After the Newcastle Takeover vents (or lack of them) on Tuesday night, the question that I have been asking myself and friends, is quite a simple but important one…

Why would Mike Ashley sell Newcastle United?

Below is a table showing the Premier League prize money breakdown for the 2016/17 from BBC Sport.

What it shows is a grim and sobering reality for fans anticipating the club being sold any time soon. As we can see, the mackems and the smoggies pocketed £93m and £98m respectively for their efforts during last season, a season in which they both got relegated.

Due to his own calamitous running of the club, Ashley didn’t see anywhere near that kind of money as we were toiling away in the Championship (ED: NUFC receiving over £41m in parachute payments and £5m for winning Championship) but you can rest assured that those figures will be the minimum he receives for wherever the club finishes this season.

Take a look at Swansea City who finished last season in 15th position and who are odds on for the drop this campaign, it’s the very place that Newcastle currently occupy. It’s fairly reasonable to assume that we will take home at least roughly the same figure as they did at the end of this season.

mike ashley

Furthermore, it’s worth noting that Swansea, Burnley, Hull and the mackems all had ten live TV appearances throughout last season and will have been paid accordingly. By the time Newcastle play Man Utd in February, we will have already had 14 Premier League Live TV dates (plus fourth round FA Cup match), no doubt due to the fact that TV broadcasters love the pantomime that follows this club, but it’s still money rolling in all the same.

How much we will receive this season for the pleasure of being viewed by the nation isn’t known for certain, but just going off what clubs received in prize money alone in 2016/17, it’s my assumption that Mike Ashley WILL give manager Rafa Benitez some capital to go and buy players in the Summer.

That’s the only good news that I can deduce, as I would estimate our extra prize money figure if staying in 15th will be the same that Swansea received last season (almost £12m – just under £2m for each extra place you finish up the league).

As we know, whatever Rafa Benitez gets to spend is unlikely to be enough to make a meaningful contribution and it will be touch and go with regards to what division we are playing in next season.

I’m of the opinion that Ashley will allow some cash to be spent as a calculated risk to avoid dropping into the Championship and who knows it may work, but any notion that he will spend fortunes can be discounted straight away as he will pick up around £100m if the club gets relegated regardless and that’s before parachute payments. So why spend needlessly?

The table also gives a little insight into why Ashley won’t sanction big spending as if Rafa was given say £50m+ to spend, the difference between finishing where Southampton did (8th) and fourth bottom is around £20m. In the penny pinching world of Mike Ashley the rewards don’t match the expenditure risks.

This is the cycle we are now stuck in, unless Amanda Staveley (or whoever) comes in with a silly bid, I don’t think Mike Ashley will be inclined to sell, as any bid will have to compensate the possible loss of £100m per season, a figure that will only rise further with the increasing TV deal due in February. With this in mind, a £250m takeover bid was never likely to be accepted. It’s simply too low for Ashley to give up the prospect of untold fortunes on what he will see as minimal spend for maximum gain.

So as much as it pains me to say it, unless there’s a dramatic change in what he is being offered, disappointingly I think we are stuck with Mike Ashley for some considerable time.

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  • Roblee7

    I kind of agree but if this is the case why did he put the club up for sale in the first place?

    • Rich Lawson

      You’d just have to assume greed and boredom,presumably thought the club would sell quickly at a higher price and lock in a 3-5yr deal for continued free advertising.I’m only guessing, like the rest of us ?

      • TheNutJob

        you could well be right

    • TheFatController

      The club doesn’t make profit, he loans it money to survive without profit. Why? To sell it and get a profit on the loans (hence he wants £300m+)

      Unfortunately he can’t find a buyer. So he’ll continue to run at a loss, only spending what the club makes but being left behind as other clubs invest in scouting, commercial revenues etc, where clearly we don’t.

      He will never get his loans back unless it’s sold. He wants that money back. He assumed someone would pay £300m+.

