Is it coincidental that the gap between the money we have reportedly lost (about £600k) and the money gained from new sponsor (£400k) is about £200k?

Dunno but it does just underline how stupid the decision by the RFL was, when they are trying to allegedly get all clubs to work on a commercial and self-sustaining basis, that they would at the same time rip us off half our income. Given that it obviously takes all the clubs AT LEAST the money including that full Sky income to be in the financial place they are - which, Leeds apart, seems to be not great - what was the plan?

"=#FF0000[iWell, we know you, like everyone, need every penny of that money, and we know you, as a new broom, have no connection with the management that failed, so to keep a level playing field, what we'll do is take away half your money. Because? Well, just because. And you, alone of all clubs, will be able to break even at least, even without half your Sky money. Whereas other clubs will run at a loss, despite full Sky money, and boosted by their cut of what we rip you off. Because there's magic which will mean Bradford can make do on less money than everyone else.[/i"

Wasn't provident deal over five yrs so 300k/yr and that's offset by losing whatever were getting from jct and tetleys. Think we've saved at least 200k on player salaries by amount we are under cap too.
Suspect loan is more to tide us over while we, as a new company, build up a credit history and also get revenue coming in from monthly sky payments ( albeit smaller than they should be), merchandise sales,hospitality etc. as long as we are repaying back with interest don't see that it's a issue at all.

Would it not also be fees-able that the loan is for brand promotion as i am sure Kate Hardcastle said that would be one of her main goals.

Who cares they got a loan and they are paying it back with interest big deal - not the only company in the UK to ever get a loan are we !!

Is that the Bulls Brand promotion or the Kate Hardcastle Brand promotion - not clear from your comment

Bit much of a suggestion innit? What have OK done to deserve that? Also does the Council normally lend to companies who the banks won't touch?



I think the council tax payers should be told.

As a Bulls fan, and a Bradford council tax payer I have mixed feelings about this: as a fan it is good we have secured some working capital to keep the show on the road, as a council tax payer you wonder how they justify lending a large sum of money to a start up company, who in a game that is struggling with its finances has a massive handcap - the reduced Sky money - that the other teams don't have. It is not easy to raise the income to cover running costs as we all know - so how do you find the cash flow to meet loan repayments as well? So I do wonder how the council justified this if it is as the say just a "normal commercial loan".

I don't think it would be exactly [inormal[/i practice but it isn't unique as they did something similar to the firm who built the Jury's Inn on Thornton 'Rd, IIRC.

I'd reckon the Council would have to be confident they could back up their decision as if it was done anything else than commercially they risk prosecution for corruption, misuse of public funds, etc., not to mention of being taken to task when the books are audited. It's not like a bank, who can take whatever risks they want and the more they do the bank's bollox in, the bigger the bonuses.

Perhaps they have Blake Solly seconded to the credit committee to help them assess financial risk?

Does anyone else remember Gerry Sutcliffe saying back in the day they'd turn to Bradford Council for a start-up loan? I just assumed this was it. I didn't read anywhere in the article when the loan was issued, so it could be 6-months old.

He and various others, including Gargoyle and the Dark Lord (or his acolytes), all made reference to council funding being available IIRC? I recall much larger numbers being bandied around, to be honest. Don't think any details were ever given, but (rightl;y or wrongly) I'd always assumed they'd had some initial loan support.

Not sure when the loan was issued, but it does not look to be secured on the assets. The club has just given a first floating charge to Barclays Bank though, so that will rank first in line anyway (at least once the charge given as security for the purchase of the business has been satisfied).

i need the help of an old sage like relic/fa or adeybull, with business knowledge

is this similar to emperors new clothes.

you get a soft loan from the council £200k then buy a rugby club from administrator for £150k, you then own this and decide to issue yourself shares. you then ask loyal fans to then invest in the club by buying shares (are those voting shares or just shares with no rights) the income received then pays off the soft loan and you still own the whole thing without spending anything.
is this how business works, your opinion would be appreciated.

Will all depend on whether any shares issued are new shares introducing new capital, or Omar selling off any of his existing holding.

If the former, then replacing debt with equity makes total sense - IF the new shares rank pari passu with the existing shares. If they do not, then the risk is you effectively replace one form of debt with another.

If the latter, then your analysis would be broadly correct if it was only a small % of the shares being sold off. In OK's case, I would never sell > 24.99%, since that means I could no longer guarantee to win on a special resolution.

I have assumed that any loans form the council will be on terms that make it sensible to retain the loans rather than repay them and replace them with alternative funding. A question for the next fans forum, I guess?

I await with interest the details of this proposed share issue. And, especially, how it avoids being classified as a public offer of equity which would require plc status and a prospectus.

You would be surprised what you can buy without actually having any "money" and similarly people wouls be very shocked if they all went to the bank at the same time to take their "money" out. That is the wonder of the banking system that it works because people have trust in money that isn't really there. A bit of a diversion but your are right with the scenario you discribe if you can get a credit line youu don't need to actually put any £ of your own in. It was always thought that Al Fayad bought Harrods for £500m when he didn't have a dime.

i am obviously in the wrong line of work, which probably accounts for the fact i have no money.

The devil will be in the detailed wording, but you'd have to assume it would be based on invoking the 'common interest' rule which would enable such an issue to go ahead.

You would presume so, although the wording - and the eligibility - would need to be very carefully drafted, I think?

However, OK's wording (as quoted, anyway) is pretty ambiguous: "I want the fans and community to be involved in the club, so I have decided to release some shares and let them be part of the club.”

"I".

Which makes me wonder if he is proposing to sell some of his OWN shares, No doubt after some bonus issue or similar, instead of issuing NEW shares?

Its all far too nebulous at the moment though to be able to comment objectively, although from [url=http://www.thetelegraphandargus.co.uk/sport/sportbulls/10276377.Fans_get_chance_to_buy_Bradford_Bulls_shares/=#800000the T&A report[/url it seems clear he is intending to retain control. The wording reads to me like he is not seeking to raise capital for the club, but instead to sell some of his own holding, but without more detail we can only speculate.

'Former Sports Minister Gerry Sutcliffe, honorary chairman of Mr Khan’s OK Bulls Ltd, said the club would be valued before shares were made available and the move would bring in investment'.

Then thiis suggests they are raising capital for the club but agreed it's not very clear.

Indeed its not. Because the wording could mean, e.g.:

a - we value the club, to put a price on new shares in the company, so we can then offer out those shares to bring in new capital; or, just as easily:

b - we value the club, as a basis for bringing in investment from other businesses or high-net-worth individuals, where we will need to calculate how much % of the club say a £100k investment will buy you; and at the same time so OK can determine how many of his own shares he can sell to supporters whilst still retaining a majority holding.

- or any one of a range of other possible interpretations.

To me, the wording could be quite deliberate: shares will be "made available", not "issued". "The move would bring in investment", not "the issue of those shares will bring more capital into the club". But, who knows? How much is lost in the translation from utterer via hack to page? How much was said just as general, informal comments in layman's speak, to try and be helpful, rather than said with a specific objective in mind?

But now the genie is out of the bottle, I do think we need a few more specifics to avoid excessive - and quite possibly wilde-of-the-mark - speculation?

As with anything like this it's hard to know what is going on when the press reports can get easily confused. I hope the T&A send a hack with some knowledge about this sort of thing (if such a person exists at Hall Ings).

That is asking an awful lot Bullseye.

But we all assume that OK actually knows exactly what coulld happen here himself - with new investors and the potential issues involved in selling shares to the fans. I guess he has been in business mainly on his own, or his families account in the past - so running a multi-share holder company could well be new ground for him as well.