Cosmo
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TBH without knowing the full details of the bond and the current bank loans its impossible to tell. At best its going to come out fairly equal, at worst its going to be more expensive than the bank loans (will be cheaper than the PIK loans, but as said they have always let them roll over so hasnt effected the clubs finances).
Id hazard a guess they have done it to gain further control over what they can do with the money - now why this is the case you could argue all day. The future will show, but given they have specifically put in a clause saying they can take out £70m within the next 12 months, I think you'll be seeing that happen.
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Terry12
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The £70M will be used to cover part of the loans taken out in their name. Basically shovelling the whole debt onto the club. Wankers
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Cosmo
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quote:
Originally posted by Terry12
The £70M will be used to cover part of the loans taken out in their name. Basically shovelling the whole debt onto the club. Wankers
No, they are going to use part of the £500m bonds to pay off those PIK loans which are secured against their assets - if reports are to be believed (it would make the most business sense tbh).
The £70m would be more of a dividend payment for them to spend on whatever they like.
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Terry12
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I thought the PIK notes were taken under the Glaziers and not the club.
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Cosmo
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quote:
Originally posted by Terry12
I thought the PIK notes were taken under the Glaziers and not the club.
They'll be in the clubs name but secured against their personal assets no doubt.
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Terry12
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Taken from this article: united bonds
The situation is not totally straightforward given the numerous clauses within the prospectus issued for the bonds, which appear to be aimed at allowing the Glazer family to take £70million out of the cash raised by the club to set against the PIK notes, whose interest is due to rise to an eye-bulging 16.25% next year.
However, the idea is clearly for the Glazers to reduce their overall interest bill, rather than just United's, and the family believe the popularity of the bonds are evidence that a worldwide attraction to United remains huge.
Looks like the Glazers are passing all their responsibilty for the debt onto the club.
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Terry12
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quote:
Originally posted by Cosmo
quote:
Originally posted by Terry12
I thought the PIK notes were taken under the Glaziers and not the club.
They'll be in the clubs name but secured against their personal assets no doubt.
Obviously they're in the clubs name. I meant they were responsible for PIK notes, So using that £70M they're playing it safe for themselves for when/if things go tits up.
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Cosmo
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Not really, as the PIK stand at something like £250m now, and paying £70m off them isnt going to stop the interest being a silly amount.
Id fully expect to see them pay them off completely now, then the rest off the bank debt. Leaving you with bond debt and the rest of the bank debt.
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Terry12
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Reading between the lines there is no way the full £500M can be paid back in 2017 without either selling the ground/Carrington or star players.
I'm hoping this is the start of the end for the Glazers and by taking out the bond scheme they've kept the Wolves from the door for the the immediate future giving them time to sell the club.
Of course I may well be on drugs
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Marc
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United won't be sold any time soon.
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Cosmo
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Or they could just do another bond scheme and use that to pay off the old one!
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Terry12
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quote:
Originally posted by Cosmo
Not really, as the PIK stand at something like £250m now, and paying £70m off them isnt going to stop the interest being a silly amount.
Id fully expect to see them pay them off completely now, then the rest off the bank debt. Leaving you with bond debt and the rest of the bank debt.
From what i've read they can only use £70M of the bond money to pay on the PIK.
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Marc
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quote:
Originally posted by Cosmo
Or they could just do another bond scheme and use that to pay off the old one!
That could very well happen
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Cosmo
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quote:
Originally posted by Terry12
quote:
Originally posted by Cosmo
Not really, as the PIK stand at something like £250m now, and paying £70m off them isnt going to stop the interest being a silly amount.
Id fully expect to see them pay them off completely now, then the rest off the bank debt. Leaving you with bond debt and the rest of the bank debt.
From what i've read they can only use £70M of the bond money to pay on the PIK.
Without seeing the notes on the bond scheme I wouldnt be able to say, but Id be very surprised if this was the case, as the biggest threat to the club is that PIK loan and the stupidly high interest rate.
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Terry12
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quote:
Originally posted by Cosmo
Or they could just do another bond scheme and use that to pay off the old one!
But paying out £45M in interest every year won't leave much profit for the them to steal from the club in bonuses to their wives
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Terry12
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quote:
Originally posted by Cosmo
quote:
Originally posted by Terry12
quote:
Originally posted by Cosmo
Not really, as the PIK stand at something like £250m now, and paying £70m off them isnt going to stop the interest being a silly amount.
Id fully expect to see them pay them off completely now, then the rest off the bank debt. Leaving you with bond debt and the rest of the bank debt.
From what i've read they can only use £70M of the bond money to pay on the PIK.
Without seeing the notes on the bond scheme I wouldnt be able to say, but Id be very surprised if this was the case, as the biggest threat to the club is that PIK loan and the stupidly high interest rate.
Most articles i've read state there is a claue in the bonds for £70M to be used on the PIK.
I still wonder how they intend to make big profits for themselves by burdening the club with more debt.
If they keep rising prices sooner or later attendances will drop.
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Cosmo
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Well if they can take £70m out of the club then thats a nice chunk of profit right away. If they can do that again in a few years whilst hopefully seeing the value of the club grow then they're in the money.
The '£70m taken out of the club' term thats being banded about wont be for the PIK loan, as its Uniteds responsibility to meet all the interest payments and pay it back at the end, so the money wouldnt have to be taken out of the club by them. The only time it will fall to the Glazers to pay is if the club cant afford to, i.e. it goes tits up.
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Terry12
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Another article I have read is saying the senior loan is united's debt whilst the PIK is the Glazers.
Manchester United’s secured bank debts total £510m, while the Pik loans – which fall on the Glazers – stand at £202m.
Everything i've read about the £70M clause does stipulate towards the PIK. I'm sure they'll find other ways to rape the club.
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Cosmo
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Guess we'll have to see really, as said though Id really be amazed if they didnt get rid of the PIK loans using it, as interest on them is something like £70m a year which is just being rolled over and compounding it all.
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Terry12
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Basically we're screwed.
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Limecat
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quote:
Originally posted by Cosmo
Guess we'll have to see really, as said though Id really be amazed if they didnt get rid of the PIK loans using it, as interest on them is something like £70m a year which is just being rolled over and compounding it all.
Nice to see you agreeing with me Cosmo. 
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Cosmo
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I agree the PIK loans interest is compounding year on year. Im not so sure the bank loans are though, no more so than these bonds may well do.
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Cosmo
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Ouch
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article6999775.ece
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strick206
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First contribution to this post, but i imagine the 70 million taken from the club will pay the PIK loan. leaving it at say 130million, at interest of 16.5% a year, so 21m a year in interest
The bond will pay most of the bank debt off, leaving however much, and then they'll probably use the first bit of profit the club makes every year and withdraw it to pay some of the PIK loan off
The best thing for us is them to die now tbh
The Glazer family are never going to struggle, but the companies they own will
How some mega rich arab hasn't come in for us i have no idea. Although i preferred it when we was a PLC 
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Marc
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quote:
Originally posted by strick206
Although i preferred it when we was a PLC
Me too, I had shares and everything
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