City Football Group | Secure $650m loan facility for infrastructure projects (p 54)

[spiny]

Absolutely. Oak View recently had $100M investment from Silver Lake.
https://variety.com/2018/biz/news/i...llion-investment-from-silver-lake-1202724408/

I would imagine the CFG have 2 things in mind for this money. Expansion and infrastructure.

Things are changing post Covid.

A NYCFC stadium has been a priority thwarted by politics and lack of opportunity. Cash in hand plus Oak View/Silver Lake combined interest with potential to develop a site into a site destination rather than a just a match day experience. Cash talks in times of trouble.

I believe the priority is a NYCFC stadium because it is such a potential cash cow that needs resolving. MCFC remains the top football club in the CFG. Completion of the Arena will see comprehisive development of the Etihad and environs except we are looking at a few years down the road.

 

[Corky]

Could cmc or silver Lake veto this if it is what adug wanted to do?

It is likely they would get first refusal to buy any new shares themselves in the first instance.

 

[jrb]

NYCFC’s stadium saga has been the rollercoaster ride recently. Following years of speculation, New York Yankees President Randy Levine gave an unusually candid interview to Forbes SportsMoney, saying that a decision on New York City FC’s stadium plans would be made in “30-60 days”. It was a glimmer of hope for fans who have been frustrated time and time again with the lack of progress.

City Football Group have raised $650 million for NYCFC Stadium

NYCFC’s majority owners are ready to commit over half a billion dollars into securing a new stadium

www.hudsonriverblue.com

NYC, Nuveen strike out with Yankees over new soccer stadium and hotel/retail development

A dispute involving 5,000 parking spaces New York City and bondholders agreed to give the Yankees as part of the development project – a complex, multi-year effort to bring economic growth to the poor South Bronx neighborhood where Yankee Stadium calls home, has scuttled plans for a new soccer...

www.foxbusiness.com

Side note. The value of major sports clubs and businesses in America is rocketing. The increasing use of digital platforms via the media hungry younger generation is pushing that value.

 

[ChicagoBlue]

Debt is currently dirt cheap, but expected to get a little more expensive. Now if the perfect time to announce the debt. It’s cheap, it puts people on notice that financing for XYZ is secured, and it literally costs much less than the $650M is probably accruing elsewhere!

Buy, Borrow, Die: How Rich Americans Live Off Their Paper Wealth — The Wall Street Journal

Banks say the wealthy are borrowing more than ever, using low-interest loans backed by their investments

apple.news

 

[slbsn]

Can't go through the 61 pages but we did a pod on this topic...on all the usual podcast apps and Spotify

 

[shemnel]

So this isn't City becoming a debt leveraged club who can compete within FFP? Something obviously many of us rail against, eg like United.

This is CFG? But surely it impacts on city, or would city suffer should cfg not have taken on the debt? Or is it one of the weird financial tricks where taking on debt is better?

 

[KS55]

Could cmc or silver Lake veto this if it is what adug wanted to do?

CFG is a British company and therefore subject to the rule that a majority shareholder cannot act in a way that disadvantages minority holders, e.g. by dilution. So their agreement to any dilution of their holdings would be required. But does 75% overrule this?
In any case, ADUG would not want to piss the others off.

 

[SilverFox2]

So this isn't City becoming a debt leveraged club who can compete within FFP? Something obviously many of us rail against, eg like United.

This is CFG? But surely it impacts on city, or would city suffer should cfg not have taken on the debt? Or is it one of the weird financial tricks where taking on debt is better?

Perhaps this Covid year debt will be treated as special and unavoidable by even tax authorities and PL together with general football authorities so maybe we want to be included?
We deliberately posted a massive loss last year so maybe there is some method to apparent madness in borrowing especially if rates are so low.

CFG is our Holding Company so one of the benefits allows investment within group companies to offset any tax due in others.
Who knows, I'm sure they know what they are doing.

 

[waspish]

So this isn't City becoming a debt leveraged club who can compete within FFP? Something obviously many of us rail against, eg like United.

This is CFG? But surely it impacts on city, or would city suffer should cfg not have taken on the debt? Or is it one of the weird financial tricks where taking on debt is better?

It’s city and the group running like any other big organisation!

 

[CatMan]

I find it a little concerning that threads like this exist, because when fans of a football team are feeling the need to become deeply acquainted with the club's financial management then that club has become a business and the team is merely the shop window.

Sadly we are long past the time when everything and everyone directly involved within the team were known, visible and accountable, and frankly Manchester City F.C. are nothing more than the current largest outlet in the City chain store group.

Some may love the idea of CFG and assume it shows some longevity of love and security for our Manchester City team, but this is simply not the case. Yes our team has prospered in the last 12 years, but likewise commercial markets are cyclical and who is to say that one of the other teams within the CFG store are not the biggest and most profitable in the coming years! The decision to borrow money to invest in a stadium for New York City does absolutely nothing for our team Manchester City and more worryingly shows CFG are now looking for more revenue and eventual profit and not looking for how they can improve Manchester City F.C.

I think the fact that our North Stand expansion never happened can be seen as a sign that CFG believe there is only limited, if any, further profitability in the Manchester based operation, yet the New York plan shows they are clearly thinking there are profits to be made elsewhere. I suppose what the jist of my post is, and I know I'll get loads of incoming for sure, is that the success of CFG is measured on the balance sheet and has long since moved from being measured by the footballing results attained by Manchester City F.C and although they are connected to some extent there are many examples throughout business of expansion plans steering businesses to new markets and older more familiar names being left behind.