Thames Sports Investment

[mr_number]

SJM currently has £28M in outstanding chairmans loans as well, which if they remain with the club (and I am sure they will), values the club (as a Championship side) at somewhat over £50M......

Not sure I follow that.

Enterprise valuation - market cap (or whatever someone's willing to pay), plus net debt basically. Quite a common valuation method.

[The Rouge]

Well I am satisfied that my reliable source was correct when ages ago he said that 'the russians had moved the goalposts somewhat'. If nothing had changed since the original plan then Madejski would never have given the predicted timetable he did for face-losing reasons and the ratification would not have taken this long.

People do not like to hear bad news but took a lot of stick despite having a 100% track record when I (rarely) reveal anything in here.

Anyway, lets hope it still all goes through OK and that Anton can have the influence in the way his interviews have suggested.

[Royal Rother]

SJM currently has £28M in outstanding chairmans loans as well, which if they remain with the club (and I am sure they will), values the club (as a Championship side) at somewhat over £50M......

Not sure I follow that.

Enterprise valuation - market cap (or whatever someone's willing to pay), plus net debt basically. Quite a common valuation method.

Yes, but what does "if they remain with the club" mean?

If the loans do get repaid (which they surely will do) then you can't add that £28m to the £25m and say the club is valued at £53m. That's not logical accounting to me.

[mr_number]

Yes, but what does "if they remain with the club" mean?

If the loans do get repaid (which they surely will do) then you can't add that £28m to the £25m and say the club is valued at £53m. That's not logical accounting to me.

Valuation of companies has very little do with accounting - the debt can remain on the club's books, but in order to buy the club 'outright' (as in have no debts to third parties), you would need to buy the debt and the equity, which would cost the £53m. The debt is owed by the company to a third party, so the new owners of the club can choose whether to keep it and keep paying interest, or pay it off. This isn't one of those accounting questions that we normally have, and valuing companies is just a subjective thing, but EV is one way of doing it that is used quite a lot.

[Royal Rother]

Cool, thanks.

I guess I'm just looking at it from a logical "what is it actually worth" school of accounting, but I appreciate your explanation.

(Over-simplification here - If someone started up a business, put in £10m, £1m as share capital and £9m as repayable loans, how much is the business actually worth at that point? I'd say £1m, but on your terms it would be £10m. In my terms that's not a proper valuation of the worth of the business but I do understand what you're saying.)

[Dare to Dr£am]

Well I am satisfied that my reliable source was correct when ages ago he said that 'the russians had moved the goalposts somewhat'. If nothing had changed since the original plan then Madejski would never have given the predicted timetable he did for face-losing reasons and the ratification would not have taken this long.

People do not like to hear bad news but took a lot of stick despite having a 100% track record when I (rarely) reveal anything in here.

Anyway, lets hope it still all goes through OK and that Anton can have the influence in the way his interviews have suggested.

There has been no moving of goalposts. That talk is absolute rubbish and you know it, you little cretin of a wum. If there had been any price hike etc, then it would almost certainly have leaked through one means or another, and it hasn't.

Madejski said himself when asked about the agreed fee for the club and now we're in the Premiership the club is worth more and he said "a deal is a deal". He recognises this is an unbelievable opportunity for the football club, and you have to grasp that with both hands (as long as all is as we're told, which it seems to be as he is very trusting of Anton and his partners).

Don't forget when we were in the Premiership the last time a certain Carson Yeung was in talks about buying the club. He didn't fail the FAPPT, as he went on to buy Birmingham (to their regret), so SJM must have done enough digging himself to decide it wasn't right for us - and bloody good on him too!

The deal is a great deal for the club, even if SJM could have got a few more bob out of it. But this is bigger to the whole club than a few more £'s in JM's pocket.

[philM]

Cool, thanks.

I guess I'm just looking at it from a logical "what is it actually worth" school of accounting, but I appreciate your explanation.

