Gazidis exposed as financials reveal disgusting plan…

by & filed under Uncategorized.

Arsenal just released their latest financials so Geoff and I have put a few comments together about our initial thoughts on what we’ve been presented.

Key points and questions:

  • We’re £200million in debt. £130million less than last year.
  • What happened to the sponsorship money we received up front? £100million from the Emirates + whatever Nike provided.
  • How come the property sales haven’t covered off more of the debt? £95mill to develop, we’ve recouped £200+ million so far with a further 130 odd flats to go.
  • What happened to our television money? We earn £50million+  from the EPL and the Champions league.
  • What has happened to the transfer budget we never spend? We’re in the black for the last 5 years.
  • Pleading poverty when you can comfortably increase the wage bill by £17million seems a little outrageous. This is before Cesc has signed a new deal, so expect it to increase further despite no additional achievement (You know, trophies). This increase is despite losing Adebayor (80k p/w) and Kolo Toure (50k p/w).
  • The player sales of Adebayor and Kolo appear to be key to keeping us in profit, despite the fact we lumped £130million off the debt. Will are use this as a stick to beat the fans who want us to spend money?
  • Arsenal make £3million a game of of you, the fan but don’t want to give anything back for your investment.


The club are being frugal to pay off the debt quicker, but why? We have a 17 year mortgage don’t we?

Is it to be able to invest in the world class player that are currently out of our reach or is it to make the club more attractive to sell to an investor who will immediately plunge the club into debt and put us in a Manchester United/Liverpool situation.

If it’s the latter, like Geoff and I have predicted for a while… are you still happy?

More to the point,  what is the MO of Gazidis? Is it to make us a world class club or is it to clear the debt for the owner in waiting, Stan Kroenke. I wonder what the bonus scheme looks like for our master of marketing and man of the people?

Is he the trojan horse, has he been employed to use our money to fatten the wallet of a billionaire? Is this the reason Stan hasn’t taken his holding to 30% becuase he doesn’t want to buy the club till it is debt free? No wonder he doesn’t answer questions at the AGM…

Will the fan base wake up and smell the coffee now? Are the debt buster brigade still pleased to see fan money go towards making a hideously wealthy cowboy even richer?

We’re being conned and it makes me sick to the pit of my stomach.


615 Responses to “Gazidis exposed as financials reveal disgusting plan…”

Jump to comment form ↓

  1. Jaguar

    Its funny when some mugs who live far off from Europe andhad never been to the stadium slag off the likes of Geoff and Pedro for not being loyal to the club.eff off you fucking pricks.Go to ACLF,and lick their arses.

  2. Duke

    This away fans is a myth, I been to many away games, the only reason you are loader then it’s because you are allowed to stand and it’s easier to organise a song with 5000 people in a tight space than 60000 people at the Grove. Also mostly all are pissed and when one starts singing “There is only one Arsene Wenger” even if another 3000 join in like sheep even if they are not truly satisfied with the way he does things it feels very very loud. Also it’s called support, you thing songs there to spur the team on. After you are out of the stadium you are allowed to voice your own opinion…

  3. Simon McMahon

    Well another round of bollock’s & back slapping and self appraisal from hill wodd regarding the finances .
    what stands out is their genuine contempt for us THE FANS , and the lack of any creative minds from any employee in the clubs financial department.
    underselling the shirt deal to begin with and the current pathetic attempts from gazidis to ensure we maximise the clubs earning potential.
    As has been said we have severly under invested in the squad for the last five years , and rewarded average at best players with new improved contracts.
    These people are greedy ,and have no soul, they dont give a rats arse about the people who pay all this money week in week out.
    Enjoy your cigars and brandy at stoke you fat Tory Eatonian bastard!!

  4. Nick

    if the loans are being paid off to put us in a stronger financial position fair enough, but if what peds and Geoff think is the real reason to be plunged back into debt to line someone else’s pockets.
    bad times and in the world we live in its more likely the worst case scenario if history is anything to go by 🙁

  5. ryan

    surely handing out new contracts isn’t that expensive in the short term. i haven’t bothered to calculate it so maybe i’m wrong, but these huge sums which get branded around as what the new contracts cost us are surely what they cost us in total, in the end, not what they cost the club in january. unless we’re handing out huge signing on fees…

  6. ryan

    oh i should add, that if the club got saddled with new debt and the club was lead down the road towards bankruptcy and a ‘real’ arsenal club was formed in the same way that those utd supporters created another united team, then i would think long and hard and really consider jumping ship for the little arsenal lot and giving them my full support instead.

