The Daily ITK Discussion Thread - 6th July

[sunnydelight786]

You're still here, aren't you?

One of the few loyalists left...

 

[SpursSvedala]

He hasn't got his finger in a bakewell tart, let alone a pie.

Fingers in a tart on a friday night... Wow!

 

[MattyP]

so that latest itk in the RO isn't "itk" as such... or am i mistaken? it was in a thread ages ago and numerous holes were shot in it: not least that ENIC don't own 100%... can any old crap get in there now?​

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ENIC effectively do own 100%. I have one share certificate as I didn't sell it bacl to them, but once they own >90% of the shares they can effectively cancel the shares they don't own.

However, I can see flaws in the recent spate of ITK.

If ENIC sell some of their stake, that goes directly into their pockets, not into THFC.

They could however, issue more shares in THFC and those shares be acquired by some rich oligarch. That money would go straight to THFC, but it would dilute the value of ENICs shares.

And that's where it falls down.

Say we are currently valued at £500m, of which ENIC owns 100%. Sell it all and they get paid £500m.

If they issue shares equivalent to diluting their holding to 60% (i.e. sort of selling 40% but the money goes to THFC) £200m comes in. But not to them, to the club.

So they have basically given away £200m on the punt that 60% of the new value of the club will be worth more than 100% today.

Personally, I don't buy that they would do that. But I'm happy to admit that I may be completely wrong.

 

[Spurs_Bear]

Why is that last ITK in the RO? There's nothing ITK about it at all.

 

[kelloggs]

"senior news editor at sky is called Keith James"

 

[ParkySpur]

Hate to say it, but this thread had now jumped the shark.

The twitter thread is now more interesting and more information packed to read, because of the lack of restrictions.

Add to that the SC ITK'ers now only post on that social network.. it's a double-whammy.

Time to reconsider the rules, or maybe merge the threads?

Spurscommunity is a whole site. If people are now spending more time on one thread than another then they so be it. They are still on Spurscommunity. I they were leaving to join COYS/FTL/SO etc then I'd be worried. This I still the best place to talk Tottenham. Primarily because it is run so well and gives so many different places to talk about different things.

In fact I would guess that the current situation actually makes it easy to mod the place!

Carry on.

 

[Sum Monsterism]

ENIC effectively do own 100%. I have one share certificate as I didn't sell it bacl to them, but once they own >90%

this is new to me, certainly not my forte, but kinda feels like we're falling back on semantics. I'm happy to be proven wrong as ever, too.

 

[SpurSince57]

One of the few loyalists left...

I think it's a simple matter of keeping this thread manageable. Yesterday Ackie posted that we were after a 'big name' from Madrid and the tiresomely predictable result was half-a-dozen pages of guesses. We've had similar with 'footballing genius' today. What do you think will happen if we allow Twitter stuff in? We can't just restrict it to Akqayid and JJ, and so we'll have bullshit increasing exponentially.

I imagine things will be reviewed after the window closes, but let's just leave Twitter in its isolation ward for now.

 

[Sum Monsterism]

I think it's a simple matter of keeping this thread manageable. Yesterday Ackie posted that we were after a 'big name' from Madrid and the tiresomely predictable result was half-a-dozen pages of guesses. We've had similar with 'footballing genius' today. What do you think will happen if we allow Twitter stuff in? We can't just restrict it to Akqayid and JJ, and so we'll have bullshit increasing exponentially.

I imagine things will be reviewed after the window closes, but let's just leave Twitter in its isolation ward for now.

still got 25 pages of bollocks in here today tho...

 

[Scott Spur]

just got back from my first venture to the tw*tter thread...........barely got out alive! MELTDOWN

 

[sunnydelight786]

I think it's a simple matter of keeping this thread manageable. Yesterday Ackie posted that we were after a 'big name' from Madrid and the tiresomely predictable result was half-a-dozen pages of guesses. We've had similar with 'footballing genius' today. What do you think will happen if we allow Twitter stuff in? We can't just restrict it to Akqayid and JJ, and so we'll have bullshit increasing exponentially.

I imagine things will be reviewed after the window closes, but let's just leave Twitter in its isolation ward for now.

Fair enough...

 

[SpurSince57]

Why is that last ITK in the RO? There's nothing ITK about it at all.

I guess, as a matter of courtesy; as I posted a page or two back, Dragon does have high-up sources (or at least did). This is nothing new, though, and much of it's opinionon.

 

[SpurSince57]

still got 25 pages of bollocks in here today tho...

It's been much, much worse in the past. Trust me on this.

 

[spurnut]

One of the few loyalists left...

I still watch this thread so im still here have to say tho I think jj is on twatters payrole, how many of us would have gone on there if it wasn't for him, I know I wouldn't have, anyhoo, any clues on who the genius could be?

 

[spurnut]

Spurscommunity is a whole site. If people are now spending more time on one thread than another then they so be it. They are still on Spurscommunity. I they were leaving to join COYS/FTL/SO etc then I'd be worried. This I still the best place to talk Tottenham. Primarily because it is run so well and gives so many different places to talk about different things.

In fact I would guess that the current situation actually makes it easy to mod the place!

Carry on.

I hear that, I love sc

 

[Pauleta01]

ENIC effectively do own 100%. I have one share certificate as I didn't sell it bacl to them, but once they own >90% of the shares they can effectively cancel the shares they don't own.

However, I can see flaws in the recent spate of ITK.

If ENIC sell some of their stake, that goes directly into their pockets, not into THFC.

