Official Takeover Thread

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Re: Official Takeover Thread

Postby Ezeikial » Sat Jan 05, 2019 11:07 pm

thecaptain wrote:


What information is out there is that Paul and Andy got a fair price for the club, the club is being prudent and not spending beyond it's means and it was confirmed several times there's still a fair chunk of wedge in the bank post takeover from the euro run.

Andy and Paul got paid whatever was agreed/ the going rate and the cash in the clubs bank account was left as is from the euro run was the general gist of things, despite the lads being well entitled to take a dividend before they sold up, though the cash in bank was a massive asset on the books for Peak6's interest in buying the club, as far as I was aware and from what I was told?



I'm confused by this -

1) Is there any reliable information about the purchase price paid by Peak6 or any other elements of the deal?

2) Where/by whom was it "confirmed several times" that the previous owners did not extract a dividend and/or that the purchase deal included the euro cash in bank?

3) is there any reliable evidence available to anyone (including Gavin, James, or Gerry) to indicate whether or not a leveraged buy out is in place?

My understanding was that all of the above is not in the public domain


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Re: Official Takeover Thread

Postby oldfogey » Sun Jan 06, 2019 1:46 am

All this talk of leveraging would have you believe we were a Premier Division or Championship side worth hundreds of millions. DFC's only real asset was SK and the squad and, as we have seen, there is no way of guaranteeing their retention. There is little value in foisting a debt onto the club as it will inevitably be wiped if Peak6 sell up and move on. Like it or not, there are no Dundalk fans out there who can buy the club and invest money in it - to make us stronger - without wanting a return. Someone who will build a stadium is even less likely as there would never be anyone to sell it on to.

I do still believe that Oriel Park will either be redeveloped or replaced but the owners will need convincing that on field success can continue, and match the substantial investment required, from whatever source

People have been comparing last year to 2016. Personally I prefer not to go there as the subsequent season was relatively underwhelming/a disaster, depending on your point of view. Which was worse, losing Stephen Kenny, or losing Horgan/Boyle/Finn?

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Re: Official Takeover Thread

Postby dell1 » Sun Jan 06, 2019 5:07 am

Only time will tell. The most significant piece of info that would be nice for supporters to know and its unlikely to happen is the point at which the owners are covering their roi eg just qualification for Europe or whether progression of x number of rounds. Getting to group stages is obviously what they want to make their killing but what is their minimum need for the team to reach to keep their interest!?

Losing SK was a blow, VP could well pick up where SK left off, I feel confident that he will and I'd usually be the more negative type of football supporter. If the current management setup doesnt work i'd imagine that Peak6 would look to appoint at least another coaching team and it would be if there was no progression then that we'd have to start worrying about their true committment or whether they would cut and run.
As it is the investment group all now have different levels of interest. 2 of those sitting with DFC scarfs at the first meeting havent been seen in Oriel since have they and are probably just looking at the finances. The Chairman on the otherhand seems to have gotten a bit more attached to the club than just the numbers. It could well be MTs enthusiasm and possible affinity that he's built that is speeding up the improvements in the YDC and maybe other stuff in due course. Here's hoping so!!!

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Re: Official Takeover Thread

Postby El Paso » Sun Jan 06, 2019 10:35 am

None of us know the full story. Peak6 don't own us directly, they are investors in the new company formed that bought us. Gardner and Woolfolk aren't Peak6. Peak6 are in with Bournemouth, but Jordan Gardner is an investor in Swansea.

Peak6 state that they are hands on investors with their 'partner companies'. Mike Tracey is listed on LinkedIn as being a 'Trader' with Peak6, and our chairman, and that he finished as 'Analytics Manager' at Bournemouth last month. Tracey is all in with us, because success with us will mean career success for him at Peak6 (that's not a criticism, probably a good thing). He seems to be small enough fry at Peak6.

The company that now owns us technically owes the money used to buy us back to those investors. Whether or not they used their own cash or borrowed the money I obviously don't know. But I'd be surprised if it was cash sitting in the bank that was used.

