City & FFP | 2020/21 Accounts released | Revenues of £569.8m, £2.4m profit (p 2395)

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ChicagoBlue said:
With the same decision maker on both sides of the table, he would pretty much be taking someone else’s money to fund his own venture, not kicking himself up the arse.
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No, he wouldn't, he'd be working to the benefit of one healthy and profitable business he owns over another he owns that's going through difficulty. Being associated with City has been very beneficial for Etihad.
 
Putting 2 and 2 together here, is it plausible that given Etihad's troubles, they're having cash flow issues and struggling to find the funds for the sponsorship while they restructure? So as opposed to Sheikh Mansour pumping in more equity to help with cash flow, we're borrowing the money from Barclay's to use as working capital until such a time as Etihad are in a more stable position?

I'm not an accountant, but would the 13% ownership in the holding company by Chinese investors influence this decision? If they didn't have that equity stake, I'm sure it would be fairly straightforward for SM to pump the funds in as working capital and then convert to equity if he wanted. But seen as we now have the Chinese investors, would that not in effect dilute their shareholding? Therefore the Barclay's loan makes more sense as it will have zero impact on the shareholding of the club?

As I say, I'm far from an expert, just thinking out loud.
 
Shaelumstash said:
Putting 2 and 2 together here, is it plausible that given Etihad's troubles, they're having cash flow issues and struggling to find the funds for the sponsorship while they restructure? So as opposed to Sheikh Mansour pumping in more equity to help with cash flow, we're borrowing the money from Barclay's to use as working capital until such a time as Etihad are in a more stable position?

I'm not an accountant, but would the 13% ownership in the holding company by Chinese investors influence this decision? If they didn't have that equity stake, I'm sure it would be fairly straightforward for SM to pump the funds in as working capital and then convert to equity if he wanted. But seen as we now have the Chinese investors, would that not in effect dilute their shareholding? Therefore the Barclay's loan makes more sense as it will have zero impact on the shareholding of the club?

As I say, I'm far from an expert, just thinking out loud.
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It could be that tbf and I'm not going to discount what you're saying, but Mansour could easily put in a director loan to be paid back when Etihad were stable without any effect on the shares. Honestly, I think it's just that he wants 6 degrees of separation so he can show that the investment was successful and City stand on their own feet without him in regards to financing.
 
aguero93:20 said:
No, he wouldn't, he'd be working to the benefit of one healthy and profitable business he owns over another he owns that's going through difficulty. Being associated with City has been very beneficial for Etihad.
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Their financial results beg to differ, but what do I know. I’m sure a few Mancs hopping on a flight every now and then must have them bathing in Kristal in Abu Dhabi.
 
aguero93:20 said:
Absolutely not. A loan isn't income, it can't be used to offset spending.
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So, what exactly does a loan do? Your first assertion, while correct, does not necessitate your second point. Surely, if it is not to offset asset spending, it is an expensive way to pad your current account, no? After all, what is a mortgage, car loan, etc...?
 
ChicagoBlue said:
So, what exactly does a loan do? Your first assertion, while correct, does not necessitate your second point. Surely, if it is not to offset asset spending, it is an expensive way to pad your current account, no? After all, what is a mortgage, car loan, etc...?
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A loan improves cashflow. Borrowing money doesn't mean you make a profit. A mortgage is an influx of cash that allows you to buy a house, but creates expenditure over a large period of time. It's a liability.
 
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