      We all know how that has played out…

  • MichaelMaximusMoose

    Those figures show exactly why Fatso won`t accept £250m,
    then there`s the TV deal next month. Oh & the live Tv fee

    • Guest 2

      And those figures show why the Club never releases full and separate accounts. It’s so we cant see where the money is going.

  • Peter Stabler

    Does Rafa stay or does Rafa walk? He is the canary in the coal mine. If he thinks there is a plan that can work he might stay if he can’t see it he should walk. If Rafa walks it should be a starting gun to oust the oaf. I can stay away if it is someone like Mark (it was the ref’s fault) Hughes in charge.

  • mactoon

    Also, don’t forget that details of the new TV rights deal will be released in February. This is rumoured to be far bigger than the current deal and will start next season, this together with the continued free SD advertising suggests he will be in no hurry to sell unless he receives a bid HE decides is enough to make him walk away.

    With regards to Rafa I doubt he will walk away until the summer. He may be looking at the bigger picture of the current owner providing some of this years TV money for summer transfers or a new ownership providing a totally new way of running the club. Oh… and he would lose a stack of money by walking now.

  • magpiefifer

    Under the ‘control’ of this clown the only way is down – and Rafa will leave in the Summer!

  • Monkseaton Magpies

    It is not like Mike Ashley is taking anything out the club in wages, dividends or bonuses he is not. He is saving us round £7m a year interest payments to Barclays with an interest free loan so in my book this more than equates to his free advertising. If we get an extra £100m in T.V money it will give more scope to buy players. What some people on this site do not realise is that he is not taking any money out the club and most of the revenue goes on operating costs. Next year there will be more money to spend whoever is in charge but this money is not going to our owner not one penny has since he has been here.

    • TheFatController

      Why not employ a top level CEO? Why not maximise commercial revenues by employing a team? Why not invest in youth and scouting? Why not communicate with the fans? Why not be honest?

      You seem to think we hate him for not putting enough money in?

      I hate him because he runs the club at a bare minimum, killing motivation and momentum, which are vital in sport.

      Also, he has had one piece of good fortune in securing rafa when he was out of work and looking for a new challenge. When Rafa feels the challenge is futile and goes, he’ll struggle to get a good manager because he doesn’t respect people who don’t need the job, so will revert to tying up a manager not up to the job.

      • FatParosite

        There is no point trying to educate Monkseaton Magpies. He’s a spambot made by Bishop’s PR agency. Save your typing fingers & salient points for someone not born of a calculator.

        • TheFatController

          True. But some don’t understand the simple truth of Ashley’s ownership – he bought to sell at a profit.

          the analogy is that the mortgage is higher than the value of the house, but obviously no one pays more than a house is worth to help out the owner and his mortgage problem.

          Ashley was greedy, bought the club to sell at a profit, but has never been offered a profit for it. That’s the full story of his ten years of ownership…he doesn’t want to siphon a few million here and there, he wants a sale at £100m profit

          Whether it’s a bot, Bishop or Barnes, I simply put the truth by reply so no one is hoodwinked by/ about the true nature of the regime and the sale of the club…

          • FatParosite

            I notice the bot hasn’t spammed since…

          • TheFatController

            He rarely replies when I use business or financial logic. Unless he just changes the subject with more ‘isolated facts’.

            He has to win even in the face of logic. Which makes his brain bend, it’s hilarious.

    • Guest 2

      LOL! He’s taken out 33 million and added it to the club debt as further loans – to repay himself. How long do you think the 45 million of mortgage would have lasted? Your 7 million in interest a year never decreases. You really are a moron.

      • Cockneytrev

        👏👏👏👏👏

      • Monkseaton Magpies

        He is entitled to repay loans he has put in that is not taking money out of the club in real terms like wages and it just means when he sells the club he will get less money. He increased the loan from £129m to £140m then back down again this is not taking money out the club in terms of profitability.

        • Guest 2

          BS. He loaned the club more money – in order to repay himself. The club debt stands at 144 million now since the 33 million loaned in Dec 2016 (18 million going to himself). When the club gets sold he gets the entire lot back as its DEBT on the books which needs to be cleared – club/busniess debt, not his.

