ALK Capital or Farnell/Elkashashy takeover

[claretonthecoast1882]

Its possibly because the default stance of many on here is that the Daily Mail tells outright lies, the PL is incompetent, everyone is against us etc etc so you go round and round in circles.

But also I'm rather hoping there is a big money backer behind ALK......!

The Daily Mail does tell lies. Matt Hughes is fairly clueless on the subject matter, he isn't very good with football either.

Parts of the PL are incompetent otherwise Mike Ashley would still be getting some clog on a match day at Newcastle. Not everyone is against us, some though are just like any other club in the country, nobody likes everyone.

There is no need to go round in circles, there is also no big money backer behind ALK.

[ClaretPete001]

And it's also quite informative from a personal point of view.-And it gives the likes of Paul to put across very strong defence of ALK.

How else would you understand the complex financial arrangements of BFC if you don't ask the questions and benefit from the wisdom of others even if it's not always straight forward....?

For the record, I don't think here is anything untoward going on.

Socrates dear boy - never forget Socrates....!

[ClaretPete001]

The Daily Mail does tell lies. Matt Hughes is fairly clueless on the subject matter, he isn't very good with football either.

Parts of the PL are incompetent otherwise Mike Ashley would still be getting some clog on a match day at Newcastle. Not everyone is against us, some though are just like any other club in the country, nobody likes everyone.

There is no need to go round in circles, there is also no big money backer behind ALK.

OK I get it now.

Matt Hughes is an idiot who has made up the fact there is a PL/EFL investigation. And the PL/EFL are idiots who are likely to conduct the kind of investigation that Matt Hughes has made up because Mike Ashley would still be getting some "clog" on a match day at Newcastle if it were not the case.

We can all move on....!

[claretonthecoast1882]

OK I get it now.

Matt Hughes is an idiot who has made up the fact there is a PL/EFL investigation. And the PL/EFL are idiots who are likely to conduct the kind of investigation that Matt Hughes has made up because Mike Ashley would still be getting some "clog" on a match day at Newcastle if it were not the case.

We can all move on....!

I am sure that will be a relief for many on this thread if you do get it and move on, glad to have helped

[dsr]

Its possibly because the default stance of many on here is that the Daily Mail tells outright lies, the PL is incompetent, everyone is against us etc etc so you go round and round in circles.

But also I'm rather hoping there is a big money backer behind ALK......!

Dream on. These people are here to take money out of the club, not to put it in.

[ClaretPete001]

I am sure that will be a relief for many on this thread if you do get it and move on, glad to have helped

Indeed I have no doubt there are many on here that would prefer to talk about Mike Ashley getting clogged on a Saturday because the PL are incompetent.

Glad to receive the benefit of your wisdom albeit just for the record it's not as informative as the stuff about US Corporate structures and LLCs in terms of understanding the financial structure of Burnley Football Club.

[claretonthecoast1882]

Jesus its like the school holidays are still going on.

You keep searching for what it is you are searching for rather than posting your immature responses.

I have said before that some people even with armbands on in the shallow end of a swimming pool are miles out of their depth on some subjects they choose to get involved in, perhaps you need a swimming ring and some floats too given your posts and how many times you have been corrected and had to have basic things explained to you.

Good luck though in your quest to find the answers you are desperate for

[taio]

In my view, supporters who remain concerned are right to continue to express their views and worries about the financial structure and future of the club, especially if new information becomes available, even if it's not considered by others to be reliable and/or it's merely going round in circles.

In relation to the last point, those who are happy with the situation and so don't see the point of discussing it can simply choose to avoid threads such as these.

For those with concerns, it's hardly surprising that they will continue to debate them given how significantly important it is to the future of the club...one way or another. Personally, I can't think of many more topics more appropriate for a football supporters' messageboard.

[NewClaret]

To be fair the substance of the story is: "The Premier League began making enquiries last season and the matter has been passed on to the EFL following the club’s relegation.

It's a either the truth or a lie. Research has nothing to do with it.

Disagree that “research has nothing to do with this”. The article alludes that there’s some secretive Jersey-based organisation lurking in the background. It doesn’t name them, despite the fact they’re fully declared in the accounts and on the website. That is either because they didn’t know (poor research) or because revealing this would make it a complete non-story (misleading, which is even worse).

I agree that news of an investigation is new news. But then he ends by saying “sources say they’ve not been asked for any information”. So is it true or not? And what are “sources”? Did he ask for a statement from the club/EFL? Did he get one? If not why not? Again, seems poorly researched - even if there’s some truth in it.

I’m not against reading bad news about BFC, I just want it to be proper journalism - not ****-stirring.

[NewClaret]

Dream on. These people are here to take money out of the club, not to put it in.

Well that’s something we’re used to, given the actions of the previous board.

How great it was to be owned by a local business man, fan and custodian…

[ClaretPete001]

Dream on. These people are here to take money out of the club, not to put it in.