My guess is that the club is expected to grow and be self-sufficient from here and that none of the original investors intend investing any more money. Maybe they will if there's a crunch, but any capital investment will have to come from money the club borrows. Peak6, Corey Woolfolk and/or Jordan Gardner are not pumping any money into Oriel Park.

If it all goes tits up then it's possible the investors will all write their original investment off, but only if they have no choice.

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Re: Official Takeover Thread

Postby thecaptain » Sun Jan 06, 2019 6:20 pm

Ezeikial wrote:
thecaptain wrote:


What information is out there is that Paul and Andy got a fair price for the club, the club is being prudent and not spending beyond it's means and it was confirmed several times there's still a fair chunk of wedge in the bank post takeover from the euro run.

Andy and Paul got paid whatever was agreed/ the going rate and the cash in the clubs bank account was left as is from the euro run was the general gist of things, despite the lads being well entitled to take a dividend before they sold up, though the cash in bank was a massive asset on the books for Peak6's interest in buying the club, as far as I was aware and from what I was told?



I'm confused by this -

1) Is there any reliable information about the purchase price paid by Peak6 or any other elements of the deal?

2) Where/by whom was it "confirmed several times" that the previous owners did not extract a dividend and/or that the purchase deal included the euro cash in bank?

3) is there any reliable evidence available to anyone (including Gavin, James, or Gerry) to indicate whether or not a leveraged buy out is in place?

My understanding was that all of the above is not in the public domain



https://www.independent.ie/sport/soccer ... 06026.html

No terms have been disclosed but it's understood that the initial payment to take 100pc ownership is a substantial six-figure sum.

Brown and Connolly cleared debts of €192,000 when they took over the troubled club in 2012 and then dug into their pockets to improve the first-team squad.

They leave the club with the finances in a healthy state and in the rare position of having turned a profit on their investment.



https://www.pressreader.com/ireland/iri ... 2510206277

Brown and Connolly felt that stage of development was beyond them, although it’s understood they have left the club in a healthy financial position with monies left over from the 2016 Europa League run that put the club on the map.


There's two I found from a quick search and it was widely reported at the time so the articles will be up online somewhere. Obviously there's things they can quote verbatim into the public domain and then things said off the record that are generalised or a source said etc.

As was mentioned we have absolutely SFA assets that a leveraged buyout would have been able to have been used as collateral for loans against. Somehow I doubt Merrill Lynch and so on would accept the lads one year contracts (at the time) as collateral for a loan of a couple of million!

In a leveraged buyout the assets of the company being bought are used as the collateral for the loan by the buyers. Then post sale the loans are then transferred and front loaded onto the purchased companies books at extortionate repayment and interest rates so the buyers don't have to dip their own hands into their pockets which is what the Glazer's did. Not a hope in hell even if the collateral was there that the club would have the income rates to meet the repayments.
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Re: Official Takeover Thread

Postby El Paso » Mon Jan 07, 2019 7:58 pm

That reads like the club was sold for less than a million. Chicken feed really, given the annual income we get from Europe just for taking part. Slightly amazing, though, that the club would be sold for less than the cash it has in the bank.

So in terms of investment, then, in the last 12 months, we have the longer contracts, some ground works and the improvements to the YDC. The operating costs, contracts/pay and ground works will have come from the operating budget. Matchday revenue, sponsorship and prize money will have been maybe (fag packet calculation) 1.5 - 2 million, which I would guess is roughly budget neutral.


You're probably right that the buyout wasn't leveraged. But I'd still love to know how the investment is structured. Have Peak6, Gardner, Woolfolk (and Fred Spencer - the guy I forgot about who looks like he's about 12 years old) bought equity in Dundalk, in which case 'the value of the investment may fall as well as rise' or have they loaned the money to a new company that bought Dundalk, in which case Dundalk is in debt to those guys?...

The reported €300K for the YDC might be the first actual money investment from the new owners. So how did they fund it? Out of the remnants of the 2016 euro cash? By injecting more of their own funds and buying more equity? Or by the club borrowing it?

Same question for additional investment - will it be money borrowed by the club or these guys pumping in more of their own funds? My guess to all these questions is that it's money the club is borrowing. Therefore any 'investment' is debt on the club.