  7. dronawenger

    Fans are getting worked up like mad when they feel they are being short changed by the lack of new signings and paying top money for season tickets.

    I would like to commend the club for running the club wisely with respect to the finances. Re-payment of the debt before hand is really a wise decision. I wonder if the club had taken any loans denominated in USD and are trying to repay at the earliest for the pound sterling seems to be destined for further depriciation.

    We should do well to remember the deals with Emirates and Nike were done before Ivan Gazidis arrived. Also we were in deep debt throughout the 2007-08 crisis. Also I would love to compare with other clubs how they fared after moving to a new stadium.

    Players have been given new contracts at break neck speed to maintain the value of the players with their capabilites coming second. Today the rules are loaded in favour of the players. Valuations of players can disappear in quick time.

  8. tonyadamsisgod

    Nick – I had a nice 3 fold the other night. Last weeks Europa Cup at HT. Backed Fulham to win whilst 1-1, Marseille to win whilst at 0-0 and Bilbao to draw at 0-1 down. 33/1. Ei ei!! 😀

  9. ArseChicago

    By my calculations, there’s likely 30-40MM pounds for transfers this offseason. That’s before any player sales which I think need to occur. Anyway, I arrive at this by taking the 80MM in unrestricted cash and netting against that the 45MM in debt that’s due within one year.

    Good news that the Highbury Square debt is nearly in our past.

    One point of contention – You state that the club is paying down debt to make it more attractive to a buyer like Kroenke. To a potential buyer, whether the club’s debt is 300MM or 200MM matters not. Any paydown of debt or hoarding of cash on the balance sheet makes a buyout more attractive to the SELLERS, not the buyer. To value the business, you’d look at the operating profit before interest, taxes, depreciation and amortization and slap a purchase multiple on it. From that number you deduct the net debt to arrive at the number the equity holders get. So my point is the amount of debt today doesn’t impact what someone like Kroenke would pay. It would only impact what the shareholders would receive in a buyout.

    Obviously we pray this doesn’t happen. What worries me is that Kroenke seems to be a business man, rather than someone that would care more about winning before maximizing profit. Time will tell.

  10. Geoff

    Jaguar, couldn’t of put it better myself mate!

    Nick, it’s worst case but very possible, it happened at United and as I’ve always said, why is Kroenke interested in football?

    At least they play football in Russia.

  11. wardo

    gnarley… the 12th Man. Classic stuff.

    Also, one of my favourite songs by the best thing to come out of oz below !!! hahahaha

  12. tonyadamsisgod

    I can come to only one conclusion through all of this. Moving to The Emirates came at to high a price and we should have stayed at Highbury. The reward, simply, has not been worth the sacrifice.

  13. gambon


    We would have absolutely no need for $ denominated loans, so thats unlikely.

    Also in the full year report they mention that they hedge against currency risk.

  14. gambon


    There hasnt been any sacrifice.

    The only difference is the club kicked out the one man who used to fight to use our profits for players.

    Now DDs gone they are lining their own pockets instead.

  15. dronawenger

    The way some fans are reacting to our profits we have become the Goldman Sachs of football.

    Also, I sincerely would like to know if any other football club has a solid balance sheet similar to Arsenal.

  16. Jaguar

    The sacrifice was well worth the reward.£1100,for watching shite like Denilshite,Clownmunia,and Shitvestre at a 60k stadium.Priceless.

    There are somethings which money cant buy.For everything else,theres Master Cunt(you know what I mean 😉 )

  17. Geoff

    And all those morons think we should be grateful Arsenal are screwing us and raking in our money.

    If I park up at a client golf do in an Aston, people think I’m charging too much, when I watch 18 year old driving past the Arsenal tavern in a Maseratis all I hear from fans is, look that was Johan. No fucking resentment there.

  18. gambon


    Since when has football been about balance sheets.

    I would rather know if any teams have a better team than us?…

    And the answer is yes!

  19. dronawenger

    Important financial lesson for any prospective new owners of AFC

    “Leverage can’t make a bad investment good, but it can make a good investment bad”

  20. tonyadamsisgod

    People who say “Giving birth to your first child is the best experience of your life” have obviously never had TWO kit-kats fall out of a vending machine when you’ve only paid for ONE!

