ALK Capital or Farnell/Elkashashy takeover

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Big Vinny K
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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Big Vinny K » Thu Jun 01, 2023 10:21 am

ClaretPete001 wrote:
Tue May 30, 2023 8:16 pm
What possible data protection issue could be raised by companies house explaining why a company hasn't managed to file accounts for 8 months?
If for example the new auditor was still trying to evidence the original source of investment for a specific director in a company and advises companies house that this was the reason they had not yet signed off the accounts / filed them.

From memory (apologies if I’m wrong here) I thought there was a connection to Delaware in some of the company set ups ? If this is correct then this is a place notorious for its lack of comparative regulation and information disclosure which is used by many business across the US for setting up companies.

Again I don’t know whether the Delaware thing is relevant here but I do know that what ALK have set up is a pretty complicated corporate structure which could be further complicated by the owners not having a history of UK residence (shall we say !!)

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Thu Jun 01, 2023 10:26 am

Big Vinny K wrote:
Thu Jun 01, 2023 10:21 am
If for example the new auditor was still trying to evidence the original source of investment for a specific director in a company and advises companies house that this was the reason they had not yet signed off the accounts / filed them.

From memory (apologies if I’m wrong here) I thought there was a connection to Delaware in some of the company set ups ? If this is correct then this is a place notorious for its lack of comparative regulation and information disclosure which is used by many business across the US for setting up companies.

Again I don’t know whether the Delaware thing is relevant here but I do know that what ALK have set up is a pretty complicated corporate structure which could be further complicated by the owners not having a history of UK residence (shall we say !!)
Indeed but that wouldn't stop companies house responding along the lines of: 'Companies House are satisfied that the Directors of the company are making all efforts to comply with the regulations and the delay has been fully explained'

It's not a data protection issue.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Thu Jun 01, 2023 10:44 am

ClaretPete001 wrote:
Thu Jun 01, 2023 10:26 am
Indeed but that wouldn't stop companies house responding along the lines of: 'Companies House are satisfied that the Directors of the company are making all efforts to comply with the regulations and the delay has been fully explained'

It's not a data protection issue.
this is what Companies House actually said

"The Registrar is aware that these documents are overdue and is following the appropriate process in these circumstances. Unfortunately, I cannot disclose any more information on this subject as this would breach data protection."

This is what Companies House say about late filing and penalties

https://www.gov.uk/government/publicati ... -penalties

Note the reserved right to take individual directors to court and apply personal fines in addition to those against the individual entities

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Thu Jun 01, 2023 10:48 am

Chester Perry wrote:
Thu Jun 01, 2023 10:44 am
this is what Companies House actually said

"The Registrar is aware that these documents are overdue and is following the appropriate process in these circumstances. Unfortunately, I cannot disclose any more information on this subject as this would breach data protection."

This is what Companies House say about late filing and penalties

https://www.gov.uk/government/publicati ... -penalties

Note the reserved right to take individual directors to court and apply personal fines in addition to those against the individual entities
I suppose the inference from that is that companies House are taking some kind of action albeit I suppose the process could be communicating with ALK but I don't see why that would be a data protection issue.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Thu Jun 01, 2023 10:57 am

ClaretPete001 wrote:
Thu Jun 01, 2023 10:48 am
I suppose the inference from that is that companies House are taking some kind of action albeit I suppose the process could be communicating with ALK but I don't see why that would be a data protection issue.
Indeed

I think it says more about Companies House not really pursuing it with not much vigour

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Big Vinny K » Thu Jun 01, 2023 11:06 am

ClaretPete001 wrote:
Thu Jun 01, 2023 10:26 am
Indeed but that wouldn't stop companies house responding along the lines of: 'Companies House are satisfied that the Directors of the company are making all efforts to comply with the regulations and the delay has been fully explained'

It's not a data protection issue.
You asked what possible data protection issue could be raised by companies house in explaining why a company was late in filing the accounts.
I gave you one of many possible examples of data protection issues.

Your suggestion as to a statement companies house could have given would not actually explain what the issue is or why they are filing late. All it would represent would be good communication from Companies House which whilst this would be welcome does nothing to tell you what the actual issue is causing the delay (which they can’t divulge because of data protection !!)

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Thu Jun 01, 2023 6:15 pm

Big Vinny K wrote:
Thu Jun 01, 2023 11:06 am
You asked what possible data protection issue could be raised by companies house in explaining why a company was late in filing the accounts.
I gave you one of many possible examples of data protection issues.

Your suggestion as to a statement companies house could have given would not actually explain what the issue is or why they are filing late. All it would represent would be good communication from Companies House which whilst this would be welcome does nothing to tell you what the actual issue is causing the delay (which they can’t divulge because of data protection !!)
Yes I phrased it badly.

The request was related to Companies House pursuing the late claim as opposed to why a company is late filing. Companies House can't answer an FOI request on why a company is filing late but it can say 'we are communicating with the company with regard to resolving the issue' as opposed to what they did say because the inference of a data protection issue gives credence that there is something amiss whereas if they said 'we are aware of the situation and are following the appropriate process and in communication with the company' would lend itself to the view that all was in order - relatively speaking - without the need to mention data protection.

I guess it depends how the question was phrased but there are no circumstances I can envisage whereby a form of words could not be constructed to answer the question without reference to data protection issues.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 6:37 pm

Late filing penalty fees

https://www.gov.uk/government/publicati ... -penalties

The penalty only applies to accounts. The level of the penalty depends on how late the accounts reach Companies House.

Length of period (measured from the date the accounts are due) Penalty for a private company or LLP

Not more than 1 month £150

More than 1 month but not more than 3 months £375

More than 3 months but not more than 6 months £750

More than 6 months £1,500

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

Maximum penalty is £1,500. It makes no difference if the accounts are filed 6 months late or any period longer than that.

Whatever the reason for the delay in filing the accounts we can assume that there is "nothing untoward" - otherwise, I'd assume, the striking off actions wouldn't have ben discontinued.

£1,500 - what's that to a football club that pays some of it's players £10,000s per week?

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 6:51 pm

I was away on holiday when the club's accounts were published. Was it mentioned at the time the accounts were published that Sean Dyche's period of managing the club wasn't mentioned in the accounts (at least not that I can find)? Yes, the Directors' Report (page 1) state: "The Group hired Vincent Kompany as its full-time first team manager in June 2022." There's also no big "jump" in Wages and Salaries. £82 million, 2022, £77 million, 2021 (both before employer's social security costs). Average monthly number of employees rises by 19 from 133 to 152.

My conclusion: pretty firm evidence that Sean Dyche was placed on "gardening leave" in April 2022 and continued to be paid by the club until he was appointed by Everton.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 7:13 pm

Who has lent the club £39 million and has not filed any security charge over the club's assets?

I've been doing a little research. I'd assumed that a loan by any of the directors would be disclosed in Related Party transactions. However, in 2019 the accounting disclosure rules, FRS 102, were modified. Yes, all loans by the club to a director must be disclosed. Similarly, any loans by a director to the club not made at open market rates must be disclosed - though not the name(s) of the directors, but if the loan is made at open market rates then the fact that any loan has been received from a director doesn't need to be disclosed.

We've recently seen Mike Garlick's Clarets Go Large accounts. They show cash of £39 million. Is it a coincidence that BFC has obtained a loan of £39 million from a "UK entity?" We know the rate of the loan is 7.5% fixed. That's a lower rate than MSD were charging, Libor/Sonia + 8%. However, there's good reason to argue that 7.5% is an "open market rate" - and so, if the £39 million has been lent by Clarets Go Large, then there is no need for the identity of the lender to be disclosed in the club's accounts and, being a director (and a previous major shareholder) of the club may be the only security required. Certainly, not filing a security charge avoids identifying the lender.

(The only connection between Macquarrie and BFC I can find are the advances against future transfer fees due. I cannot believe Macquarrie would file security charges for these advances, but not file a security charge for a many times larger loan to the club).

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Thu Jun 01, 2023 7:21 pm

Paul Waine wrote:
Thu Jun 01, 2023 7:13 pm
Who has lent the club £39 million and has not filed any security charge over the club's assets?

