Dell v Mel

[kevinhectoring]

Some are saying that Dell were involved in the EFl negotiations. The club statement indicates that Dell have lent more as things have got tight (did they take out Gabay)? 
 

We know from his clumsy attempts to sell the club (Samuelson, Alonso) that Mel has no corporate finance acumen. He has no restructuring experience either. Dell is packed full of aggressive clever MBAs who have been hardened in the tough world of US M&A and restructuring. It’s no contest. 
 

we don’t know how much Dell is owed, but they are probably the economic owners of the club. If they have been involved with the EFl then either they are really worried about losses, or they are focused on making a killing by owning or selling the club. 
 

The reason this matters is that Dell’s interests - like those of the club - are certainly best served by avoiding administration. They are probably in the driving seat. We should not regard administration as an inevitability just yet 

[Sparkle]

Dell have preferred status for repayment don’t they? 

[Tyler Durden]

Michael Dell's motto apparently is be crazy and don't seek too much advice.

Can see why he chose Morris as a partner. Fits right in. 

[kevinhectoring]

1 hour ago, Sparkle said:

Dell have preferred status for repayment don’t they? 

Yes they are secured  On all Mel’s football assets. They’ll likely determine the future of the academy for example 

 

Edited September 18, 2021 by kevinhectoring

[Igor Igor Whats the Score?]

Is the announcement of an intention to go into administration a play to force Dells hand in some way? Or am I just being naive….

[The Scarlet Pimpernel]

1 hour ago, kevinhectoring said:

Some are saying that Dell were involved in the EFl negotiations. The club statement indicates that Dell have lent more as things have got tight (did they take out Gabay)? 
 

We know from his clumsy attempts to sell the club (Samuelson, Alonso) that Mel has no corporate finance acumen. He has no restructuring experience either. Dell is packed full of aggressive clever MBAs who have been hardened in the tough world of US M&A and restructuring. It’s no contest. 
 

we don’t know how much Dell is owed, but they are probably the economic owners of the club. If they have been involved with the EFl then either they are really worried about losses, or they are focused on making a killing by owning or selling the club. 
 

The reason this matters is that Dell’s interests - like those of the club - are certainly best served by avoiding administration. They are probably in the driving seat. We should not regard administration as an inevitability just yet 

Yes, I wondered exactly this. Are Dell poised to take over the club? They certainly would be in the best position. 

[kevinhectoring]

11 minutes ago, Igor Igor Whats the Score? said:

Is the announcement of an intention to go into administration a play to force Dells hand in some way? Or am I just being naive….

Maybe, it’s hard to know. It may be that Dell wanted the board to announce an intention to file. Then, if Dell uses its security it is not seen as the aggressor. Time will tell 

[Van der MoodHoover]

Don't know anything about MSDs business model, but I would think that there's a big difference between charging 15%interest on secured loans (really? That's equity level returns) and running a football club. 

[BramcoteRam84]

I’m hoping ??? The absolute best case scenario is Dell  take over sort our poo out and sell us onto a buyer for the long-term. We could avoid admin and keep this group together. 
 

Still think it’s wishful thinking

[RenegadeRam]

This is worth a read…

https://www.chroniclelive.co.uk/sport/football/football-news/strange-case-michael-dell-Derby-17977130

Or are they trying to make their way into a club on the cheap perhaps? Donald is reported to want somewhere in the region of £35-40m for Sunderland. They’ve loaned the club around £9m which, if defaulted, would mean they take control. You don’t need to be a mathematician to see the saving made should the loan repayment be defaulted. Worse case scenario, they get their £9m back and move on.

So are they targeting clubs they perceive to be financially vulnerable to try and lever their way in through the backdoor? One thing’s for certain, these are very clever businessmen who specialise in investment.

[Eddie]

34 minutes ago, Igor Igor Whats the Score? said:

Is the announcement of an intention to go into administration a play to force Dells hand in some way? Or am I just being naive….

It's a strange one. I'd never heard of it in football - just 'we have gone into administration' or some similar phrase.

[kevinhectoring]

4 minutes ago, Eddie said:

It's a strange one. I'd never heard of it in football - just 'we have gone into administration' or some similar phrase.

often a company is put into administration by its bank, because the bank has got a loan default and has got to the end of the line. Directors who have given security to their lenders are not allowed to enter administration without giving 'notice of intention'. This allows the lender themselves to appoint and so to choose the administrator. That's what's going on superficially but what's going on below the surface remains to be seen

[therealhantsram]

The dCFC statement was strangely complimentary about Dell. It just didn't sit with the rest of the statement. No need to mention them really. Unless...

