ALK Capital or Farnell/Elkashashy takeover

[Paul Waine]

from the MMT thread but just as appropriate here

Sam Wallace in the Telegraph is sceptical (or is that scathing at the thought) of the new wave of American "Investors"

Covid era is not threatening American investors' interest in Premier League clubs - but what do they think they are buying?
If Burnley were to fall into hands of US investors, it would make club fifth in the Premier League owned outright by American money

SAM WALLACE - CHIEF FOOTBALL WRITER
26 September 2020 • 1:35pm
Sam Wallace

***************** Cut down text to focus on one point ************************

The US investment sector now even has the former Premier League chief executive, latterly executive chairman, Richard Scudamore amongst its advisors. He works on behalf of RedBall, one of many US special purpose advisory companies (SPACs) set up to raise funds for investment.

Hard to know if Sam Wallace meant to write special-purpose acquisition company (SPAC) and "advisory" is just a typo?

Maguire's - see post above and linked Twitter - £10 ALK Investments is a special-purpose vehicle registered for a special purpose. In the fullness of time, the SPV may become a subsidiary of an American owned SPAC - and that will be the vehicle used to raise the funds to complete any acquisition(s) and invest in a Premier League football club.

[KRBFC]

For the above reason I am very sceptical about any consortium takeover. I don’t believe for a moment they have any more money, or invest more money, than Garlick.

When was the last time Garlick invested a penny out of his own pocket?

[joey13]

When was the last time Garlick invested a penny out of his own pocket?

Sssshhh hope you’ve got your tin hat ready

[Gordaleman]

The man they want/trust wants to sell.

I don't think he does want to sell, but with his money and that of the other board members not being enough to progress the club, he feels that he has no option.

He's a fan like all of us and he wants us to do well, so I don't think he'll sell us out to someone with the wrong intentions.

If the Telegraph article posted earlier is correct, then the current board will continue to run the club on behalf of the buyers. if the deal goes through. That can't be a bad thing. I'd rather that than total strangers, with no idea about British football, come in and mess things up Venkys style.

[arise_sir_charge]

I don't think he does want to sell, but with his money and that of the other board members not being enough to progress the club, he feels that he has no option.

He's a fan like all of us and he wants us to do well, so I don't think he'll sell us out to someone with the wrong intentions.

If the Telegraph article posted earlier is correct, then the current board will continue to run the club on behalf of the buyers. if the deal goes through. That can't be a bad thing. I'd rather that than total strangers, with no idea about British football, come in and mess things up Venkys style.

Forget it. I’ve tried to explain a few times. I’m not trying again.

[Gordaleman]

Forget it. I’ve tried to explain a few times. I’m not trying again.

Please yourself. Perhaps you're not very good at explaining?

[ClaretCraig]

Please yourself. Perhaps you're not very good at explaining?

Of course he wants to sell. Hes a businessman and if the offer is good enough he'll snatch their hands off. Burnley's stock is at an all time high and he'll retire a very rich man.

[dandeclaret]

You do know he's already a very rich man don't you?

[Gordaleman]

You do know he's already a very rich man don't you?

No, he probably doesn't.

[paulatky]

If its far down the line as being mentioned i think you might be in for a shock

We will see

[NewClaret]

When was the last time Garlick invested a penny out of his own pocket?

He invested in the shares, none in the club to my knowledge. My point being ALK are likely to do the same, or worse, use debt to buy the shares then transfer it to the club. I’m open-minded to investment but not positive about this ALK thing.

[Steddyman]

He invested in the shares, none in the club to my knowledge. My point being ALK are likely to do the same, or worse, use debt to buy the shares then transfer it to the club. I’m open-minded to investment but not positive about this ALK thing.

And are you positive to the ongoing MG thing? Thought not.

[bfcjg]

The notion that these people are going to throw money at Burnley because they have developed a transatlantic love affair with us is laughable, they want the tele money, the parachute money then they will scarper off leaving us with massive debts, it is how their business model works.

[Billy Balfour]

People need to be careful what they wish for.

[BurnleyFC]

Anyone but Garlick at the moment.

[jedi_master]

Sky commentary team said that “Dyche has said that ALK have been to the training ground”, didn’t know if that was new information on this topic but it was news to me so thought it worth sticking on here.