(Over-simplification here - If someone started up a business, put in £10m, £1m as share capital and £9m as repayable loans, how much is the business actually worth at that point? I'd say £1m, but on your terms it would be £10m. In my terms that's not a proper valuation of the worth of the business but I do understand what you're saying.)

It would cost you at least £9M if you were to buy the business. What it's actually worth is dependant on other things. For example if the £9M had been used to buy equipment then it would be worth something, however if the £9M was frittered away on salaries and other costs then the business would be worth less. The worth of the business is all about assets, turnover and profitability.

[Terminal Boardom]

Simple question peeps. Where does the £15k a week come from for Garath McCleary? Sure there is the windfall from the Prem but it still adds up to quite a large sum (£780k). Therefore, as I see it, there is no problem regarding the takeover. If SJM had any doubts, the plug would have been pulled. If SJM had any doubts, the original announcement would not have been made - see references to Carson Yeung above!

[chilipepper91]

Simple question peeps. Where does the £15k a week come from for Garath McCleary? Sure there is the windfall from the Prem but it still adds up to quite a large sum (£780k). Therefore, as I see it, there is no problem regarding the takeover. If SJM had any doubts, the plug would have been pulled. If SJM had any doubts, the original announcement would not have been made - see references to Carson Yeung above!

The money is loaned to the club, just like it was for the Roberts/Cywka/Mullins signings, I believe. So even if it goes tits up we'll still owe TSI/Zingarevich the money at 1% over base rate.

[Royal Rother]

Cool, thanks.

I guess I'm just looking at it from a logical "what is it actually worth" school of accounting, but I appreciate your explanation.

(Over-simplification here - If someone started up a business, put in £10m, £1m as share capital and £9m as repayable loans, how much is the business actually worth at that point? I'd say £1m, but on your terms it would be £10m. In my terms that's not a proper valuation of the worth of the business but I do understand what you're saying.)

It would cost you at least £9M if you were to buy the business. What it's actually worth is dependant on other things. For example if the £9M had been used to buy equipment then it would be worth something, however if the £9M was frittered away on salaries and other costs then the business would be worth less. The worth of the business is all about assets, turnover and profitability.

Indeed to all that. I'm just talking about that basic one-off transaction though to illustrate that a loan is not really (in my book) ever truly a part of a valuation of a business.

But I accept that technically, in the real world, it can be / is, as explained by Mr Number.

[mr_number]

Cool, thanks.

I guess I'm just looking at it from a logical "what is it actually worth" school of accounting, but I appreciate your explanation.

(Over-simplification here - If someone started up a business, put in £10m, £1m as share capital and £9m as repayable loans, how much is the business actually worth at that point? I'd say £1m, but on your terms it would be £10m. In my terms that's not a proper valuation of the worth of the business but I do understand what you're saying.)

It would cost you at least £9M if you were to buy the business. What it's actually worth is dependant on other things. For example if the £9M had been used to buy equipment then it would be worth something, however if the £9M was frittered away on salaries and other costs then the business would be worth less. The worth of the business is all about assets, turnover and profitability.

Indeed to all that. I'm just talking about that basic one-off transaction though to illustrate that a loan is not really (in my book) ever truly a part of a valuation of a business.

But I accept that technically, in the real world, it can be / is, as explained by Mr Number.

I guess as Phil pointed out, there's a difference between the 'cost to buy' and the 'value' of a business, and you're focused on the cost to buy, which is entirely valid, but different to the overall value.

[The Rouge]

Well I am satisfied that my reliable source was correct when ages ago he said that 'the russians had moved the goalposts somewhat'. If nothing had changed since the original plan then Madejski would never have given the predicted timetable he did for face-losing reasons and the ratification would not have taken this long.

People do not like to hear bad news but took a lot of stick despite having a 100% track record when I (rarely) reveal anything in here.

Anyway, lets hope it still all goes through OK and that Anton can have the influence in the way his interviews have suggested.