I'm not personally worried about their ownership. As long as we keep qualifying for Europe, i.e. stay in the Top4, we'll be fine. But I still have no reason to believe anything substantial will ever happen at Oriel unless it's forced on them.

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Re: Official Takeover Thread

Postby dell1 » Tue Jan 08, 2019 2:44 am

So the new owners were able to buy a company with say €2million cash reserves for a fraction of that amount, without taking in to account other assets like the ground/YDC, players etc and the guaranteed participation money from Europe to come!? The FastFix lads may have just wanted rid of the club for whatever reason and practically gave it away in a very generous manner and also being very trusting of the new guys who could have taken the money in the bank and then walked slowly away.

This is probably a far too simplistic way of looking at it but isnt like buying a house for a lot less than its worth and getting the previous owners bank savings with it.

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Re: Official Takeover Thread

Postby Ezeikial » Tue Jan 08, 2019 9:08 am

Although the next CRO returns may shed some additional light, the exact details of the transaction are obviously only known to a relatively small number of people and it's natural that people will try to speculate based on snippets of information. Sometimes this leads to people, in good faith, presenting what they have been told or read as being fact.

What The Captain quoted from Daniel McDonnell in the Irish Independent in Jan of last year is worth repeating
No terms have been disclosed but it's understood that the initial payment to take 100pc ownership is a substantial six-figure sum.

https://www.independent.ie/sport/soccer ... 06026.html

Even if you take this as at face value (Daniel McDonnell can only report what he has been told), it is clearly suggesting that "this substantial six-figure sum" is an initial payment. It sheds little light on what was paid (or is due to be paid) by the current owners.

The suggestion that someone could acquire the football club along with many millions of cash in the bank for some hundreds of thousands of euro seems bizarre and improbable to me .

That said, I'm not sure that this is a particularly important point in itself. To me the financial issues are more about
1) the owners willingness and ability to invest further in the club to try to achieve domestic and European success
2) The doomsday scenario/Exit strategy - the debt and solvency risks for the football club should the current investors decide to withdraw in the future
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Re: Official Takeover Thread

Postby Ezeikial » Tue Jan 08, 2019 10:21 am

Caoimhin Reilly reporting on the Jordan Gardener Planet Fútbol podcast that was linked here previously.

He is also strong on talk of visions

“The end goal is to try and execute a vision."


https://www.dundalkdemocrat.ie/news/spo ... -goal.html
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Re: Official Takeover Thread

Postby thecaptain » Tue Jan 08, 2019 11:08 am

My thinking on it is that the consortium paid the six figure sum, whatever that was, on the basis that the cash in the bank from the euro run wasn't taken out by Paul and Andy as a dividend before they sold up. Knowing the lads by rep and a little I'd assume they wanted to leave the club better than they found it and wouldn't have taken the dividend, either way they've got a good return on their investment and it's worked out well for all so far anyway.

With the takeover being for a high six figure sum I'd say it was a "cash" transaction so to speak, i.e. no loans taken out by the consortium itself with Peak6 fronting the consortium with the other individuals then. Maybe personally some of the consortium would have gotten loans for their part of the pie/ bid but the consortium itself wouldn't have taken a loan out en masse for the purchase. All speculation on that though!

While that amount is serious money for us, in the grand scheme of things for these lads and football outside Ireland in general it's a pittance relatively speaking. The only assets the club had at the time were the YDC which needed a hell of a lot of work done to it and the playing squad who were nearly all on 1 year deals at the time so not worth a jot really as an asset. We don't own the ground so that's not an asset the club can place on it's accounts, despite the long term lease, so the YDC and cash in bank were the only two real assets on book.

All speculation on whether the improvements so far in the last 12 months have come out of capital in the bank from the club or from investment from the owners, as I mentioned and as Ezeikial said that will be clear when the books are out later this year on the balance sheets. I'd say it's from the cash in bank the club has already.

There was a lot of misgivings this time last year but I think if we look at the things done over the last 12 months the new owners have done a reasonable amount in such a relatively short space of time. The likes of long term contracts and nailing the squad down so if anyone moves we'll at least get a fee, the puddle(:D), the YDC improvements, professionalising the club (if that's a term) behind the scenes too etc. Really things only started moving from the Summer on when the new owners got their feet under the table and assessed everything in their first 6 months.