  21. Arse&Nose

    Tottenham’s preparations for their Premier League clash against Everton have been disrupted by a virus.

    First-team stars Wilson Palacios and Vedran Corluka have been hit by the sickness and diarrhoea bug.

    They are among 18 players and staff at the Spurs training ground in Chigwell, Essex, to be affected.

    Tottenham manager Harry Redknapp stated: “We’ve closed the training ground. It’s off limits. We’re just going to train there and that’s it.”

  22. Rtist

    pure fucking speculation with some meaty “umericun” insults from the Ingla Terra lads…6AM over here: gotta get to work. Pull up yer pants, tighten yur chin straps on yur pith helmets (Kipling -style), adjust the one nutt you seem to have left and have a laugh: it ain’t that fuckin bad outside yur little fish bowl.

  23. Duke


    People who say “Giving birth to your first child is the best experience of your life” have obviously were not at Shite Hart Lane in 2004!

  24. Geoff

    The thing about Gazidas, and Kroenke is because they are from America, they don’t understand support.

    If you are from Colorado, you support what-ever team are from there. You don’t support them if you were born in New York.

    Now football is different, you support the team because you like them, all these young kids that are now deciding who to support go for the successful teams, I dread to think of the kids we are losing.

    In Islington you’ll get a lot of fans because they are local, or their family support us, but you get many more that aren’t local.

    So 5-10 years on, we’ll have a problem, Gazidas doesn’t understand, Hill-Wood doesn’t care and all Wenger is bothered about is his salary.

    We have fans all over the world, this site bears testimony to that, we are losing out on the kids though and that’s what Arsenal need to be careful of, there won’t be a balance sheet to worry about if they don’t watch it.

  25. AndAPrayer

    Gambon, can I just ask how you know the debt can not be repaid early. Given that it just has been repaid early it seems somewhat counter intuitive.

    Pedro, your argument about saving money for the benefit of future owners is simply incorrect. By reducing debt the value of the business is increased making it more expensive for the future owner to buy it. The danger is that they then saddle this debt on to the club a la Man Utd but this might happen anyway and be added to the clubs debt making no discernible difference to the end result.

    Ultimately being debt free is a good thing for the club’s security. It makes administration less likely (nb I’m not suggesting we’re going to do a Portsmouth just that it makes it less likely we will) it also makes a hostile takeover less likely as repaid debt can’t be given as an immediate dividend while cash reserves can (see vt group for an example of a cash rich company facing hostile takeovers).

    All in all these figures aren’t a bad thing. You can argue that you’d like more investment in players and you may be right but looking beyond that then repaying debt is the best thing for the continued health of the club we love.

  26. gambon


    We are talking about different debt.

    You are talking about the loan for the flats, i am talking about the loan for the stadium.

  27. Pedro

    AndAPrayer, why haven’t Liverpool been taken over then?

    DIC, one of the richest groups in the world have said they won’t touch it until the debt is cleared.

    Why hasn’t someone bought Pompey?

    It’s more attractive to a business man to buy a debt free club with a great business model than a paying £600mill for a club with £200mill debt.

  28. Duke

    I saw a beggar who was so poor that he was standing on the corner shouting, “WILL WORK FOR CARDBOARD AND A MAGIC MARKER!”

  29. Jaguar

    I can smell the last words coming from a person here.

    ‘Go and support another club’.

    These people are the bane of my club.

  30. Duke

    Sorry if this one is too bad:

    Sporting CP 3 – Everton 0

    Continuing the trend of Everton fans getting fucked when they travel to Portugal.

  31. Henrystar


    My main problem with your post is you guys seem to have decided that the main reason for paying the property debt from property income is so as to make the club more attractive for Stan.

    How do you know this? You’re presenting your assumption of other people’s motive as fact.

    Given the way the club has been managed so far, wouldn’t someone be justified to think

  32. Geoff

    Henry I don’t know why you think the club and debt have been well managed, I’m in Marketing and the deal they did for naming and shirts could have been done better by an 8 year old, and I said that at the time.

    That was shit management. They may have sacked Edelman but someone passed it.

  33. Pedro

    Henry, Stan sitting at 29.9%, Gazidis employed from the American league, no experience of the Premiership… continues the club down the route of prudence at the expense of success on the pitch… etc etc…

    The board were much more football focused when Dein was here… now he’s gone, it’s all about getting the max from the shares the remaining member have.

    That’s looking pretty factual, unless you have another theory?