          • Monkseaton Magpies

            The £18m was not paid to himself the only way you can take money out of a club is wages dividends and bonuses
            which he did not receive. The only money he took out reduced his loan and that is the truth.

          • Guest 2

            Yes, it was paid to him. St James Holdings repaid Mike Ashley 18 million (from a 33 mil loan) – and all of it was added to the club debt. Exactly what he did in 2012 after the first relegation when he repaid himself also.
            So Mike Ashley’s company loaned money to Mike Ashley’s football club, in order to mostly repay Mike Ashley.
            Go read the accounts you simpleton.

          • Monkseaton Magpies

            If any cash is taken out the club the cash balance is reduced and so is the debt it is basic double entry book keeping. If it was not the debt reduced where is the other leg in the accounts wages dividends or bonuses there has to be one. My understanding is this. First loan £110m second loan £30m total loan £140m as confirmed by the accounts. Repayment to Mike Ashley £11m new total loan £129m as confirmed by last years accounts.

          • Guest 2

            Proves the [email protected] you speak. 129 million of debt included 18 mil owed to Ashley personally. 111 mil was a club debt.

            Dec 2016 another 33 mil was loaned by St James Holdings – 18 mil repaid to Ashley himself, now resulting in 144 mil of debt in the club accounts.

            So, fatty managed to recoup 29 mil of personal loans, by loaning money from St James Holdings. He got personally repaid, but as a result the business debt owed by the club has increased.

            I wouldn’t let you near your kids piggy bank.

          • Monkseaton Magpies

            Sorry you have got this wrong where is the other leg of him taking the money out wages dividends bonus or repayment of the loan.

          • Guest 2

            Where? In the accounts that’s where. 29 million in total repaid to Ashley – funded by further loans from St James Holdings and added to the club debt.
            I ain’t got nowt wrong, fatty lover.

        • TheFatController

          His loans are secured against profit from the future sale of the club.

          A good owner would plan to pay back loans from profits made by investing in his company.

          He’s not here to make the club progressive, he’s here to sell it to people with more money than sense.

          He’s finding that the world’s Investors have money, but sense also.

          • Monkseaton Magpies

            In truth we have not got the money in the bank to repay his loan. There is hardly any money left to buy players never mind repay him. Yes he could have got more sponsorship
            than perhaps he has or put more money in which he is not prepared to do so that’s the reason his debt remains. If the debt reduces by the way to him so does the sale value of the club so if we can pay him back any money it’s a good thing for selling.

          • TheFatController

            The debt would be reduced if he didn’t get us relegated by employing managers like carver and MacLaren who all PL clubs won’t touch with a barge pole.

            He picks the managers, they get us relegated. The debt is increased due to his inability to handle strong managers. But strong managers manage players well.

            Catch 22 for Mr Ashley, that one – ‘you mean the manager I picked for being a yes man isn’t respected by the players and can’t get results…who’d have thought..?’

    • Lord

      When Ashley took over, our club was roughly on a par with Spurs and Everton in terms of results, status and value. We’d had a few rough years, maybe, but still capable of pushing for Europe and a Premiership stalwart.

      10 years on, looking at the prospect of a third relegation and having a squad valued lower than Bournemouth and Watford, it’s impossible to find any metric about our club that can be considered a success under Mike Ashley.

      Some degree of financial security is not to be sniffed at but you will not find many on this forum who value ‘not going bankrupt’ higher than success and ambition.

      • Monkseaton Magpies

        When Mike Ashley we took over we finished 13th only five points off relegation and were in decline. Spurs were 5th Everton 6th miles ahead of us. Even Bolton 7th Reading 8th Portsmouth 9th and Blackburn 10th were streets a head of Newcastle. He inherited a club destined for relegation. Most people on this site believe he took over a team in the Champions league. They could not even compete with the likes of Bolton so wish people on this site would wake up and smell the coffee and look at the facts not just you all of you bar half a dozen on here blame Mike for the clubs demise. It was all ready in free fall destined for the Championship.

