Derby County

[Mr Popodopolous]

25 minutes ago, Bristol Rob said:

Purely hypothetical but if Derby ceased to exist and all of their results were deleted, how would that impact the league table?

All results against them expunged I think. Perhaps 2 would go down as well.

Edited September 22, 2021 by Mr Popodopolous

[REDOXO]

23 minutes ago, BTRFTG said:

Worth highlighting that a majority of creditors must agree to any CVA and that could be problematic.

MSD can only get their money back from the ground, so one option might be for them to pick up the tax & footballing debt, force a CVA with non-preferential creditors & buy both club & ground (cheaper than it was initially offered but it's a much diminished product.) On the other hand maybe they've lost interest, or might acquire only as a flip to somebody else, else force the whole shebang into liquidation and get monies back from development options on the ground. Derby fans must be hoping Dell don't want a new production/ storage facility in the UK.

Amazon might want something. :laugh:!

This whole shitfest is tiring. So many disappearing up themselves trying to explain away this financial nightmare over months and years. The lies that have been told to cover up years of idiocy are horrific and now a diminishing group of supporters are prepared to keep arguing black is white. 
 

The hubris of some on the outside and inside of this is also insane, those on the outside often being egged on by people inside the club. 
 

The idea that the EFL are acting against the supporters of Derby County is insane, but they now finally have indisputable evidence that the owner and board of the club have been cheating since 2016 and that cheating has cost the league positions of other clubs (the points deductions would have relegated Derby at least once) this will cause problems for years to come  

Pick the bones out of this! The EFL having to appeal a decision made by an outside party that effectively exonerated this effed up nightmare of a club! Who on earth thinks that was a good idea! 
 

I read a thread earlier on DCFC FORUM about how the rules of the EFL should be changed. Yes they should, to stop a shiester from appealing to external panels and somehow obtaining rulings that are clearly flawed. Guess Mark Ashton could be brought bacK to the EFL THAT WILL LEARN EM! SIGH!

 

Edited September 22, 2021 by REDOXO

[Mr Popodopolous]

Small note, amusing to see some of the Villa fans...calling out Derby for cheating. Yes their rap sheet in terms of sheer coverup was quite a bit less but if not promoted, I could have seen the EFL imposing stringent conditions to keep within FFP, as well as a throrough investigation for the most recent accounts.

https://www.villatalk.com/topic/22025-derby-county/

They would have had a SIGNIFICANT hole set to arise.

@REDOXO Make you right. Some sort of system where the EFL handed down sanctions could be best, or some kind of swift system where the charge is known and the only hearings are a) A sanctioning heating and b) The final avenue for appeal to the LAP. Talking of such characters appealing, wonder if Nick De Marco is owed cash by them- he represented both DCFC and SWFC vs the EFL.

Arguing black is white sums it up well, there is some bizarre and contorted logic on that forum- among sections of that fanbase!

Edited September 22, 2021 by Mr Popodopolous

[REDOXO]

2 minutes ago, Mr Popodopolous said:

Small note, amusing to see some of the Villa fans...calling out Derby for cheating. Yes their rap sheet in terms of sheer coverup was quite a bit less but if not promoted, I could have seen the EFL imposing stringent conditions to keep within FFP, as well as a throrough investigation for the most recent accounts.

https://www.villatalk.com/topic/22025-derby-county/

They will be relegated one day! Just like QPR

[Mr Popodopolous]

2 minutes ago, REDOXO said:

They will be relegated one day! Just like QPR

Oh yeah and the sanctions are bigger this time...I'd be surprised if the EFL are not keeping powder dry.

Villa, some of their fans going on about ESL and how fans shouldn't be punished for ownership...those ones don't have a clue that's all I'll say.

Edited September 22, 2021 by Mr Popodopolous

[exAtyeoMax]

50 minutes ago, Bristol Rob said:

Purely hypothetical but if Derby ceased to exist and all of their results were deleted, how would that impact the league table?

I'd be in the pub really early on my birthday…

[Mr Popodopolous]

More bad news...

https://www.telegraph.co.uk/football/2021/09/22/middlesbrough-pursuing-legal-case-against-derby-alleged-finance/

Behind a paywall.

I also remember highlighting Steve Lansdown's Tweet in August 2019 after we won at Derby.

https://www.bristolpost.co.uk/sport/football/derby-county-disaster-another-cruel-5955318

Seems like it was indeed in reflection of beating them due to the FFP situation.

Edited September 22, 2021 by Mr Popodopolous

[REDOXO]

13 minutes ago, Mr Popodopolous said:

Oh yeah and the sanctions are bigger this time...I'd be surprised if the EFL are not keeping powder dry.

Villa, some of their fans going on about ESL and how fans shouldn't be punished for ownership...those ones don't have a clue that's all I'll say.

I’m not sure of how far back the EFL will can go once they are inside the books but quite apart from Wycombe becoming a creditor, PNE and Middlesbrough will be looking closely as they would have been in the play offs in a couple of seasons. The manual manipulator at Derby admitting they earned a four point deduction for earlier seasons makes me furious. 
 

Edit. I see from Pops post borough have started proceedings!   Ffs Derby supporters

Edited September 22, 2021 by REDOXO

[WarksRobin]

5 hours ago, ExiledAjax said:

Prior to the -12 they were on 10 points from 8 games. 1.25 ppg. Keep that up and they would get another 47.5 points from the remaining 38 games (lets be generous and round that up to 48). Sees them finish on 46, and likely relegated. As you say, a further -9 and they're done.

They need to improve their early form if they are to survive. 