[mill hill claret]

The squad needs investment...are we gonna get it with the current board ? ....no

[NewClaret]

And are you positive to the ongoing MG thing? Thought not.

Nope. Just marginally in favour of Garlick continuing to under invest vs a leveraged takeover.

[MRG]

Every Burnley Fan should say their prayers before bed tonight that this goes ahead. We are desperate for a change of ownership

[ClaretCraig]

You do know he's already a very rich man don't you?

Of course he is but he could be a lot richer that's why he's talking to ALK about selling the club. If he didn't want to sell there wouldn't be any negotiations.
Gordaleman go ask your hospital pharmacist, I've heard he's a man in the know.

[ClaretCraig]

The notion that these people are going to throw money at Burnley because they have developed a transatlantic love affair with us is laughable, they want the tele money, the parachute money then they will scarper off leaving us with massive debts, it is how their business model works.

Have you asked them?

[bfcjg]

Have you asked them?

Do you have their phone number please?

[arise_sir_charge]

Please yourself. Perhaps you're not very good at explaining?

It’s very simple, it’s his decision, HE doesn’t have to sell if HE doesn’t want to.

As it happens, HE has apparently decided that HE wants to sell for whatever reason HE feels necessary.

So, all those people wanting HIM to stay in charge aren’t realising that’s not what HE wants.

Hope that helps

[Paul Waine]

Sky commentary team said that “Dyche has said that ALK have been to the training ground”, didn’t know if that was new information on this topic but it was news to me so thought it worth sticking on here.

I thought they said "Dyche said there'd been visitors at training ground." I don't think they said Dyche gave a name to those visitors.

[Paul Waine]

Article in The Times, Saturday about "blank cheque companies" - otherwise known as Special-Purpose Acquisition Companies, SPACs.

Posting it because it may throw some light on ALK Investment's plans to raise capital. On the other hand, so far as I'm aware there has been nothing said by ALK themselves that a SPAC forms part of any plans they might be pursuing.

The article does mention Billy Beane, of "moneyball" fame - "thought have its eyes on a top-flight English football club and "recently hired Richard Scudamore as a director."

I've picked out a few "taster" paragraphs.

The hot fund that’s like handing a blank cheque to its creators
Spacs can make huge returns for those who set them up but very little for ordinary investors

https://www.thetimes.co.uk/article/0c7c ... 8f8dd5ff70

"Blank cheque investment funds are all the rage in America this year. Prominent figures from business, politics and sport have raised tens of billions of dollars before going on the hunt for acquisitions."

"Such is their soaring popularity that blank cheque funds account for 43 per cent of all the money raised from initial public offerings (IPOs) in the US this year, research conducted for The Times shows. This is, by some distance, the largest proportion for any year in the last decade, and it comes in what is a bumper year for IPOs of all kinds."

Big names and numbers aside, blank cheque funds are changing the way that private companies go public. They are clearing a shortcut to the stock market, along a route that is shaded from the prying eyes of sceptical investors, stock exchange officials and government regulators.

More formally known as special purpose acquisition companies, or Spacs, blank cheque funds raise money from investors through IPOs before listing their shares on a stock exchange.

Nonetheless, American funds are looking for targets across the Atlantic. A $575 million Spac co-chaired by Billy Beane, the baseball executive portrayed in Moneyball, starring Brad Pitt, is thought to have its eyes on a top-flight English football club. The company recently hired Richard Scudamore, the former executive chairman of the Premier League, as a director.

UTC

[Somethingfishy]

Please yourself. Perhaps you're not very good at explaining?

There's an old saying very apt here. There's none so deaf as those who will not hear.

[WalkdenClaret]