I've been doing a little research. I'd assumed that a loan by any of the directors would be disclosed in Related Party transactions. However, in 2019 the accounting disclosure rules, FRS 102, were modified. Yes, all loans by the club to a director must be disclosed. Similarly, any loans by a director to the club not made at open market rates must be disclosed - though not the name(s) of the directors, but if the loan is made at open market rates then the fact that any loan has been received from a director doesn't need to be disclosed.

We've recently seen Mike Garlick's Clarets Go Large accounts. They show cash of £39 million. Is it a coincidence that BFC has obtained a loan of £39 million from a "UK entity?" We know the rate of the loan is 7.5% fixed. That's a lower rate than MSD were charging, Libor/Sonia + 8%. However, there's good reason to argue that 7.5% is an "open market rate" - and so, if the £39 million has been lent by Clarets Go Large, then there is no need for the identity of the lender to be disclosed in the club's accounts and, being a director (and a previous major shareholder) of the club may be the only security required. Certainly, not filing a security charge avoids identifying the lender.

(The only connection between Macquarrie and BFC I can find are the advances against future transfer fees due. I cannot believe Macquarrie would file security charges for these advances, but not file a security charge for a many times larger loan to the club).
MORGAN EDWARDS

Across almost 30 years in the financial services sector, Morgan Edwards has been involved in more than 400 mergers and acquisitions, totalling more than $40 Billion whilst working for leading firms such as Morgan Stanley, Bear Stearns and Macquarie.

More recently Morgan has acted as Chief Financial Officer for several start-ups with his passion now transferred to growing businesses in this space such as CommonBond – named a ‘Genius’ company by Time magazine – where he helped grow loan volumes from $2m a month to $50m a month.

from https://www.burnleyexpress.net/sport/fo ... ey-3082651

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Thu Jun 01, 2023 8:37 pm

Paul Waine wrote:
Thu Jun 01, 2023 6:51 pm
I was away on holiday when the club's accounts were published. Was it mentioned at the time the accounts were published that Sean Dyche's period of managing the club wasn't mentioned in the accounts (at least not that I can find)? Yes, the Directors' Report (page 1) state: "The Group hired Vincent Kompany as its full-time first team manager in June 2022." There's also no big "jump" in Wages and Salaries. £82 million, 2022, £77 million, 2021 (both before employer's social security costs). Average monthly number of employees rises by 19 from 133 to 152.

My conclusion: pretty firm evidence that Sean Dyche was placed on "gardening leave" in April 2022 and continued to be paid by the club until he was appointed by Everton.
You'll have to explain this one slowly to me Paul....

The accounts are up to July 22, Sean Dyche was sacked in April 22 and appointed manager of Everton at the end of Jan 23.

So, the accounts cover 3 months of his sacking and do not cover 6 months up to the point he was appointed manager of Everton.

And there was no jump in salaries except for the £5 million it went up by because of the 19 new employees joining the company.

How do you conclude with 'pretty firm evidence' that Dyche was paid up to the point he joined Everton?

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 8:49 pm

Chester Perry wrote:
Thu Jun 01, 2023 7:21 pm
MORGAN EDWARDS

Across almost 30 years in the financial services sector, Morgan Edwards has been involved in more than 400 mergers and acquisitions, totalling more than $40 Billion whilst working for leading firms such as Morgan Stanley, Bear Stearns and Macquarie.

More recently Morgan has acted as Chief Financial Officer for several start-ups with his passion now transferred to growing businesses in this space such as CommonBond – named a ‘Genius’ company by Time magazine – where he helped grow loan volumes from $2m a month to $50m a month.

from https://www.burnleyexpress.net/sport/fo ... ey-3082651
Hi CP, yes, I've read the stuff about Morgan Edwards. His LinkedIn profile says he was at Macquarie from 2008 to June 2015. His profile doesn't mention ALK. His profile says, from Dec 2021, he's Head of Debt Capital Markets at Crewe Capital, a niche investment bank in Salt Lake City. His endorsements includes one from Alan Pace. I've no doubt that he can play a roll in what ALK are doing.

Macquarie don't do "mates rates." A guy who left them more than 7 years before (at the time of someone lending BFC £39 million, is not going to be counted as a "mate" by Macquarie, just as an ex-member of staff isn't counted as a "mate" by any commercial institution. (Yes, you can get things done, but not things that expose the place you used to work at to risk beyond their usual appetite for risk). There's no way Macquarie would lend £39 million to BFC without filing security. As far as I can discover, Macquarie aren't in the business of medium term loans to football clubs, just advance fees against future receivables and we know about this because they file their security. If Macquarie had extended their business pattern, I'm pretty sure they would mention this on their website - not necessarily naming the entity they have lent to, but just the fact that they are in this business and have completed (at least) one deal.

You might find it strange. I was puzzled by (1) the absence of filing security and (2) the absence of related party disclosure. From what I now know, because FRS 102 was amended in 2019, there is no longer a requirement for a loan from a director/shareholder to an entity at open market rates to be disclosed in the entity's financial accounts. It's a good investment for Mike Garlick to lend £39 million to BFC, as a director he is in the perfect position to monitor any risk to his loan.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Thu Jun 01, 2023 9:05 pm

Paul Waine wrote:
Thu Jun 01, 2023 8:49 pm
Hi CP, yes, I've read the stuff about Morgan Edwards. His LinkedIn profile says he was at Macquarie from 2008 to June 2015. His profile doesn't mention ALK. His profile says, from Dec 2021, he's Head of Debt Capital Markets at Crewe Capital, a niche investment bank in Salt Lake City. His endorsements includes one from Alan Pace. I've no doubt that he can play a roll in what ALK are doing.

Macquarie don't do "mates rates." A guy who left them more than 7 years before (at the time of someone lending BFC £39 million, is not going to be counted as a "mate" by Macquarie, just as an ex-member of staff isn't counted as a "mate" by any commercial institution. (Yes, you can get things done, but not things that expose the place you used to work at to risk beyond their usual appetite for risk). There's no way Macquarie would lend £39 million to BFC without filing security. As far as I can discover, Macquarie aren't in the business of medium term loans to football clubs, just advance fees against future receivables and we know about this because they file their security. If Macquarie had extended their business pattern, I'm pretty sure they would mention this on their website - not necessarily naming the entity they have lent to, but just the fact that they are in this business and have completed (at least) one deal.

You might find it strange. I was puzzled by (1) the absence of filing security and (2) the absence of related party disclosure. From what I now know, because FRS 102 was amended in 2019, there is no longer a requirement for a loan from a director/shareholder to an entity at open market rates to be disclosed in the entity's financial accounts. It's a good investment for Mike Garlick to lend £39 million to BFC, as a director he is in the perfect position to monitor any risk to his loan.
Edwards is definitely ALK - from The Offer Letter to the small shareholders

2. WHO IS VS?

2.1. VS forms part of Velocity Sports Partners Group, which is the sports investment division of ALK Capital LLC (“ALK”). The members of ALK are an experienced team of investment professionals who specialise in the operation of modern sports, media and entertainment organisations.

2.2. One the founding members of ALK is new Chairman Alan Pace. Alan brings 20 years in the financial services industry and over a decade of sports management experience to Burnley. A dual British American national, he was formally a Managing Director and Global Head of Sales for Securities Services at Citi, responsible for overseeing a multibillion-dollar division. Alan is a former partner at SCP Worldwide LLC – owner of sports, entertainment and media properties – and a previous CEO of Major League Soccer franchise Real Salt Lake, where he oversaw the transformation of a consistently last-place team to winning the 2009 MLS Cup.

2.3. All the other founding members of ALK have significant experience of both investing in and managing complex business, elite sports, and financial organisations. The ALK team includes (i) Stuart Hunt, who brings over 20 years of experience in managing and restructuring sports and media groups, success both in financial services for JPMorgan and a variety of hedge funds on Wall Street, and has also built a restaurant business which operates across 70+ locations in the US and UK and employs nearly 2,000 members of staff; (ii) Mike Smith, with over 20 years as an experienced advisor having represented professional American Football leagues and some of the largest companies and most successful entrepreneurs in the world; and (iii) Morgan Edwards, with involvement in more than 400 mergers and acquisitions, totalling more than $40 Billion, and acting as Chief Financial Officer to help develop a number of start-ups into successful businesses.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 9:06 pm

ClaretPete001 wrote:
Thu Jun 01, 2023 8:37 pm
You'll have to explain this one slowly to me Paul....

The accounts are up to July 22, Sean Dyche was sacked in April 22 and appointed manager of Everton at the end of Jan 23.

