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Surely the loans are in addition to the initial investment to secure shares?
You would hope that is the case.
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I’m no forensic financial expert but even to a penny pudding like myself… if it wasn’t for the goodwill of the Fantastic Four we’d probably be defunct, reformed and playing in the Northern Counties East Football League Division One – Step 6 of the National League System (Level 10 overall).
Michelle (64)
George (69)
Roj (55)
Ian (45)They’ve all got substantial amounts of their own money tied up in their passion for the club.
We’re lucky to have four such noble fans.
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Tend to agree Rene. I’m no financial expert either but didn’t Kieran Maguire say it was his understanding that the debt will be brought down to £400k this year and could be met with some decent sponsorship and not leaving the showers on? Yes, I know the last bit wasn’t literal but his point was, it can be met given careful planning. I understand the loan aspect but wouldn’t like to see any of the Directors scoot off due to perceived criticism leaving the club in the mire again. This is just musing btw.
Just to add, any ‘new investment’ needs to be the right investment selected with due diligence. Deals that continue towards a sustainable model.
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I don’t think there is any great expectation those loans will be paid back, especially int the short term. They are unsecured and interest free.
Even if things went bad, there is no way the club has a chance of paying creditors with minimal assets and a small pot of cash.
If I remember right, Michelle wasn’t simply given the shares. I’m sure it has been mentioned that she paid off WHAM, somewhere in the region of 100k?
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They’re all dedicated and committed supporters not investors looking to call their loans back in, surely?
That’s certainly what I like to think. There’s been a few bumps but it’s been a long tough road.
Who’s to say that they was loans in the early firefighting days of the takeover because, like the rest of us, we hoped a quadrillionaire would come and buy the lot.
Michelle and Co may not have expected to have still been running the show this far down the line. They might have just been thinking they were temporary custodians waiting for deeper pockets.
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Can we also remember the time and effort that these people have put in to get the club back on an even keel.
It is a significant amount, and they have not been paid for it.
Also, they could have made a good few quid if they’d invested their money elsewhere.
We are lucky to have them.
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I don’t understand all the share/loan stuff enough to comment on how that all works.
But while a level of scepticism is needed, it is a fact that Michelle and the other directors have stuck a good wedge of money into the club without which we would be talking Scunthorpe United 1899 to 2023. The supporters showed they would help at the time and attendances are higher than I ever thought we’d get in non league, we are hopefully all in it together.6 users thanked author for this post.
Spot on…they’ve made some mistakes (particularly in entertaining the FC100k fiasco) but without them we’d be AFC Scunthorpe or some similar phoenix club in the Dog and Duck League.
A big thanks to whoever the massive donations are coming from as well (was it £300k last season?)…just a speculative hunch but my guess is that’s from the Wharton family.
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Don’t forget Michelle told us the debt was almost paid down, only to be told it wasn’t quite the case at trust meeting where then remarkably an extra £65,000 a month was needed in the form of loans.
It’s certainly true that communication around this has been disingenuous at best, but I suspect that what Michelle meant was that external creditors have largely been paid off.
Clearly this is positive, as it’s external creditors who are likely to issue winding-up orders if not paid.
What wasn’t clear at the time was that director loans had been required to achieve this.
It’s a worry that the club appears to be far from sustainability given the current crowds (how many would there be if we were struggling?), but the amount of money loaned by the directors is worthy of praise. Even if repayment is expected down the line, these loans are interest free, and therefore at significant opportunity cost to the directors.
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