https://www.google.com/maps/place/8+The ... 75.5241898
1. Alan and Dave's new address for ALK , 8 The Green in Delaware, may look pretty, but it's simply a meeting room for hire for legals.
https://www.delawarecompanyhouse.com/
2. Alan Pace left Citbank to buy a Premier League club, a bit of a random thing to do.
https://www.thetradenews.com/citi-globa ... ball-club/
3. He and as his mate are corporate finance people, they are on commission. If all you blind progressives are happy with this, they will will want their (well earned !) £30-40m commission from someone.....(a debt on the club)
4. They bought a stake in AiScout and Player Lens to to either a/ provide some legitimacy, b/ pretend that moneyball stats in football is actually a thing.
4. Moneyball is 1%, inert skill/dedication of individuals, training, scouting is how football works and always will. The players testimonials and success stories on AiScout are from already good players who were about to step on the conveyor belt.
5. SCP/Legends (who Checketts left goodness when or why) is simply a corporate concession (Warning the price of Twix is probably best saved until Halloween).
6. It's rubbish being negative, but when the real money guy is secret, it makes me nervous (All the clubs that have been involved with secret potential buyers find out he's a criminal, dodgy human rights, no money....), have they even got someone lined up or are they peacocking from this end to sniff out a US money man or woman.
7. One of the few decent owners mentioned on here was Srivaddhanaprabha of King Power. A nice man who made billions from being a landlord of leased rental space on 3 malls in 30 years (and being a friend of the prince and forgetting to pay his taxes, bet the Thai public actually loved him)
8. Lots of comments suggest a buyback model, e.g., £100m over 5 years (like the SheffUTD model) @ 20%
9. ALK own 100% on day 1, pay 20M, less 40m to ALK (-20m) plus debt to Garlick and Banaszkiewicz (-100m)
10. year 2, ALK pay 2nd instalment, £20m, balance now 100m to G&B) get relegated, ALK invoke clause saying relegated value £40 so paid up.
11.Still no investment, but in debt to B&G.
12. B&G forced to write off debt. ALK kindly inject capital, solely reduces debt.
13. Meanwhile, wildly in debt, fire sale, blah blah blah. we never did spend that £50m on getting us to that magic 6th position.

[Spiral]

https://www.google.com/maps/place/8+The ... 75.5241898
1. Alan and Dave's new address for ALK , 8 The Green in Delaware, may look pretty, but it's simply a meeting room for hire for legals.
https://www.delawarecompanyhouse.com/
2. Alan Pace left Citbank to buy a Premier League club, a bit of a random thing to do.
https://www.thetradenews.com/citi-globa ... ball-club/
3. He and as his mate are corporate finance people, they are on commission. If all you blind progressives are happy with this, they will will want their (well earned !) £30-40m commission from someone.....(a debt on the club)
4. They bought a stake in AiScout and Player Lens to to either a/ provide some legitimacy, b/ pretend that moneyball stats in football is actually a thing.
4. Moneyball is 1%, inert skill/dedication of individuals, training, scouting is how football works and always will. The players testimonials and success stories on AiScout are from already good players who were about to step on the conveyor belt.
5. SCP/Legends (who Checketts left goodness when or why) is simply a corporate concession (Warning the price of Twix is probably best saved until Halloween).
6. It's rubbish being negative, but when the real money guy is secret, it makes me nervous (All the clubs that have been involved with secret potential buyers find out he's a criminal, dodgy human rights, no money....), have they even got someone lined up or are they peacocking from this end to sniff out a US money man or woman.
7. One of the few decent owners mentioned on here was Srivaddhanaprabha of King Power. A nice man who made billions from being a landlord of leased rental space on 3 malls in 30 years (and being a friend of the prince and forgetting to pay his taxes, bet the Thai public actually loved him)
8. Lots of comments suggest a buyback model, e.g., £100m over 5 years (like the SheffUTD model) @ 20%
9. ALK own 100% on day 1, pay 20M, less 40m to ALK (-20m) plus debt to Garlick and Banaszkiewicz (-100m)
10. year 2, ALK pay 2nd instalment, £20m, balance now 100m to G&B) get relegated, ALK invoke clause saying relegated value £40 so paid up.
11.Still no investment, but in debt to B&G.
12. B&G forced to write off debt. ALK kindly inject capital, solely reduces debt.
13. Meanwhile, wildly in debt, fire sale, blah blah blah. we never did spend that £50m on getting us to that magic 6th position.

All good points, but 99% of our fanbase just wants to see some nipple. I'm investing in bedsheets and market pens.

[KRBFC]

I still have no idea what to expect from this, some are optimistic but seems there are huge red flags? I’ll reserve opinion for now

[Chester Perry]

I still have no idea what to expect from this, some are optimistic but seems there are huge red flags? I’ll reserve opinion for now

That is where I am at too

[Chester Perry]

Article in The Times, Saturday about "blank cheque companies" - otherwise known as Special-Purpose Acquisition Companies, SPACs.