So, the accounts cover 3 months of his sacking and do not cover 6 months up to the point he was appointed manager of Everton.

And there was no jump in salaries except for the £5 million it went up by because of the 19 new employees joining the company.

How do you conclude with 'pretty firm evidence' that Dyche was paid up to the point he joined Everton?
Hi Pete, we all understand that Sean Dyche signed a new 4 year (or was it 5?) contract in November 2021. We all know that he stopped being BFC's manager in April 2022. We now all know that there is no mention of Sean Dyche in the latest set of accounts to 31st July 2022 and signed off by Alan Pace on 28th April 2023. If Sean Dyche received a lump sum compensation when he was dismissed it would have been reported in the accounts, not least to explain a significant bump in the wages and salaries for the year. There was no bump in the wages and salaries, just the uplift of £5 million.

If Sean Dyche had received significant lump sum compensation at any time after 31st July 2022 it would also have to be reported in the accounts because it related to his employment by BFC up to April 2022. Of course, we saw no evidence that Sean Dyche was in dispute with BFC over his sacking, again evidence that BFC continued to pay him up until the time that he signed his new contract with Everton. (And, I think we can all agree that, despite their financial challenges, Everton wouldn't have signed Sean Dyche on lower wages than he'd been paid by BFC).

The accounts don't report, btw, that there were 19 new employees joining the company, just that the average monthly number of employees rose by 19.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by GodIsADeeJay81 » Thu Jun 01, 2023 9:12 pm

ClaretPete001 wrote:
Thu Jun 01, 2023 8:37 pm

How do you conclude with 'pretty firm evidence' that Dyche was paid up to the point he joined Everton?
It's also quite common, so clubs don't have to pay out lump sums of money

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 9:18 pm

Chester Perry wrote:
Thu Jun 01, 2023 9:05 pm
Edwards is definitely ALK - from The Offer Letter to the small shareholders

2. WHO IS VS?

2.1. VS forms part of Velocity Sports Partners Group, which is the sports investment division of ALK Capital LLC (“ALK”). The members of ALK are an experienced team of investment professionals who specialise in the operation of modern sports, media and entertainment organisations.

2.2. One the founding members of ALK is new Chairman Alan Pace. Alan brings 20 years in the financial services industry and over a decade of sports management experience to Burnley. A dual British American national, he was formally a Managing Director and Global Head of Sales for Securities Services at Citi, responsible for overseeing a multibillion-dollar division. Alan is a former partner at SCP Worldwide LLC – owner of sports, entertainment and media properties – and a previous CEO of Major League Soccer franchise Real Salt Lake, where he oversaw the transformation of a consistently last-place team to winning the 2009 MLS Cup.

2.3. All the other founding members of ALK have significant experience of both investing in and managing complex business, elite sports, and financial organisations. The ALK team includes (i) Stuart Hunt, who brings over 20 years of experience in managing and restructuring sports and media groups, success both in financial services for JPMorgan and a variety of hedge funds on Wall Street, and has also built a restaurant business which operates across 70+ locations in the US and UK and employs nearly 2,000 members of staff; (ii) Mike Smith, with over 20 years as an experienced advisor having represented professional American Football leagues and some of the largest companies and most successful entrepreneurs in the world; and (iii) Morgan Edwards, with involvement in more than 400 mergers and acquisitions, totalling more than $40 Billion, and acting as Chief Financial Officer to help develop a number of start-ups into successful businesses.
Hi CP, yes, I agree Morgan Edwards is part of the ALK team. All the details you quote are included in his LinkedIn profile - except, for whatever reason, his LinkedIn profile doesn't mention ALK. There are also dates of employment on LinkedIn. There's nothing there that suggests he has the connections to persuade Macquarie to deviate from their usual business practices and take on risks that they wouldn't usually take on, never mind significantly undercut another lender in the football finance space.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Thu Jun 01, 2023 9:22 pm

Paul Waine wrote:
Thu Jun 01, 2023 9:06 pm
Hi Pete, we all understand that Sean Dyche signed a new 4 year (or was it 5?) contract in November 2021. We all know that he stopped being BFC's manager in April 2022. We now all know that there is no mention of Sean Dyche in the latest set of accounts to 31st July 2022 and signed off by Alan Pace on 28th April 2023. If Sean Dyche received a lump sum compensation when he was dismissed it would have been reported in the accounts, not least to explain a significant bump in the wages and salaries for the year. There was no bump in the wages and salaries, just the uplift of £5 million.

If Sean Dyche had received significant lump sum compensation at any time after 31st July 2022 it would also have to be reported in the accounts because it related to his employment by BFC up to April 2022. Of course, we saw no evidence that Sean Dyche was in dispute with BFC over his sacking, again evidence that BFC continued to pay him up until the time that he signed his new contract with Everton. (And, I think we can all agree that, despite their financial challenges, Everton wouldn't have signed Sean Dyche on lower wages than he'd been paid by BFC).

The accounts don't report, btw, that there were 19 new employees joining the company, just that the average monthly number of employees rose by 19.
Again I don't dispute the logic of it but when is £5 million a bump or an uplift?

In reality, he would certainly be entitled to a compensation package and that would be is determined by his contract.

I guess he may have a clause in his contract that stated he couldn't receive the full package until after he had been re-employed but I assume that the 6 months he was not employed would not constitute his whole package and I wonder how a clause like that would work.

Maybe it's me but quite a lot of assumptions seem to be involved here but I can see the logic.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Thu Jun 01, 2023 9:35 pm

Paul Waine wrote:
Thu Jun 01, 2023 8:49 pm
Hi CP, yes, I've read the stuff about Morgan Edwards. His LinkedIn profile says he was at Macquarie from 2008 to June 2015. His profile doesn't mention ALK. His profile says, from Dec 2021, he's Head of Debt Capital Markets at Crewe Capital, a niche investment bank in Salt Lake City. His endorsements includes one from Alan Pace. I've no doubt that he can play a roll in what ALK are doing.

Macquarie don't do "mates rates." A guy who left them more than 7 years before (at the time of someone lending BFC £39 million, is not going to be counted as a "mate" by Macquarie, just as an ex-member of staff isn't counted as a "mate" by any commercial institution. (Yes, you can get things done, but not things that expose the place you used to work at to risk beyond their usual appetite for risk). There's no way Macquarie would lend £39 million to BFC without filing security. As far as I can discover, Macquarie aren't in the business of medium term loans to football clubs, just advance fees against future receivables and we know about this because they file their security. If Macquarie had extended their business pattern, I'm pretty sure they would mention this on their website - not necessarily naming the entity they have lent to, but just the fact that they are in this business and have completed (at least) one deal.

You might find it strange. I was puzzled by (1) the absence of filing security and (2) the absence of related party disclosure. From what I now know, because FRS 102 was amended in 2019, there is no longer a requirement for a loan from a director/shareholder to an entity at open market rates to be disclosed in the entity's financial accounts. It's a good investment for Mike Garlick to lend £39 million to BFC, as a director he is in the perfect position to monitor any risk to his loan.
It's an interesting shout and it would make sense because had Burnley not achieved promotion MSD would have been entitled to most of the parachute money in year 2, which would have left the club in considerable trouble.

However, the terms of the loan would have to be similar to MSDs or his capital would be in considerable risk and although he could monitor the risk he could do little about it other than the terms he loaned the money.
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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 9:46 pm

ClaretPete001 wrote:
Thu Jun 01, 2023 9:22 pm
Again I don't dispute the logic of it but when is £5 million a bump or an uplift?

In reality, he would certainly be entitled to a compensation package and that would be is determined by his contract.

I guess he may have a clause in his contract that stated he couldn't receive the full package until after he had been re-employed but I assume that the 6 months he was not employed would not constitute his whole package and I wonder how a clause like that would work.

Maybe it's me but quite a lot of assumptions seem to be involved here but I can see the logic.
Lots of managers were "let go" by clubs in both Premier League and Championship this last season. Several times it was reported that the contract either only paid out a maximum of one year or that the ex-manager continued to be paid by the club until they got a new position.

In terms of BFC, if Sean Dyche had been paid lump sum compensation for loss of office it would have been disclosed in the accounts. Sean Dyche's loss of office didn't even rate a mention, never mind any lump sum compensation. So, we can conclude that the club continued to pay him.