Indeed, you would hope there is something more substantive than what we currently see.

[NewClaret]

Indeed, you would hope there is something more substantive than what we currently see.

Sadly, I don’t think there is, or we wouldn’t have needed the debt, the factoring, quite so many player sales, or arguing over valuations of strikers.

I do think there’s every chance we’ll get it if promoted again. Also, not convinced we’re in any real financial problems without it though, especially after receiving £15m for Collins after halving the debt - with presumably some more to come for McNeil.

[ClaretPete001]

Disagree that “research has nothing to do with this”. The article alludes that there’s some secretive Jersey-based organisation lurking in the background. It doesn’t name them, despite the fact they’re fully declared in the accounts and on the website. That is either because they didn’t know (poor research) or because revealing this would make it a complete non-story (misleading, which is even worse).

I agree that news of an investigation is new news. But then he ends by saying “sources say they’ve not been asked for any information”. So is it true or not? And what are “sources”? Did he ask for a statement from the club/EFL? Did he get one? If not why not? Again, seems poorly researched - even if there’s some truth in it.

I’m not against reading bad news about BFC, I just want it to be proper journalism - not ****-stirring.

I agree...! It's hard to know what is the truth...

[ClaretPete001]

Sadly, I don’t think there is, or we wouldn’t have needed the debt, the factoring, quite so many player sales, or arguing over valuations of strikers.

I do think there’s every chance we’ll get it if promoted again. Also, not convinced we’re in any real financial problems without it though, especially after receiving £15m for Collins after halving the debt - with presumably some more to come for McNeil.

I think like last year they may have undercooked the investment in playing assets - without Cork and Jay Rod I wonder how good the team would be. No promotion would mean a rebuild next year.

But I agree the cataclysm of relegation is not as bad as anticipated and the team looks better than expected.

[GodIsADeeJay81]

I guess if you are coming from the perspective the Daily Mail would not write outright lies about the club and then you would have to assume the PL is incompetent. Unless of course they have seen something, which contradicts the audited accounts. I doubt they have or even that there is an investigation.

Have the Mail ever posted falsehoods?
Yes, plenty of times, we all know that.

Are the PL incompetent?
3-4 yrs of an on going court case with Man City would suggest that yes they are, but there are other instances.

[ClaretPete001]

Have the Mail ever posted falsehoods?
Yes, plenty of times, we all know that.

Are the PL incompetent?
3-4 yrs of an on going court case with Man City would suggest that yes they are, but there are other instances.

I don't dispute that the PL could be incompetent or that the Mail does not tell the whole truth but that is of little interest to me.

What I want to understand is the corporate structure of BFC. And I now know that the likely problem here is the complex relationships between the US corporate structure of LLCs and UK audited accounts relating to controlling interests cited in the accounts.

I am still interested in some of the ambiguities of language involved but that does not mean I think there is anything untoward here. I have never thought that ALK have done anything remotely untoward from a legal perspective. More, that there could be something more substantive than has been cited albeit that is unlikely as well.

[GodIsADeeJay81]

I don't dispute that the PL could be incompetent or that the Mail does not tell the whole truth but that is of little interest to me.

What I want to understand is the corporate structure of BFC. And I now know that the likely problem here is the complex relationships between the US corporate structure of LLCs and UK audited accounts relating to controlling interests cited in the accounts.

I am still interested in some of the ambiguities of language involved but that does not mean I think there is anything untoward here. I have never thought that ALK have done anything remotely untoward from a legal perspective. More, that there could be something more substantive than has been cited albeit that is unlikely as well.

So if you're not interested in a paper lying and the PL being incompetent why ask?

You're just seeking something that isn't there, ok fine, have fun going round in circles chasing your tail over it

[Newcastleclaret93]

Have the Mail ever posted falsehoods?
Yes, plenty of times, we all know that.

Are the PL incompetent?
3-4 yrs of an on going court case with Man City would suggest that yes they are, but there are other instances.

Let’s hope Pace takes them to court.

[GodIsADeeJay81]

Let’s hope Pace takes them to court.

There's little point, it gives them the attention they crave, it's best to be ignored because it isn't doing any damage really apart from in the minds of idiots.

[aggi]

Dream on. These people are here to take money out of the club, not to put it in.

I posted this on page 1 of this thread:

Being owned by a venture capital firm is very different to something like Man City.

They're generally in it to make money (and quite a lot of it) in a relatively short time period.

The question really is what the best way of making money is, how much investment you'll need to maximise your returns (and how much they can afford).

[Chester Perry]

I posted this on page 1 of this thread:

Being owned by a venture capital firm is very different to something like Man City.

They're generally in it to make money (and quite a lot of it) in a relatively short time period.

The question really is what the best way of making money is, how much investment you'll need to maximise your returns (and how much they can afford).