It depends whether these events create a siege mentality and the team starts playing better or it undermines confidence and it all falls apart. Character, do they have enough?

[ExiledAjax]

3 minutes ago, WarksRobin said:

It depends whether these events create a siege mentality and the team starts playing better or it undermines confidence and it all falls apart. Character, do they have enough?

Perhaps. I'd be betting they don't have enough.

[Mr Popodopolous]

8 minutes ago, REDOXO said:

I’m not sure of how far back the EFL will can go once they are inside the books but quite apart from Wycombe becoming a creditor, PNE and Middlesbrough will be looking closely as they would have been in the play offs in a couple of seasons. The manual manipulator at Derby admitting they earned a four point deduction for earlier seasons makes me furious. 
 

Edit. I see from Pops post borough have started proceedings!   Ffs Derby supporters

Do you mean Villa or Derby? Preston covers 2017/18, they lost out as the overspending once restated covered that season, 2018/19 would likely have failed P&S/FFP or seen transfer restrictions hence Middlesbrough were disadvantaged to Derby.

Still though, the misconception/falsehood about Gibson selling tax losses. Oh he did but that does not benefit a club FFP wise! If it was a tax credit then it's Profit or Loss before tax and if it was corporation tax on profit, again it's before that. It's a falsehood that has been out there since May 2019, put out there by Derby's owner and it's just not that true.

Even if it was as well, the EFL couldn't have blocked promotion in 2015/16- merely a fine or a January embargo if up or staying down respectively.

Edited September 22, 2021 by Mr Popodopolous

[chinapig]

21 minutes ago, Mr Popodopolous said:

Villa, some of their fans going on about ESL and how fans shouldn't be punished for ownership...those ones don't have a clue that's all I'll say.

Fans have a share of responsibility if they keep demanding their club spends money it doesn't have. Some of our own fall into that category.

More so Derby fans who cheered Morris on as he drove their club over a cliff.

[REDOXO]

6 minutes ago, Mr Popodopolous said:

Do you mean Villa or Derby? Preston covers 2017/18, they lost out as the overspending once restated covered that season, 2018/19 would likely have failed P&S/FFP or seen transfer restrictions hence Middlesbrough were disadvantaged to Derby.

Still though, the misconception/falsehood about Gibson selling tax losses. Oh he did but that does not benefit a club FFP wise! If it was a tax credit then it's Profit or Loss before tax and if it was corporation tax on profit, again it's before that. It's a falsehood that has been out there since May 2019, put out there by Derby's owner and it's just not that true.

Even if it was as well, the EFL couldn't have blocked promotion in 2015/16- merely a fine or a January embargo if up or staying down respectively.

I think we are starting with Boro. Again there is no protection from the corporate veil now.  Even approved accounts will be trawled through. Watch this space. Keep in mind there is prize money for league places too. 
 

FYI As I was having my rant you posted about Boro doing what I thought. Bet Gibson is on his hotline to Lansdown giving it loads as we speak. 

Edited September 22, 2021 by REDOXO

[BTRFTG]

One thing it would be interesting to know is whether the sell and splitting of the ground, which clearly helped Derby's FFP hole, might also have been a requirement by MSD for their loan and potential takeover?

Seems to me if a struggling club has freehold (not ground) sought by others then it could be worth a punt by any asset-stripper to keep them afloat via a loan secured against a discretely secured holding. Few years down the line and with the link severely weakened between club and prime asset, that asset suddenly becomes a potential weakness. Sod the club and force their hand.

[Mr Popodopolous]

The ground thing, some Derby fans are saying that Mel Morris owes them £81.1m for the ground- this can't be true surely?

You never know @BTRFTG but the MSD loans came in 2020.

FWIW, excitement aside I'm not sure how Middlesbrough have much of a case, given EFL regs with arbitration, all clubs agree to arbitrate etc- can arbitration award punitive damages or not?

Edited September 22, 2021 by Mr Popodopolous

[Cidre Monita]

Mel Morris is fully to blame for this. He went on a wild spending spree hoping to get to the Prem , but forgot to pay his bills. He may have spent 200M , but the debts are such you have to doubt he has actually spent it in cash terms. Does the ground get included in the administration process ? I doubt. He had the money to get Derby through to a buyer , but has chosen to let them possibly die. Derby fans should be spitting about that man. FFP fair play is one thing, but when someone knowingly piles up debt with no desire to pay it back, it is fraudulent. He owes HMRC £20 m . He allowed that to happen, yet he will still have his £300/400m safe at home. There is no gun to the head of anyone in football to pay wages to players they cannot afford. Owners do it , and they keep doing it, and keep paying players more than the business can afford. The banks, HMRC, accountants and the EFL need a long hard look at themselves, because this sort of nonsense is not happening over night. How the lot of them escape any fraud charges is beyond me. 

Edited September 22, 2021 by Cidre Monita

[Bristol Rob]

12 minutes ago, chinapig said:

Fans have a share of responsibility if they keep demanding their club spends money it doesn't have. Some of our own fall into that category.

More so Derby fans who cheered Morris on as he drove their club over a cliff.

Don't agree with that.

Of course fans demand/ask that the club buy/spend, but generally speaking, the person signing the cheques has made their money by knowing where to invest, when to invest and when to say no.

They are in a position of leadership because of their ability to lead, and if they yielded to every request they'd be broke in no time.

[BTRFTG]

4 minutes ago, Mr Popodopolous said:

The ground thing, some Derby fans are saying that Mel Morris owes them £81.1m for the ground- this can't be true surely?

You never know @BTRFTG but the MSD loans came in 2020.

