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Thread: Gao FT article

  1. #1

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    Default Gao FT article


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    We have no money and will continue to cut costs. The parent Co(s) are financially fragile. Uncertain times for SFC.

  3. #3

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    Great!

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    Pretty much confirms what we all knew I think. The club is expected to be self sustaining there won't be any help from the owner. Given that we really need to start getting our recruitment spot on we can't afford to carry dead wood on the wage bill and we need to be finding players we can sell on for profit a couple of seasons down the line.

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    Not a surprise, the signs were always there.

    First real statement from Gao and not the most positive one.

  6. #6

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    [/QUOTE] The Financial Times Limited . All rights reserved. Please don't copy articles from FT.com and redistribute by email or post to the web.[/QUOTE]

    unlucky FT

  7. #7

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    Nothing overly negative here, just a confirmation of what we knew i.e he isn't investing anything further. The LD Sports deal does appear shady, will be interesting to see how that develops.

    The real question is, why did KL make out like Gao could take us forward when he obviously can't?

    Gao makes out like self sustainability is new, but its what KL put in place. What does he add?

  8. #8

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    KL couldn't give a monkeys about the future. It was about who would pay the most.

    I fear that in a business where owners do lavish money on their teams, there is an inevitability in that we will struggle.

  9. #9

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    Quote Originally Posted by Saint Billy View Post
    Not a surprise, the signs were always there.

    First real statement from Gao and not the most positive one.
    Well if you want to look at a positive it doesn't look like he is using the club as a source of income he isn't putting anything in but it doesn't look like he is taking anything out which was a fear of some on here. Also while we'd all love loads of financial investment from the owner it PL terms it doesn't look like he has a pot to **** in (worth 147 million?) there is always a fear owners like that will gamble and spend money they don't really have and rake up big debts putting the club in financial difficulty doesn't look like that will happen here so we will be in a safe but rather boring pair of hands.

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    I am so tempted to make more of the "Fattened Pig" analogy but best not.

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    Goa ain't about to tell the FT all his sneaky next level Chinese gov. backed plans is he?



  12. #12

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    Pretty depressing article.

  13. #13

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    Well at least we know roughly how much the new sponsorship deal is worth I suppose....

  14. #14

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    Gao out...

  15. #15

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    If money is that tight how about stopping expenditure on flame cannons, cardboard clappers, over staffing and the like that suggests a somewhat frivolous waste of our precious resources. There seem to be a huge number of staff strutting about on match days these days doing very little. Suspect the organisation is not very tightly controlled and there are a few unchecked little empire builders at large in the building. We need a tough new boss who will focus on what really matters, review staff jobs at every level and cut waste. No doubt there's a few million quid to be saved.

    As for Gao's statement, the sooner he tires of his new baby and badgers off the better.

  16. #16

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    So, basically, he's got no money or intelligible strategy.

    Great stuff.

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    Slightly dubious...

    Mr Gao dismissed these concerns. ďAll companies have their own style,Ē he said. ďAsians tend to be low-key. As long as the money reaches Southamptonís bank account and itís in pounds sterling then itís OK,Ē he said.

  18. #18

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    Cannot wait to see all the business, leisure and residential property development that is definitely going to happen.

  19. #19

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    Quote Originally Posted by angelman View Post
    KL couldn't give a monkeys about the future. It was about who would pay the most.

    I fear that in a business where owners do lavish money on their teams, there is an inevitability in that we will struggle.
    I still don't know why she should have to "give a monkeys". She was at the helm for one of the most successful eras of our existence and still people grizzled and whinged like bi itches. Getting the hell out and leaving us all to it just seems fair enough to me.

    Enjoy "the next level", chumps.

  20. #20

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    The club has to be self-sufficient - good. We don't want to end up like the blue phew and spend beyond our means.

    I don't see the article as being negative, I just see the owner saying he's being careful. At the end of the day, if we have a relatively stress-free season (i.e. we're not in a relegation battle again) then criticism of the owner will die down.

  21. #21

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    Quote Originally Posted by Heisenberg View Post
    Goa ain't about to tell the FT all his sneaky next level Chinese gov. backed plans is he?