I guess someone could track all the incoming players and outgoing players through the 2021/22 season and estimate how much each would have been paid. In the 2020/21 season the club finished 17th and the following season 18th. It's hard to believe - I guess not impossible - that there would be a "staying up" bonus in 2020/21 and, of course, no such bonus in 2021/22. Maybe someone can also work out who all the monthly average staff were across the two seasons. Maybe someone of the additional staff include growth in the womens team. When was it that BFC Women went full time professional? Their wages will be part of the total.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Thu Jun 01, 2023 9:53 pm

Paul Waine wrote:
Thu Jun 01, 2023 9:46 pm
Maybe someone of the additional staff include growth in the womens team. When was it that BFC Women went full time professional? Their wages will be part of the total.
BFC womens team is not full time professional
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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Thu Jun 01, 2023 10:14 pm

Chester Perry wrote:
Thu Jun 01, 2023 9:53 pm
BFC womens team is not full time professional
and, interesting to see that BFC Women accounts are only filed as a dormant company - reporting nil employees.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by aggi » Fri Jun 02, 2023 9:13 am

Paul Waine wrote:
Thu Jun 01, 2023 7:13 pm
Who has lent the club £39 million and has not filed any security charge over the club's assets?

I've been doing a little research. I'd assumed that a loan by any of the directors would be disclosed in Related Party transactions. However, in 2019 the accounting disclosure rules, FRS 102, were modified. Yes, all loans by the club to a director must be disclosed. Similarly, any loans by a director to the club not made at open market rates must be disclosed - though not the name(s) of the directors, but if the loan is made at open market rates then the fact that any loan has been received from a director doesn't need to be disclosed.

We've recently seen Mike Garlick's Clarets Go Large accounts. They show cash of £39 million. Is it a coincidence that BFC has obtained a loan of £39 million from a "UK entity?" We know the rate of the loan is 7.5% fixed. That's a lower rate than MSD were charging, Libor/Sonia + 8%. However, there's good reason to argue that 7.5% is an "open market rate" - and so, if the £39 million has been lent by Clarets Go Large, then there is no need for the identity of the lender to be disclosed in the club's accounts and, being a director (and a previous major shareholder) of the club may be the only security required. Certainly, not filing a security charge avoids identifying the lender.

(The only connection between Macquarrie and BFC I can find are the advances against future transfer fees due. I cannot believe Macquarrie would file security charges for these advances, but not file a security charge for a many times larger loan to the club).
Do you have the full link to this? I thought that exemption was only for Small companies.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by aggi » Fri Jun 02, 2023 9:19 am

Paul Waine wrote:
Thu Jun 01, 2023 6:51 pm
I was away on holiday when the club's accounts were published. Was it mentioned at the time the accounts were published that Sean Dyche's period of managing the club wasn't mentioned in the accounts (at least not that I can find)? Yes, the Directors' Report (page 1) state: "The Group hired Vincent Kompany as its full-time first team manager in June 2022." There's also no big "jump" in Wages and Salaries. £82 million, 2022, £77 million, 2021 (both before employer's social security costs). Average monthly number of employees rises by 19 from 133 to 152.

My conclusion: pretty firm evidence that Sean Dyche was placed on "gardening leave" in April 2022 and continued to be paid by the club until he was appointed by Everton.
I'm also not convinced by this. There was an expectation that wages would be lower in 2022 as there were no staying up bonuses (which were previously believed to be substantial). That difference could be down to a payoff for Dyche. I don't think we can say there is firm evidence either way.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Big Vinny K » Fri Jun 02, 2023 10:38 am

Given how many people have left the club staff since AP came in I’m surprised at the increase.
Maybe the cuts in staff will not really show up until the next set of accounts or maybe we have changed the balance (no bad thing) from the non footballing staff to the coaches, analysts, etc.
That photo VK had with his back room team when he won manager of month one time was like those old school photos with the panoramic lens shot !!

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Fri Jun 02, 2023 11:11 am

aggi wrote:
Fri Jun 02, 2023 9:19 am
I'm also not convinced by this. There was an expectation that wages would be lower in 2022 as there were no staying up bonuses (which were previously believed to be substantial). That difference could be down to a payoff for Dyche. I don't think we can say there is firm evidence either way.
The accounts were signed in April 23 - Dyche joined Everton in January 23.

I know the law is an ass but I can't imagine that Dyche remained an employee and on the payroll until he got a new job and any other arrangement would be compensation and the auditors would be aware of it.

You could equally claim Sean Dyche waived all compensation away because he loves the club so much based upon the same evidence.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Fri Jun 02, 2023 6:01 pm

aggi wrote:
Fri Jun 02, 2023 9:13 am
Do you have the full link to this? I thought that exemption was only for Small companies.
Hi aggi, I've checked through the text of FRS 102 (current version).

Para 33.4 states: In the context of this FRS, the following are not related parties:

(a) Two entities simply because they have a director or other member of key management personnel in common or because a member of key management personnel of one entity has significant influence over the other entity.

We know that Mike Garlick is a Director of BFCHL. We also know that Mike Garlick is a Director of Clarets Go Large.

My reading of 33.4 (a) is that this is a clear statement that Clarets Go Large is not a related party for the purposes of Related Party disclosures by BFCHL. Thus no requirement for BFCHL to disclose Clarets Go Large as the provider of loan finance to BFCHL if that is where the loan has come from.

I've not been involved in preparing financial statements for almost 2 decades. When I had to do this I was always using either IFRS or US GAAP. I've no idea whether FRS 102 has always included 33.4 (a) in the current form or whether it has been changed in recent years. It's very likely that my earlier post about 2019 changes may be a mis-reading of commentary I read yesterday.

Of course, if you (or any other poster on here) has better information on FRS 102 and Related Party disclosures, including para 33.4 (a) I'm happy to hear it.

PS: Yes, I'm a retired accountant. I've retained the right to consult ICAEW resources in retirement.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Fri Jun 02, 2023 6:11 pm

ClaretPete001 wrote:
Fri Jun 02, 2023 11:11 am
The accounts were signed in April 23 - Dyche joined Everton in January 23.

I know the law is an ass but I can't imagine that Dyche remained an employee and on the payroll until he got a new job and any other arrangement would be compensation and the auditors would be aware of it.

You could equally claim Sean Dyche waived all compensation away because he loves the club so much based upon the same evidence.
It's very common for senior employees to be placed on gardening leave. It happens almost every time employees resign with the intention of taking up a new job offer with a competitor. The media frequently reports on staff who are placed on gardening leave for extended periods, perhaps while matters are investigated and while severance terms are agreed.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by aggi » Fri Jun 02, 2023 7:53 pm

Paul Waine wrote:
Fri Jun 02, 2023 6:01 pm
Hi aggi, I've checked through the text of FRS 102 (current version).

Para 33.4 states: In the context of this FRS, the following are not related parties:

(a) Two entities simply because they have a director or other member of key management personnel in common or because a member of key management personnel of one entity has significant influence over the other entity.

We know that Mike Garlick is a Director of BFCHL. We also know that Mike Garlick is a Director of Clarets Go Large.

My reading of 33.4 (a) is that this is a clear statement that Clarets Go Large is not a related party for the purposes of Related Party disclosures by BFCHL. Thus no requirement for BFCHL to disclose Clarets Go Large as the provider of loan finance to BFCHL if that is where the loan has come from.

I've not been involved in preparing financial statements for almost 2 decades. When I had to do this I was always using either IFRS or US GAAP. I've no idea whether FRS 102 has always included 33.4 (a) in the current form or whether it has been changed in recent years. It's very likely that my earlier post about 2019 changes may be a mis-reading of commentary I read yesterday.

Of course, if you (or any other poster on here) has better information on FRS 102 and Related Party disclosures, including para 33.4 (a) I'm happy to hear it.

PS: Yes, I'm a retired accountant. I've retained the right to consult ICAEW resources in retirement.
Ah, so a different exemption than the non-market rate one (which I'm pretty sure is only small companies).

Non-accountants look away now, this is going to be dull.