But recall Morris had been seeking a purchaser for years and such deals take years to reach fruition. Bit like saying I'll buy your house but not until you've replaced the roof. Maybe not here, but I wonder if MSD had been positioning Morris to structure the club toward something they'd be prepared to purchase, hedging their bets either way should Derby reach the Premier or not.

Stranger things have happened in business.

[Davefevs]

48 minutes ago, exAtyeoMax said:

I'd be in the pub really early on my birthday…

And I wouldn’t be checking my phone whilst supposedly celebrating my dad’s 80th.

[1960maaan]

Mel Morris is a dodgy one, luckily all other owners have gone through a thorough "fit and proper persons test. Which, ironically isn't fit for purpose.

So in todays, here that sounds a bit dodgy news. I give you Fleetwood.

[Mr Popodopolous]

32 minutes ago, Bristol Rob said:

Don't agree with that.

Of course fans demand/ask that the club buy/spend, but generally speaking, the person signing the cheques has made their money by knowing where to invest, when to invest and when to say no.

They are in a position of leadership because of their ability to lead, and if they yielded to every request they'd be broke in no time.

The thing is though, Derby fans weren't just doing that.

They were actively cheering, revelling in not only the spending but the loopholes used to pursue them.

"EFL on strings"- they were actively gloating and revelling in the 'wisdom' of their leader and his pursuit of the loopholes. Mocking those who questioned, "We're so smart" kinda thing, laughing at the fact that they were seemingly running rings round the EFL etc.

Okay there are bits of poetic license but I think I sum it up well.

Edited September 22, 2021 by Mr Popodopolous

[chinapig]

10 minutes ago, Bristol Rob said:

Don't agree with that.

Of course fans demand/ask that the club buy/spend, but generally speaking, the person signing the cheques has made their money by knowing where to invest, when to invest and when to say no.

They are in a position of leadership because of their ability to lead, and if they yielded to every request they'd be broke in no time.

We'll have to agree to disagree perhaps. The modern history of the game is littered with successful businessmen who abandon their business principles once they own a football club. So they cannot always be trusted as custodians.

Steve himself has been guilty of that at times. Most recently he talked about sustainability then allowed Ashton to increase the wage bill to unsustainable levels. Nigel is now having to fix that.

I would argue that the first thing fans should care about is the long term survival of their club. That includes not encouraging owners to overspend to please the fans in pursuit of that dreadful phrase "chasing the dream". Which is what happened with Derby.

Still, come January we will no doubt see some fans on here demanding Steve spend money and in some cases claiming that he uses P&S as an excuse for not doing so. Happily they seem to be in a minority though.

[BanburyRed]

So Derby docked 12pts, 1pt more than they achieved in their 2007/2008 PL season....

[Cidre Monita]

As a caution, we also like to feel and for god reason that SL keeps us going. Just imagine what would happen f one day he just said "enough". We would be in exactly the same position. We do not own the ground as a football club, and our debts are huge and our cash flow such we would melt down in weeks. Football is a broken system, there is so much money in the game, yet the businesses are allowed to be run with the most incredible accounting results and manipulation. There is more than enough money generated in the game for it to function in a very sustainable manner, yet clubs continue to over pay wages in the search for success.  The guarantees for the debts and loans look to be written in the sand. Owners build up debts knowing the business is ring fenced and they can walk away. The Championship is the most idiotic set up of any sport, where some competitors are paid vast sums for failure. Getting rid of parachute payments should start to bring some wage sanity. Then some. But even our club, what on earth were we doing with a  £30m plus wage bll . Madness. 

[AnAstonVillafan]

1 hour ago, REDOXO said:

They will be relegated one day! Just like QPR

Don't judge a whole a club or its fanbase by a couple of people on a forum.

I'll remind you once again that Aston Villa did nothing wrong. As declared after two separate investigations. The club is going from strength to strength right now, on and off the field. Long may that continue.

I did say on here long ago that Derby will get what's coming to them. But I can take no pleasure from their current demise. 

[Mr Popodopolous]

1 minute ago, AnAstonVillafan said:

Don't judge a whole a club or its fanbase by a couple of people on a forum.

I'll remind you once again that Aston Villa did nothing wrong. As declared after two separate investigations. The club is going from strength to strength right now, on and off the field. Long may that continue.

I did say on here long ago that Derby will get what's coming to them. But I can take no pleasure from their current demise. 

Fair enough.

Erm, I have to wonder as I said on the Villa thread about certain bits of the accounting treatment in fairness. Thinking the current asset bit, convertible within 12 months etc yet it remained within a year.

When Derby are docked pts for FFP then that will certainly be getting what is coming to them. That is still dragging interminably and tbh not submitting accounts to CH should be some kind of points deduction in itself- that's 2 years and longer that they haven't- their fans still seem quite bullish despite everything all things considered.

[chinapig]

4 minutes ago, AnAstonVillafan said:

I'll remind you once again that Aston Villa did nothing wrong

Essentially true imo. The problem was clubs being enable to comply with P&S by "selling" their stadium thanks to a loophole. I suspect they were positively encouraged to do so by a former head of the EFL.

The gamble paid off in Villa's case but in Derby's case could yet be a factor in their being liquidated.

[AnAstonVillafan]

10 minutes ago, chinapig said:

Essentially true imo. The problem was clubs being enable to comply with P&S by "selling" their stadium thanks to a loophole. I suspect they were positively encouraged to do so by a former head of the EFL.

The gamble paid off in Villa's case but in Derby's case could yet be a factor in their being liquidated.

I'm well aware that their situation could easily have been us had we not attracted the owners we have now.