There has been no moving of goalposts. That talk is absolute rubbish and you know it, you little cretin of a wum. If there had been any price hike etc, then it would almost certainly have leaked through one means or another, and it hasn't.

Madejski said himself when asked about the agreed fee for the club and now we're in the Premiership the club is worth more and he said "a deal is a deal". He recognises this is an unbelievable opportunity for the football club, and you have to grasp that with both hands (as long as all is as we're told, which it seems to be as he is very trusting of Anton and his partners).

Don't forget when we were in the Premiership the last time a certain Carson Yeung was in talks about buying the club. He didn't fail the FAPPT, as he went on to buy Birmingham (to their regret), so SJM must have done enough digging himself to decide it wasn't right for us - and bloody good on him too!

The deal is a great deal for the club, even if SJM could have got a few more bob out of it. But this is bigger to the whole club than a few more £'s in JM's pocket.

- You are quite offensive
- None of what I have posted about this source is either not real, or a wind-up. I wouldn't consider it a funny wind-up to be honest.
- By 'moving of the goalposts', I never read that as suggesting the amount offered for the stake had changed, more that one or more of these things may have changed (where the money was coming from, the amount of money available post-takeover, some other terms of the takeover)
- If nothing at all has changed, do you think SJM would be 2 months and counting wrong in his published estimate of takeover completion?
- Re: Carson Yeung - I fail to see the relevance of your comment, no - I don't want someone like him and yes - I do believe the fit and proper person checklist would have been strengthened (but SJM would have known about this)

[Cypry]

According to last years balance sheet the assets (both fixed and intangible) of the club were valued at £57,324,284...
Net current liabilities were £38.959,952, so for SJM to sell at that time (June 2011) without taking any profit, the amount someone would've had to have paid would've nominally been £22,020,296 - not a giant leap to the rumoured £25M that TSI have agreed for the whole club....

Assuming that the Chairmans loans are left on the balance sheet going forward (i.e. we will still owe SJM £26M - it's shown as £26,301,575 in the accounts), then I suspect the valuation of the club for the purposes of the takeover will have been set at a level not dissimilar to that shown on the balance sheet, somewhere between £55M and £60M. I cannot see anything happening other than this debt remaining, unless TSI decide to pump some capital into the club to pay it back immediately. It would effectively mean that SJM would come out of the deal £1M in the red if the debt was written off....perhaps this is why the takeover has been staged? To give TSI a period of time to repay the loans in a structured way....perhaps this is why SJM remains as chairman even once TSI own 100% of the club - effectively he'll still have a significant financial interest in the club...?

Promotion to the PL will make a significant change to the cash flow next year, and that money will be spent on fixed assets (like the academy, training ground etc) and intangible assets (players etc) which will naturally increase the value of the club. TSI may also choose to use some of that additional income to repay SJM some of his money, whether they choose to do (or even get the chance to if the PL say no) so remains to be seen....

[Ian Royal]

Well I am satisfied that my reliable source was correct when ages ago he said that 'the russians had moved the goalposts somewhat'. If nothing had changed since the original plan then Madejski would never have given the predicted timetable he did for face-losing reasons and the ratification would not have taken this long.

People do not like to hear bad news but took a lot of stick despite having a 100% track record when I (rarely) reveal anything in here.

Anyway, lets hope it still all goes through OK and that Anton can have the influence in the way his interviews have suggested.

There has been no moving of goalposts. That talk is absolute rubbish and you know it, you little cretin of a wum. If there had been any price hike etc, then it would almost certainly have leaked through one means or another, and it hasn't.

Madejski said himself when asked about the agreed fee for the club and now we're in the Premiership the club is worth more and he said "a deal is a deal". He recognises this is an unbelievable opportunity for the football club, and you have to grasp that with both hands (as long as all is as we're told, which it seems to be as he is very trusting of Anton and his partners).

Don't forget when we were in the Premiership the last time a certain Carson Yeung was in talks about buying the club. He didn't fail the FAPPT, as he went on to buy Birmingham (to their regret), so SJM must have done enough digging himself to decide it wasn't right for us - and bloody good on him too!