    Yep. I've decided we're going to be well funded via some shady, semi government led scheme, routing £££ to us via the new sponsors, in order to further the unknown goals of the Chinese government.

    We'll be fine.

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    We’ll be fine until eventually we’re relegated. Which will happen under this regime eventually.

    Then shit really will hit the fan.

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    I suspect we may be sold again in the not too distant future.

  24. #24

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    Depressing

  25. #25

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    Quote Originally Posted by Dalek2003 View Post
    I suspect we may be sold again in the not too distant future.
    Thought the same. It wouldn’t be a bad thing either.

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    Belt-tightening at the club? Havenít we been doing that since 2014? Not sure why it warrants special mention. Elsewhere in the article it suggests that the focus on austerity reflects the poor performance of Goaís business in China which is a new factor and might mean we see more belt-tightening than weíve seen historically.

    Can a lawyer or accountant explain how Lander Sports Investment, which owns SFC, is unrelated to Lander Sports Development when Goa used his stake in Lander Sports Development as collateral for loans to buy SFC?

    The article does nothing to dispel the suspicions about LD Sports. By Goaís own admission, the company doesnít yet have an operating business and is only launching this summer -notwithstanding the lofty claims it made on its now defunct Chinese website.

    Itís all well and good saying we can spend more on new players than we receive from selling them; but if, as the article makes clear, thatís determined by profits and for a club our size, profits are determined not by commercial revenue but by net spend, then the statement appears pretty circular and vacuous.

  27. #27

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    Quote Originally Posted by benjii View Post
    So, basically, he's got no money or intelligible strategy.

    Great stuff.
    in a nutshell yep

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    Quote Originally Posted by shurlock View Post
    Belt-tightening at the club? Haven’t we been doing that since 2014? .
    still paying off Cortese's reckless spending innt

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    Quote Originally Posted by shurlock View Post
    Belt-tightening at the club? Haven’t we been doing that since 2014? Not sure why it warrants special mention. Elsewhere in the article it suggests that the focus on austerity reflects the poor performance of Goa’s business in China which is a new factor and might mean we see more belt-tightening than we’ve seen historically.

    Can a lawyer or accountant explain how Lander Sports Investment, which owns SFC, is unrelated to Lander Sports Development when Goa used his stake in Lander Sports Development as collateral for loans to buy SFC?

    The article does nothing to dispel the suspicions about LD Sports. By Goa’s own admission, the company doesn’t yet have an operating business and is only launching this summer -notwithstanding the lofty claims it made on its now defunct Chinese website.

    It’s all well and good saying we can spend more on new players than we receive from selling them; but if, as the article makes clear, that’s determined by profits and for a club our size, profits are determined not by commercial revenue but by net spend, then the statement appears pretty circular and vacuous.

    The initial loan would have been secured against Lander Sports and i suspect that it was made up of a main loan McQuarrie which i may well have been the declared value on the BVI 146 Million Plus a mezzanine short term loan from a friend or even a representative on paper loan from Kat !
    This is because NO bank will lend 100 PC of purchase price and they will not allow to secure against the asset you are buying before you buy it.

    Once the purchase was complete the Loan would have be re financed into a full term loan with McQuarrie with the club as the security for it, hence why Lander sports have nothing to do with it , but it does mean the liability for the loan sits now with the securitised asset ....The football club and the stadium.

    Probably the reason KAT stayed in for 20% is simply because he could only raise 80 pc of the purchase price under bank criteria and it pushed the deal over the line.

    The Loan will be at best interest only and will be at circa 4% PA maybe 5% which will be costing 10M per year based on 200m lend without any capital reduction......who do you think will be paying that in this self sustaining model .


    In time this will go only one way , lets hope he sells before it does !

  30. #30

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    Quote Originally Posted by Batman View Post
    still paying off Cortese's reckless spending innt
    In case you missed it in the article - "club’s profits, which were £28.6m last year"
    By all means hate Cortese, though it does help your point of view if you base it on actual facts. We are not in debt now - maybe we were when Cortese left (arguable). New owner does not want to speculate to accumulate, which is entirely his right as he stumped up the money (from wherever) to buy us. Let it go - Cortese left years ago and is not influencing our club now.

