The Takeover Thread v3.0 - DONE! - Methven interview in the Telegraph (p55)

ProperCharlton said:

seth plum said:

ProperCharlton said:

seth plum said:

bobmunro said:

seth plum said:

bobmunro said:

se9addick said:

seth plum said:

The Cawley article contains an interesting bit of information, or at least makes clear something that seemed to me to be a bit vague.
Each shareholder has to have two years money to keep Charlton going in proportion to their shareholding or they don’t get the nod from the EFL.
In back of an envelope terms if the club loses 10 million a year (20 over two years) and Mr Methven has a 10% share, then he has to prove he is good for 2 million over the next two years.
I would expect the EFL to have some kind of method where that 20 million is locked away in a vault of some kind for two years (accumulated in proportion to shareholding) and those monies are released at need by some kind of burser.
Now I know with my business ignorance it probably doesn’t work quite like that, maybe somebody can clarify how indeed it does work.
What stops somebody showing they have funds for the future, but not fronting up when the need arises?

I don’t think the EFL lock the funds away in some sort of high security vault in Preston! I would imagine you just need to demonstrate sufficiency of funds for the duration (I.e you have adequate liquid assets to cover your share of the running costs) 

Correct - proof of sufficiency of funds is all that is required, not the funds up front locked away in some escrow account. 

Does that lead to a risk if shareholders are called on to make good their promise but they refuse, or melt away when that time comes?

If the club, like any other business, fails to pay the bills as and when they fall due then they are insolvent and the EFL can take action.

Which presumably means points deductions and fines.

In that scenario I imagine a few of us will watch and study each and every shareholder like a hawk in order to get an early warning that a points deduction might be coming down the track.

I know that sounds negative, but it also seems to be reality.

In my defence I repeat that I was the first person on CL to warn about the Southall takeover, it was at a time when a lot of people were urging the EFL to hurry up and approve him. My warning back then was about sufficiency of funds.

Predictably I was roundly castigated by other CL posters as being negative, many of whom were probably chanting ‘we’re effing rich’ soon afterwards.

Cheer up lad

Congratulations on your graduation. I hope the ceremonials were really nice.
If I am right in remembering what you posted I reckon you qualify as a lad much more than me.
I qualify as a miserable old git.

Thank you. Sadly, the ceremony doesn't start until this evening. I have a long day of waiting around before the excitement begins. At least the takeover has put me in a good mood.