        • Lord

          Come on. Roeder took us into Europe in 2005/6.

          We had a bad 2006/7 season not helped by Shearer retiring and losing Owen for a year to his knee injury.

          2007/8 – the year Ashley bought us – we finished a handful of points behind Spurs in midtable.

          It wasn’t glory years but weren’t a club destined for relegation either.

          • Monkseaton Magpies

            Five points of relegation when he took over that’s all.
            These are facts.

        • GToon

          Can I refer you to an article I wrote that you commented on recently that showed the average place with Ashley is 15th and before him it was 9th.

          • Monkseaton Magpies

            Think since we began our average league position has been 15.5 so he is par for the course.

  • Tino o

    The only way he was going to sell for £250 mill was if he was desperate and he isn’t looking at those figures and what other benefits he gets she was dreaming of him going for the bait. In fairness if she doesn’t come back with a serious offer she will be proven to be a time waster. Praying for someone who has the money to buy the club we need fatty out !

    • TheFatController

      Loads of people have money to buy the club. They just know it’s not worth £350m of anyone’s money.

      Why? Because if it was someone would pay £350m.

      Market forces, supply and demand.

      • TheNutJob

        then he won`t sell

        • Tino o

          Exactly.

        • TheFatController

          He can’t sell. It’s clearly not one of those ‘must have items’ you hear about all the time …

      • Tino o

        He’s here to stay then only another relegation ( highly likely this season) and a failure to bounce back 1st time would see him lower his valuation. This clubs potential remains untapped I’m sure her upping her bid by 50-75 mill could be retrieved in the near future by running the club as it should be.

        • TheFatController

          Well, say PCP put £300m in a bank, at year end they’d have £305m after tax at current interest rates.

          Most clubs re-invest profits just to stay competitive, so PCP would be unlikely to take much profit as dividends. Maybe £10m after tax per season (hence better to reinvest profit to avoid tax). But better than a bank, and more fun.

          So if they’d make £5m a year from a bank, and £10m if lucky from a PL club’s profits, maybe you can see why £50m is being haggled over ?

          • Tino o

            Time will tell

  • John Oliver

    I think the reason why Ashley has pulled the plug on the
    deal is because of the leaks to the press from PCP,
    on tuesday we were told that
    there was an increased offer of £300m,this story came
    from the two newspapers owned by the bloke who set
    up the curry house meeting,this could have been the
    final straw for Ashley,PCP seem to be releasing this
    information to try and get the fans to turn on Ashley,
    and some fans have by calling him greedy.
    Lets hope that when the dust settles they can start
    negotiations again,but this time Amanda Staveley
    needs to tell her people to shut the f*ck up and stop
    releasing information to the press.

    • TheFatController

      You couldn’t possibly know that PCP want to influence the fans.

      They are wanting to buy a PL club, they want the supporters backing the team to help maintain PL status.

      So they have no motivation to get the fans to turn on the current regime (they know the fans already hate the regime so there’s not really a job to be done there anyway) and you have no facts to back it up.

      So personally, I think you’re wrong, given the lack of evidence.

    • Guest 2

      Give over, man. All the leaks are to Sky and come from Ashley;s cronies!

  • Cockneytrev

    In September 2008 A consortium which included Dr. Sulaiman Al-Fahim opted to switch their attention from Newcastle United to Manchester City and decided to invest in that club instead of Newcastle united, the reason for this was After a meeting was set up between Ashley and the prospective buyers, Ashley never showed up, he didn’t inform the Arabs and left them sitting there. (I was told that he was actually in a casino, I cannot 100% verify this but it was from a fairly reliable source)
    (This consortium had previously looked at Liverpool in 2006.)
    Ashley has no intention of selling the club. Despite what others would have you believe he is making millions, be it one way or another, either selling land, tax avoidance, shirt sales, moving money into different accounts, or various other ways he can collect,,

    • TheFatController

      He’s also loaning the club money to get it back from a future sale.