It was a gamble and not in the spirit of the regulations I'll admit. But it saved us.

Unless the gap between the top two divisions is narrowed somehow, these issues will keep coming up. And more clubs will go to the wall. 

Edited September 22, 2021 by AnAstonVillafan

[Monkeh]

In villas defense, they've never been under suspicion or charged by the efl

As much as we don't like it you have to stick to innocent until proven guilty,

 

[BTRFTG]

39 minutes ago, Psychopomp said:

We do not own the ground as a football club, and our debts are huge and our cash flow such we would melt down in weeks.

And therein lies the problem with fans. We emotionally support a club and indulge using terms such as 'us', 'ours', 'we', save it isn't ours and never will be. It's not our debt, it's not our money, not our club,  it's SL's. In his case it makes sod all difference whether or not the club owns the ground, he owns the whole shebang, on his own, outright. And that's why muppets who criticise for him not investing further in stupid purchases are nothing but deluded. They think they have a 'right' to dictate the club's future, they think they should have a say, yet don't have the wherewithal to make a difference.

Just be thankful we've a benefactor with deep pockets who, for now, is happy to indulge us in our hobby. Shame those ingrates who anonymously berate him on social media don't realise they're the ones making it more likely he'll one day decide he's had enough.

Don't bite the hand that feeds.

[Mr Popodopolous]

22 minutes ago, AnAstonVillafan said:

I'm well aware that their situation could easily have been us had we not attracted the owners we have now.

It was a gamble and not in the spirit of the regulations I'll admit. But it saved us.

Unless the gap between the top two divisions is narrowed somehow, these issues will keep coming up. And more clubs will go to the wall. 

The FFP bit not insolvency could well have posed issues without promotion in that specific season 

The EFL also have something to answer in a load of these cases. T + 1 and T + 2, once the lower threshold is exceeded- so thinking 2017/18, then with Villa and lots of other clubs, the power is there for T + 1 and T + 2, and how they'll comply..and budgetary 'guidance' can be implemented, the EFL in 2018 dropped the ball quite badly.

In layman's terms, loanees or not the EFL could have imposed measures with an eye on the following two seasons if losses fell between £15-39m. I can't remember the exact requirements but there were  lots of clubs who fell into that category and AVFC were one.

Probably less expensive loanees new owners or not basically.

[REDOXO]

1 hour ago, AnAstonVillafan said:

Don't judge a whole a club or its fanbase by a couple of people on a forum.

I'll remind you once again that Aston Villa did nothing wrong. As declared after two separate investigations. The club is going from strength to strength right now, on and off the field. Long may that continue.

I did say on here long ago that Derby will get what's coming to them. But I can take no pleasure from their current demise. 

I try not too. 
 

However as has been said many times forums do tend to be a decent cross section. 
 

As for Villa, who knows what will happen unless they get relegated and the four years of we dun nuffin wrong gov out of Derbyshire will ensure that everything gets looked at in that light. 

[Mr Popodopolous]

6 minutes ago, REDOXO said:

I try not too. 
 

However as has been said many times forums do tend to be a decent cross section. 
 

As for Villa, who knows what will happen unless they get relegated and the four years of we dun nuffin wrong gov out of Derbyshire will ensure that everything gets looked at in that light. 

Good points, all of them.

The EFL do reserve the right to go back and look at anything, there's nothing in the regulations to prevent it as such.

In a sense, the more they pursue and charge for wrongdoing past and present, the less choice they have in pursuit of others. It makes a bit of a rod for their own back and I believe that the stadium loophole is one that the EFL will have been especially furious about.

[Mr Popodopolous]

The latest idea I've seen on Twitter is.

Mel Morris gives back the Stadium to Derby for £1 or a nominal fee and then they mortgage it for £50m.

Will Mel pay the cash to MSD as well, can the club sub-mortgage it just like that.

How do the club defend the £81.1m transaction- £1 in an FFP context? Surely the EFL would have something to say about that.

Edited September 22, 2021 by Mr Popodopolous

[REDOXO]

1 minute ago, Mr Popodopolous said:

The latest idea I've seen on Twitter is.

Mel Morris gives back the Stadium to Derby for £1 or a nominal fee and then they mortgage it for £50m.

Will he pay the cash to MSD as well, can the club sub-mortgate it just like that. How do the club defend the £81.1m transaction -  £1 in an FFP context?

I would get your head down Pop. The scenarios are endless!

The idea of a transaction even for a pound happening prior to the administrator extracting the maximum for them selves/doing their due diligence is laughable. This could be over without cash and a willing buyer in days! Who the hell wants a club and stadium if the new variants start rearing up!

[Bristol Rob]

23 minutes ago, Mr Popodopolous said:

The latest idea I've seen on Twitter is.

Mel Morris gives back the Stadium to Derby for £1 or a nominal fee and then they mortgage it for £50m.

Will Mel pay the cash to MSD as well, can the club sub-mortgage it just like that.

How do the club defend the £81.1m transaction- £1 in an FFP context? Surely the EFL would have something to say about that.

Wouldn't the club then get hammered by HMRC for avoiding stamp duty? Likewise, with property/land values on the rise, Mel would struggle to get less than his purchase price if he did, he would be avoiding capital gains tax.... unless the valuation of the stadium was absolutely bobbins.

[Davefevs]

29 minutes ago, Mr Popodopolous said:

The latest idea I've seen on Twitter is.

Mel Morris gives back the Stadium to Derby for £1 or a nominal fee and then they mortgage it for £50m.

Will Mel pay the cash to MSD as well, can the club sub-mortgage it just like that.