The new stand in Tallaght cost €1.9 million paid for by SDCC so it's important to bear in mind it's not exactly chump change to do any major renovation works to Oriel at a cost to the club as opposed to Rovers just being tenants and not having to dip the hand in their own pocket. I remember them basically saying as well that any upgrades to Oriel would be incremental and dependent on income so I.E. euro money coming in.

Personally I'm fine with that approach spending money that you have in the bank and not taking out loans that have to be repaid over the years and leaves things open to worst case scenario if things go belly up. Cut your cloth accordingly as the saying goes. I know there are other plans in the works at the club medium to long term to sort things out generally but I haven't a clue on the specifics though.

The interesting thing to watch for is in year 2,3,4 etc with the new owners is whether or not they start taking a dividend out of the club for a return on their investment. I'd say they will to some degree or another as they didn't buy us out of the goodness of their hearts!


Jaysis, this ended up longer than I thought it would be! Parklife! :D
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Re: Official Takeover Thread

Postby dell1 » Tue Jan 08, 2019 11:09 am

For all the times I read the various reports I missed the key word of 'initial' payment in Daniel's piece. That makes some more sense than the suggestion of offloading the club with cash reserves for significantly less than that value. Albeit speculative, It would also be a good reason why the takeover of the club took so long to complete in the end where some balance may have been struck between the initial payment and performance related future payments. If the club were ever to make CL groups never mind EL it is sound thinking that there is a formal agreement on getting some of the money back that was put in to the club by the last owners rather than the acrimonious situation that occured with Gerry Matthews where he felt entitled to get some payment toward improvements he made when the club subsequently generated a decent financial surplus.

I agree that it matters little, and details are scant but indication of the sort of money paid for the club would also be an indicator of the sort of financial committment made already by the new owners, that could not be dipping in to the cash reserve for increases in the playing budget and 300k on the YDC for example; Therefore the owners not spending too much of their own personal money while technically seeing a return already by aquiring the club and its bank balance for a lot less than that bank balance (if that makes sense?). While money spent out of the reserves is the owners money its like having a free bet with minimal impact on their personal wealth and minimising their actual 'investment' in the club.

As mentioned before, making a financial committment on improving spectator facilities at Oriel Park, or not, will always be the only real indication of the genuine long term involvement of the owners imo, with or without another European windfall. As for what might happen if Peak6 decide to leave in the future, is it legally possible that the previous owners (alleged) low pricing of the club could also be due to clauses insisted upon in the sale that safeguards the club in some way? eg debts get paid or are underwritten by the vastly wealthy Peak6 (as opposed to the consortium of owners), club is transferred back to Fastfix lads for token payment etc? Can such clauses exist in the sale of a company/football club. Not that I think they will walk away especially as we are (currently) set up to qualify for Europe annually and with a third tier UEFA competition increasing opportunity for LoI champions in future, I am probably clutching at straws if things go sour especially when you consider how the recent change of team management and issues with senior club admin could be a disruption to our recent dominance.
Last edited by dell1 on Tue Jan 08, 2019 1:13 pm, edited 1 time in total.

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Re: Official Takeover Thread

Postby Ezeikial » Tue Jan 08, 2019 12:01 pm

thecaptain wrote:My thinking on it is that the consortium paid the six figure sum, whatever that was, on the basis that the cash in the bank from the euro run wasn't taken out by Paul and Andy as a dividend before they sold up. Knowing the lads by rep and a little I'd assume they wanted to leave the club better than they found it and wouldn't have taken the dividend, either way they've got a good return on their investment and it's worked out well for all so far anyway.

With the takeover being for a high six figure sum I'd say it was a "cash" transaction so to speak, i.e. no loans taken out by the consortium itself with Peak6 fronting the consortium with the other individuals then. Maybe personally some of the consortium would have gotten loans for their part of the pie/ bid but the consortium itself wouldn't have taken a loan out en masse for the purchase. All speculation on that though!