UTC

I have been posting about these things quite a bit in the last couple of months on the MMT thread for those looking for some extra detail - a simple search or two should bring up the relevant posts - one key search phrase "vulture" within the thread will bring up a lot on Private Equity - not all but a lot

[ClaretCraig]

Do you have their phone number please?

Thought you might have it seeing as you seem to know everything about them and their intentions.

[Long Time Lurker]

Article in The Times, Saturday about "blank cheque companies" - otherwise known as Special-Purpose Acquisition Companies, SPACs.

The financial media could have done better with the acronym for them.

Special Purpose Investment Ventures or SPIVs for short

Urban Dictionary entry for a Spiv

A flashy, slick operator who makes a living more from speculation or profiteering than from actual work. The kind of guy who wears a shiny medallion, goes bankrupt from a dodgy swampland development scheme, but still has a big house in his wife's name.

[Long Time Lurker]

Sorry for the re-post. I put this in the Harry Wilson thread a couple of days ago ( as a rambling response to a comment about the impact ALK might have on our scouting ), but it probably fits this thread better.

I could be wrong, but I think a number of false impression are being generated.

ALK only bought into the apps Player Lens and AiScout four weeks ago. That doesn't suggest a long term affiliation with proven statistical tools that could lead to a massive rise in the performance of our recruitment. However, the front and centre mouth pieces of the ALK consortium bid, if it actually exists, have used other analytical scouting tools as part of their work in other team sports.

https://www.sportbusiness.com/news/alk- ... ayer-lens/

https://www.sportbusiness.com/2020/08/a ... mfortable/

So what do we know about these apps

Player Lens

As far as I can see Player Lens is a move to try and change the landscape of the player transfer model. The best description for it would be a disruptive innovation strategy. At the moment agents tout players, clubs contact clubs with no idea if players are available or not and the whole thing is a little inefficient - albeit lucrative for agents.

Player Lens is an attempt to create an easy to navigate market place for the trading of players. Agents or clubs list the players they want to move on ( in terms of permanent signings or loans ). The players can also list themselves. This is done for a small fee and a listing can include analytical data ( by linking to other platforms lie WYSCOUT ) and specific needs, wants and expectation required by clubs, players and agents. The idea being that this will simplify the whole of the transfer process.

It strikes me as the crack dealer approach to market share penetration " the first one is free ". Or in this case the first use of the platform requires a nominal charge. Over time as the way of doing business changes the need for agents decreases. Players and clubs could simply circumvent the service the provide. This could lead then to the implementation of the classic " finders fee " recruitment charge. When a transfer is made Player Lens takes a fee from the seller and buyer , in essence allowing them to grab part or all of those juicy agent fees.

Moving on the platform could be extended to general sponsorship contracts. A player needs a little extra money so they make their availability known. Corporate site members looking for somebody to open a supermarket or wear their trainers for a fee can then simply look at who is available to sign on the dotted line. Player Lens would then take a finders fee from that. I'm just guessing on this part, but it is what I would do next, along with other things.

Think of it as EBAY for player transfers ( with or without the auction element )

The founder of Player Lens is Lee Hemmings, who used to be a commodity dealer.

https://beta.companieshouse.gov.uk/comp ... ng-history and https://www.playerlens.com and https://inews.co.uk/sport/football/play ... din-471636

The other Directors are

Liz Ellen - https://twitter.com/sportslawliz?lang=en and https://lividasport.com

Mark Betteridge - of the seemingly failed and defunct http://myeye.world and https://secure.toolkitfiles.co.uk/clien ... UNCHES.pdf

Jose Ramon Capdevila - Real Madrid’s former head of football operations

AiScout

This one is a bit trickier, because it appears to be in the Beta ( initial ) stages of development. As far as I can tell it seems to be a platform that will allow for the remote assessment of players.

Normally, development players attend trials in person. The clubs look at them over the course of a day or days and decide who they want to offer contracts to. This app seems to revolve around a series of trial tests that any person can engage with ( using their phone and possibly some means of motion capture ). The user runs through the tests and the generated data creates a profile for them. Interested clubs can then remotely view this data, watch the players performance and decide whether to offer them a contract or invite them for a trial.

The same software could be used to create profiles for established development players. In these cases the app data would also be supported by any data available through established scouting platforms.

