took on some very expensive debt to buy the rags, some of which was personal debt. No one knows what happened to that other than it was paid off somehow.

I also suspect that their United shares are used as collateral to prop up their shopping mall business in some way, which is almost certainly heavily indebted.

Cheers. I have read quite a bit about the shopping malls debacle.

 

[TBooksbluearmy]

My guess is that if we go after K Mbappe we will be investigated for breaching FFP. If PSG can get away with buying Neymar that surly we should be able to get away with buying K Mbappe.

 

[asahartford1]

They paid around £20m net in respect of financing costs last financial year and the financing is secured on the stadium and other assets.

What we don't know is what's hidden away in the holding companies in Delaware and the Cayman Isles. The Glazers took on some very expensive debt to buy the rags, some of which was personal debt. No one knows what happened to that other than it was paid off somehow.

I also suspect that their United shares are used as collateral to prop up their shopping mall business in some way, which is almost certainly heavily indebted.

One last one. Would I be way off mark in concluding that the reason they do not sell utd ,is because the business (utd)has an operating profit, they use the income to service other debts.?

 

[Prestwich_Blue]

One last one. Would I be way off mark in concluding that the reason they do not sell utd ,is because the business (utd)has an operating profit, they use the income to service other debts.?

My guess would be that:
1) They take £15m a year out in dividends between the six of them and that they rely on that for their personal expenses.

A2) The proceeds from the sale of the club might not actually be enough to cover their personal and business indebtedness. They remortgaged their malls just before the credit crunch and it's possible that the loan-to-value ratio was well over 100% at one point. If that was the case, their lenders would have asked for significant additional security and their Utd shares were the only security they had.

Also the PIK loans they took out to finance the purchase and subsequently paid off in 2010 (without saying how) could have cost them in the region of £500m or more. This was probably done via yet more debt.

 

[BluessinceHydeRoad]

The regulations do not concern themselves with individual transfers but with each clubs accounts. It is not for the Spanish FA to defend or apply the regulations but for a UEFA committee which claims to have analysed those accounts. Nowhere in those regulations does it permit an individual or multiple transfer to be refused even if a club has violated the sacred rules. Clubs may be punished in a number of ways but cancelling the transfer is not one of them. La Liga is exceeding its powers by refusing the payment stipulated in the player's contract and I suspect Neymar's lawyers will advise him to leave the money on deposit with instructions to the bank to try to pay the monies to La Liga repeatedly in the future, and to complete the transfer regardless. UEFA then has an enormous problem though not a new one. The Bosman case concluded with a stinging warning to UEFA that disputes would be decided in accordance with contract law NOT the wishes of the football authorities and that UEFA had better take heed of this. Here we have a case of a footballer fulfilling what the contract stipulates to secure his release, a football authority again stepping outside the law to prevent him (while also infringing his right to free movement of labour) and UEFA having to decide whether it gives the ultimate proof that "Financial Fair Play" is, in fact, not fair at all but simply a mechanism to protect football's "establishment" from the nouveau riche, risking the whole series of regulations being condemned to the waste bin or does it see La Liga and Barcelona humiliated, order them to comply and hope it can find PSG in violation of the rules at the end of the season and make a real example of them then. Even then I suspect it would only keep the rules out of court until the end of the season.

 

[BluessinceHydeRoad]

The regulations do not concern themselves with individual transfers but with each clubs accounts. It is not for the Spanish FA to defend or apply the regulations but for a UEFA committee which claims to have analysed those accounts. Nowhere in those regulations does it permit an individual or multiple transfer to be refused even if a club has violated the sacred rules. Clubs may be punished in a number of ways but cancelling the transfer is not one of them. La Liga is exceeding its powers by refusing the payment stipulated in the player's contract and I suspect Neymar's lawyers will advise him to leave the money on deposit with instructions to the bank to try to pay the monies to La Liga repeatedly in the future, and to complete the transfer regardless. UEFA then has an enormous problem though not a new one. The Bosman case concluded with a stinging warning to UEFA that disputes would be decided in accordance with contract law NOT the wishes of the football authorities and that UEFA had better take heed of this. Here we have a case of a footballer fulfilling what the contract stipulates to secure his release, a football authority again stepping outside the law to prevent him (while also infringing his right to free movement of labour) and UEFA having to decide whether it gives the ultimate proof that "Financial Fair Play" is, in fact, not fair at all but simply a mechanism to protect football's "establishment" from the nouveau riche, risking the whole series of regulations being condemned to the waste bin or does it see La Liga and Barcelona humiliated, order them to comply and hope it can find PSG in violation of the rules at the end of the season and make a real example of them then. Even then I suspect it would only keep the rules out of court until the end of the season.

 

[Eebo]

We probably know more about FFP than the fans of most other clubs, given that we are one of the main targets of this made up and nonsensical rule.
Most footie fans are also pretty uninterested in accounts and have very little knowledge of how business or finances work.
When you add these two factors together it is perhaps not that surprising that there is so much utter rubbish spouted by so many.

The simple understanding from other fans seems to be that the rules are to stop City and other 'new money' clubs like PSG from spending big (ie more than the established elite) so they assume that because we and PSG are spending £xxx million then we/they must be guilty of breaching FFP.

The problem is, seems like many 'journalists' and commentators and pundits are no better informed, and it seems even La Liga official are confusing what FFP was meant to achieve with what the actual rules are.

Not once have I seen a journalist point out that profits on transfers in are taken in the year they happen and that transfer fees are amortised over the term of the contract.

Expect to see calls for salary caps, transfer spending to be linked to gate receipts and lots more arbitrary made up rules to protect the elite, and ultimately a breakaway European League which will by invitation only. What really bothers the traditional elite clubs about City and PSG is that we stop them from making juicy profits that they can take out of the game. Previously it was a cosy cartel where they could all make lots of money for their owners while winning everything between them. City and PSG are investing so heavily that their choice has become make money or win trophies. Up till now that has been the choice facing Premier League owners (United, Liverpool, Arsenal, Spurs) and now it is hitting Bayern and Barca and Madrid.

 

[Prestwich_Blue]

La Liga is exceeding its powers by refusing the payment stipulated in the player's contract .

Strictly speaking, Spanish buy-out clauses can only be mandatorily triggered by (a) a transfer between Spanish clubs under Spanish law or (b) by the player personally presenting his own money (rather than the non-Spanish club doing it). But if PSG just give the money to Neymar then he becomes liable to significant tax on that money.