I posted this at the end of August on the MMT - whatever Pace and co (even other US Investors in football) it is actually Mike Garlick that has set the bar in terms of multiples in ROI

This is truly significant as a marker for the future of the game

Elliot Management become the first American fund management operation to make a very large return in football - the investment return ratio's are less than those achieved by Mike Garlick and co - less than half (which I suspect will never be beaten, but the numbers are also significantly larger.

Red Bird Capital buy AC Milan for EUR 1.2 billion with a little help from the owner of the NY Yankees

https://twitter.com/tariqpanja/status/1 ... 7951907840

I stand by the suspicion that the multiple will never be beaten in a relatively short time frame

[ClaretPete001]

I posted this on page 1 of this thread:

Being owned by a venture capital firm is very different to something like Man City.

They're generally in it to make money (and quite a lot of it) in a relatively short time period.

The question really is what the best way of making money is, how much investment you'll need to maximise your returns (and how much they can afford).

Again this is one of those question that begs the issue of the contradictions of ALK.

If we are to believe that the previous owners struggled to sell the club and that ALK has struggled to secure investment then you would have to assume that the previous owners having taken all the value out of it and are the real winners here.

The easiest and most accessible profit is the money taken from the clubs cashflow because there seems little other way of quickly raising the value of the club other than very significant increases in broadcast revenue.

You would however have to hope that ALK offers something more substantive than that.....!

[ClaretPete001]

So if you're not interested in a paper lying and the PL being incompetent why ask?

You're just seeking something that isn't there, ok fine, have fun going round in circles chasing your tail over it

Because I'm interested in the corporate structure of BFC and that is what I am asking questions about...

[ClaretPete001]

I realise that one or two want to get back to discussing Mike Ashley getting a clogging on a saturday :tehee :rofl :lol etc., however, just for my knowledge does anyone know if there is a difference between the use of "significant influence" and "significant control" in company law? I know there is guidance to suggest there is but I don't know if that guidance is widely followed or accepted in practice

Significant influence or control - terminology

1.21. “Significant influence” and “control” are alternatives.
1.22. Where a person that can direct the activities of a company, trust or firm, this would
be indicative of “control”.
1.23. Where a person can ensure that a company, trust or firm generally adopts the
activities which they desire, this would be indicative of “significant influence”.

[Paul Waine]

Paul, that's all I was trying to do ascertain where the Daily Mail story comes from and clarify the relationship between ALK LLC and VSL (Jersey). I don't just dismiss stuff out of hand.

I asked the simple questions above (to anyone who might know): who is the owner of Burnley FC and how do you know?

ALK LLC own and control the voting rights of VSL (Jersey). I'm not a corporate lawyer so I don't know how the role of managing partner manifests itself in US and UK law. And I don't know if Alan Pace is the Managing Partner of ALK CAPITAL LLC or how anyone would know that...!

On the club web site it cites Alan Pace as having "significant interest" not "significant control" and again I'm not a corporate lawyer but as far as I am aware there is statutory guidance to differentiate between the two albeit I don't know whether that is enacted in practice.

I asked Aggi whether it was possible that LLCs could be setup such that voting rights are differentiated from normal shares to the extent that the control and ownership of ALK LLC could not be inferred from the shareholding of VSL (Jersey) and Aggi seemed to suggest it that it could - in other words you cannot infer ownership of ALK from the shareholding of VSL.

Of course, I all think Alan Pace owns and controls ALK LLC and therefore Burnley Football Club but I couldn't point to anything to evidence that view point.

You might be able to ..!

Are your questions sorted now, Pete?

You might find it interesting to read what Investopedia has to say about Controlling Interest.

By TIM SMITH Updated December 05, 2021, Reviewed by ANDY SMITH, Fact checked by YARILET PEREZ

www.investopedia.com/terms/c/controllinginterest.asp

Extracts:

What Is a Controlling Interest?
The term controlling interest refers to a situation that arises when a shareholder or a group acting in kind holds the majority of a company's voting stock. Having a controlling interest gives the holding entity(s) significant influence over any corporate actions. Shareholders who have a controlling interest are often able to direct the course of a company and make the most strategic and operational decisions.

KEY TAKEAWAYS
A controlling interest is when a shareholder holds a majority of a company's voting stock.
A shareholder does not have to have majority ownership in a company to have a controlling interest as long as they own a significant portion of its voting shares.
Having a controlling interest provides a shareholder with significant power and influence within a company.
Ownership of operational and strategic decision-making processes is given to a shareholder with a controlling interest.
A controlling interest grants leverage to increase a shareholder's stake in a company in a merger or acquisition.

[Paul Waine]

I realise that one or two want to get back to discussing Mike Ashley getting a clogging on a saturday :tehee :rofl :lol etc., however, just for my knowledge does anyone know if there is a difference between the use of "significant influence" and "significant control" in company law? I know there is guidance to suggest there is but I don't know if that guidance is widely followed or accepted in practice

Significant influence or control - terminology

1.21. “Significant influence” and “control” are alternatives.
1.22. Where a person that can direct the activities of a company, trust or firm, this would
be indicative of “control”.
1.23. Where a person can ensure that a company, trust or firm generally adopts the
activities which they desire, this would be indicative of “significant influence”.