I think the bit you're missing from your exemption is that Garlick isn't just a director of Clarets Go Large, he is also in control. This means 33.2(b)(vi) applies. Unless of course Garlick doesn't qualify as a related person under 33.2(a)

33.2 A related party is a person or entity that is related to the entity that is preparing its
financial statements (the reporting entity).
(a) A person or a close member of that person’s family is related to a reporting
entity if that person:
(i) has control or joint control over the reporting entity;
(ii) has significant influence over the reporting entity; or
(iii) is a member of the key management personnel of the reporting entity or
of a parent of the reporting entity.
(b) An entity is related to a reporting entity if any of the following conditions apply:
(i) the entity and the reporting entity are members of the same group (which
means that each parent, subsidiary and fellow subsidiary is related to the
others).
(ii) one entity is an associate or joint venture of the other entity (or an
associate or joint venture of a member of a group of which the other entity
is a member).
(iii) both entities are joint ventures of the same third party.
(iv) one entity is a joint venture of a third entity and the other entity is an
associate of the third entity.
(v) the entity is a post-employment benefit plan for the benefit of
employees of either the reporting entity or an entity related to the
reporting entity. If the reporting entity is itself such a plan, the sponsoring
employers are also related to the reporting entity.
(vi) the entity is controlled or jointly controlled by a person identified in (a).
(vii) a person identified in (a)(i) has significant influence over the entity or is a
member of the key management personnel of the entity (or of a parent of
the entity).
(viii) the entity, or any member of a group of which it is a part, provides key
management personnel services to the

But this is the kind of thing I'd normally refer to our technical department to be honest.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Colburn_Claret » Fri Jun 02, 2023 8:30 pm

The dots and crosses are too complicated for me to put any effort into understanding, just happy to read others input.

Simon Jordan and Jim White were talking about us this morning, or rather talking about Leeds and we were mentioned.

SJ was a great critic of the leveraged buy out, from day 1.
On relegation he quickly forecast that we would suffer the consequences, and quickly get relegated again.

This morning we are the blue print to follow. Praised the way we raised 100 mil from player sales. Praised they way we refinanced the loan from 14% interest to 7%. Praised the way we hired VK, and transformed the playing style.
To summarise from being relegated and sinking down the plug hole, we've come back in a far, far healthier position than when we left, and SJ, being the businessman heaped praise on AP for the way he handled it.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Spijed » Fri Jun 02, 2023 8:58 pm

Colburn_Claret wrote:
Fri Jun 02, 2023 8:30 pm
The dots and crosses are too complicated for me to put any effort into understanding, just happy to read others input.

Simon Jordan and Jim White were talking about us this morning, or rather talking about Leeds and we were mentioned.

SJ was a great critic of the leveraged buy out, from day 1.
On relegation he quickly forecast that we would suffer the consequences, and quickly get relegated again.

This morning we are the blue print to follow. Praised the way we raised 100 mil from player sales. Praised they way we refinanced the loan from 14% interest to 7%. Praised the way we hired VK, and transformed the playing style.
To summarise from being relegated and sinking down the plug hole, we've come back in a far, far healthier position than when we left, and SJ, being the businessman heaped praise on AP for the way he handled it.
Is a good blueprint if a club gets relegated but doesn't return to the Premier league before all the parachute payments run out?
Such as West Brom, for example. Where does the money then come from to pay the loans and interest payments?

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Sat Jun 03, 2023 1:25 pm

aggi wrote:
Fri Jun 02, 2023 7:53 pm
Ah, so a different exemption than the non-market rate one (which I'm pretty sure is only small companies).

Non-accountants look away now, this is going to be dull.

I think the bit you're missing from your exemption is that Garlick isn't just a director of Clarets Go Large, he is also in control. This means 33.2(b)(vi) applies. Unless of course Garlick doesn't qualify as a related person under 33.2(a)

33.2 A related party is a person or entity that is related to the entity that is preparing its
financial statements (the reporting entity).
(a) A person or a close member of that person’s family is related to a reporting
entity if that person:
(i) has control or joint control over the reporting entity;
(ii) has significant influence over the reporting entity; or
(iii) is a member of the key management personnel of the reporting entity or
of a parent of the reporting entity.
(b) An entity is related to a reporting entity if any of the following conditions apply:
(i) the entity and the reporting entity are members of the same group (which
means that each parent, subsidiary and fellow subsidiary is related to the
others).
(ii) one entity is an associate or joint venture of the other entity (or an
associate or joint venture of a member of a group of which the other entity
is a member).
(iii) both entities are joint ventures of the same third party.
(iv) one entity is a joint venture of a third entity and the other entity is an
associate of the third entity.
(v) the entity is a post-employment benefit plan for the benefit of
employees of either the reporting entity or an entity related to the
reporting entity. If the reporting entity is itself such a plan, the sponsoring
employers are also related to the reporting entity.
(vi) the entity is controlled or jointly controlled by a person identified in (a).
(vii) a person identified in (a)(i) has significant influence over the entity or is a
member of the key management personnel of the entity (or of a parent of
the entity).
(viii) the entity, or any member of a group of which it is a part, provides key
management personnel services to the

But this is the kind of thing I'd normally refer to our technical department to be honest.
Hi aggi, yes, I read all of the Related Party section of FRS 102. Exciting stuff...or maybe not.

The reporting entity is BFCHL. From my reading of FRS 102 para 33.4, Clarets Go Large is not a related party of BFCHL simply because Mike Garlick is a director and shareholder of both BFCHL and Clarets Go Large. Thus, no requirement for BFCHL to disclose that Clarets Go Large is the provider of the £39 million loan...IF, of course, that is who is the unidentified provider of the loan.

Yes, it's only speculation. I'm trying to reconcile the absence of any security for the new loan with who may be in a position to make the loan and no related party disclosure.

Mike Garlick/Clarets Go Large has the means and, I believe FRS 102 33.4 applies, Mike Garlick/Clarets Go Large is not a related party that would require BFCHL to report the provider of the loan as a related party.

Similarly, we know that any financial institution lending the money wouldn't do it without full and effective security, i.e. they would disclose who they are by registering their charge.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by NewClaret » Sat Jun 03, 2023 1:51 pm

Paul Waine wrote:
Sat Jun 03, 2023 1:25 pm
Hi aggi, yes, I read all of the Related Party section of FRS 102. Exciting stuff...or maybe not.

The reporting entity is BFCHL. From my reading of FRS 102 para 33.4, Clarets Go Large is not a related party of BFCHL simply because Mike Garlick is a director and shareholder of both BFCHL and Clarets Go Large. Thus, no requirement for BFCHL to disclose that Clarets Go Large is the provider of the £39 million loan...IF, of course, that is who is the unidentified provider of the loan.

Yes, it's only speculation. I'm trying to reconcile the absence of any security for the new loan with who may be in a position to make the loan and no related party disclosure.

Mike Garlick/Clarets Go Large has the means and, I believe FRS 102 33.4 applies, Mike Garlick/Clarets Go Large is not a related party that would require BFCHL to report the provider of the loan as a related party.

Similarly, we know that any financial institution lending the money wouldn't do it without full and effective security, i.e. they would disclose who they are by registering their charge.
I find it miraculously coincidental that the amounts are so similar. I think you might be on to something here PW. Would also tie in wit the rumours that MG would become involved again in the event of relegation, albeit not in the way expected.

I have to say, I’d feel much better if the loan was from MG. And also better about him (i.e. he didn’t take his money and run, he ensured we didn’t end up owing a huge debt to a third party as such).
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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Sat Jun 03, 2023 3:16 pm

NewClaret wrote:
Sat Jun 03, 2023 1:51 pm
I find it miraculously coincidental that the amounts are so similar. I think you might be on to something here PW. Would also tie in wit the rumours that MG would become involved again in the event of relegation, albeit not in the way expected.

I have to say, I’d feel much better if the loan was from MG. And also better about him (i.e. he didn’t take his money and run, he ensured we didn’t end up owing a huge debt to a third party as such).
The amount was determined by the outstanding balance with MSD, plus the penalty payment

To get to that the club had first to pay £12.2m plus penalties in August 2022 (after its £20m relegation enforced repayment)

between August and November there was a stage payments paid (late again, but paid) apparently from ALK/VSL funds - there is no note of post event additional loans in the accounts. It is notable that Mike Garlick was not that amicable with ALK.VSL in April 2022 when the schedule stage payment was late and he activated default clauses in the sale agreement and by the account I have heard was ready to do so again in early October 2022 before the payments was made a week late.