  31. #31

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    Isnt being sustainable the correct way of running a business nowadays? You would need to spend millions if not a billion to get us into a top 4 position, so why take a risk? We had our chance a few years ago when it wasnt such a risk but sadly Marcus passed away and NC left.
    We need to regain a bit of stability but also improve the quality of our squad

  32. #32

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    We've always been run this way. No problem with that continuing. As long as we stay in the PL we will be minted. With RH at the helm we are in our best position since the Koeman era. Will be an exciting season for sure.

  33. #33

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    So many prem clubs are in a difficult situation with the long and expensive contracts they have committed themselves to in recent years. We are one, Everton and Arsenal are others I'm aware of as I have mates who support them.....all struggling to off load expensive flops. I'm sure sensible and sustainable management means a more measured approach to agreeing contracts. We don't know how much financial lag there has been from investment in previous years and then there are the contracts for the likes of Forster, Mo, that 'striker', boufal etc etc - all sitting merrily on the balance sheet.

    The days of NC pumping money in to speculate for success are long gone as we know - there is probably still a little bit of a hangover from this plus the financial mess that Reed left us in with his bad deals. If Gao is taking a more nurturing approach then fine, as he clearly wants us to be successful and the comment at the end about spending more than we get in suggests the club is willing to invest where needed.

  34. #34

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    Quote Originally Posted by OldNick View Post
    Isnt being sustainable the correct way of running a business nowadays? You would need to spend millions if not a billion to get us into a top 4 position, so why take a risk? We had our chance a few years ago when it wasnt such a risk but sadly Marcus passed away and NC left.
    We need to regain a bit of stability but also improve the quality of our squad
    Belt-tightening and self-sustaining are not the same thing.

  35. #35

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    Back in league one in five years


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  36. #36

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    Quote Originally Posted by angelman View Post
    KL couldn't give a monkeys about the future. It was about who would pay the most.

    I fear that in a business where owners do lavish money on their teams, there is an inevitability in that we will struggle.
    The top 6 plus Everton and probably now Newcastle are in another stratosphere in terms of spending power. Leicester, Palace, Bournemouth, West Ham have all shown a willingness and ability to outspend us over the last few seasons. Wolves spent circa £30M on Jimenez.
    So we are basically left with Brighton, Burnley, Watford and the promoted teams as financial peers. Its not ALL about finance but it is highly likely/inevitable that we are going to get squeezed out at some point sadly.

  37. #37

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    Imo we've been self sustaining since Kat took control , we've never really had any injections of cash !

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    I've read it, and read this thread. Could someone please explain the negatives of us wanting to be a self sufficient club? Seems better than a debt laden club to me.

  39. #39

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    Quote Originally Posted by charliemiller View Post
    The initial loan would have been secured against Lander Sports and i suspect that it was made up of a main loan McQuarrie which i may well have been the declared value on the BVI 146 Million Plus a mezzanine short term loan from a friend or even a representative on paper loan from Kat !
    This is because NO bank will lend 100 PC of purchase price and they will not allow to secure against the asset you are buying before you buy it.

    Once the purchase was complete the Loan would have be re financed into a full term loan with McQuarrie with the club as the security for it, hence why Lander sports have nothing to do with it , but it does mean the liability for the loan sits now with the securitised asset ....The football club and the stadium.

    Probably the reason KAT stayed in for 20% is simply because he could only raise 80 pc of the purchase price under bank criteria and it pushed the deal over the line.

    The Loan will be at best interest only and will be at circa 4% PA maybe 5% which will be costing 10M per year based on 200m lend without any capital reduction......who do you think will be paying that in this self sustaining model .


    In time this will go only one way , lets hope he sells before it does !
    Lander was in decline for several years before he was forced to sell it, presumably because of the debt he had run up borrowing the money to pay Kat. Our best hope is that he is forced to sell the club sooner rather than later to someone who has money of his own.

  40. #40

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    Quote Originally Posted by simo View Post
    Imo we've been self sustaining since Kat took control , we've never really had any injections of cash !
    Yes, and we have gone from a club with ambition for being regular top 10 to being content to 'stay up'.