    Why invest in a football club if you’re American? There has to be a pay back…

  34. Charles

    What is wrong with people. I am of the opinion that their is nothing like good debt. If we have to sacrifice blowing big money on buying players that may not even guarantee the clup trophies so we can clear our debt, so be it.
    Club game is not a 10 or 20yrs thing, its a century thing. If Arsenal can be debt free in the next 10 years, then, its even better for the future generation. And who says that blowing £100m on players gurantees sucess? see Man City. big spensing is nothing without a good manager. A lot of you derive joy in slagging off AW in every opportunity you have, lets see what happens when he leaves.
    I bet if you ask any Pompey fan to choose between not winning FA cup and going into Administration, they will choose not blowing the budget on FA cup winning team.
    I say lets clear our debt and make sure that whoever that is going to buy the club in the future will not be allowed to leavarage the club in the process.

  35. Arse&Nose

    Pedro you’re right, he will buy it when we are debt free.
    Then the £3,000,000 we make per game will be his not the banks.

  36. ArseChicago

    Think of buying the club like buying someone’s house. When you buy a house from someone for 200,000, do you care if the owner has 50,000 left on his mortgage or 100,000 left on his mortgage? No, why should you care. If the house is worth 200,000 to you, you pay 200,000. Whatever the seller does with the money, whether that’s pocketing it all or using it all to pay down mortgage debt should be of no concern. Whatever non-Emirates Stadium mortgage debt is on the balance sheet when a hypothetical takeover takes place would be refinanced with new debt (and unfortunately more incrementally, likely).

    And someone above asked when did football become about balance sheets? Well, when club’s are going into administration and when fans believe that the club needs to spend 50MM in transfer fees in the offseason, then it probably makes sense to have a look at the balance sheet occasionally. No one likes that sport is business now, but I don’t think you can blame Arsenal singularly for this.

  37. Jaguar

    Nothing is gonna happen when Wenger leaves.We will still be the same big club,even before,an unknown from Monaco took over .Get over this shit attitude of Arsene FC.Any one who compares us to the likes of Pompey is a proper nutcase,with no basic knowledge of finance,and they should restrict their ‘valuable’comments to

  38. Pedro

    … and City haven’t bought success?

    Their money, in my opinion will give them 4th this year.

    Pretty good going don’t you think?

  39. Duke

    Charles, well done mate, we are all asking for us to buy Ronaldo and Messi and not just spend the money we got from the Ade, Toure sale on something like a keeper, DM and a CF. That would be crazy. Bring Ronaldo and Messi in now or get out Wenger. I think if he doesn’t buy them this summer I will support Spurs or Chelsea as they spend on players, I didn’t decide which one to go with yet, any suggestions?

  40. Pedro

    AC… you don’t take on someones debt when you buy a house.

    You do when you buy a Company.

    It’s nothing like buying a house!

  41. Geoff

    Didn’t the US nearly fuck up the worlds banking system with their knowledge of the sub prime mortgage industry, or am I being churlish Chicago?

  42. ArseChicago

    Pedro, I’m in leveraged buyouts for a career. When a leveraged buyout takes place, existing debt is paid off and a new debt facility is put in place. Just like a mortgage. The existing mortgage is paid off and a new mortgage is put in place. In the case of an Arsenal takeover, the Emirates mortgage would remain. Any other debt, not that there’s much of it anymore aside from the mortgage, would be paid off, likely from proceeds of new debt (unfortunately). Now if someone like Kroenke would agree to assume the debt, well then that’s just less money for the sellers. Again, Kroenke would be on the hook for the same amount of money. It’s just a matter of the mix between what he pays to the equity holders and what he assumes in debt, if anything.

  43. gambon

    Yeah Pedro

    I went to Sainsburys last night, got a weekly shop, then had a phone call saying i would have to go into administration.

    I explained that I have £6k in the bank & I spent £40, but they said if you spend ANY money you automatically go bust!

  44. Duke

    Chicago mate, it was not an insult, an insult would be attacking you personally, while stating facts about your country does not fall into the insult category (as per the rules of this site).

  45. Theo

    Personally, I’m happy to keep going as we are for now. Clearing the debt makes sense at the mo. I want this current crop of kids coming through to be given every chance to make it with us. If they prove not up to it in 2-3 years then fair enough, get the cheque book out to supplement the squad then. I have far more pride in this current set of players now than I would if it was made up of mercenaries like Adebayor. Remember our history and the legacy we will continue to leave for future generations. We’ve won Championships in the 30’s, 40’s, 50’s, 70’s, 80’s, 90’s & 00’s NOBODY comes close to that. We’ve done it our way CONSISTENTLY with our own money! We will continue doing the same long into the future. Portsmouth & Leeds are the most current examples of what happens when you go for broke – boom and bust is clearly not the answer!