So, while Mike Garlick appears to have the funds in Clarets go Large Ltd to finance such a loan, it feels a stretch

Paul's speculation is based, understandably, on the lack of visible security/'charge' but that does not mean there isn't one somewhere up the organisation chain in Delaware or Jersey. Indeed I myself have speculated that such a loan may have come from the ownership group itself, previously.

The Athletic were clear in that the loan was from Macquarie and that security was provided by the original group that bought the club. It is not unreasonable to believe that between them - Alan Pace, Stuart Hunt, Mike Smith, Morgan Edwards, John Dewey, Dave Checketts and Antonio Parra have sufficient assets available to provide such security/guarantees particularly as we are now aware of just how much control (and likely shareholding they own in the structure that owns the club).

I agree that there is no such thing as 'mates rates' but these people are not unknowns, they have lengthy track records and we have to believe, given that ALK Capital LLC still has an physical New York office that there is activity there (mainly led by COO John Dewey) that is generating further revenues. So for now I am more inclined to go with the Athletics story, though as always I will be on the lookout for other sources.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Nori1958 » Sat Jun 03, 2023 3:44 pm

Anyone know if Mr Garlick has lent any money?

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Sat Jun 03, 2023 4:00 pm

Nori1958 wrote:
Sat Jun 03, 2023 3:44 pm
Anyone know if Mr Garlick has lent any money?
No, not since the takeover, it is just speculation - he did when Kilby and himself were Chairmen

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Nori1958 » Sat Jun 03, 2023 4:05 pm

Chester Perry wrote:
Sat Jun 03, 2023 4:00 pm
No, not since the takeover, it is just speculation - he did when Kilby and himself were Chairmen
Thankyou

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Sat Jun 03, 2023 7:06 pm

Chester Perry wrote:
Sat Jun 03, 2023 3:16 pm

The Athletic were clear in that the loan was from Macquarie and that security was provided by the original group that bought the club. It is not unreasonable to believe that between them - Alan Pace, Stuart Hunt, Mike Smith, Morgan Edwards, John Dewey, Dave Checketts and Antonio Parra have sufficient assets available to provide such security/guarantees particularly as we are now aware of just how much control (and likely shareholding they own in the structure that owns the club).

I agree that there is no such thing as 'mates rates' but these people are not unknowns, they have lengthy track records and we have to believe, given that ALK Capital LLC still has an physical New York office that there is activity there (mainly led by COO John Dewey) that is generating further revenues. So for now I am more inclined to go with the Athletics story, though as always I will be on the lookout for other sources.
Hi CP, I've now finally read the Athletic.

So far as I can see all they write is: "ALK used a £20million chunk of the £54.7million profit the club made from player sales to pay off some of the loan during the 2021-22 accounting period, then it replaced the rest with a smaller and cheaper loan from the British arm of Australian bank Macquarie in November."

Where does the Athletic say that Alan Pace and others in ALK team have provided the required security for a loan from Macquarie?

I don't want to start reading FRS 102 Related Parties reporting rules again. However, we know that Alan Pace and all ALK Capital are a related party of BFCHL. If Alan Pace/ALK have provided security to obtain a loan from Macquarie that would be a related party transaction and would be reportable in the accounts along with the Events after the balance sheet date reporting that MSD loan had been repaid and a new £39 million loan obtained. (Alan Pace is described as the Ultimate Controlling Party of BFCHL, so he doesn't qualify as described in FRS 102 para 33.4 as not being a related party).

Maybe the source(s) that you occasionally mention can provide some more info on these arrangements.

I'd expect ALK Capital and Velocity Sports (US) always to have presence in US. The owners and investors are, for the most part, US persons. It would make it a lot harder for ALK/VSP to execute their investment plans if they didn't maintain their US presence.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Chester Perry » Sat Jun 03, 2023 7:14 pm

Paul Waine wrote:
Sat Jun 03, 2023 7:06 pm
Hi CP, I've now finally read the Athletic.

So far as I can see all they write is: "ALK used a £20million chunk of the £54.7million profit the club made from player sales to pay off some of the loan during the 2021-22 accounting period, then it replaced the rest with a smaller and cheaper loan from the British arm of Australian bank Macquarie in November."

Where does the Athletic say that Alan Pace and others in ALK team have provided the required security for a loan from Macquarie?

I don't want to start reading FRS 102 Related Parties reporting rules again. However, we know that Alan Pace and all ALK Capital are a related party of BFCHL. If Alan Pace/ALK have provided security to obtain a loan from Macquarie that would be a related party transaction and would be reportable in the accounts along with the Events after the balance sheet date reporting that MSD loan had been repaid and a new £39 million loan obtained. (Alan Pace is described as the Ultimate Controlling Party of BFCHL, so he doesn't qualify as described in FRS 102 para 33.4 as not being a related party).

Maybe the source(s) that you occasionally mention can provide some more info on these arrangements.

I'd expect ALK Capital and Velocity Sports (US) always to have presence in US. The owners and investors are, for the most part, US persons. It would make it a lot harder for ALK/VSP to execute their investment plans if they didn't maintain their US presence.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Sun Jun 04, 2023 1:16 pm

Colburn_Claret wrote:
Fri Jun 02, 2023 8:30 pm
The dots and crosses are too complicated for me to put any effort into understanding, just happy to read others input.

Simon Jordan and Jim White were talking about us this morning, or rather talking about Leeds and we were mentioned.

SJ was a great critic of the leveraged buy out, from day 1.
On relegation he quickly forecast that we would suffer the consequences, and quickly get relegated again.

This morning we are the blue print to follow. Praised the way we raised 100 mil from player sales. Praised they way we refinanced the loan from 14% interest to 7%. Praised the way we hired VK, and transformed the playing style.
To summarise from being relegated and sinking down the plug hole, we've come back in a far, far healthier position than when we left, and SJ, being the businessman heaped praise on AP for the way he handled it.
Lots of time for Simon Jordan on financial issues but pundits tend to praise success. When Bournemouth were crap that had made a big mistake with Garry O' Neil and then it was a stroke of genius staying loyal to him - same with Forest.

Praise is due to Alan Pace but it's not a blue print of any sort because 15 other managers failed and got sacked so unless Alan Pace 's career investment banking career has left him with a unique insight into football management then you have to say it's partially inspiration, partially luck and partially serendipity that VK was available when we were looking for someone.

We haven't come back in a far healthier place. When we got relegated we had £100 million quid's worth of talent and £80 million in the bank.

It was the undoubtedly the takeover that caused many of the problems because the previous regime would not invest in the playing squad and the current regime wanted the money to but the club.

At this point, we don't really know how the squad shaping up for the Prem' and how much debt is still floating around so it's a case of let's wait and see.

If there are big strides towards paying off the debt and the squad looks resilient in the PL then we can start talking of success but I hope it's not a blue print because many many clubs would go bust spending so much on shares and being reliant on bouncing straight back....!

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Sun Jun 04, 2023 1:26 pm

Paul Waine wrote:
Fri Jun 02, 2023 6:11 pm
It's very common for senior employees to be placed on gardening leave. It happens almost every time employees resign with the intention of taking up a new job offer with a competitor. The media frequently reports on staff who are placed on gardening leave for extended periods, perhaps while matters are investigated and while severance terms are agreed.
Totally, but gardening leave for an indeterminate time potentially to the end of a 5 year contract? But yes like I say above nothing wrong with the logic of it and it looks like a point well made; it just feels a stretch to me.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Colburn_Claret » Sun Jun 04, 2023 3:27 pm

ClaretPete001 wrote:
Sun Jun 04, 2023 1:16 pm
Lots of time for Simon Jordan on financial issues but pundits tend to praise success. When Bournemouth were crap that had made a big mistake with Garry O' Neil and then it was a stroke of genius staying loyal to him - same with Forest.

Praise is due to Alan Pace but it's not a blue print of any sort because 15 other managers failed and got sacked so unless Alan Pace 's career investment banking career has left him with a unique insight into football management then you have to say it's partially inspiration, partially luck and partially serendipity that VK was available when we were looking for someone.

We haven't come back in a far healthier place. When we got relegated we had £100 million quid's worth of talent and £80 million in the bank.

It was the undoubtedly the takeover that caused many of the problems because the previous regime would not invest in the playing squad and the current regime wanted the money to but the club.

At this point, we don't really know how the squad shaping up for the Prem' and how much debt is still floating around so it's a case of let's wait and see.