The deal is a great deal for the club, even if SJM could have got a few more bob out of it. But this is bigger to the whole club than a few more £'s in JM's pocket.

- You are quite offensive
- None of what I have posted about this source is either not real, or a wind-up. I wouldn't consider it a funny wind-up to be honest.
- By 'moving of the goalposts', I never read that as suggesting the amount offered for the stake had changed, more that one or more of these things may have changed (where the money was coming from, the amount of money available post-takeover, some other terms of the takeover)
- If nothing at all has changed, do you think SJM would be 2 months and counting wrong in his published estimate of takeover completion?
- Re: Carson Yeung - I fail to see the relevance of your comment, no - I don't want someone like him and yes - I do believe the fit and proper person checklist would have been strengthened (but SJM would have known about this)

I'd say a large part of the delay is the fact we've got promoted. The FL would have been the ones approving the takeover, but then we got promoted and they washed their hands and passed on the files to the PL. The PL have other priorities recently and we're also not officially a PL club yet. Not only that, but the PL have difference criteria and stricter rules, so it'#s not just a case of them rubber stamping what the FL had already done.

There's your delay. If there had been a shifting of goal posts the delays would be with Madejski and TSI. Not with the FL / PL.

Either you, or your source, is talking silliness.

[79Royal]

- By 'moving of the goalposts', I never read that as suggesting the amount offered for the stake had changed, more that one or more of these things may have changed (where the money was coming from, the amount of money available post-takeover, some other terms of the takeover)
- If nothing at all has changed, do you think SJM would be 2 months and counting wrong in his published estimate of takeover completion?

These two points are the key, I reckon. It has taken longer than was planned, so something may well have changed. Yes, the Football League had to do their checks and that process was lengthened when we won promotion to the PL. But it doesn't necessarily account for two months worth of delays.

However, a lot of people seem to think that TSI 'moving the goalposts' (if that has actually happened - for all we know, SJM has moved them) is a bad thing, but it may not be. It's plausible that the due diligence process has thrown up something that neither party had expected and they've had to find a way around it. I know it's not nearly the same thing, but whenever I've bought houses, there have always been unforeseen challenges crop up that have to be ironed out. I imagine the same thing can happen when you are selling a business.

In any case, we appear to have to men determined to make the deal work and at least one of them is firmly on our side. I trust SJM to make the right decision for the future of the club, even if that ultimately means pulling out of the deal.

[Geekins]

http://www.bbc.co.uk/sport/0/football/18073244
Another non story!

Reading takeover by Anton Zingarevich an 'ongoing process'
By Nabil Hassan
BBC Sport Russian tycoon Anton Zingarevich's takeover of Reading has still not been approved, two months after the club's original target date for completion.

Sir John Madejski announced in January he was selling to Zingarevich and the deal was due to be approved in March.

But Reading's promotion meant the deal needed Premier League approval which Madejski said would be given in April.

On Tuesday, the Premier League told BBC Sport that "it is an ongoing process" with no deadline made.

It is nearly four months since Madejski - who has owned Reading for 22 years - announced he had agreed to sell 51% of the club to Thames Sports Investment, led by Zingarevich.

Speaking in April, Madejski calmed any fears that there was a hitch.

"We want to make sure that the deal is completely watertight for the sake of the club going forward. But that should all pan out," he told BBC Sport.

Initially only the Football League needed to approve the deal but following April's promotion, the Premier League have now also had to ratify the proposed takeover, meaning a second set of tests.

Those 'fit and proper persons' tests involve an 'owners and directors' check which includes a face-to-face meeting between the Premier League, Zingarevich and all representatives of TSI.

The test also requires Zingarevich and TSI to provide proof of current and future funds as well as budgets and a business plan.

TSI is not a company or limited-liability partnership incorporated in the UK, making inquiries less straightforward.