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    A perfect opportunity to clarify the squirrel significance and he ducked it. Make of that what you will

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    Quote Originally Posted by OldNick View Post
    Isnt being sustainable the correct way of running a business nowadays? You would need to spend millions if not a billion to get us into a top 4 position, so why take a risk? We had our chance a few years ago when it wasnt such a risk but sadly Marcus passed away and NC left.
    We need to regain a bit of stability but also improve the quality of our squad
    All very good if your youth policy is producing young talent, as off late we are not and now we are in the position of trying to buy it in on the cheap and taking a gamble. Plus we are also trying to offload players where we have little hope in getting anywhere close to our initial outlay.

    A decent injection of funds and then look at being self sustaining would have been much much better but as Gao has no funds to fatten the pig he expects the pig to feed on peanuts but produce decent bacon.

  43. #43

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    Quote Originally Posted by egg View Post
    I've read it, and read this thread. Could someone please explain the negatives of us wanting to be a self sufficient club? Seems better than a debt laden club to me.
    Debt-laden isn't an option. You're either a club where the owner supplements income with injections of cash that convert into equity (max £105m over three seasons), or you're a club that finances itself purely from tv, sponsorship and player sales. Either way, FFP means clubs can only really be in debt to their owners, and even then not for very long without the debt being converted.

    Leaving aside the top six, whose commercial incomes are so much bigger than ours they don't warrant comparison, you'd have to say that the spending patterns of the likes of Bournemouth, Leicester and Everton suggest their owners are providing additional funds, while Gao is saying categorically that he wont.

  44. #44

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    Quote Originally Posted by charliemiller View Post
    The initial loan would have been secured against Lander Sports and i suspect that it was made up of a main loan McQuarrie which i may well have been the declared value on the BVI 146 Million Plus a mezzanine short term loan from a friend or even a representative on paper loan from Kat !
    This is because NO bank will lend 100 PC of purchase price and they will not allow to secure against the asset you are buying before you buy it.

    Once the purchase was complete the Loan would have be re financed into a full term loan with McQuarrie with the club as the security for it, hence why Lander sports have nothing to do with it , but it does mean the liability for the loan sits now with the securitised asset ....The football club and the stadium.

    Probably the reason KAT stayed in for 20% is simply because he could only raise 80 pc of the purchase price under bank criteria and it pushed the deal over the line.

    The Loan will be at best interest only and will be at circa 4% PA maybe 5% which will be costing 10M per year based on 200m lend without any capital reduction......who do you think will be paying that in this self sustaining model .


    In time this will go only one way , lets hope he sells before it does !
    Made up numbers and made up facts - it’s a good story, but just a story.

    I’m neither pro, nor anti GAO. We’ve struck lucky with just one owner in the time I’ve been supporting Saints, and even with Marcus no-one knows what his attitude to spending would have been once we reached the promised land of the PL.

  45. #45

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    Quote Originally Posted by egg View Post
    I've read it, and read this thread. Could someone please explain the negatives of us wanting to be a self sufficient club? Seems better than a debt laden club to me.
    We have a debt ...the money used to buy us to macquarrie bank what else could he secure 200m against he has nothing now lander has gone to the wall

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    Any business (and that is what Saints are) should be self-sufficient. Look down the M27 to see what happens when you spend beyond your means.

    We are a small fish in a big pond and will never have the allure or attraction of much bigger clubs - some years we'll punch above our weight, others we will struggle. In my 40+ years of supporting Saints it has never been any different.

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    If he’s not putting money in to improve our value and he’s not taking money out, what’s in it for him?

  48. #48

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    Quote Originally Posted by for_heaven's_Saint View Post
    If he’s not putting money in to improve our value and he’s not taking money out, what’s in it for him?
    Status - Chinese are very materialistic.

  49. #49

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    I wasnt expecting the owner to throw money around and with financial fair play its not going to happen in the Premier League.

    The lack of commercial revenue is the most criminal part to whats happened over the last two years from Gao and now we have seem some, it looks predictably shifty and played out with a fake website with farcical claims.

    As we have seen getting players on the cheap and doubling or more in fees is a very limited practice.

    Its clear to me he has no idea what hes doing and nore do his associates.

    I can see now why both Reed and Krueger actually left to other jobs and not as claimed being sacked.

  50. #50

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    Ah well let's all give up. No ****ing point to it anymore. After all as fans we're entitled to a rich owner, aren't we?

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