How do the club defend the £81.1m transaction- £1 in an FFP context? Surely the EFL would have something to say about that.

Derby fans:

[AnotherDerbyFan]

7 hours ago, Mr Popodopolous said:

Still trying to grasp and wangle their way out, some fans still of that mindset...

Erm, I can't see the EFL accepting that!! How do you give away for free as part of a deal, a stadium that a) 'Sold' for £81.1m in 2018 and b) Has a lease of, can't recall but it's either 20-25 years. The annual rent is about £3m too low as well possibly.

Football Creditors had to be paid in full I thought? HMRC less clearcut.

Obviously,  whislt still owner he would have to sell the stadium at fair value (lower now due to covid), but once sold, he'd be able to gift it to the (eventual) new owners as an unrelated party, surely?

[BTRFTG]

53 minutes ago, Mr Popodopolous said:

The latest idea I've seen on Twitter is.

Mel Morris gives back the Stadium to Derby for £1 or a nominal fee and then they mortgage it for £50m.

Will Mel pay the cash to MSD as well, can the club sub-mortgage it just like that.

How do the club defend the £81.1m transaction- £1 in an FFP context? Surely the EFL would have something to say about that.

That makes no sense.

The company (capitalised at £1) who owns the stadium (as supposedly an investment vehicle,) values the asset at just over £81m but has creditors within one year at just over £3k more than the value of the asset. Interestingly, one might have assumed to see rental income in their accounts but none appears, hence they'll doubtless argue it appears as a 'capital appreciation vehicle' only.

Therein lies one huge problem.

The value of the asset is intrinsically linked to the amount of income it might generate, plus wider land/asset appreciation. The £81m figure was doubtless reached by considering a legal commitment by Derby County FC to lease the stadium back at £Xm per season for Y seasons. Now if they forego that, what other entity might desire to lease a Sports Stadium in Derby and at what price? If the answer is nobody or peanuts, the asset value  downgrades overnight and one wonders whether creditor loans (where the money came to buy it in the first place) are secured against the freehold or lease income?

Giving the stadium to the Administrator makes little sense as it strengthens funds available to creditors and lessens the prospect of getting monies back to those who purchased the stadium. The only reason for so doing would be high poker stakes, if one thought long-term Derby would come good, start making a Kings ransom and one might claw that back through club profits not the stadium vehicle (assuming one still held a stake in the club.)

Pigs will fly first.

[BTRFTG]

8 minutes ago, AnotherDerbyFan said:

Obviously,  whislt still owner he would have to sell the stadium at fair value (lower now due to covid), but once sold, he'd be able to gift it to the (eventual) new owners as an unrelated party, surely?

Once sold there's nothing left to gift and Morris already has no say over the club. There's also doubt that Morris funded the stadium acquisition wholly with his own money. What if he's borrowed some if it himself?

Were I a potential buyer willing to pick up the MSD, HMRC & football debt that would have to be subject to Gellaw selling me the stadium at the price I'd demand. With Hobson's I'd expect to pay no more that £15-20m for it.

[Mr Popodopolous]

32 minutes ago, AnotherDerbyFan said:

Obviously,  whislt still owner he would have to sell the stadium at fair value (lower now due to covid), but once sold, he'd be able to gift it to the (eventual) new owners as an unrelated party, surely?

Erm, hard to say- I've a feeling the EFL would not be particularly amused let's say...£81.1m-£1/give away. Would there be no tax implications as Rob mentioned?

Might depend on what you mean by to the new owners- under the club group, that'd pose a serious FFP issue. If it's to the new owners and rented to the club then perhaps.

The accounts that took at least a part of Covid into account still had the value at around £81.1m- talking the Gellaw 202 and 204.

...Then there's the MSD loans secured against it, what happens with these? MSD don't strike me as the type to let secured assets be sublet/submortgaged whatever. Would Mel keep paying them off?

I'm basically overall suggesting that Derby cannot have their cake and eat it.

Edited September 22, 2021 by Mr Popodopolous

[Mr Popodopolous]

24 minutes ago, BTRFTG said:

That makes no sense.

The company (capitalised at £1) who owns the stadium (as supposedly an investment vehicle,) values the asset at just over £81m but has creditors within one year at just over £3k more than the value of the asset. Interestingly, one might have assumed to see rental income in their accounts but none appears, hence they'll doubtless argue it appears as a 'capital appreciation vehicle' only.

Therein lies one huge problem.

The value of the asset is intrinsically linked to the amount of income it might generate, plus wider land/asset appreciation. The £81m figure was doubtless reached by considering a legal commitment by Derby County FC to lease the stadium back at £Xm per season for Y seasons. Now if they forego that, what other entity might desire to lease a Sports Stadium in Derby and at what price? If the answer is nobody or peanuts, the asset value  downgrades overnight and one wonders whether creditor loans (where the money came to buy it in the first place) are secured against the freehold or lease income?

Giving the stadium to the Administrator makes little sense as it strengthens funds available to creditors and lessens the prospect of getting monies back to those who purchased the stadium. The only reason for so doing would be high poker stakes, if one thought long-term Derby would come good, start making a Kings ransom and one might claw that back through club profits not the stadium vehicle (assuming one still held a stake in the club.)

Pigs will fly first.

Ah yes, there's a bit on that too- putting aside the less than likely chances of the stadium being gifted back.

Rent

Club are supposed to be paying £1.1m per season on an £81.1m transaction or something in that ballpark.

Yet if you read the written reasons for the first case, the valued rent- as in the valuation given by the Independent Valuer that DCFC themselves hired- was £4.16m per season.