There's also a whole section on People with Significant Control (PSC) on www.gov.uk/guidance/people-with-signifi ... ntrol-pscs

Extracts:

How to identify and record the people who own or control your company.

A person with significant control (PSC) is someone who owns or controls your company. They’re sometimes called ‘beneficial owners’.

You must identify your PSC and tell us who they are. This might be you, or someone associated with your company. A company can have one or more PSCs.

You must record their details on your company’s PSC register, and you’ll need to include this information when you set up (incorporate) your company.

If you cannot identify your PSC, or do not have one, you need to tell us.

Identifying your PSC

A PSC must meet one or more conditions known as the ‘nature of control’. Your register must show which conditions are met.

Most PSCs are those who hold:

more than 25% of shares in the company
more than 25% of voting rights in the company
the right to appoint or remove the majority of the board of directors
You should check your company’s register of members for information on shareholders and voting rights.

Your company’s constitution and articles of association may also contain information on voting and other rights associated with ownership of shares in the company.

Other significant influence or control

Your PSC might influence or control your company through other means. This could be directly, or on behalf of someone else.

For example, someone may influence or control the actions of directors or shareholders.

This condition will only apply in limited circumstances. The full PSC guidance has more information on the meaning of ‘significant influence or control’.

__________________

To answer your questions above. Yes, this is company law. Yes, this is followed in practice.

[ClaretPete001]

There's also a whole section on People with Significant Control (PSC) on www.gov.uk/guidance/people-with-signifi ... ntrol-pscs

Extracts:

How to identify and record the people who own or control your company.

A person with significant control (PSC) is someone who owns or controls your company. They’re sometimes called ‘beneficial owners’.

You must identify your PSC and tell us who they are. This might be you, or someone associated with your company. A company can have one or more PSCs.

You must record their details on your company’s PSC register, and you’ll need to include this information when you set up (incorporate) your company.

If you cannot identify your PSC, or do not have one, you need to tell us.

Identifying your PSC

A PSC must meet one or more conditions known as the ‘nature of control’. Your register must show which conditions are met.

Most PSCs are those who hold:

more than 25% of shares in the company
more than 25% of voting rights in the company
the right to appoint or remove the majority of the board of directors
You should check your company’s register of members for information on shareholders and voting rights.

Your company’s constitution and articles of association may also contain information on voting and other rights associated with ownership of shares in the company.

Other significant influence or control

Your PSC might influence or control your company through other means. This could be directly, or on behalf of someone else.

For example, someone may influence or control the actions of directors or shareholders.

This condition will only apply in limited circumstances. The full PSC guidance has more information on the meaning of ‘significant influence or control’.

__________________

To answer your questions above. Yes, this is company law. Yes, this is followed in practice.

Thanks Paul, unless I've misunderstood that wasn't quite my question. The term used on the clubs web site is "significant influence" not "control", however, the guidance has an interesting distinction.

My question was: is that a semantic difference or is there a real distinction between those who control and those who are adopters (see below)?

Significant influence or control - terminology

1.21. “Significant influence” and “control” are alternatives.

1.22. Where a person that can direct the activities of a company, trust or firm, this would
be indicative of “control”.

1.23. Where a person can ensure that a company, trust or firm generally adopts the
activities which they desire, this would be indicative of “significant influence”.

[ClaretPete001]

Also as an aside Rovers accounts do name the foreign incorporated company the wonderfully named Venkateshwara Hatcheries Pvt. Ltd. where you can buy if you wish Desugared Spray Dried Hen Egg Albumen Powder.....!

"The company is a subsidiary undertaking of Venky's London limited with Ventakateshwara Hatcheries PVT Ltd being the ultimate controlling company, which is incorporated in India"

[Paul Waine]

Thanks Paul, unless I've misunderstood that wasn't quite my question. The term used on the clubs web site is "significant influence" not "control", however, the guidance has an interesting distinction.

My question was: is that a semantic difference or is there a real distinction between those who control and those who are adopters (see below)?

Significant influence or control - terminology

1.21. “Significant influence” and “control” are alternatives.

1.22. Where a person that can direct the activities of a company, trust or firm, this would
be indicative of “control”.

1.23. Where a person can ensure that a company, trust or firm generally adopts the
activities which they desire, this would be indicative of “significant influence”.

Two questions:

1) Where on the club's website do you see "significant influence?" What is the context?

2) Are you quoting from Department for Business Innovation and Skills - Statutory Guidance on the meaning of "significant influence or control" over Limited Liability Partnerships in the context of the Register of People with Significant Control?

[Paul Waine]

Also as an aside Rovers accounts do name the foreign incorporated company the wonderfully named Venkateshwara Hatcheries Pvt. Ltd. where you can buy if you wish Desugared Spray Dried Hen Egg Albumen Powder.....!