      This means he wants more for the club than anyone is willing to pay, his valuation includes a profit on the loans, but doesn’t take account of the lack of investment in infrastructure and playing squad.

      Potential buyers recognise the club isn’t invested in to make profit currently, it’s invested in to be sold.

      That’s why no one has offered anything for it. Anything requiring investment to be a going PL concern isn’t going to be valued at top dollar by investors. They want to buy at a level that allows them to invest to make it a going PL concern.

    • Guest 2

      And don’t forget the 80 million saga with Barry Moat

  • nevfur

    When asking why invest if the difference between finishing 15th and 8th is only around £20M you miss the point that aiming for 15th risks relegation and and that next season would cost about £100M. Parachute payments etc amount as we have seen to only around £45M even if you finish up as champions. Staying in the EPL and getting EPL tv money will bring in around £110M. That alone is a difference of £65M. Add in reduced gate money and reduced merchandise sales plus lower sponsorship and advertising monies and it’s a big hit going down.

    • HarryHype59

      True, as this club found out last season!

  • Coble’s Return

    The TV money is almost irrelevant. It increases every year and so do transfer fees and wages. The only way the owner benefits is if that money is not reinvested, giving the owner a short term dividend, whilst almost certainly condemning their club to the drop.

    • mactoon

      and that’s what is happening…

    • Guest 2

      Net player spend by the club during Ashley ownership is only around 26 million. That’s in total! Wherever all the revenue has gone, it certainly hasn’t been onto the pitch.

      • TheFatController

        You have to think about motivation – Ashley can make more in a night at a casino than he can in a year with us.

        Getting a few million out of us at year end must have the same impact as any of us finding a tenner in an old pair of trousers’ pocket. Nice, but not really life changing…

        I doubt he puts much effort into siphoning off money other than free advertising and publicity which takes little effort on his part, and the £100m profit on a sale of £400m he is after …

        • Guest 2

          His motivation is greed. Why does he expect a profit on an asset he has refused to invest in or grow?
          He’s taken club land away in order to develop it for himself, along with the free advertising and merchandising deals he benefited from.
          A sale will guarantee him all of his money back – thanks to all of loans being transferred to a club owned debt.

          • TheFatController

            If you were fat and unpopular despite being a billionaire (and thus unsure if anyone likes you for you, or for your money) wouldn’t you be obsessed with making a profit on things …?

            Maybe you wouldn’t. But he seems to be…

  • NUFC9

    If I was a hard nosed investor, why would I pay Ashley the $350m he is supposedly looking for? Instead, why not spend a fraction of that on an under achieving Championship club with a decent heritage and large fanbase (Leeds, Sheff Wed, Villa for example)? With a moderate spend on players to get promoted I would have a club in a similar position to where we are now: A struggling Premier League club with a squad of mostly Championship players fighting to finish 15/16/17th and keep the TV money rolling in). This could be done for a fraction of the $350m cost of buying NUFC.

    The only thing that sets us apart from a promoted Leeds, Sheff Wed or Villa is our manager. How long will he stay around under the current regime?

    • Tino o

      And stadiums they don’t come cheap

    • TheFatController

      Agreed. Exhibit A: Wolverhampton Wanderers …

  • Leazes

    It’s not the owners money Paul… he doesn’t get it regardless of selling the club.

    • Lord

      True. But as he wholly owns the club there are any numbers of ways he can extract funds out for himself whether it be loan repayments, dividends or a bonus for running a Premiership club so successfully.

      • TheFatController

        We know it makes him nothing each season in relation to his wealth on paper for the simple reason that if it did, he wouldn’t sell.

        He bought it to sell it, it’s just selling it for a profit has been far harder than he imagined.

        His motivation for ownership is nothing more complicated than that. The SD exposure is a bonus but the main aim was making a quick profit and being famous for 5 minutes…