Despite the issues, Madejski and Zingarevich - who spent last week on holiday in Miami - have continued to put on a united front but it is understood Premier League approval is not imminent.

"There are a couple of formalities to complete, and it is all on course and I hope it is going to happen very soon," Zingarevich told BBC Sport on 18 April.

Madejski added to BBC Sport two days later: "With all intents and purposes the deal will be completed next week."

Manager Brian McDermott has already drawn up a short list of new recruits and has spent the past month since Reading won promotion scouting across Europe.

The club told BBC Sport on Tuesday they were still waiting on the Premier League to approve the deal, adding "they quite rightly have to do their checks".

[The Rouge]

I'd say a large part of the delay is the fact we've got promoted. The FL would have been the ones approving the takeover, but then we got promoted and they washed their hands and passed on the files to the PL. The PL have other priorities recently and we're also not officially a PL club yet. Not only that, but the PL have difference criteria and stricter rules, so it'#s not just a case of them rubber stamping what the FL had already done.

There's your delay. If there had been a shifting of goal posts the delays would be with Madejski and TSI. Not with the FL / PL.

Either you, or your source, is talking silliness.

So you say a large part of the delay has been due to being promoted - that is your guess, whereas my info came from a good source so inclined to believe that more (although not saying the promotion hasn't affected things at all).

You also infer that ALL delays have been as a result of the FL/PL. That is a pretty big inference I reckon.

[Big Ern]

http://www.bbc.co.uk/sport/0/football/18073244
Another non story!

Reading takeover by Anton Zingarevich an 'ongoing process'
By Nabil Hassan
BBC Sport Russian tycoon Anton Zingarevich's takeover of Reading has still not been approved, two months after the club's original target date for completion.

Sir John Madejski announced in January he was selling to Zingarevich and the deal was due to be approved in March.

But Reading's promotion meant the deal needed Premier League approval which Madejski said would be given in April.

On Tuesday, the Premier League told BBC Sport that "it is an ongoing process" with no deadline made.

It is nearly four months since Madejski - who has owned Reading for 22 years - announced he had agreed to sell 51% of the club to Thames Sports Investment, led by Zingarevich.

Speaking in April, Madejski calmed any fears that there was a hitch.

"We want to make sure that the deal is completely watertight for the sake of the club going forward. But that should all pan out," he told BBC Sport.

Initially only the Football League needed to approve the deal but following April's promotion, the Premier League have now also had to ratify the proposed takeover, meaning a second set of tests.

Those 'fit and proper persons' tests involve an 'owners and directors' check which includes a face-to-face meeting between the Premier League, Zingarevich and all representatives of TSI.

The test also requires Zingarevich and TSI to provide proof of current and future funds as well as budgets and a business plan.

TSI is not a company or limited-liability partnership incorporated in the UK, making inquiries less straightforward.

Despite the issues, Madejski and Zingarevich - who spent last week on holiday in Miami - have continued to put on a united front but it is understood Premier League approval is not imminent.

"There are a couple of formalities to complete, and it is all on course and I hope it is going to happen very soon," Zingarevich told BBC Sport on 18 April.

Madejski added to BBC Sport two days later: "With all intents and purposes the deal will be completed next week."

Manager Brian McDermott has already drawn up a short list of new recruits and has spent the past month since Reading won promotion scouting across Europe.

The club told BBC Sport on Tuesday they were still waiting on the Premier League to approve the deal, adding "they quite rightly have to do their checks".

[mathematically_safe]

An update, of sorts. Flame/Dodd me all you like. My, ahem, source, cannot be revealed but said,

'There are still problems with the take-over especially issues with the training ground and Academy'

There you go Mr Fordham - bung this in your paper as an 'Exclusive!'

[TBM]

An update, of sorts. Flame/Dodd me all you like. My, ahem, source, cannot be revealed but said,

'There are still problems with the take-over especially issues with the training ground and Academy'

There you go Mr Fordham - bung this in your paper as an 'Exclusive!'

What issues would cause a delay, though?