"The company is a subsidiary undertaking of Venky's London limited with Ventakateshwara Hatcheries PVT Ltd being the ultimate controlling company, which is incorporated in India"

Yes, of course, Blackburn Rovers accounts can name the ultimate controlling company... because it is an incorporated entity.

BFCHL cannot do this beyond VSL (Jersey) because VSP LLC and ALK Capital LLC are US partnerships and not companies limited by shares or other forms of "body corporate" ownership.

As posted earlier above, it is the legal status of VSP LLC and ALK Capital LLC that determines the disclosures in BFCHL's accounts.

[ClaretPete001]

Two questions:

1) Where on the club's website do you see "significant influence?" What is the context?

2) Are you quoting from Department for Business Innovation and Skills - Statutory Guidance on the meaning of "significant influence or control" over Limited Liability Partnerships in the context of the Register of People with Significant Control?

On the company details page of the web site.

[ClaretPete001]

Yes, of course, Blackburn Rovers accounts can name the ultimate controlling company... because it is an incorporated entity.

BFCHL cannot do this beyond VSL (Jersey) because VSP LLC and ALK Capital LLC are US partnerships and not companies limited by shares or other forms of "body corporate" ownership.

As posted earlier above, it is the legal status of VSP LLC and ALK Capital LLC that determines the disclosures in BFCHL's accounts.

LLCs are legal entities and as such can have a controlling interest in UK companies. It would be a bit odd to draft controlling legislation and then exclude legal entities that can control UK companies from being cited in audited accounts. As the club is keen to point out: ALK is the controlling interest in BFCHL not VSL (Jersey).

Portsmouth is owned by an American investment company:

The company's immediate parent undertaking is The Tornante Company LLC, a company registered in the United States of America. Mr M. Eisner is considered to be the ultimate controlling party of the company, by virtue of his majority shareholding in the parent undertaking

[Tall Paul]

As I understand the statement on the website, the shares in VSL are split between ALK Capital LLC and VSP LLC, so neither are the parent undertaking, which makes VSL the ultimate parent of BFC, as per the accounts.

[ClaretPete001]

As I understand the statement on the website, the shares in VSL are split between ALK Capital LLC and VSP LLC, so neither are the parent undertaking, which makes VSL the ultimate parent of BFC, as per the accounts.

Where on the statement does it say the shares are equally split?

[Tall Paul]

Where on the statement does it say the shares are equally split?

It doesn't say equally split, and neither did I.

"ALK Capital LLC and Velocity Sports Partners LLC are the only persons or entities owning 25% or greater of Velocity Sports Limited."

That, to me, says that both ALK Capital LLC and VSP LLC each own more than 25% of VSL. To be a parent there must be over 50% ownership, so that suggests that either they own 50% each or there are other minority shareholders.

[ClaretPete001]

It doesn't say equally split, and neither did I.

"ALK Capital LLC and Velocity Sports Partners LLC are the only persons or entities owning 25% or greater of Velocity Sports Limited."

That, to me, says that both ALK Capital LLC and VSP LLC each own more than 25% of VSL. To be a parent there must be over 50% ownership, so that suggests that either they own 50% each or there are other minority shareholders.

As far as I understand it you said split between the two and therefore VSL(Jersey) must be the parent company. Now you are saying something different.

Either way it’s irrelevant! The issue is the controlling party not parent company, which has a clear set of rules laid out in Gov’t guidance and nothing to do with 50 per cent.

The audited accounts say it is VSL (Jersey) the club says it’s ALK LLC. Paul argues that it is because LLCs cannot be cited because they are not incorporated but LLCs are cited on Portsmouth’s accounts and the legislation reads to me that any legal entity can be cited.

But I could be wrong...! Of course, I do not suggest that there is anything untoward going on or that’s Alan Pace is not the controlling party but that the use of language by the club does not help and that maybe fuels media interest. And, of course, the interest of the odd Burnley fan on here.

[Tall Paul]

As far as I understand it you said split between the two and therefore VSL(Jersey) must be the parent company. Now you are saying something different.

Either way it’s irrelevant! The issue is the controlling party not parent company, which has a clear set of rules laid out in Gov’t guidance and nothing to do with 50 per cent.

The audited accounts say it is VSL (Jersey) the club says it’s ALK LLC. Paul argues that it is because LLCs cannot be cited because they are not incorporated but LLCs are cited on Portsmouth’s accounts and the legislation reads to me that any legal entity can be cited.

But I could be wrong...! Of course, I do not suggest that there is anything untoward going on or that’s Alan Pace is not the controlling party but that the use of language by the club does not help and that maybe fuels media interest. And, of course, the interest of the odd Burnley fan on here.

I'm not saying anything different. I'm saying I don't think VSL has a parent company because no entity owns over 50% of its equity shares. Therefore VSL is BFC's ultimate parent company, as stated in the accounts.