I'm not sure what the profit key will be for this app, because it is still in its infancy. I suspect it will be another sign up fee ( for anyone wanting to put themselves in front of clubs ) and a finders fee. Given the current restrictions to movement this idea strikes me as having some potential. At the very least it could allow clubs to view more potential development candidates. However, it is basically just an online trial portal and it could possibly lead to the platform being swamped by eager sign ups ( from players or parents of players ) hoping to gain a career in football - despite them not having the ability to make the grade.

Think online X-Factor for development squad positions.

https://www.apollo.io/companies/AiScout ... hart=count

Darren Peries ( Founder ) and Mark Russell ( Operations Director ) don't seem to have a huge amount of experience in Football. That certainly doesn't prevent them from having a good idea for an app that relates to football. In terms of their direct commercial experience they appear to be more comfortable in the restaurant sector, which accounts for most of their CV details.

Conclusion

Neither of these recently bought apps have established themselves in the market place. So I can't see how anybody would presume that they would automatically result in a big improvement to our recruitment. Some of the articles jumping on the Money Ball idea are also very wide of the mark. I think this was just lazy journalism and people not looking at the true impact analytical scouting had at Oakland or how other clubs go about things.

Brentford are certainly in the business of speculating to accumulate when it comes to player transfers, but even they don't describe themselves as a Money Ball team and neither would I. While they might employ analytics the way they look to get value is not by sticking to the numbers ( like statistical sycophants ), but by using their common sense and deductive reasoning to read between and around the numbers.

https://talksport.com/football/fa-cup/6 ... er-fa-cup/

https://bleacherreport.com/articles/271 ... ge-budgets

https://eflanalysis.com/analysis/moneyb ... statistics

Everybody has access to the same statistical data these days so having it conveys no real advantage, being without it would be a disadvantage though. The advantage comes from the application of data and not the availability of data.

Success is about having quality people who can see patterns within the data, make profitable connections and realise avenues of interest that aren't immediately obvious. If you give a paintbrush and paint to a talented artist they will create a valuable work of art. However, give the same tools to a toddler and you will get a messy house.

The quality of the data is important, but the quality of the people interpreting and working creatively with that data is always a lot more important.

[summitclaret]

We don't need to sell our soul. We just need to sign a competent cb and right winger this week. If we have to borrow a bit to do it until the Covid vaccine kicks in, so be it.

[Winstonswhite]

You do know he's already a very rich man don't you?

Not disputing he is.

However, I’d be interested to know the numbers behind his initial purchasing of shares in Burnley, (I think he got them off Flood), and what he stands to gain if he sold all of them- that’s 49% of the club.

His personal wealth is £68 million at the last count before Covid I believe.

[Boss Hogg]

We don't need to sell our soul. We just need to sign a competent cb and right winger this week. If we have to borrow a bit to do it until the Covid vaccine kicks in, so be it.

Garlick needs to go but not sure whether ALK are the answer. Some alarm bells ringing in respect of who or what is behind this company and their intentions. We need a decent CB and RW as above. We also need to be able to afford a better calibre of CM than 31 year old Dale Stephens. Garlick has reached his limit and it needs a different pair of hands to provide the manager with the basic tools he needs to try and maintain or improve us.

[Hedontplayforyou]

I read somewhere that these guys are the face of the takeover , using many different investors - some being wealthy individuals but I can’t find it for the life of me - maybe circling back to the dirty money quote again if there are/will be wealthy individuals involved

[Steve-Harpers-perm]

