There's a "fog of war" feel about the legal ramifications of the ruling. This is the full article.
City launch legal action against the Premier League | City win APT case (pg901)
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halfcenturyup
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It's only a big deal to the extent that it forces shareholders to do something they presumably didn't want to do: either capitalise the loans or take a hit to the P/L.
Each club can determine how serious that is to them. As you say, probably not very in most cases. But maybe some clubs won't be so keen on ex-ante assessment when it affects them. Who knows?
But I'm not sure I agree that they can't call shareholder loans in because the clubs don't have the funds to repay them. They can call in whatever cash the club has and effectively bankrupt them. As in Portsmouth?
I am a bit confused regarding the meaning of turning loans into equity.
Are all these 14 clubs that currently have shareholder loans struggling financially hence they have taken these shareholder loans which if they were to repay would tip them into a deeper financial crisis hence the club just gives the shareholders more shares in the club and holds onto the cash that was originally loaned to them?
Are all these 14 clubs that currently have shareholder loans struggling financially hence they have taken these shareholder loans which if they were to repay would tip them into a deeper financial crisis hence the club just gives the shareholders more shares in the club and holds onto the cash that was originally loaned to them?
johnny crossan
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It would be really helpful if perhaps you could summarise the principal reasons given by 'the many' for their disagreement with your assessment that 'it isn't a big deal' ?
Rory Bluelow
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Of that panel of four, I would always tend to put more weight on the views of practising experts in the field rather than an academic. On the bases of each individual bio, Leaf seems most expert and Zglinski least.
3 out of 4 is good :)
SilverFox2
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Strange how most of the PL clubs are looking at their investments.
Their investments range from expecting aa cash cow indefinately to wanting to massively invest but prevented by rules.
How lucky we are to have an owner who simply invested not only financially but also in management people at the peak of their obvious areas of expertise.
Incidentally our owners investment continues which must be frightening to others who must spend to compete where previously they could divide up their cartel profits and simply buy votes by giving breadcrumbs to mid table clubs.
We have gone legal on the PL where their targeted changes to rule have been hastily configured with a hubris that the writers never considered so I am hopeful there are many other areas of general illegality or unfairness that our waiting game will turn to if necessary.
Their investments range from expecting aa cash cow indefinately to wanting to massively invest but prevented by rules.
How lucky we are to have an owner who simply invested not only financially but also in management people at the peak of their obvious areas of expertise.
Incidentally our owners investment continues which must be frightening to others who must spend to compete where previously they could divide up their cartel profits and simply buy votes by giving breadcrumbs to mid table clubs.
We have gone legal on the PL where their targeted changes to rule have been hastily configured with a hubris that the writers never considered so I am hopeful there are many other areas of general illegality or unfairness that our waiting game will turn to if necessary.
They don’t understand that such loans are basically equity anyway. Everton’s shareholder loans are actually treated as equity in their accounts under FRS102.22. The owners can achieve most of the aims of shareholder loans (like added security) with slithers of loans. And this was the explanation from one lawyer in the Athletic. He doesn’t get it because even his number is highly misleading.
gordondaviesmoustache
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Not even sure if the fourth one is a lawyer. I’d say he’s almost certainly not a practising one. I’m always wary of academics talking about the implications of determinations because they don’t have a feel for things like those at the coal face do. Only a lived experience can give you that instinct.
Colin Bells Boots
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