[Carl Sagan]

This is something I tried to ask about in the Pride Park/Moor Farm thread. Were the "charges" on the club's assets or on Mel's separate assets? What is actually owned by DCFC, what by Mel, and what by Dell? If DCFC call in administrators but Mel owns the stadium and training facility, what is Derby County's except the staff? 

The wording about "intention" to go into admin is interesting. The wording being careful to praise Dell is interesting. We know the ownership and financial structure of DCFC is exceedingly complex (to put it mildly). There are probably a lot of twists and turns yet in this saga, before things become properly clear. If they ever do...

[Ellafella]

50 minutes ago, The Scarlet Pimpernel said:

Yes, I wondered exactly this. Are Dell poised to take over the club? They certainly would be in the best position. 

Ssshh! Don’t spoilt Mel’s 3D chess moves. ?

[kevinhectoring]

20 minutes ago, Carl Sagan said:

This is something I tried to ask about in the Pride Park/Moor Farm thread. Were the "charges" on the club's assets or on Mel's separate assets? What is actually owned by DCFC, what by Mel, and what by Dell? If DCFC call in administrators but Mel owns the stadium and training facility, what is Derby County's except the staff? 

The wording about "intention" to go into admin is interesting. The wording being careful to praise Dell is interesting. We know the ownership and financial structure of DCFC is exceedingly complex (to put it mildly). There are probably a lot of twists and turns yet in this saga, before things become properly clear. If they ever do...

I think it is this:

all Mel's football assets are owned by companies in the same overall group as the club

MSD has security over all of those companies' assets

unlikely Mel has personally given any charges but he may personally have guaranteed some of the bank debt

this means MSD has the power to appoint an administrator, who could carry on the business or sell the assets. MSD also has the power to take possession of any of those assets, and sell them, but not if an administrator is in place (eg one appointed by the club)

the statement of an intention to go into administration is a legal requirement - it's not specific to this case.

The praise of MSD in the statement looks odd, as you say. Maybe it means there might just be some cunning plan to avoid administration. Here's hoping 

Edited September 18, 2021 by kevinhectoring

[Gringo]

2 hours ago, Sparkle said:

Dell have preferred status for repayment don’t they? 

Yes they have charges including the stadium the lease on the academy and all goods,chattels and future income whilst the loans and there are only 2 charges registered are outstanding.

[Gringo]

There is something super weird about this weeks events;

1 why pay off Barclays if you are going into administration, that does not make sense UNLESS it was Dell that paid off Barclays as the bank also has a charge on the stadium etc, this clears the way for Dell to be in sole  charge of all the assets.

2. Why on earth are Pinsents being appointed the administrators? They are a magic circle outfit and an insolvency this size is really small for them

3. The fake sheiks lawyers were Pinsents

We have to wait 28 days before any potential buyer is flushed out but my guess is there is one.

Edited September 18, 2021 by Charlotte Ram
Spelling

[The Scarlet Pimpernel]

Dell were rumoured to be interested in buying the club previously weren't they? 

[San Fran Van Rams]

24 minutes ago, kevinhectoring said:

I think it is this:

all Mel's football assets are owned by companies in the same overall group as the club

MSD has security over all of those companies' assets

unlikely Mel has personally given any charges but he may personally have guaranteed some of the bank debt

this means MSD has the power to appoint an administrator, who could carry on the business or sell the assets. MSD also has the power to take possession of any of those assets, and sell them, but not if an administrator is in place (eg one appointed by the club)

the statement of an intention to go into administration is a legal requirement - it's not specific to this case.

The praise of MSD in the statement looks odd, as you say. Maybe it means there might just be some cunning plan to avoid administration. Here's hoping 

The MSD link is interesting. There's a link in another thread to an article about a similar loan to Sunderland which was secured against club assets.

If the club transfers to MSD in the event the club defaults on the loan, perhaps this is a cheaper way for MSD to take control. I don't understand why the statement was so complimentary of MSD if this is the case, unless they had a hand in writing it as a way of getting fans onside early. 

It does seem there is a lot more to this than meets the eye. We're not formally in admin yet and it does seem that MSD will ultimately make that decision.