  46. Pedro

    Yeah, I didn’t see the personal insults?

    If you asked whether Brits were in a position to advise on how to cut down teenage pregnancy… I’d take it on the chin.

  47. melvyn

    Spinmaster Wenger now reckons the Law could force Bridge to play for England !! How about a law which forces Nic (I’m better than TH14) Bendtner , De NIL son and Fawlty Manuel to leave the UK for not acheiving Conference league standard after 3 years+ at Arsenal.

  48. Geoff

    Theo, Portsmouth is what happens when you have a dodgy manager who spends money they didn’t have then fucks off sharpish when he realises he’s fucked up.

    Leeds had O’Leary, I rest my case.

  49. Pedro

    AC, what are the chances of Kroenke funding a leveraged buyout for a club with £200mill debt and keeping the payments respectable?

    Very low…

    Look at the problems the Glazers are having.

    What is going to work better for Stan… £200mill worth of debt… or 0 debt.

    I don’t think you need to be in leveraged buyouts to know that.

  50. tonyadamsisgod

    Wenger in a pound shop, ha ha, I can see it now….

    Wenger – “How much is that”
    Shop Owner – “£1”
    Wenger – “I’ll give you 37p”
    Shop Owner – “Its £1”
    Wenger – “OK, OK, 23p?”

  51. Jaguar

    Too manyu intruders from here.Really happy to know that these mugs have time to post comments on other sites after all these arselicking exercises.

  52. Duke

    Theo and people of likewise thinking:

    I am sorry but I really really don’t understand your comments… If I am on 50 grand a year after tax, and I have to pay 5 grand mortgage and then I spend another 35 grand on living costs and still have 10 grand in the bank come the end of the year how will I go bust? Please explain…

  53. Mark C

    Can anyone explain why we need to keep 100 mill IN the bank when we dont buy any players?

    Geoff- one of the points you made earlier was the directors had large expenses – Dein claimed 500k on expenses. Where did you get that from?

    I thought in Financial statements pay had to be shown to all Directors including salary and bonuses with share holding.

    FD’s of football club seems to take around 1 mill – even Storrey at Pompey has been paid over 1 mill and they have no cash !!!.

  54. Pedro

    That was my point Mark, someone pointed me to an article about it a few years back when I was defending Dein.

    It might not have been £500k, but it was between £300k-£500k.

  55. Rohan

    Just to put my 2-pence into it, I don’t think you can dispute AC’s argument ( for the record, I disagree with the house-club analogy ) just by stating the fact that he is American. It’s not like he is solely if at all responsible for the financial meltdown. 😀 Unless he’s the top dog at a big bank.

  56. TonyM

    I just wish we would buy some players with all this money.
    It makes sense to me to pay off debt early.
    Stan Kroenke is worth about 3 billion dollars and his wife is heir to the wal-mart fortune. I dont think he’ll be short of a few quid.
    The guy didn’t get to where he is by being stupid. I’m pretty sure he is taking note of whats going on at Liverpool and united.
    I think we should be a little more positive

  57. Duke

    Chicago, no mate, it’s not about being racist…I have a mind of my own hence I know what I see and read. Just because you are telling me that you work in finance does not make me change my opinion.

    I am in shipping, and if there is a vessel which you can clearly see that won’t go through the Panama Canal, and the Captain tells you that it is not allowed to go through the Panama Canal, and the Ship owner says that you are clearly not allowed because it’s in the Charter Party. But then I come along and say “Mate, I work in shipping, fucking go for it” would you do it?

  58. Geoff

    I made 17 years of straight profits, doesn’t make me an accountant, but it sure shows I know how to make money.

    I’ll leave it at that.

  59. ArseChicago

    Pedro, Arsenal’s enterprise value is over 1 billion pounds. Arsenal’s debt is 200MM pounds. That means there’s 800MM+ of equity value. This is not some American invention. This is simple math. I agree, the financing markets, in which I work, are ice cold right now and now would not be an ideal time for Kroenke to seek LBO financing (look at the trouble United is having refinancing their own debt). This is good for the Arsenal supporter that doesn’t want to see a leveraged buyout. My point is that if Kroenke wants to own 100% of Arsenal, he will have to come up with total funding north of 1 billion pounds. He could write a check for the entire amount without taking out any debt, but that’s unfortunately not how these things work (see Liverpool and United’s takeovers).