There is also a reference to rental payments from Club DCFC and Stadia DCFC- what is less clear is whether they would be included in the £1.1m ie £1.1m=Club + Club DCFC + Stadia DCFC or if Rent=£1.1m (Club) + Club DCFC + Stadia DCFC=Actual rent.

EFL still need to pursue that particular avenue as well, because £1.1m per season on an £81.1m transaction is absurd. Well out of kilter with other grounds as a % of sale price etc.

Edited September 22, 2021 by Mr Popodopolous

[downendcity]

Looking back over Derby’s last few seasons, they are littered with irony.

As a generalisation, it must be ( for Derby fans who lauded his actions as being clever than the EFL) bitter irony that the ffp system that Mel Morris worked so hard to circumvent was put in place to protect clubs from the activities of owners just like him and avoid exactly what has now happened.

It is ironic that, when eventually bought to book for having cheated the system, Mel Morris proudly announced that because of the transfer embargo they would have to play youngsters and use their academy, as though he was the first to have thought of that idea. The irony being that other clubs had taken just that step, among others,  in order to comply with ffp when the new rules came into being. Had they taken the same steps, then they would not have been facing embargo and worse that was to follow.

In the same statement, Mel Morris also said that had they complied with the new ffp rules, it would have made Derby less competitive on the pitch. The irony is that  had he taken the right steps at the right time then, while it might have made them less competitive, ( in just the same way it did for many other clubs that did take the right steps in order to comply) they would at least remain relatively competitive in the championship, rather than contemplating life in league 1 -that is if they still exist after this season.

How long have we had to listen to Derby fans telling all those criticising the actions of Morris over  the sale of Pride Park and , more recently, their accounting practices, that other clubs’ fans’ are just jealous that they didn’t /couldn’t do the same, and how Morris has had one over the EFL. The irony is that those same fans are now not only contemplating relegation this season, but must genuinely be worried about the future of their club. Rather than looking for third parties to blame, in particular Steve Gibson and the EFL, most now realise that the focus for their anger is, and always should have been , the club’s owner - the man they believed and lauded as though he was some sort of knight in shining armour fighting back against the EFL, who of course had a vendetta against Morris and Derby.

The ultimate irony is that,  had Morris bitten the bullet at the first ffp reckoning, admitted a breach of ffp limits and taken a points deduction, the worst outcome would have been no chance of promotion. It is also likely the EFL would have organised a business plan, as they have with others, which would have put Derby in a much better position to cope with the financial effects of the pandemic. This in turn would have likely avoided the need for administration and the club would have retained ownership of Pride Park.

Of course hindsight is a wonderful thing, but I bet that Morris wishes he could turn back the clock, as do the Derby fans.

Luckily we have an owner that exercised foresight as far as ffp was concerned, rather than hindsight and, while he might not get all his decisions right, I for one would rather the club be in his hands going forward.

[Roger Red Hat]

1 minute ago, downendcity said:

Looking back over Derby’s last few seasons, they are litter

Correct!

[downendcity]

21 minutes ago, Roger Red Hat said:

Correct!

I’ve just cleaned out our cat’s litter and can confirm that you are indeed absolutely correct.

Having said that I would also add that our cat is a lot cleaner!

[BTRFTG]

7 hours ago, Mr Popodopolous said:

Ah yes, there's a bit on that too- putting aside the less than likely chances of the stadium being gifted back.

Rent

Club are supposed to be paying £1.1m per season on an £81.1m transaction or something in that ballpark.

Yet if you read the written reasons for the first case, the valued rent- as in the valuation given by the Independent Valuer that DCFC themselves hired- was £4.16m per season.

There is also a reference to rental payments from Club DCFC and Stadia DCFC- what is less clear is whether they would be included in the £1.1m ie £1.1m=Club + Club DCFC + Stadia DCFC or if Rent=£1.1m (Club) + Club DCFC + Stadia DCFC=Actual rent.

EFL still need to pursue that particular avenue as well, because £1.1m per season on an £81.1m transaction is absurd. Well out of kilter with other grounds as a % of sale price etc.

But is there any evidence rent has ever been paid? It's not in the investment holding accounts and Gellaw 203 (I hope you're sitting down,) have yet to file accounts which are long overdue.

As you say, £1.1m per season in rent would give nowhere near a valuation of £81m for the stadium.

[BTRFTG]

35 minutes ago, TomF said:

Is Pride Park worth £50m?  I mean its a nice stadium but it is actually nearly 25 years old. 

According the accounts of the company that owns it it's worth £81.1m....

[Davefevs]

1 hour ago, downendcity said:

Looking back over Derby’s last few seasons, they are littered with irony.

As a generalisation, it must be ( for Derby fans who lauded his actions as being clever than the EFL) bitter irony that the ffp system that Mel Morris worked so hard to circumvent was put in place to protect clubs from the activities of owners just like him and avoid exactly what has now happened.

It is ironic that, when eventually bought to book for having cheated the system, Mel Morris proudly announced that because of the transfer embargo they would have to play youngsters and use their academy, as though he was the first to have thought of that idea. The irony being that other clubs had taken just that step, among others,  in order to comply with ffp when the new rules came into being. Had they taken the same steps, then they would not have been facing embargo and worse that was to follow.

In the same statement, Mel Morris also said that had they complied with the new ffp rules, it would have made Derby less competitive on the pitch. The irony is that  had he taken the right steps at the right time then, while it might have made them less competitive, ( in just the same way it did for many other clubs that did take the right steps in order to comply) they would at least remain relatively competitive in the championship, rather than contemplating life in league 1 -that is if they still exist after this season.