The club statement goes in to say that "ALK Capital LLC holds and controls the voting rights of Velocity Sports Limited", which does not necessarily make it a parent company, but does make it a controlling party.

Although the corporate structure may be fairly complex, it's really not that complicated or worth getting worked up about. All you need to know is that Alan Pace controls the club as clearly and consistently (to me) stated in the accounts and on the website.

[Tall Paul]

As far as I understand it you said split between the two and therefore VSL(Jersey) must be the parent company. Now you are saying something different.

Either way it’s irrelevant! The issue is the controlling party not parent company, which has a clear set of rules laid out in Gov’t guidance and nothing to do with 50 per cent.

The audited accounts say it is VSL (Jersey) the club says it’s ALK LLC. Paul argues that it is because LLCs cannot be cited because they are not incorporated but LLCs are cited on Portsmouth’s accounts and the legislation reads to me that any legal entity can be cited.

But I could be wrong...! Of course, I do not suggest that there is anything untoward going on or that’s Alan Pace is not the controlling party but that the use of language by the club does not help and that maybe fuels media interest. And, of course, the interest of the odd Burnley fan on here.

Cant edit now but to add - the audited accounts do not say that VSL is the controlling party, they say it's the ultimate parent and Pace is the controlling party.

[aggi]

As far as I understand it you said split between the two and therefore VSL(Jersey) must be the parent company. Now you are saying something different.

Either way it’s irrelevant! The issue is the controlling party not parent company, which has a clear set of rules laid out in Gov’t guidance and nothing to do with 50 per cent.

The audited accounts say it is VSL (Jersey) the club says it’s ALK LLC. Paul argues that it is because LLCs cannot be cited because they are not incorporated but LLCs are cited on Portsmouth’s accounts and the legislation reads to me that any legal entity can be cited.

But I could be wrong...! Of course, I do not suggest that there is anything untoward going on or that’s Alan Pace is not the controlling party but that the use of language by the club does not help and that maybe fuels media interest. And, of course, the interest of the odd Burnley fan on here.

I think you may be overestimating auditors and how consistent the technical advice between firms is here. Nuances such as should an LLC be defined as a parent company even though it's not a company probably didn't receive much thought beyond "what did we do last time". I'd view the naming of the controlling party to be the important bit, no-one will care much about the exact detail of parent company.

[ClaretPete001]

I'm not saying anything different. I'm saying I don't think VSL has a parent company because no entity owns over 50% of its equity shares. Therefore VSL is BFC's ultimate parent company, as stated in the accounts.

The club statement goes in to say that "ALK Capital LLC holds and controls the voting rights of Velocity Sports Limited", which does not necessarily make it a parent company, but does make it a controlling party.

Although the corporate structure may be fairly complex, it's really not that complicated or worth getting worked up about. All you need to know is that Alan Pace controls the club as clearly and consistently (to me) stated in the accounts and on the website.

We both agree ALK LLC is the controlling party and that is who should be cited on the audited accounts as the controlling party.

Any other conclusion is just obtuse.

Unless, you can give a technical reason why VSL (Jersey) is cited not ALK LLC. Or why an LLC is cited in Portsmouth’s case but not ours then what else is there to say?

You may think this is a banal point and so be it but it is the End of conversation surely..! Point made we can all move on!

[ClaretPete001]

I think you may be overestimating auditors and how consistent the technical advice between firms is here. Nuances such as should an LLC be defined as a parent company even though it's not a company probably didn't receive much thought beyond "what did we do last time". I'd view the naming of the controlling party to be the important bit, no-one will care much about the exact detail of parent company.

My original point was that the Daily Mail article may well have resulted from this lack of clarity or the fact that the auditors didn’t care too much about the facts and no one sought to correct them.

Paul raised the issue of the legal status of LLCs.

The issue is in my view the level of argumentation that naturally ensues whenever a point is made about ALK, which constantly seeks to obfuscate simple points.

What begins as an attempt to consider why these articles emerge becomes a long winded journey to hell and back.

[Chester Perry]

That Matt Hughes report that ignited the last couple pf pages of this thread has made it onto The Price of Football Podcast

https://play.acast.com/s/priceoffootbal ... d219b532c0

much is made of the many tiers of the ownership hierarchy - which Maguire misses a couple of elements of - though the actual report is written off as it is here - all in all the information is much better on here as Maguire misses out loads of info including just how out of date that statement of ownership is on the club's website

The key point made is one of transparency and that is on the nail

[Paul Waine]

On the company details page of the web site.

Thanks. It took me a bit of searching, but finally found the "Company Details" page, somewhere down the hierarchy of pages.

