Burnley - financial problems?

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HeySethUTB said:
Agree with Irv Barkley was effectively their creative force and Osho was very good, by a country Mike their best defender. Statistically in the highest percentiles for lots of defensive metrics in comparison to other defenders in the premier league.
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They didn't have Barkley when they went up, so I don't necessarily think it's a huge loss that he's gone.
 

SGBlade said:
This is exactly the tactic for parachute clubs. Loans are huge these days. If you think about it objectively, it’s the sensible way to go about it. You recoup most of the transfer budget you spent when you went up (even if you recruit terribly, like us, this seems possible) then you use your parachutes to bring in loans that no other champ club could afford. If you go up, great - rinse and repeat. If not, you’re not locked into 5 year contract that send you into administration.

Just to be clear, I’m not necessarily condoning it - I’d rather see rules brought in to make all leagues more competitive. I also find it a bit depressing as a fan of a parachute team, because you rarely own your best players.

Although, tbf, this year we’ve bought well on last-year-of-contract permanents and frees. So getting that mix right, plus investing in your own young players feels like the right blend.
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We essentially spent nothing and took our medicine to get back on an even keel.

Yes we signed a few but short of actually doing nothing at all, the small amount of trading we did pretty much equates to doing nothing, just as Norwich did a few years back.

A net spend of about 25m to 30m pounds, largely decreased by half that when we’d sent Archer back.

Since then Traore has gone, meaning our net investment is Slimane and Trusty, both of whom may still leave during this window.

But we can loan Rak-Sayki, Souttar and a promising Chelsea lad. We have been able to get in Cooper as well to put a long term fix in a key position.

The only ironic thing is that we’ve now lost Osula and Jebbo to the Premier League, albeit under differing circumstances, and now find ourselves craving for competition for Moore at a time both of these could have got the game time they desired.

That said the model does include the Academy and 12m guarantees plus 5m additional for Osula and sizeable add-ons for Jebbo are not to be sniffed at.
 
Irv said:
Appears that Burnley are in a bit of turmoil and the fans are not happy..
They’ve sold or are about to sell the following:-
Johann Berg Gudmondsson (sold)
Scott Twine (sold)
Sander Berge (sold)
Anass Zaroury (sold)
Wilson Odobert (sold)
Muric (sold)

Dara O'Shea - off to Ipswich
Manuel Benson - off to Leeds
Josh Cullen
Wout Weghorst
Luca Koleosho - off to Wolves
Mike Tresor

Looks like the big spending gamble last season for zero reward was a massive mistake.

Their fans think it’s ALK asset stripping to repay themselves what they put in and the fears people had about their takeover are about to be realised.

Good news for us if they implode!
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What a ridiculous statement that it would be 'good news' if Burnley F.C. imploded.
Wouldn't be good news if any of the Football/Prem. Leagues clubs implode.
Demotion and promotion is what it's all about.
 
Champagneblade said:
We essentially spent nothing and took our medicine to get back on an even keel.

Yes we signed a few but short of actually doing nothing at all, the small amount of trading we did pretty much equates to doing nothing, just as Norwich did a few years back.

A net spend of about 25m to 30m pounds, largely decreased by half that when we’d sent Archer back.

Since then Traore has gone, meaning our net investment is Slimane and Trusty, both of whom may still leave during this window.

But we can loan Rak-Sayki, Souttar and a promising Chelsea lad. We have been able to get in Cooper as well to put a long term fix in a key position.

The only ironic thing is that we’ve now lost Osula and Jebbo to the Premier League, albeit under differing circumstances, and now find ourselves craving for competition for Moore at a time both of these could have got the game time they desired.

That said the model does include the Academy and 12m guarantees plus 5m additional for Osula and sizeable add-ons for Jebbo are not to be sniffed at.
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Yeah it’s a bit catch 22 isn’t it?

First time we went up we gambled on spending, for us, big money and signed Brewster, McBurnie, Berge, Ramsdale etc. That gamble didn’t pay off - I guess mainly because we recruited badly - and when we came down we nearly went into financial meltdown.

Second time we went up we lost our two best players, admittedly for OK money, and spent net nothing. That ended in us being one of the worst teams in premier league history. But at least now the club looks reasonably stable and is able to buy the best of league one / mid champ plus get some very good loans to challenge this year and next.

The one thing we could have done better over the last couple of years is put a bit of money aside to tie our best young players down to longer contracts. Not thinking Berge here or Ndiaye 2nd season. But we could have gambled on Jebbo, Ndiaye after the first Hecky season, and Lankshear (I know we offered him a deal but by then half of Europe wanted him). Wouldn’t have cost a fortune and you can see the difference in the relative fees we got for Jebbo vs Osula.

God knows what the answer is. Perhaps there isn’t really an answer, unless you have someone willing to pump in 100m for fun. But, in general, it looks like we’ve managed it better this time round.
 
SGBlade said:
Yeah it’s a bit catch 22 isn’t it?