How long have we had to listen to Derby fans telling all those criticising the actions of Morris over  the sale of Pride Park and , more recently, their accounting practices, that other clubs’ fans’ are just jealous that they didn’t /couldn’t do the same, and how Morris has had one over the EFL. The irony is that those same fans are now not only contemplating relegation this season, but must genuinely be worried about the future of their club. Rather than looking for third parties to blame, in particular Steve Gibson and the EFL, most now realise that the focus for their anger is, and always should have been , the club’s owner - the man they believed and lauded as though he was some sort of knight in shining armour fighting back against the EFL, who of course had a vendetta against Morris and Derby.

The ultimate irony is that,  had Morris bitten the bullet at the first ffp reckoning, admitted a breach of ffp limits and taken a points deduction, the worst outcome would have been no chance of promotion. It is also likely the EFL would have organised a business plan, as they have with others, which would have put Derby in a much better position to cope with the financial effects of the pandemic. This in turn would have likely avoided the need for administration and the club would have retained ownership of Pride Park.

Of course hindsight is a wonderful thing, but I bet that Morris wishes he could turn back the clock, as do the Derby fans.

Luckily we have an owner that exercised foresight as far as ffp was concerned, rather than hindsight and, while he might not get all his decisions right, I for one would rather the club be in his hands going forward.

Mel Morris - from Candy Crush to Derby Crush.

[Hxj]

9 hours ago, AnotherDerbyFan said:

Obviously,  whislt still owner he would have to sell the stadium at fair value (lower now due to covid), but once sold, he'd be able to gift it to the (eventual) new owners as an unrelated party, surely?

Just to ensure that the record is correct Morris does not own the Stadium so he cannot do anything with it.

The Stadium is owned by a company that Morris owns, but it has a charge or two on it in respect of the debt owed to MSD.  So it can't be sold or given away until that charge is paid up in full (including interest, default interest along with the costs and fees of lender).

It would also appear that that company, or a parent owed the football club the purchase price in June 2018.  If that is still the case (no one outside a small group knows as no accounts have ben submitted since then) then the Administrators will have to seek to recover the debt from the Stadium companies, which I guess will force the Stadium companies into administration or liquidation, which will mean that MSD will control everything.

If of course the Stadium companies have paid for the stadium in full then it is difficult to see how the Football Club is in administration.

[Davefevs]

4 minutes ago, Hxj said:

Just to ensure that the record is correct Morris does not own the Stadium so he cannot do anything with it.

The Stadium is owned by a company that Morris owns, but it has a charge or two on it in respect of the debt owed to MSD.  So it can't be sold or given away until that charge is paid up in full (including interest, default interest along with the costs and fees of lender).

It would also appear that that company, or a parent owed the football club the purchase price in June 2018.  If that is still the case (no one outside a small group knows as no accounts have ben submitted since then) then the Administrators will have to seek to recover the debt from the Stadium companies, which I guess will force the Stadium companies into administration or liquidation, which will mean that MSD will control everything.

If of course the Stadium companies have paid for the stadium in full then it is difficult to see how the Football Club is in administration.

So to summarise for a non-accountant.  Please correct anything I get wrong.

Derby owned stadium - value of asset in books

Derby sold stadium to another “company x” for £81.1m, realising profit of £x that stopped FFP issues (in their eyes).

Derby pay rent for use of stadium.

Company x borrowed money from MSD to purchase the stadium, hence charge on it.

Company x might not have paid fully for the stadium yet?

If Company x has paid for it, club might still be in FFP trouble because of dodgy amortisation method and breaking FFP limits, but shouldn’t be in administration, e.g. why do they still have a £30m HMRC bill outstanding.  Is it this bit that makes you think Company x hasn’t paid for it yet?

Ta.

[Hxj]

7 minutes ago, Davefevs said:

Derby owned stadium - value of asset in books

Derby sold stadium to another “company x” for £81.1m, realising profit of £x that stopped FFP issues (in their eyes).

Derby pay rent for use of stadium.

All agreed.

 

8 minutes ago, Davefevs said:

Company x borrowed money from MSD to purchase the stadium, hence charge on it.

Unlikely.  The stadium sale was in 2018. 

The MSD Charges were put in place in August and November 2020.  So it looks like the MSD money was used to fund cash flow across all entities not for payment for the stadium.

 

11 minutes ago, Davefevs said:

Company x might not have paid fully for the stadium yet?

It may not have paid anything.

 

12 minutes ago, Davefevs said:

If Company x has paid for it, club might still be in FFP trouble because of dodgy amortisation method and breaking FFP limits, but shouldn’t be in administration, e.g. why do they still have a £30m HMRC bill outstanding.  Is it this bit that makes you think Company x hasn’t paid for it yet?

Exactly.  Along with Cocu and Keogh and the late payment of transfer fees.

The alternative is that they have burnt through £81 million cash in roughly three years.  I could have paid off all the debts and still had a great time with the remaining £20 million or so .......... 

[downendcity]

37 minutes ago, Davefevs said:

So to summarise for a non-accountant.  Please correct anything I get wrong.

Derby owned stadium - value of asset in books

Derby sold stadium to another “company x” for £81.1m, realising profit of £x that stopped FFP issues (in their eyes).

Derby pay rent for use of stadium.

Company x borrowed money from MSD to purchase the stadium, hence charge on it.

Company x might not have paid fully for the stadium yet?

If Company x has paid for it, club might still be in FFP trouble because of dodgy amortisation method and breaking FFP limits, but shouldn’t be in administration, e.g. why do they still have a £30m HMRC bill outstanding.  Is it this bit that makes you think Company x hasn’t paid for it yet?