Quoting all of it here:

COMPANY DETAILS
Welcome to the official website of Burnley Football Club

For all Club Privacy Related documents please go HERE

The Club operates and carries out its activities through the following commercial entity:

BURNLEY FOOTBALL & ATHLETIC COMPANY,LIMITED(THE) Turf Moor, Burnley, Lancashire, BB10 4BX

Company Number: 00054222 VAT number: GB 174 3679 35

Directors: Alan Pace Stuart Hunt Mike Smith Dave Checketts Prof. Antonio Davila Mike Garlick John Banaskiewicz

Significant Interest: The Club is a member of the English Premier League (EPL) and English Football League (EFL) and is subject to the EPL and EFL’s rules and regulations. As required by those regulations, the Club can confirm the following person(s) have a ‘significant interest’ (as that term is defined within the EPL and EFL regulations) in the Club:

Burnley Football & Athletic Company Limited is wholly-owned by Burnley FC Holdings Limited, of which 83.97% of its entire issued share capital is owned by Calder Vale Holdings Limited, a company incorporated in England and Wales (“Calder Vale”). Calder Vale is owned, through a wholly-owned subsidiary, by Velocity Sports Limited, a company incorporated in Jersey. ALK Capital LLC and Velocity Sports Partners LLC are the only persons or entities owning 25% or greater of Velocity Sports Limited. ALK Capital LLC holds and controls the voting rights of Velocity Sports Limited, and Alan Pace and Michael Smith are each directors. The persons having a significant interest in Velocity Sports Limited, and therefore Burnley Football & Athletic Company Limited, are Alan Pace (50.382%), Michael Smith (16.794%) and Stuart Hunt (16.794%).

***************

I've added bold and underlined this statement: As required by those regulations, the Club can confirm the following person(s) have a ‘significant interest’ (as that term is defined within the EPL and EFL regulations) in the Club:

I've done this to note that "significant interest" is as that term is defined within the EPL and EFL regulations.

I think I recall question above along the lines of "is this law?" and "why is this inconsistent with what is stated in the club's accounts?"

Simple answer: the EPL and EFL do not create UK laws, we leave that to our elected Parliament. There's no reason why EPL and EFL need to use exactly the same terms as used in company law. So, there can be no inconsistency in using one phrase in one context (the club and EPL/EFL) and another phrase in another context (company accounts prepared according to UK company law).

[Paul Waine]

LLCs are legal entities and as such can have a controlling interest in UK companies. It would be a bit odd to draft controlling legislation and then exclude legal entities that can control UK companies from being cited in audited accounts. As the club is keen to point out: ALK is the controlling interest in BFCHL not VSL (Jersey).

Portsmouth is owned by an American investment company:

The company's immediate parent undertaking is The Tornante Company LLC, a company registered in the United States of America. Mr M. Eisner is considered to be the ultimate controlling party of the company, by virtue of his majority shareholding in the parent undertaking

Wikipedia: (extracts)

The Tornante Company, LLC is an American privately held investment firm founded in 2005 and owned by former Paramount Pictures and The Walt Disney Company CEO Michael Eisner. Tornante invests in, acquires, and operates media and entertainment companies.

When Eisner was bicycling around Italy, he saw a signpost that inspired the name Tornante for his company. Tornante means "hairpin turn" in Italian.

In August 2017, Tornante closed on the purchase of the Portsmouth Football Club for an undisclosed deal; however, BBC reported that Eisner had offered £5.67 million "and will invest an extra £10m."

***********************

Yes, The Tornante Company LLC is another LLC. But, nothing in the wikipedia details that Tornante is set up in the same way as ALK and VSP - the latter with (the possibility of) multiple partners. Unfortunately, US disclosure rules don't provide us with access to further details (so far as I'm aware).

[Paul Waine]

My original point was that the Daily Mail article may well have resulted from this lack of clarity or the fact that the auditors didn’t care too much about the facts and no one sought to correct them.

Paul raised the issue of the legal status of LLCs.

The issue is in my view the level of argumentation that naturally ensues whenever a point is made about ALK, which constantly seeks to obfuscate simple points.

What begins as an attempt to consider why these articles emerge becomes a long winded journey to hell and back.

Without wanting to pre-empt aggi, I understood his comment about auditors was making a distinction on the conclusions arrived at by BFCHL auditors on one hand and the conclusions of Portsmouth's auditors on the other - and countless other auditors all making judgements on disclosure requirements when presented with different facts, even if, to many, the differences are only marginal or nuanced.

I quoted US tax authorities on the legal status of US LLCs. It appears to be relevant and addressed the questions Pete was raising following on from the article in the Daily Mail.

[aggi]

My original point was that the Daily Mail article may well have resulted from this lack of clarity or the fact that the auditors didn’t care too much about the facts and no one sought to correct them.

Paul raised the issue of the legal status of LLCs.

The issue is in my view the level of argumentation that naturally ensues whenever a point is made about ALK, which constantly seeks to obfuscate simple points.

What begins as an attempt to consider why these articles emerge becomes a long winded journey to hell and back.

There is a lack of clarity but the Mail article also ignored a substantial amount of public domain info (whether to generate a better story or just through poor research, who knows).