If there are big strides towards paying off the debt and the squad looks resilient in the PL then we can start talking of success but I hope it's not a blue print because many many clubs would go bust spending so much on shares and being reliant on bouncing straight back....!
We weren't reliant on bouncing back. Both AP and VK have stated their surprise at last seasons success. That being the case they must have been confident that we could survive comfortably for their 3-4 year plan.
Bouncing straight back was just a bonus.

Whilst much of what you say is true, I wasn't arguing otherwise, just putting it out there, SJs praise for AP, and his change of tack on how he felt the club was being run. I don't believe the praise was for the immediate return, rather than the way we dealt with the financial realities of relegation. THIS is where he was saying other clubs could use us as a blue print. How many relegated teams, have ignored their own debt, and players PL wage structure, and gambled on an immediate return.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Big Vinny K » Sun Jun 04, 2023 4:16 pm

ClaretPete001 wrote:
Sun Jun 04, 2023 1:26 pm
Totally, but gardening leave for an indeterminate time potentially to the end of a 5 year contract? But yes like I say above nothing wrong with the logic of it and it looks like a point well made; it just feels a stretch to me.
The difference in football in recent years compared to gardening leave in the real world !!…..is that the clubs and managers are often negotiating the severance. The way players and managers contracts are written these days is often massively weighted towards the players / managers.
As a manager unless you resign (who was the last one who did that ?) you are going to be entitled to the rest of your contract paid up….or something not far from that. It may have been that the deal we did with Dyche was to carry on paying him in full until as such a time that he got a new job. At that point we stop paying him.
My guess would be that in Dyche’s contract he was not entitled to be paid the full remainder of his contract - either because that’s the way it was written or because of something that had happened at the club which the club could have dragged out in the courts etc.

There are so many possible scenarios that are in play that I suspect we will never found out the full details around his dismissal or the leaving package

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by aggi » Mon Jun 05, 2023 10:36 am

Paul Waine wrote:
Sat Jun 03, 2023 1:25 pm
Hi aggi, yes, I read all of the Related Party section of FRS 102. Exciting stuff...or maybe not.

The reporting entity is BFCHL. From my reading of FRS 102 para 33.4, Clarets Go Large is not a related party of BFCHL simply because Mike Garlick is a director and shareholder of both BFCHL and Clarets Go Large. Thus, no requirement for BFCHL to disclose that Clarets Go Large is the provider of the £39 million loan...IF, of course, that is who is the unidentified provider of the loan.

Yes, it's only speculation. I'm trying to reconcile the absence of any security for the new loan with who may be in a position to make the loan and no related party disclosure.

Mike Garlick/Clarets Go Large has the means and, I believe FRS 102 33.4 applies, Mike Garlick/Clarets Go Large is not a related party that would require BFCHL to report the provider of the loan as a related party.

Similarly, we know that any financial institution lending the money wouldn't do it without full and effective security, i.e. they would disclose who they are by registering their charge.
I think I'd disagree with that. The requirement isn't because Garlick is a common director, it is because he is key management personnel of BFCHL and in control (not just a shareholder) of Clarets Go Large. 33.4 only applies where none of the conditions are met (otherwise all related party disclosures where there is a common director would be exempted which clearly isn't the case).

However, stepping back and thinking about the big picture it obviously wouldn't be disclosed because it doesn't fall in that year's accounts so the rest of the discussion is irrelevant!

It's a compelling narrative. Garlick has this "spare" cash, he can get a good return, the club can save on interest repayments and have a somewhat more sympathetic person on the other end of the loan, possibly explains the lack of a new charge.

My gut says no though. Having largely come out of things it seems a bit of a u-turn to put that money back in again.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Mon Jun 05, 2023 1:34 pm

aggi wrote:
Mon Jun 05, 2023 10:36 am
I think I'd disagree with that. The requirement isn't because Garlick is a common director, it is because he is key management personnel of BFCHL and in control (not just a shareholder) of Clarets Go Large. 33.4 only applies where none of the conditions are met (otherwise all related party disclosures where there is a common director would be exempted which clearly isn't the case).

However, stepping back and thinking about the big picture it obviously wouldn't be disclosed because it doesn't fall in that year's accounts so the rest of the discussion is irrelevant!

It's a compelling narrative. Garlick has this "spare" cash, he can get a good return, the club can save on interest repayments and have a somewhat more sympathetic person on the other end of the loan, possibly explains the lack of a new charge.

My gut says no though. Having largely come out of things it seems a bit of a u-turn to put that money back in again.
From an investment perspective it would be insane to have all those eggs in one basket. MSD are dealing in billions but for one person to invest that much in a football club - you'd have to be puddled to be honest. Of course, that doesn't mean it isn't true but objectively speaking it seems unlikely.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Mon Jun 05, 2023 3:39 pm

aggi wrote:
Mon Jun 05, 2023 10:36 am
I think I'd disagree with that. The requirement isn't because Garlick is a common director, it is because he is key management personnel of BFCHL and in control (not just a shareholder) of Clarets Go Large. 33.4 only applies where none of the conditions are met (otherwise all related party disclosures where there is a common director would be exempted which clearly isn't the case).

However, stepping back and thinking about the big picture it obviously wouldn't be disclosed because it doesn't fall in that year's accounts so the rest of the discussion is irrelevant!

It's a compelling narrative. Garlick has this "spare" cash, he can get a good return, the club can save on interest repayments and have a somewhat more sympathetic person on the other end of the loan, possibly explains the lack of a new charge.

My gut says no though. Having largely come out of things it seems a bit of a u-turn to put that money back in again.
Take a look at what 33.4 says.

"In the context of this FRS, the following are not related parties:

(a) Two entities simply because they have a director or other member of key management personnel in common or because a member of key management personnel of one entity has significant influence over the other entity.
"

For me, FRS 102 33.4 (a) clearly states that Clarets Go Large is not a related party of BFCHL.

Yes, I've considered that the new loan was made in November 2022. However, the new loan is mentioned in the Events After the Balance Sheet Date. I'd argue that, if the loan had been made by a related party that would also need to be disclosed along with the reporting of the repayment of the MSD loan and replacing it with a new loan on more favourable terms.

We know Mike Garlick remains a director of BFCHL. We also know that the previous director/shareholders provided significant vendor financing to ALK/VSP (US) in the stage payments for their shares. We know, therefore that Mike Garlick (and the other previous directors) took significant credit risk when Alan Pace/ALK bought BFCHL. Mike Garlick has also retained a small shareholding in the corporate structure - but, that doesn't matter for the questions re the loan, except it it indicates that he hadn't at this time fully "come out of things" at BFCHL.

CP has referred to Mike Garlick insisting on the stage payments being paid in 2022. Given that the first one of these was April 2022, Sean Dyche had just been fired and the club was very close being relegated, I'd expect most of us would have been very nervous about any money we were owed. Again relying on CP's input, the outstanding payments were paid. in November 2022 Vincent Kompany had transformed the team and Burnley were top of the Championship and, BFCHL's finances were much better than they were earlier in the year. Clarets Go Large was sitting with £39 million cash and Mike Garlick would be looking where to invest it. I don't think it's out of the question for Clarets Go Large to lend the money to BFCHL. As you say, BFCHL could replace the MSD loan with a new loan at much lower rates. Remembering also that the earlier vendor financing was probably agreed at £nil interest.

Of course, it all hangs on no charge being registered.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Mon Jun 05, 2023 5:04 pm

Paul Waine wrote:
Mon Jun 05, 2023 3:39 pm
Take a look at what 33.4 says.

"In the context of this FRS, the following are not related parties:

(a) Two entities simply because they have a director or other member of key management personnel in common or because a member of key management personnel of one entity has significant influence over the other entity.
"

For me, FRS 102 33.4 (a) clearly states that Clarets Go Large is not a related party of BFCHL.

Yes, I've considered that the new loan was made in November 2022. However, the new loan is mentioned in the Events After the Balance Sheet Date. I'd argue that, if the loan had been made by a related party that would also need to be disclosed along with the reporting of the repayment of the MSD loan and replacing it with a new loan on more favourable terms.

We know Mike Garlick remains a director of BFCHL. We also know that the previous director/shareholders provided significant vendor financing to ALK/VSP (US) in the stage payments for their shares. We know, therefore that Mike Garlick (and the other previous directors) took significant credit risk when Alan Pace/ALK bought BFCHL. Mike Garlick has also retained a small shareholding in the corporate structure - but, that doesn't matter for the questions re the loan, except it it indicates that he hadn't at this time fully "come out of things" at BFCHL.