  60. AMS

    The figures mentioned today are a bit distorted because it takes into account cash in the bank which it shouldn’t because the club has short term creditors to pay. (accounting policy says you have to!)

    The real view is the club is still £308M in debt with the large chunk repayable after 5 years as per our 17 year mortgage.

    Basically, Arsenal have used the proceeds from the Flat sale to reduce the rolling short term loan (Less than one year)

    Arsenal annouce profits but they need to use some of the profits to repay the loan.

    The Group’s financial liabilities/debt is repayable as follows: £M

    Between one and two years 6,209
    Between two and five years 20,719
    After five years 232,759
    Within one year 48,936
    __________ 308,623

    The club used the Nike and Emirates Money to pay for a portion of the building costs (Roughly Cost £390M. The money the club is making is servicing the loan like everything in life nothing is for free…

    Like all Arsenal Fans, I want our Trophy cabinet to be full but I also don’t want to be like Chelsea, Liverpool and Man U… Look at Portsmouth what a waste!

    Man U are in debt but if the club floats again on the stock exchange it will be valued at minimum £1Billion which will clear the debts but lead to future dividend payments.

    The club didn’t take the loans out in USD. TV income should be higher this year because the Euro being nearly 1 to 1 with the Sterling!

    It sounds like a spine but Arsenal need a decent GK, Another CB (To be a proper leader on the pitch when the heads are down), DM (If Denilson was english he would have been out the door) and Striker (Someone with Power, Pace, height and eye for goal) I’m sure it would cost £40M to £50M to get the lot but will he do it… I doubt it more like £15M this summer… RVP to be like a new signing!

  61. Pete the First

    Geoff & Pedro think you’ve called it right here.

    Been saying the same for a while.

    We have over £100M on deposit, why? Is it to help fund a takeover? Seems a coincidence doesn’t it?

  62. Geoff

    Angelos, you can’t insult us and expect your post to get shown, that would make me as stupid as you are don’t you think?

  63. Pedro

    AC, Arsenal aren’t worth a billion pounds… we’re worth £600million.

    If Stan is going to buy it out of his own pocket, debt free works better than debt laden.

    If he’s going to leverage the debt, he’ll want to get a lower price for the club to ensure he can get the finance for the loans.

    Debt free works best in both situations.

    I’d have more chance getting a a £300k house if it didn’t have £100k debt…

  64. ArseChicago

    Pedro, as a follow on to your earlier point. For Kroenke to buy Arsenal without taking out any new debt from any bank, it would actually be better to have Arsenal have 200MM rather than 0MM. Let’s say Arsenal is worth 1 billion. Arsenal with 200MM in debt – For Kroenke to buy Arsenal, he would assume 200MM and pay out 800MM from his own account. Arsenal with 0MM in debt – Kroenke would have to pay 1 billion from his own account. Would Kroenke prefer writing a check for 800MM or 1 billion? With or without 200MM in debt, the enterprise value is the same (as the enterprise value is based on a multiple of EBITDA, which is a measure of profit before considering what interest needs to be paid, interest due on whatever the debt is).

  65. BillikenGooner

    Wouldn’t a debt free Arsenal (per share) be much more expensive than a club/company with debt?

    How would it be in Kroenke’s interest to push the value of the club up before he intends to buy it?

    Unless you are saying he is just going to use it as a cash vehicle for a few years, never intends to pay off the debt he incurred to buy it and then look to sell it off later? Which isn’t exactly his modus operandi with his sports franchises in North America.

    Just curious.

  66. ArseChicago

    According to Forbes last year (there may have been an update), Arsenal was worth $1.2 billion. So you’re right, it’s a little less than 1 billion pounds. Still, the enterprise value dwarfs the debt amount meaning there’s a ton of equity value there for shareholders. If Kroenke wanted to buy the club, he could pay $1.2 billion cash (if there was 0 debt) or he could pay $900MM cash and assume the debt (assuming 200MM pounds equals $300MM U.S. $). It’s better for Kroenke to have the mortgage on the books rather than have to fund money to pay that debt off at closing (which he wouldn’t be required to do in a hypothetical buyout).