https://www.google.com/maps/place/8+The ... 75.5241898
1. Alan and Dave's new address for ALK , 8 The Green in Delaware, may look pretty, but it's simply a meeting room for hire for legals.
https://www.delawarecompanyhouse.com/
2. Alan Pace left Citbank to buy a Premier League club, a bit of a random thing to do.
https://www.thetradenews.com/citi-globa ... ball-club/
3. He and as his mate are corporate finance people, they are on commission. If all you blind progressives are happy with this, they will will want their (well earned !) £30-40m commission from someone.....(a debt on the club)
4. They bought a stake in AiScout and Player Lens to to either a/ provide some legitimacy, b/ pretend that moneyball stats in football is actually a thing.
4. Moneyball is 1%, inert skill/dedication of individuals, training, scouting is how football works and always will. The players testimonials and success stories on AiScout are from already good players who were about to step on the conveyor belt.
5. SCP/Legends (who Checketts left goodness when or why) is simply a corporate concession (Warning the price of Twix is probably best saved until Halloween).
6. It's rubbish being negative, but when the real money guy is secret, it makes me nervous (All the clubs that have been involved with secret potential buyers find out he's a criminal, dodgy human rights, no money....), have they even got someone lined up or are they peacocking from this end to sniff out a US money man or woman.
7. One of the few decent owners mentioned on here was Srivaddhanaprabha of King Power. A nice man who made billions from being a landlord of leased rental space on 3 malls in 30 years (and being a friend of the prince and forgetting to pay his taxes, bet the Thai public actually loved him)
8. Lots of comments suggest a buyback model, e.g., £100m over 5 years (like the SheffUTD model) @ 20%
9. ALK own 100% on day 1, pay 20M, less 40m to ALK (-20m) plus debt to Garlick and Banaszkiewicz (-100m)
10. year 2, ALK pay 2nd instalment, £20m, balance now 100m to G&B) get relegated, ALK invoke clause saying relegated value £40 so paid up.
11.Still no investment, but in debt to B&G.
12. B&G forced to write off debt. ALK kindly inject capital, solely reduces debt.
13. Meanwhile, wildly in debt, fire sale, blah blah blah. we never did spend that £50m on getting us to that magic 6th position.

14. Our local owners would obviously sell their shares to the first dodgy outfit that come to town.

[Gordaleman]

It’s very simple, it’s his decision, HE doesn’t have to sell if HE doesn’t want to.

As it happens, HE has apparently decided that HE wants to sell for whatever reason HE feels necessary.

So, all those people wanting HIM to stay in charge aren’t realising that’s not what HE wants.

Hope that helps

So now you are saying exactly the same as me. He wants to sell to help the club, not because he's had enough or wants a profit. He certainly doesn't need the money.

He'd love to stay, but it's in the club's interest that he doesn't.

Oh, and I've never said that I wanted him to stay in charge. I'm pragmatic about a takeover, but it needs to be the right takeover. ALKs could be as it appears that they might want Mike Garlick to continue running the club on their behalf.

[Steddyman]

I love how all your keyboard internet warriors with no knowledge of the deal being proposed, the due diligence performed by the club and the council are already writing all this off. If only MG wasn’t naive eh?

[Steve-Harpers-perm]

I love how all your keyboard internet warriors with no knowledge of the deal being proposed, the due diligence performed by the club and the council are already writing all this off. If only MG wasn’t naive eh?

They aren’t local people though so it’s really scary to some on here!

[Paul Waine]

I have been posting about these things quite a bit in the last couple of months on the MMT thread for those looking for some extra detail - a simple search or two should bring up the relevant posts - one key search phrase "vulture" within the thread will bring up a lot on Private Equity - not all but a lot

Hi CP, yes, I agree you've collected a lot of value insights in the MMT thread. I thought about adding The Times article to MMT, but decided it may be directly relevant to the ALK Capital situation - and, not just because The Times published it yesterday.

The Times mentions Billy Beane, Moneyball and Richard Scudamore. It's possible that ALK Capital has ambitions to follow a similar model - which will explain the "early morning market announcement" tease that one of our posters has suggested. On the other hand, if this is ALK's path then it is switching the order of Billy Beane's and the usual SPAC "blank cheque" approach.

I think we are a little in the "what clues do we have?" - just like the "whose home is this?" tv show.
ALK Capital - owned by Alan Pace - ex-investment banker (Citi) - previously involved with Real Salt Lake MSL soccer team - MBA in Barcelona and first experience of "soccer" at Nou Camp. Low interest rates/low returns on stocks and shares - let's keep our eye on the financial markets - lot's of people looking for better returns on their funds - previous times this would encourage IPOs, but private equity is also pursuing the "start ups" and their is imbalance in demand and supply - Special-purpose Acquisition Corporation, SPACs start to get some traction - what are they? a way of attracting investors to invest (some of) their investments in a corporation that has not yet identified how it will spend/invest your money - but, of course, it has the promise of big returns. Then we ask, where can big returns be made? US sports franchises have frequently shown multiple increases in value - the US now watches a lot of Premier League "soccer." - maybe high returns can also be achieved by investing in (English) Premier League clubs - let's call it EPL, because that's what the US high net worth individuals will call it.