My point re: the auditors was more that for a large amount of stuff there isn't a definitive correct answer. Even if you go to the Institute's technical team (which is unlikely on an immaterial point such as this) you're not guaranteed that everyone will think the same.

It certainly is the case that the structure is complex and based in a few territories where disclosure of records is minimal. Whether that is deliberate to obfuscate the ownership or because it is the most tax efficient manner or a bit of both we don't know.

[ClaretPete001]

There is a lack of clarity but the Mail article also ignored a substantial amount of public domain info (whether to generate a better story or just through poor research, who knows).

My point re: the auditors was more that for a large amount of stuff there isn't a definitive correct answer. Even if you go to the Institute's technical team (which is unlikely on an immaterial point such as this) you're not guaranteed that everyone will think the same.

It certainly is the case that the structure is complex and based in a few territories where disclosure of records is minimal. Whether that is deliberate to obfuscate the ownership or because it is the most tax efficient manner or a bit of both we don't know.

Indeed who knows but if you read the publicly available information that ALK LLC owns the club and then go to the accounts, which is possible for a journalist, you would ponder why a Jersey company is cited not ALK LLC. This forum is pretty well informed, compared to most people out there, so it seems reasonable to me for a tabloid journalist not to have the full facts to hand.

LLCs are well known to UK legislators and are regarded as opaque for tax purposes so I see little that could cause confusion. The legislation regarding control is also fairly self-evident from my reading of it - the purpose is to identify the controlling party. And unless the controlling party has no legal identity then it is fair game.

I think the wording on the club's web site is quite interesting and does make you wonder exactly who owns ALK LLC. If for nothing more than an intellectual exercise in pondering why there is such a reluctance to cite the ownership of ALK LLC, if it is as straight forward as we all assume, and the use of terms such as "significant influence" and not "controlling influence" is interesting although there could be a very mundane reason for it like it was written by web masters doing their best. Or, the terms are conflated in general usage.

I think the only thing you can say with any integrity is we don't really know but it seems Alan Pace is the controlling party and it goes without saying all of this is above board and not unusual.

It's just that in this case it is a precious community asset involved....!

[Chester Perry]

I thought I was following MSD UK Holdings Limited at Companies House but it turns out I wasn't (that has now been corrected) - It seems they published their 2nd set of accounts dated December 31 2021 four weeks ago

https://find-and-update.company-informa ... ng-history

I will move a discussion started on the MMT to here where it is a more appropriate continuation

Interesting stuff on the GBP:USD price changes and their implications for football in The Athletic

What a strong dollar and weak pound means for UK football and American investors
https://archive.ph/laLeB

What isn't mentioned is that other kind of US Investment in the English game which our club (like West Ham and Southampton) are currently connected too, namely MSD UK Holdings Limited. This entity is due to file its latest (only their 2nd) set of accounts in the next week or so, the accounts utilise USD valuations rather than GBP. In the first ones dated only 4 months after the business creation over $2m was lost in currency exchange, the GBP has become devalued by over 20% against the USD since then. This is significant because the loans, interest payments and capital repayments appear to be made in GBP, the TISE listings certainly are.

I recently noted in an article for the London Clarets Magazine - Something to write home about, that MSD have not entered into a new finance deal in English Football since February 2021 and West Ham's £120m flexible (overdraft type) loan at a then variable rate of around 8.9%. Has this exchange rate change and the potential reductions in anticipated revenue impacted MSD's willingness to grow their business in Football (there could be plenty of other reasons)? Of course, they may have learned from their initial losses and hedge the future revenues.

Hi CP, we may have been a little slow. Companies House shows MSD UK Holdings Limited accounts for the period ended 31-Dec-2021 on file from 2nd September. (I don't know whether reporting of filing has been delayed by the late Queen's death and period of mourning).

Lots of interesting stuff to read. There's mention of "one of the underlying borrowers associated with a 65,000,000 GBP loan..."

Yes, MSD loans to English football clubs are (mostly) GBP. It may be that the (MSD) Offshore Fund is where fx risk is managed/hedged... or it may be that part of MSD's strategy is to have GBP exposure...

From what is said in MSD accounts, it may be the issues relating to Russian invasion of Ukraine that has impacted on any new MSD activities this year...

as Paul states there are some interesting details in the report

[Chester Perry]

I thought I was following MSD UK Holdings Limited at Companies House but it turns out I wasn't (that has now been corrected) - It seems they published their 2nd set of accounts dated December 31 2021 four weeks ago

https://find-and-update.company-informa ... ng-history

I will move a discussion started on the MMT to here where it is a more appropriate continuation




as Paul states there are some interesting details in the report

btw I note that 3 month LIBOR was a little over 3.6% yesterday and has been rising fast over the last month

[Paul Waine]

btw I note that 3 month LIBOR was a little over 3.6% yesterday and has been rising fast over the last month

Yes, interest rates have been rising these past several weeks. A lot of the action has been US Fed, with Bank of England and European Central Bank trailing a little.