First time we went up we gambled on spending, for us, big money and signed Brewster, McBurnie, Berge, Ramsdale etc. That gamble didn’t pay off - I guess mainly because we recruited badly - and when we came down we nearly went into financial meltdown.

Second time we went up we lost our two best players, admittedly for OK money, and spent net nothing. That ended in us being one of the worst teams in premier league history. But at least now the club looks reasonably stable and is able to buy the best of league one / mid champ plus get some very good loans to challenge this year and next.

The one thing we could have done better over the last couple of years is put a bit of money aside to tie our best young players down to longer contracts. Not thinking Berge here or Ndiaye 2nd season. But we could have gambled on Jebbo, Ndiaye after the first Hecky season, and Lankshear (I know we offered him a deal but by then half of Europe wanted him). Wouldn’t have cost a fortune and you can see the difference in the relative fees we got for Jebbo vs Osula.

God knows what the answer is. Perhaps there isn’t really an answer, unless you have someone willing to pump in 100m for fun. But, in general, it looks like we’ve managed it better this time round.
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The money required for promoted clubs to spend to just hold their own is now beyond most clubs .The gap has got so wide the prem has become a closed shop .
 
Irv said:
Appears that Burnley are in a bit of turmoil and the fans are not happy..
They’ve sold or are about to sell the following:-
Johann Berg Gudmondsson (sold)
Scott Twine (sold)
Sander Berge (sold)
Anass Zaroury (sold)
Wilson Odobert (sold)
Muric (sold)

Dara O'Shea - off to Ipswich
Manuel Benson - off to Leeds
Josh Cullen
Wout Weghorst
Luca Koleosho - off to Wolves
Mike Tresor

Looks like the big spending gamble last season for zero reward was a massive mistake.

Their fans think it’s ALK asset stripping to repay themselves what they put in and the fears people had about their takeover are about to be realised.

Good news for us if they implode!
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I said this in the summer, they’re in serious bother, they spent big on both occasions in the prem with the new owners and didn’t sell anyone one of note when in the champ last time, if they don’t sell they’re screwed as the owners don’t have any money other than prem income that they gamble with and looks like that failed.
 
XH536 said:
What a ridiculous statement that it would be 'good news' if Burnley F.C. imploded.
Wouldn't be good news if any of the Football/Prem. Leagues clubs implode.
Demotion and promotion is what it's all about.
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Do you know what I mean by implode? No? - what a ridiculous statement from you to take the massive leap from me saying imploding on the pitch to going bust.
 
Isaw Joeshaw said:
Sadly , as I have pointed out before , the commonly held belief that leveraged buyouts are now banned is a misconception.

Premier League rules still allow 65% of the purchase price to be dumped on the club as a debt . In the USA as long ago as 10 years or more this was restricted to 25 % which is why vultures like the Glazers looked to our country, which at the time had no restrictions at all , to practice their dark arts of asset stripping which they have carried with almost breathtaking efficiency .

Even worse , the EFL have no specific limits in this respect and as with the PL , no restrictions on the level of interest which can be charged against this debt which is typically twice the going commercial rate or even more .

I’m not saying that that all potential US ‘investors ‘ and their banking buddies have the above scenario in mind as being their main objective when taking over one of our clubs , but there must be a big temptation for them to do so given our ridiculously weak approach to this very serious and disconcerting anomaly .
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A business I owned a stake in was sold a couple of years ago, I was a minority shareholder so didn’t have much say in the process but I warned the other shareholders against this kind of thing and eventually it came to pass that the 2 PE guys who bought the business didn’t use a penny of their own to do so despite saying they would and providing proof of funding throughout the process.

They turned the business from a debt free, cash rich company where there was little pressure and could have happily ticked along for years to a cash starved, highly geared company where I had to have daily conversations with suppliers about why they weren’t being paid on time etc. I was retained as the MD but the expectation to run the business on a shoestring was ridiculous.

Horrendous situation to work in, I did get a payout for my shares and the 2 major shareholders obviously got a lot more and retired but I lasted a year before I walked away.

Last week I received a WhatsApp from the new owners asking if I wanted to buy the business back from them, spoke to them last week and they want to sell it ‘as is’ still loaded with debt and starved for cash, albeit at a much lower price, I politely declined.

A cautionary tale in selling businesses!
 
Looks like they are signing a few today.

Sarmiento, Mejbri and Jayden Anthony incoming.

Not sure yet what sort of deals they all are, I’d imagine they are loan, loan with obligation to buy and loan.

It will still be interesting who gets sold.

As far as we can tell all they’ve done their is buy themselves some time and in terms of Mejbri, sign a player but not actually start paying until 12 months’ time.

Still, one of their centre backs is heading to a team in Germany and Brownhill is being linked to Turkey.
 
Houston_Blade said:
A business I owned a stake in was sold a couple of years ago, I was a minority shareholder so didn’t have much say in the process but I warned the other shareholders against this kind of thing and eventually it came to pass that the 2 PE guys who bought the business didn’t use a penny of their own to do so despite saying they would and providing proof of funding throughout the process.