What's in it for Alan Pace? The founders/sponsors of a SPAC get some "founders' shares." They make the initial, modest investment - that's their stake and if everything comes off, yes, they make bundles and bundles or cash! They need the HNW investors to put their money in - these guys will make "good returns" - but not "mega bucks" because it's only a modest investment and only a part of their portfolio of investments. A SPAC that owns an EPL football club will be their way of accessing the opportunity to make money in the EPL - and it's a SPAC, listed on an exchange, so they can trade in and out, the share price is known every day - it has a liquidity advantage that private equity doesn't have. (A SPAC is not a vulture fund - the objective to make money is the same, but it's not looking for businesses that are in financial trouble - remember however, vultures, in nature, have the purpose of cleaning up the dead and creating the opportunities for new life).

Yes, EPL is not the same as a US sports franchise - there is the risk of relegation - and that can be "priced in."

How would I pitch it (my first draft): Sports franchise investments track records - EPL, not as big as US sports, so lots of growth upside. 20 EPL teams, look at the track records of Man United (listed, US owners), Liverpool (Fenway), other "big 6" and others with wealthy backers - so, ALK Capital's opportunity is Burnley - smaller club, so smaller entry fee - club in need of investment - so our (initial) plan is, lets say $200 million - with these funds we can do X and Y and Z (X = investment in new players, Y = support higher player wages, Z = infrastructure, ground etc etc). Risks - relegation - but if a team is relegated and is kept together then there is a high(er) probability of quick return to EPL - and Burnley have done that - 3 promotions in the past 11 seasons, now 5th consecutive season in EPL, 7 in total in 11 years - and all this without any significant investment. (This club has operated a model that really works). Where's Burnley - part of the Northern Powerhouse - UK gov't promotion of NPH - near Manchester, near Liverpool - lot's of other opportunities. (Yes, it's the lower cost "side of the tracks"). Burnley have been run by Mike Garlick, Chairman, for 10 years. Mike has agreed to stay (for at least x years). We need his expertise and experience of the area and the community (US investors love the "community.)" Burnley also have a very well respected team manager/coach (the title chosen to suit US investors). Sean Dyche has successfully managed the club for 8 years. He has agreed a new contract for a minimum of y years (let's assume y = 5 years). Burnley's proud history - First Division Champions.

What have I missed? or got wrong, above?

As before, I know absolutely nothing about what is going on. For all I know ALK Capital and Mike Garlick may have ended any discussions that may, or may not have taken place.

Oh, the AIScout stuff? I don't see that dominating Burnley's scouting approach. AIScout and Player LENS just give ALK Capital extra "credibility" that they know soccer and EPL when they ask their potential investors to get their chequebooks out (or the digital equivalent).

UTC

[Gordaleman]

They aren’t local people though so it’s really scary to some on here!

That's where trust comes in. Mike Garlick is a true fan of the club and we need to trust him not to sell to just anybody.

It seems that ALK may want Garlick to continue running the club on their behalf, so at least there would be some continuity.

[Paul Waine]

The financial media could have done better with the acronym for them.

Special Purpose Investment Ventures or SPIVs for short

Urban Dictionary entry for a Spiv

A flashy, slick operator who makes a living more from speculation or profiteering than from actual work. The kind of guy who wears a shiny medallion, goes bankrupt from a dodgy swampland development scheme, but still has a big house in his wife's name.

I recommend sticking with SPAC. There is a difference between an investment banker and a "spiv" - though, no doubting that many spivs find their way into investment banking.

Don't forget, in the US, bankruptcy is worn as a badge of honour. You weren't really trying to make money if you haven't experienced at least one bankruptcy.

[warksclaret]

You would think if we were serious about selling that we would be trying to put things in place to make us look like a good buying proposition. No different to having your house on the market-it makes you do some of the obvious things done and tidied up.

