Spurs take out £75m loan
- Thread starter JollyHappy
- Start date
DC555
Member
- Sep 26, 2005
- 565
- 0
Think you are correct, not sure if this is the same loan but we did arrange something way back then for £75m
arthurgrimsdell
Well-Known Member
- Feb 16, 2004
- 843
- 826
It is not a loan of £75 million, but a loan facility of up to £75 million, arranged in October 2007, of which as previously stated an initial £11,250,000 has been drawn down, and, it appears, spent in the six months to 31st December 2007, on property purchases. Property, Plant and Equipment increased in the Accounts from £51,057,000 to £66,088,000 during the period.
The facility is for stadium re-development costs including property purchases (which will eventually come to substantially more than £75 million). There was a previous £75 million facility arranged in 2002, of which £20 million was drawn down in 2006, for the Training Academy, and this has started to be repaid, though clearly there is still substantial expenditure to come on the Academy, as construction work hasn't even started. I'd assume the rest of that facility is now redundant and replaced by the new October 2007 one.
The ring-fencing aspect means that the monies borrowed can only be spent on what is specified in the facility agreement. It does not mean that the loans don't have to be serviced and repaid out of the Company's net income.
This is why a new stadium would have a massive effect on the Club's ability to operate, if the funding were to be through loans. We really need a massive injection of new share capital to pay for this (on top of the cost of any takeover) if we are not to have a collossal millstone around our necks for the next 15 years or so. Extra revenue from more seats and executive suites would mitigate this, but until the debts are repaid we'd need to sell a few Berbatov's a season to survive, unless we got regular CL football, and even then we'd be on a knife-edge.
Anyone know anyone with a spare £750 million or so?
The facility is for stadium re-development costs including property purchases (which will eventually come to substantially more than £75 million). There was a previous £75 million facility arranged in 2002, of which £20 million was drawn down in 2006, for the Training Academy, and this has started to be repaid, though clearly there is still substantial expenditure to come on the Academy, as construction work hasn't even started. I'd assume the rest of that facility is now redundant and replaced by the new October 2007 one.
The ring-fencing aspect means that the monies borrowed can only be spent on what is specified in the facility agreement. It does not mean that the loans don't have to be serviced and repaid out of the Company's net income.
This is why a new stadium would have a massive effect on the Club's ability to operate, if the funding were to be through loans. We really need a massive injection of new share capital to pay for this (on top of the cost of any takeover) if we are not to have a collossal millstone around our necks for the next 15 years or so. Extra revenue from more seats and executive suites would mitigate this, but until the debts are repaid we'd need to sell a few Berbatov's a season to survive, unless we got regular CL football, and even then we'd be on a knife-edge.
Anyone know anyone with a spare £750 million or so?
I don't think there's any news there. It's just required disclosure of routine financing for business activities. We knew about the academy and spending some money upfront on stadium options this is just a ring-fenced loan on that.
Yes, the new stadium will be a load more debt but the overall debt will be doable for the company/club so I'm not worried in that respect. The tough bit is that interest rates are much higher for this type of project (again DL has said this so nothing new) which makes annual servicing harder.
I don't believe for a minute that DL is looking at servicing debt with anything other than revenue, i.e. not selling assets like players. He won't gamble too much either (i.e. assume in his revenue forecasts that we have CL locked in in the near future). He's a businessman not a gambler so this will be no Leeds-style decision making. The company has to be a viable business without CL football. Joe Lewis wouldn't let him risk it as it could destroy a potential sale exit.
With interest rates where they are though, we may now be forced to go for a 'cheaper' option than we probably would have liked to keep the risk profile of the cashflows in check. It might tighten the transfer kitty budget a bit though when the debt is on board...
No ITK here but just my educated guesses.
Yes, the new stadium will be a load more debt but the overall debt will be doable for the company/club so I'm not worried in that respect. The tough bit is that interest rates are much higher for this type of project (again DL has said this so nothing new) which makes annual servicing harder.
I don't believe for a minute that DL is looking at servicing debt with anything other than revenue, i.e. not selling assets like players. He won't gamble too much either (i.e. assume in his revenue forecasts that we have CL locked in in the near future). He's a businessman not a gambler so this will be no Leeds-style decision making. The company has to be a viable business without CL football. Joe Lewis wouldn't let him risk it as it could destroy a potential sale exit.
With interest rates where they are though, we may now be forced to go for a 'cheaper' option than we probably would have liked to keep the risk profile of the cashflows in check. It might tighten the transfer kitty budget a bit though when the debt is on board...
No ITK here but just my educated guesses.
si_yidarmy
£NIC OUT
- Apr 17, 2005
- 4,717
- 931
price of tickets wont go up again will they?
bigturnip
Tottenham till I die, Stratford over my dead body
- Oct 8, 2004
- 1,640
- 49
The price of tickets will always go up, as long as we keep filling the stadium.
tobi
Clear Eyes, Full Hearts, Can't Lose
- Jun 10, 2003
- 17,615
- 11,825
Thats the work of OG's right there.
Thanks for all that AG - good info
as I keep saying without a 'sugar daddy' (or massive takeover with massive cash injection which is much the same thing) I just don't see us breaking into the big 4 (it takes more than an odd top 4 finish to do that ask Everton Toon Leeds) -
the amount of money needed to fund players stadium and training ground is phenomenal - I just think on our current business model which is very sound we won't raise sufficient cash to get all 3 points of 'the triple crown' done
JollyHappy
Well-Known Member
- Oct 9, 2005
- 1,443
- 1,161
- Thread starter
- #29
Agree it's a loan facility so not fully drawn down but it was arranged on 1 October 2007 and I still think it is unusual that it was not mentioned anywhere obvious before now.
It may be a replacement for previous loan facilities, but again not clear!
It may be a replacement for previous loan facilities, but again not clear!