CP has referred to Mike Garlick insisting on the stage payments being paid in 2022. Given that the first one of these was April 2022, Sean Dyche had just been fired and the club was very close being relegated, I'd expect most of us would have been very nervous about any money we were owed. Again relying on CP's input, the outstanding payments were paid. in November 2022 Vincent Kompany had transformed the team and Burnley were top of the Championship and, BFCHL's finances were much better than they were earlier in the year. Clarets Go Large was sitting with £39 million cash and Mike Garlick would be looking where to invest it. I don't think it's out of the question for Clarets Go Large to lend the money to BFCHL. As you say, BFCHL could replace the MSD loan with a new loan at much lower rates. Remembering also that the earlier vendor financing was probably agreed at £nil interest.

Of course, it all hangs on no charge being registered.
The issue is how far do we travel from what we know and what is common good sense.

CP has also done some brilliant detective work that suggests ALK have found tens of millions to pay Mike Garlic on the scheduled payments. Like this, the evidence it is quite powerful on the face of it but is it likely? I think not because it tends to contradict the press statements etc. and just the general purpose of a leveraged buy-out and the ongoing relationship between the current and prior regime.

And I point to the loan itself, which a number including yourself jumped to the conclusion it had been paid off when it clearly hadn't...! We can now conjecture that the reason it was paid off is because it was a loan from Mike Garlick but still we don't really know...

Biblical scholars have argued that there is more evidence for the resurrection of Christ than any other historical event. Using Bayesian methods they compare different historical events and the resurrection is up there.

The problem is that super natural events require more evidence than other events. And maybe I am naive but the concept of Mike Garlic loaning the club £40 million and embroiling himself in a situation that he himself felt was no longer tenable seems a bit far fetched.

Albeit I have to say, interesting to debate and with good detective work to back it up.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by Paul Waine » Tue Jun 06, 2023 11:53 am

ClaretPete001 wrote:
Mon Jun 05, 2023 5:04 pm
The issue is how far do we travel from what we know and what is common good sense.

CP has also done some brilliant detective work that suggests ALK have found tens of millions to pay Mike Garlic on the scheduled payments. Like this, the evidence it is quite powerful on the face of it but is it likely? I think not because it tends to contradict the press statements etc. and just the general purpose of a leveraged buy-out and the ongoing relationship between the current and prior regime.

And I point to the loan itself, which a number including yourself jumped to the conclusion it had been paid off when it clearly hadn't...! We can now conjecture that the reason it was paid off is because it was a loan from Mike Garlick but still we don't really know...

Biblical scholars have argued that there is more evidence for the resurrection of Christ than any other historical event. Using Bayesian methods they compare different historical events and the resurrection is up there.

The problem is that super natural events require more evidence than other events. And maybe I am naive but the concept of Mike Garlic loaning the club £40 million and embroiling himself in a situation that he himself felt was no longer tenable seems a bit far fetched.

Albeit I have to say, interesting to debate and with good detective work to back it up.
Hi Pete, yes, the absence of a charge was the reason why many of us came to the conclusion - following information that were strong indications that the MSD loan had been repaid off, both TISE filings by MSD and "fully satisfied" filings on 3 (now 4) of the 5 entities where MSD charge had been registered - that no new loan had been taken out to replace the MSD loan. We were right about the MSD loan being paid off. Of course, we now all know, as reported in BFCHL accounts a few weeks ago, that a new £39 million loan was taken out in November 2022. So, we are left with the puzzle who has provided the new loan and why have they done that without registered any security on Companies House records for the entity receiving the loan?

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by ClaretPete001 » Tue Jun 06, 2023 1:15 pm

Paul Waine wrote:
Tue Jun 06, 2023 11:53 am
Hi Pete, yes, the absence of a charge was the reason why many of us came to the conclusion - following information that were strong indications that the MSD loan had been repaid off, both TISE filings by MSD and "fully satisfied" filings on 3 (now 4) of the 5 entities where MSD charge had been registered - that no new loan had been taken out to replace the MSD loan. We were right about the MSD loan being paid off. Of course, we now all know, as reported in BFCHL accounts a few weeks ago, that a new £39 million loan was taken out in November 2022. So, we are left with the puzzle who has provided the new loan and why have they done that without registered any security on Companies House records for the entity receiving the loan?
I think the inference was that ALK had found the money to pay it off rather than another loan had been sourced: 1 + 1 equalled 3 in that instance despite the evidence.

But, yes and I guess it's a case of the lack of a charge at companies house against the scepticism that ALK have found tens of millions to pay off the formers owners and then the former owners have given tens of millions of pounds back to ALK in the form of a cheap loan.

I suppose it's quite possible that it became evident given MSDs claim on 3/4s of the parachute money in year two after relegation that he had little choice because I can't see how the club could operate with that condition on the original loan. Or maybe it was built into the contract.

The only scenario that makes sense to me is that Mike Garlick had little choice because the club could not meet the conditions of the original loan.

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Re: ALK Capital or Farnell/Elkashashy takeover

Post by aggi » Wed Jun 07, 2023 10:04 am

Paul Waine wrote:
Mon Jun 05, 2023 3:39 pm
Take a look at what 33.4 says.

"In the context of this FRS, the following are not related parties:

(a) Two entities simply because they have a director or other member of key management personnel in common or because a member of key management personnel of one entity has significant influence over the other entity.
"

For me, FRS 102 33.4 (a) clearly states that Clarets Go Large is not a related party of BFCHL.

Yes, I've considered that the new loan was made in November 2022. However, the new loan is mentioned in the Events After the Balance Sheet Date. I'd argue that, if the loan had been made by a related party that would also need to be disclosed along with the reporting of the repayment of the MSD loan and replacing it with a new loan on more favourable terms.

We know Mike Garlick remains a director of BFCHL. We also know that the previous director/shareholders provided significant vendor financing to ALK/VSP (US) in the stage payments for their shares. We know, therefore that Mike Garlick (and the other previous directors) took significant credit risk when Alan Pace/ALK bought BFCHL. Mike Garlick has also retained a small shareholding in the corporate structure - but, that doesn't matter for the questions re the loan, except it it indicates that he hadn't at this time fully "come out of things" at BFCHL.

CP has referred to Mike Garlick insisting on the stage payments being paid in 2022. Given that the first one of these was April 2022, Sean Dyche had just been fired and the club was very close being relegated, I'd expect most of us would have been very nervous about any money we were owed. Again relying on CP's input, the outstanding payments were paid. in November 2022 Vincent Kompany had transformed the team and Burnley were top of the Championship and, BFCHL's finances were much better than they were earlier in the year. Clarets Go Large was sitting with £39 million cash and Mike Garlick would be looking where to invest it. I don't think it's out of the question for Clarets Go Large to lend the money to BFCHL. As you say, BFCHL could replace the MSD loan with a new loan at much lower rates. Remembering also that the earlier vendor financing was probably agreed at £nil interest.

Of course, it all hangs on no charge being registered.
I still disagree with that. I don't believe it is an exemption in the way you are viewing it. For those thinking that accountants always agree on disclosures and how things should be presented here's a useful example that quite a bit of it is subjective.

Coincidentally Clarets Go Large have a related party disclosure that would be exempt applying the above:
Screenshot 2023-06-07 094413.jpg
Screenshot 2023-06-07 094413.jpg (11.3 KiB) Viewed 776 times
Anyway, regardless of disclosure or not, my feeling is still that Garlick wouldn't want to get back into this after getting out. I'd also expect that although the vendor financing may have been at 0%, there would be interest on late payment (probably 8% plus base).

My belief was always that the loan had been refinanced rather than paid off although I agree that the lack of security is a bit surprising (although if Garlick was really loaning £40m I don't see why he wouldn't want security in the same nature as a third party loan).

A possibly interesting tweet from Matt Slater (who is also the journalist in the Athletic who suggested that our loan had been refinanced with Macquarie) showing a load of charges satisfied by Sheffield Utd by, he believes, refinancing their borrowings by taking more from Macquarie and they will be secured against PL broadcast payments. There's no new charge appearing for this at the moment for Sheff Utd.

https://twitter.com/mjshrimper/status/1 ... 6050114561

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