If I was an overseas observer looking at our club right now. I would have doubts. I would see that in three months the club has done sweet FA to increase its squad. In July we had no first teamers on the bench, and probably had the smallest ever fit squad in he Pl. Last night 3 months later we played like a side destined to go down, with two defenders only on the bench-the other 5 had no minutes PL experience. We kept for 90 minutes hoofing the ball up to Wood-something the Saints anticipated prior to the game, so changed their centre half, he won every ball. You would also have seen just one Burnley player who had any value attached to him namely Taylor

Last night I could hand on heart have seen any PL side including Fulham and definitely WBA beat us. We are now so easy to play against. Brighton, Leicester and Saints beat us and managed these 3 games without a sweat. I dread to think what would have happened had we played ten or so of the attack minded teams

8 days left in the window. We are totally in the dark over our prized asset. We don't know what game SD is playing in trying to read through his interviews, and we have a recruitment team that should be ashamed of itself. Would you currently want to take ownership of a club who will soon be favorites to be relegated, with the next transfer window not until January ??

[Steve-Harpers-perm]

That's where trust comes in. Mike Garlick is a true fan of the club and we need to trust him not to sell to just anybody.

It seems that ALK may want Garlick to continue running the club on their behalf, so at least there would be some continuity.

If true that should ease any reservations.

[Chester Perry]

Hi CP, yes, I agree you've collected a lot of value insights in the MMT thread. I thought about adding The Times article to MMT, but decided it may be directly relevant to the ALK Capital situation - and, not just because The Times published it yesterday.

The Times mentions Billy Beane, Moneyball and Richard Scudamore. It's possible that ALK Capital has ambitions to follow a similar model - which will explain the "early morning market announcement" tease that one of our posters has suggested. On the other hand, if this is ALK's path then it is switching the order of Billy Beane's and the usual SPAC "blank cheque" approach.

---------

UTC

Seems that more or less covers everything Paul

Beane and Scudamore are part of the Redball SPAC, which has some vey heavyweight US involvement, their purpose is very similar to that of ALK, they are just listed with the NYSE as that is how they raised their monies.

It is important for people to realise that for High Net Worth individuals thee are very limited returns out there in the world and that has been the case for over a decade. That is why they will be willing to risk a few % of their overall wealth, a return of 5 % , 10%, 15% over 5 to 10 years is probably better than they can get in a lot places now, and I am talking about value creation not dividends.

Our club has exercised stringent fiscal management, operating in a league with clear rules on fiscal regulation and steady avenues of income and the greatest level of recognition and interest in the world. One of America's biggest media organisations (CBS) is leveraging it's partnership with that league to build an OTT network (Peacock), similar to Sky's UK satelite service.

The Covid crisis has done a couple of things that Investors may like too, the price for the sports organisations has come down, the finances in the league below have become weaker and the regulations look like they are about to get tighter too, which means (in their eyes at least) that a club relegated with a strong balance sheet has a disproportionate chance of returning to the big league - they are perceiving a virtuous circle from that starting place advantage.

There is another element too, the crisis may yet mean that we only have 2 possibly 3 professional leagues as clubs go out of business - what could be better than a closed shop, where incomes are more stable and the sport can be developed on a more solid financial footing, again from their perspective.

When you throw in the associated opportunities that have been talked about within the region, you can understand what they are looking at, whether you like it or not is a different matter and will probably depend on whether you are team blinkered or not.

[Steddyman]

If true that should ease any reservations.

Isn't that model what MG has touted all along is the only model he would support for external funding? I can't find the exact quote, but I found this one from a year ago:

https://www.lancs.live/sport/football/f ... n-16869360

If you go back a year ago when he talked about a takeover, he said the only way he would support it is if he retained overall control of the club, and that the third party invested capital. Wouldn't an arrangement where ALK invest capital, and get to determine the player recruitment policies to prove their sports technology platform benefit all parties?

I don't know if this is what is being proposed, but that is what MG has always said, so it makes sense.

[redcloud203]

I personally hope a takeover happens .

The premier league is a tough and unforgiving league and money rules ok . The current shareholders have done an excellent job in taking us from the championship to being a Premier league club . However that status is not a given right and I worry that in this covid era with club net revenue significantly reduced we may not have the financial muscle to keep this status with limited financial resources to strengthen the side if the team hit a difficult period .Selling our best players - for hopefully top dollar , buying well will be very difficult and adds risk to our league survival chances .

Hopefully any new owners will inject money into the club as well as giving the current owners a well deserved payoff for their shareholdings and risk they have taken during their stewardship .