I fully accept that you believe this "six figure sum" as being the actual purchase price. I'm sure you would also accept that while you may well be 100% right, you could also be way off. Daniel McDonnell's piece also indicates that this amount is not the full consideration

Paul and Andy's bona fides are not in question here, but surely selling a multi-million asset at that price does not appear in keeping with the work of intelligent hard-working business-savvy individuals that they cleary are

thecaptain wrote:
There was a lot of misgivings this time last year but I think if we look at the things done over the last 12 months the new owners have done a reasonable amount in such a relatively short space of time. The likes of long term contracts and nailing the squad down so if anyone moves we'll at least get a fee, the puddle(:D), the YDC improvements, professionalising the club (if that's a term) behind the scenes too etc. Really things only started moving from the Summer on when the new owners got their feet under the table and assessed everything in their first 6 months.


I think they have done well so far and I remain cautiously optimistic, but believe that this transfer window will give us a better handle on progress
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Re: Official Takeover Thread

Postby Martin Lawlor80 » Tue Jan 08, 2019 10:22 pm

Interesting tweet from MT yesterday regarding Georgie Kelly : ‘We taught Georgie how to trade volatility over the offseason. Putting in equal effort off the pitch and taking advantage of educational opportunities!’.
Kelly has a BComm from UCD . Good stuff from MT to help him with his studies and maybe a career after ball

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Re: Official Takeover Thread

Postby thecaptain » Wed Jan 09, 2019 9:56 am

Ezeikial wrote:
thecaptain wrote:My thinking on it is that the consortium paid the six figure sum, whatever that was, on the basis that the cash in the bank from the euro run wasn't taken out by Paul and Andy as a dividend before they sold up. Knowing the lads by rep and a little I'd assume they wanted to leave the club better than they found it and wouldn't have taken the dividend, either way they've got a good return on their investment and it's worked out well for all so far anyway.

With the takeover being for a high six figure sum I'd say it was a "cash" transaction so to speak, i.e. no loans taken out by the consortium itself with Peak6 fronting the consortium with the other individuals then. Maybe personally some of the consortium would have gotten loans for their part of the pie/ bid but the consortium itself wouldn't have taken a loan out en masse for the purchase. All speculation on that though!



I fully accept that you believe this "six figure sum" as being the actual purchase price. I'm sure you would also accept that while you may well be 100% right, you could also be way off. Daniel McDonnell's piece also indicates that this amount is not the full consideration

Paul and Andy's bona fides are not in question here, but surely selling a multi-million asset at that price does not appear in keeping with the work of intelligent hard-working business-savvy individuals that they cleary are

thecaptain wrote:
There was a lot of misgivings this time last year but I think if we look at the things done over the last 12 months the new owners have done a reasonable amount in such a relatively short space of time. The likes of long term contracts and nailing the squad down so if anyone moves we'll at least get a fee, the puddle(:D), the YDC improvements, professionalising the club (if that's a term) behind the scenes too etc. Really things only started moving from the Summer on when the new owners got their feet under the table and assessed everything in their first 6 months.


I think they have done well so far and I remain cautiously optimistic, but believe that this transfer window will give us a better handle on progress



Oh aye of course, I just said that six figure sum as a catch all term for whatever was paid up front and whatever on the drip then/ whatever the deal was and sure said myself all speculation! As we mentioned we'll see when the books are filed later this year anyway.

Transfer wise I think we'll see some activity in January or Feb (as our deadline is still open post 31st Jan for international transfers) with one or two from outside of Ireland coming in to round out the squad.

From last years sports capital grants I think if my memory served the club got a few bob towards the kit out of the YDC, I could be wrong but think it was 60k towards the initial refurb? Then the additional work/ 300k the club spent on it.

Deadline for applications for the sports capital grants is end of February so it'll be interesting to see if the club have applied for anything this year. Personally I think that's the only way we'll see any movement on significant works being done to Oriel, grant allocations & then the club dipping in to the reserves to pay the balance of whatever is done piece by piece.

I vaguely remember last year reading of a new ring fenced fund for infrastructure improvements outside of the CSG, can't remember for the life of me how much it was for though. Moving into ground standards thread territory here so I'll stop there!
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