They could however, issue more shares in THFC and those shares be acquired by some rich oligarch. That money would go straight to THFC, but it would dilute the value of ENICs shares.

And that's where it falls down.

Say we are currently valued at £500m, of which ENIC owns 100%. Sell it all and they get paid £500m.

If they issue shares equivalent to diluting their holding to 60% (i.e. sort of selling 40% but the money goes to THFC) £200m comes in. But not to them, to the club.

So they have basically given away £200m on the punt that 60% of the new value of the club will be worth more than 100% today.

Personally, I don't buy that they would do that. But I'm happy to admit that I may be completely wrong.

*************
Your post is spot on. But if ENIC do issue a rights issue and use this to finance the new stadium and team investment, their future value of their 60% (assuming this is the number) could be well worth a lot more than their present 100% without the stadium financed. With a 10 to 15 year naming rights deal and an almost 100% increase in match day revenue plus the revenue from future CL campaigns and success brought by the investment they could easily treble or quadruple the current value of THFC (so if assumed £100m now their stake could be worth £180m to £240m by leveraging this investment). With companies valued on value of future revenue potential (one method of valuing it) I do think this is highly plausible. I am also sure that there will be some sort of option for the investors to take a further stake at a future date if all goes well (and they may exit PSG) so could be prudent all round.

Which shows if the ITK is right the appointment of AVB is more critical than ever as there are some multi million '£' gambles going on.

 

[seanyboy]

Say we are currently valued at £500m, of which ENIC owns 100%. Sell it all and they get paid £500m.

If they issue shares equivalent to diluting their holding to 60% (i.e. sort of selling 40% but the money goes to THFC) £200m comes in. But not to them, to the club.

So they have basically given away £200m on the punt that 60% of the new value of the club will be worth more than 100% today.

It's not selling 40% if it's issuing new shares. If THFC issues shares worth £200m to new investors, the new value of the enterprise is £700m. The 500 from before plus 200. If ENIC had owned 100% before, they'd be 500/700=~70% owners. The new investor would be 200/700=~30% owners.

Also, their owned equity stake will not have gone down at all. It will still be worth the £500m that it was prior to investment. The hope therefore is that THFC can take the extra 200 cash and create value (assets such as new stadium -> new players/staff -> on pitch success -> fans -> growth -> higher valuation) such that the combined firm is worth more than £700m it would be with the investment.

This is of course not true if ENIC is just trying to sell some shares (i.e. no new shares), in that case the cash goes to ENIC who would then own, as you said, 60%.

Not trying to attack, just sharing my newfound knowledge of finance (I'm in school for it).

 

[Armstrong_11]

If ENIC sell some of their stake, that goes directly into their pockets, not into THFC.

if we get new owners... we will get new investments. no one will buy an X-Box and not buy games for it right? it's a new toy, and it goes well with alot of expensive accessories.

 

[MattyP]

*************
Your post is spot on. But if ENIC do issue a rights issue and use this to finance the new stadium and team investment, their future value of their 60% (assuming this is the number) could be well worth a lot more than their present 100% without the stadium financed. With a 10 to 15 year naming rights deal and an almost 100% increase in match day revenue plus the revenue from future CL campaigns and success brought by the investment they could easily treble or quadruple the current value of THFC (so if assumed £100m now their stake could be worth £180m to £240m by leveraging this investment). With companies valued on value of future revenue potential (one method of valuing it) I do think this is highly plausible. I am also sure that there will be some sort of option for the investors to take a further stake at a future date if all goes well (and they may exit PSG) so could be prudent all round.

Which shows if the ITK is right the appointment of AVB is more critical than ever as there are some multi million '£' gambles going on.

I agree that the future revenue earning potential most certainly would increase, but the figures people are quoting about being pumped in would just about support a valuation of £500m (admittedly on a very basic back of a fag packet calculation).

When you compare that valuation to say, what Man Utd (allegedly the world's most valuable sporting club) were acquired for there's not that much scope to increase the valuation post rights issue.

Of course, this assumes that any investor would apply logic and would not overpay, something that doesn't hold true given the spending at Citeh and Chelsea for example.

 

[MattyP]

It's not selling 40% if it's issuing new shares. If THFC issues shares worth £200m to new investors, the new value of the enterprise is £700m. The 500 from before plus 200. If ENIC had owned 100% before, they'd be 500/700=~70% owners. The new investor would be 200/700=~30% owners.

Also, their owned equity stake will not have gone down at all. It will still be worth the £500m that it was prior to investment. The hope therefore is that THFC can take the extra 200 cash and create value (assets such as new stadium -> new players/staff -> on pitch success -> fans -> growth -> higher valuation) such that the combined firm is worth more than £700m it would be with the investment.

This is of course not true if ENIC is just trying to sell some shares (i.e. no new shares), in that case the cash goes to ENIC who would then own, as you said, 60%.

Not trying to attack, just sharing my newfound knowledge of finance (I'm in school for it).

No worries, I'm not taking it as an attack.
I'm aware that issuing new shares is not selling, it's diluting. Was just putting it in laymans terms for those not in finance.

And yes, you are correct that the hope is that we take the £200m and add value. As just replied above, I'm a bit sceptical as to how much value building a new stadium will add, if you consider the top end value of football clubs (Man Utd) and the "information" that's rolling around in relation to any new investment.

But, then what do I know. 15 years in finance does not mean I can apply normal business logic to anything to do with a football club.

I do think it can be applied to ENIC's thinking, but as for any potential investor, probably not.