  67. Pedro

    BillikenGooner, what would happen to the £200million debt if Stan bought the club now?

    Would it disappear? Or like AC said, would he assume it?

  68. BillikenGooner

    btw – I believe his percentage of the St Louis Rams is near $400mil (260GBP)and the group he is with is looking to sell them. So perhaps that might be part of his ‘stake’ in a future purchase.

  69. Pedro

    AC… we’re not worth a Billion…

    We’re valued on share price, in November we were worth £575mill… unless something amazing happened over the past few months, I’m pretty sure we didn’t add £400mill to our value.

  70. ArseChicago

    Pedro, l think it would behoove any buyer to NOT refi the Emirates mortgage as the terms are so incredibly favorable compared to what they could do in a refi in the prevailing market. So if we assume he would assume the mortgage, the question becomes how does Kroenke finance the remainder of the purchase consideration. Our biggest fear is that he tries to borrow as much as possible to fund the rest, rather than paying his own money for the club. Thankfully, for now, the leverage market wouldn’t provide him with the kind of debt the bankers gave to the Glazers and to the Liverpool buffoon Americans (yes, they’re buffoons and American!).

  71. gambon


    You work in leveraged buy outs but you dont understand the concept of Market Capitalisation?

    Sounds fishy to me.

  72. BillikenGooner

    If he was looking to just use Arsenal and it’s profits as a cash vehicle with no real interest in improving the club or trying to get it back out of debt once he has purchased it, then it wouldn’t really matter what kind of debt it had, no?
    It seems an awfully elaborate plan to install a man (Gazidis) to run the club to get it debt free to buy it, just to later run it into the ground when he could have started that process already.
    The debt load would be = either way, right? From what is on the books now or what extra he has to borrow to cover the more expensive shares.

    I’m not trying to be difficult and as my wife knows, I’m horrible with accounting, but just trying to come to grips with how being debt-free is no a bad thing.

  73. Pedro

    Tim, I stuck your comment up just because it was so funny.

    Getting lessons in racism from Americans is pretty funny as well!

    When we slag an African player off… all the Africans go mad becuase we’re racist.

    When we point out that Americans hardly have the best record when it comes to British football clubs… the Americans get up in arms!

    This isn’t a race issue, it’s a football issues… I don’t want to become another ManU or Liverpool at the expense of anyone, regardless of where they’re from!

  74. ArseChicago

    Gambon. Market value of equity is equal to enterprise value minus net debt (which is debt less cash). I understand it all too well. What Forbes means by its value is enterprise value. Their use of market value is not technically correct. To value a club like Arsenal, you would start by looking at EBITDA which is a measure of cash flow available to a club prior to any capital expenditures or interest expense. You have to look at EBITDA in order to determine how much debt could feasibly be placed on a company’s balance sheet.

  75. ArseChicago

    Pedro, if you look at a company’s share price, that doesn’t always equate to what the takeover price would be. If a company is trading on the stock exchange for $30 per share, it doesn’t mean that if an acquiror came along and offered $30 a share for the entire company, the board would accept it. There’s ALWAYS a takeover premium. Arsenal’s share price does not reflect a takeover premium.

  76. Geoff

    I thought if you bought 30% of a company, you had then to offer to buy all the remaining shares at the highest price those shares traded at, though I could be wrong.

  77. BillikenGooner

    If/when Kroenke tries to make a buyout does he offer 1 price and then every shareholder decides yes/no off that price, or like when a developer wants to buy a bunch of properties he has to negotiate with each individual so that the last few ‘hold outs’ can demand an even higher price?

  78. gambon


    You are talking value of the club, not price.

    Value is determined by

    1- Net assets
    2- Future cash flows discounted against a risk free rate
    3- Future prospects

    Price is determined by

    1- Share Price

    Current price is 9500 with 62500 shares = 550m give or take.

  79. ArseChicago

    Anyway, my point is that it’s an interesting time financially for football. I wish it wasn’t so much dominated by biz, but it is. All I wanted to say was that any hoarding of cash or paying of debt by Arsenal (rather than spending it on players) benefits any potential seller, not the potential buyer. Not only does it make the equity proceeds to the seller greater in a sale, but refraining from buying more expensive players keeps the wages lower, the operating profits higher, and as a result of the latter (assuming an enterprise value is a certain multiple of operating profits), a higher overall valuation. Anyway, sorry to be the boorish Americans we’re all thought to be. Toodles….