Ashley Running NUFC For His Benefit, Not The Fans
Yes it is great that the club isn’t losing money as shown in the latest accounts but don’t believe everything you read….
When there has been positive news on Newcastle United to report, Ashley & Llambias have used the opportunity to push as much stuff out as possible which portrays them in the best possible light. Very rarely do the people paid to report on Newcastle United, on and off the pitch, give the information pushed out by the club any kind of a critical eye.
Today we have the following….
Mike Ashley wipes Newcastle United’s £75m debt
by Dan Warburton, Evening Chronicle
Ashley has wiped clean the club’s overdraft and external debts – figures which stood at more than £75m when he took control of the club and cost around £6.5m a year in interest.
In absorbing the club’s debt, the sports tycoon is now owed £140m, which he confirmed would still be available interest free.
A few things need to be understood here.
The bulk of that £75m and most of the £6.5m interest relates to a loan that was taken out by the Halls/Shepherds and was a kind of ‘mortgage’ secured against future season ticket sales to pay for the development of St.James’ Park. When Mike Ashley didn’t do his due diligence this debt was the main nasty surprise he found when he walked into St.James’ Park, an amount of around £50m that was repayable on demand if the club was ever sold….
It is rumoured that as soon as he found this information out, that the club wasn’t quite the bargain he thought, he instantly tried to sell NUFC on but couldn’t find a taker.
So, he has bought a business with £75m worth of debt and interest payments of £6.5m a year. If you owed £1000 and were paying £100 a year interest, while in another account you had £1000 earning next to nothing in interest, what should you do?
Obviously you pay off the £1000 debt with the other £1000 and save yourself the best part of £100 a year. Simples.
This isn’t a direct criticism of Mike Ashley, more a criticism of the easy ride Ashley & Llambias are getting in portraying themselves as benefactors at Newcastle United.
Ashley is a very successful businessman and it was obvious, but good business, to use money he had elsewhere to save himself the best part of £6.5m a year.
He owns all of Newcastle United, when he is doing anything to save Newcastle United money he is doing it to save himself money!
Mike Ashley is not doing this because he wants to do us, the fans, any favours. He wants now to do the best job in running the club to get the best possible deal when he exits St.James’ Park, keeping costs down as much as possible and then hopefully recouping as much money as he can when he sells it on. He got stung when he bought it and then increased the club’s (his!) debts when he led Newcastle United to relegation in one of the most mismanaged seasons in the club’s history! Have people really forgotten how he brought Keegan in then undermined him with Wise, Jiminez and all the other jokers, or employing Joe Kinnear to stagger around swearing at and upsetting everybody, while dragging the team down with him?
Well done to Mike Ashley for employing Alan Pardew and Graham Carr, plus for having the deep pockets that meant he could afford to protect his asset (Newcastle United) when he’d all but ruined it with the relegation the Halls and Shepherds had been leading us to for some time. Now if we’d got relegated with that lot we could have really been in big big trouble.
Just don’t tell me that Mike Ashley is doing what he is doing for me or you!
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