They turned the business from a debt free, cash rich company where there was little pressure and could have happily ticked along for years to a cash starved, highly geared company where I had to have daily conversations with suppliers about why they weren’t being paid on time etc. I was retained as the MD but the expectation to run the business on a shoestring was ridiculous.

Horrendous situation to work in, I did get a payout for my shares and the 2 major shareholders obviously got a lot more and retired but I lasted a year before I walked away.

Last week I received a WhatsApp from the new owners asking if I wanted to buy the business back from them, spoke to them last week and they want to sell it ‘as is’ still loaded with debt and starved for cash, albeit at a much lower price, I politely declined.

A cautionary tale in selling businesses!
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Not sure it’s a cautionary tale for the majority shareholders. Surely they got exactly what they wanted out of it? It’s none of their business once they’ve sold unless they were on some sort of earn out.
 
Nick Jansky said:
Not sure it’s a cautionary tale for the majority shareholders. Surely they got exactly what they wanted out of it? It’s none of their business once they’ve sold unless they were on some sort of earn out.
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They were happy as none of it was earn out based, however part of the discussions all along were that they wanted to protect the long term staff who they’d had working for them. It goes to show that as much as people want “the right buyer” ultimately the right buyer is the one willing to pay the money they want. I did ok out of it but not enough to retire before 40 unfortunately.

I think people take Abdullah literally when he says he’s going to be selective about the new owner, when it comes to it then he won’t and will sell to whoever pays him what he wants.
 

Houston_Blade said:
A business I owned a stake in was sold a couple of years ago, I was a minority shareholder so didn’t have much say in the process but I warned the other shareholders against this kind of thing and eventually it came to pass that the 2 PE guys who bought the business didn’t use a penny of their own to do so despite saying they would and providing proof of funding throughout the process.

They turned the business from a debt free, cash rich company where there was little pressure and could have happily ticked along for years to a cash starved, highly geared company where I had to have daily conversations with suppliers about why they weren’t being paid on time etc. I was retained as the MD but the expectation to run the business on a shoestring was ridiculous.

Horrendous situation to work in, I did get a payout for my shares and the 2 major shareholders obviously got a lot more and retired but I lasted a year before I walked away.

Last week I received a WhatsApp from the new owners asking if I wanted to buy the business back from them, spoke to them last week and they want to sell it ‘as is’ still loaded with debt and starved for cash, albeit at a much lower price, I politely declined.

A cautionary tale in selling businesses!
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Exactly what has happened with Burnley FC. The owners have taken out a £125 million loan from BFC, on which they pay no interest. As at July 2023 BFC had borrowed £101m from banks and finance houses on which they had paid £9.5m interest. (The new owners also collect £2.5m per year as payment for being owners.)

From July 2023 until the start of this fire sale, the club has (net) spent at least £60m and probably £80m on further new players, which must take the loans to £160m-£180m less whatever profit (if any) they made last season. That's why we're having to sell anyone and everyone; though why it all has to be last minute, I don't know.

As of a week last Saturday, we had 37 names on the back of the programme. Leaving out the 4th goalkeeper and a youngster, 34 players. 7 have since been sold and 6 more are long term injured, and a further 6 were left out with strains, illnesses, or other niggles that will last until the transfer window closes. (1 of them may have been a genuine injury, the other 5 are apparently expecting to be sold.) Hence a squad v Sunderland that had 2 keepers and 3 youth team players on the bench.

They have also signed two new players with three more expected today. It's a farce.

Good luck with your American owners.
 
Keen Blade said:
Brentford & Brighton manage B quite well
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Yep, because they’ve been putting the foundations in place for years. They’re also well-established in the top flight enough to make it work.

Even with all that though they’re still only a couple of seasons of duds or injuries away from it all falling apart. To expect them to keep unearthing diamonds who’ll make them a profit is unrealistic.
 
Le Cynique said:
Yep, because they’ve been putting the foundations in place for years. They’re also well-established in the top flight enough to make it work.

Even with all that though they’re still only a couple of seasons of duds or injuries away from it all falling apart. To expect them to keep unearthing diamonds who’ll make them a profit is unrealistic.
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Both are bankrolled by bazillionaires.
 
Le Cynique said:
Yep, because they’ve been putting the foundations in place for years. They’re also well-established in the top flight enough to make it work.

Even with all that though they’re still only a couple of seasons of duds or injuries away from it all falling apart. To expect them to keep unearthing diamonds who’ll make them a profit is unrealistic.
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Both have enormous data led recruitment teams, arguably some of the best in the business in Western Europe. They will keep picking up the bargains and moving them on for three times the price they paid.
 
Surely Leeds are the ones under SWFC pressure to go up?
 

SRBlade said:
Surely Leeds are the ones under SWFC pressure to go up?
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They have one more year of parachute payments, right? They would probably have to sell a few players though which won't make it easier next season.
 
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