positive news
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From BBC Sport
Cardiff City owner Vincent Tan has converted a further £8m the club owes him into equity.
The Championship club is about £100m in debt, and Tan said in February it would be debt free by 2021.
More than 50 million ordinary shares at 15.69p each will convert £8m of his loan into equity, in line with his pledge to cut the club's debt annually.
The move will ensure the Malaysian businessman will be able to reduce the debt by £100m in the next few years.
Cardiff City had £174m worth of debt at the end of the 2013-14 financial year, with most of it owed to Tan.
"Action is being taken systematically, in stages," said Ken Choo, the club's chief executive and executive director.
"The process will take time and it is not something which can be completed with a flick of a switch.
"Reducing debt will be completed as soon as practically possible."
Choo said the club must adhere to Malaysian regulatory controls during the process of clearing the debt.
Last edited by Phill Stants brother; 22-11-16 at 18:39.
positive news
Has it been copied yet.
This is a positive move and hopefully the next step in something good (and blue).
Also I have a general business question,
my friend just asked me what does to equity actually mean?
So i gave him my general thought of what it was, along the lines of ' A business might owe Lender £10 million. Instead of continuing to make payments on this debt, the business might agree to give Lender a percentage in shares say 10%, ownership share in the company if the company is valued at £100m in exchange for the debt.
I guess this is usually done if a company is having some financial difficulties or just general wants to lower its debt obligations.'
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However after this he asked well who gives up their shares in order to make this transaction, so if tan owns 80% already then another director(s) will have to give up 10% of their own personal shares to hand over to Tan? why would they do this at no financial benefit to themselves.
I have heard of companies releasing more shares, but how is this done if 100% of the company is under ownership, without devaluing the amount of shares everyone else has.
got to be good news
well done Vinnie, keeping to his word
The £8m is a conversion of debt into shares already in existence. The larger conversion of £68m requires more shares to be created hence the upcoming shareholders meeting to pass a resolution to create them. As you say, this will dilute the value of shares already in existence but the non VT owned shares are already a very small, insignificant percentage so the big new share issue proposed makes very little difference
I hope Wales Online are reading this. Their report (not copied to you know where as far as I can see) is rubbish. It claims that the bulk of Tan's debt was converted to equity at the start of the year (presumably at the February Q&A session) and that the outstanding debt to Tan was down to £40m. Anyone with even a passing interest in the club (let alone someone claiming to be a local journalist) must know that the bigger conversion is waiting Malaysian regulatory approval and the new share issue after the shareholder meeting. Embarrassing by Wales Online!
http://www.walesonline.co.uk/sport/f...debt-12215525?
That's terrible. Mainly because of Phil Smith, Wales Online's coverage of football matches has got better this season, but this story shows that the improvement does not stretch to off field matters.
About a fortnight ago, the Trust sent out an e-mail to members which stated clearly that the "immediate" conversion of £68 million of debt into equity had not gone through yet (the reason for this delay given by the club was also included). Because the Trust is so poorly supported by City fans, the numbers who got to read this are, no doubt, a lot fewer than the numbers who will read the story by Wales Online which contains info that is just not true.
The true position can be found in the link below and, as it first appeared on the Trust website on the tenth of this month, it was there well before Wales Online's incorrect story was written ;-
http://www.ccfctrust.org/?p=4829
it's a shame the hack concerned didn't do a little research before writing his story.
At it again today
http://www.cardiffcityforum.co.uk/vi...1c267f54e67d5c
Still a **** though.