Ta.

I wonder whether they never thought ACTUAL money would ever need to change hands for the stadium “sale”.

[downendcity]

39 minutes ago, Davefevs said:

So to summarise for a non-accountant.  Please correct anything I get wrong.

Derby owned stadium - value of asset in books

Derby sold stadium to another “company x” for £81.1m, realising profit of £x that stopped FFP issues (in their eyes).

Derby pay rent for use of stadium.

Company x borrowed money from MSD to purchase the stadium, hence charge on it.

Company x might not have paid fully for the stadium yet?

If Company x has paid for it, club might still be in FFP trouble because of dodgy amortisation method and breaking FFP limits, but shouldn’t be in administration, e.g. why do they still have a £30m HMRC bill outstanding.  Is it this bit that makes you think Company x hasn’t paid for it yet?

Ta.

My summary:

Oh what a tangled web we weave when first we practice to deceive!

Big Tone style summary:

When you're in a shithole in the midlands,  stop digging

[Davefevs]

[Monkeh]

11 hours ago, Mr Popodopolous said:

The latest idea I've seen on Twitter is.

Mel Morris gives back the Stadium to Derby for £1 or a nominal fee and then they mortgage it for £50m.

Will Mel pay the cash to MSD as well, can the club sub-mortgage it just like that.

How do the club defend the £81.1m transaction- £1 in an FFP context? Surely the EFL would have something to say about that.

They can't and would get a further harsher points deduction,

But as they are ****** anyway may as well accept it,

Although by the time this is all sorted there is a very real chance of Derby being a league 2 or even a non league club, that's how serious it is

[Hxj]

If you can get it BBC Radio Derby are live at the Administrators' press conference at 11 am today.

[BS3City]

11 minutes ago, Davefevs said:

That looks good to me...

[RoystonFoote'snephew]

12 minutes ago, BS3City said:

That looks good to me...

It would look even better if the further deduction of 9 points for FFP breaches was applied and it read minus 11.

Edited September 23, 2021 by RoystonFoote'snephew
Typo alteration

[BetterRedthanBlue]

Going onto a point raised by @BTRFTG is there any evidence that derby have paid rent on the stadium? Or is it contained in accounts that aren't on companies House?

Because surely if no rent has been paid that would incur an additional penalty?

[AnotherDerbyFan]

1 hour ago, Hxj said:

The alternative is that they have burnt through £81 million cash in roughly three years.  I could have paid off all the debts and still had a great time with the remaining £20 million or so .......... 

Not forgetting income during the 18/19, 19/20 and 20/21 seasons.

Sevco 5112 turnover in 17/18 was £29.1m.
18/19 & 19/20 - likely averaging out at £30m. Playoff final (vs semi), cup runs with games away at Chelsea, Man Utd and on TV. Offset by c£5m loss in income due to Covid
20/21 - c£15m due to no match receipts or commercial/hospitality.
Player sales and compensation for managers during that period of roughly £25m - Vydra, Weimann, Jerome, Luke Thomas, Bogle, Lowe, Whittaker, Bennett, Evans, Holmes, Delap, Gordon, 3 youngsters to Man Utd, Rowett, Lampard

Along with the stadium that would be £180m cash. With a vastly reduced wage bill, I'm highly doubtful we could have burnt through all of that in just over 3 years.

[East Londoner]

Apologies if this has been asked already, I’ve seen people raising the possibility of liquidation but how is this any worse than the Portsmouth scenario for example when the debt was like double or is it that the stadium sale is what might tip it over the edge?

[Monkeh]

7 minutes ago, walnutroof said:

Apologies if this has been asked already, I’ve seen people raising the possibility of liquidation but how is this any worse than the Portsmouth scenario for example when the debt was like double or is it that the stadium sale is what might tip it over the edge?

Portsmouth almost got liquidated they were very lucky

If Derby don't find a buyer willing to take on a club with a mountain of debt and no ownership of their facilities then they will go the same way as Chester or Hereford

 

[thatchersgold]

Will they also be getting the 9 point deduction for breaking financial rules which they were close to agreeing?

[Monkeh]

Just now, thatchersgold said:

Will they also be getting the 9 point deduction for breaking financial rules which they were close to agreeing?

Yes

[thatchersgold]

59 minutes ago, Monkeh said:

Yes

Will that be immediate? Or next season

[Davefevs]

2 minutes ago, thatchersgold said:

Will that be immediate? Or next season

Asap.

[BTRFTG]

4 hours ago, Hxj said:

The Stadium is owned by a company that Morris owns, but it has a charge or two on it in respect of the debt owed to MSD.

In this twisted web it may be worth being pedantic in saying a company of which, by association, Morris is sole director, though it may not necessarily follow he is the beneficial owner. I've seen elsewhere suggestion that funding may have come from him and other parties, excluding MSD.

[Monkeh]

3 minutes ago, thatchersgold said:

Will that be immediate? Or next season

Depends when they finish auditing all the accounts

But I expect it will by by the end of October

With further punishments possible

[thatchersgold]

Just now, Monkeh said:

Depends when they finish auditing all the accounts

But I expect it will by by the end of October

With further punishments possible

I thought after they agreed a 9 point deduction this was there way around getting both. Certainly hope there punished further

[Davefevs]

Just now, thatchersgold said:

I thought after they agreed a 9 point deduction this was there way around getting both. Certainly hope there punished further

Nope, totally separate things.  Administration points already deducted, EFL charges still being finalised.