Shareholders letter

[Former Labour leader]

#Steve`s response is really strange because converting debt to equity has no impact on Profitability and Sustainability (FFP) compliance. It is a balance sheet adjustment which improves that balance sheet but has no effect on the profit and loss account which is what FFP is all about.

Despite the above misunderstanding , a debt to equity conversion should be very much welcomed as it is a return to the steps promised by VT to convert all his debt to equity which has been delayed by the impact of Covid over the last coupke of years.

Yes, when Steve replied I thought it a bit strange, as it appeared to me that VT was taking on £45m of debt, which is clearly good news for the club.

[TWGL1]

Yes, when Steve replied I thought it a bit strange, as it appeared to me that VT was taking on £45m of debt, which is clearly good news for the club.

How exactly does this work , debt to equity in respect of Cardiff City ?

The current debt is £93m , so if VT converts £45m does Cardiff City’s debt reduce by £45m ?

Also is he really converting £45m?

[The Lone Gunman]

The current debt is £93m , so if VT converts £45m does Cardiff City’s debt reduce by £45m ?

No flies on you.....

[TWGL1]

No flies on you.....

I deserved that … good news all the same ….

[stan butler]

No flies on you.....

[life on mars]

I deserved that … good news all the same ….

You might be right if you take admin,tax and commission charges into considerations

[Lawnmower]

How exactly does this work , debt to equity in respect of Cardiff City ?

The current debt is £93m , so if VT converts £45m does Cardiff City’s debt reduce by £45m ?

Also is he really converting £45m?

Debts owing to shareholders and other connected parties were £49m in the last accounts. I’d expect that has grown since, although the wage bill has shrunk dramatically since, we will still have been making losses.

Either way the conversion of that £45m is really very good news and puts a big hole in our massive debts.

Just need 3 points tonight now

[blue matt]

were some people not recently telling us that VT has lost interest in us ? ? ?

wiping 45 Mill of debts might mean he hasn't after all

[Optimistic Nick]

#Steve`s response is really strange because converting debt to equity has no impact on Profitability and Sustainability (FFP) compliance. It is a balance sheet adjustment which improves that balance sheet but has no effect on the profit and loss account which is what FFP is all about.

Despite the above misunderstanding , a debt to equity conversion should be very much welcomed as it is a return to the steps promised by VT to convert all his debt to equity which has been delayed by the impact of Covid over the last coupke of years.

I'm pretty ignorant when it comes to ffp (and most things) but is tan's debt interest bearing and does the interest expense get taken into account in the ffp rules?

[Ninian1962]

Debts owing to shareholders and other connected parties were £49m in the last accounts. I’d expect that has grown since, although the wage bill has shrunk dramatically since, we will still have been making losses.

Either way the conversion of that £45m is really very good news and puts a big hole in our massive debts.

Just need 3 points tonight now

And we got them Tim

Now that the game has finished I can comment on the shareholder letter, a copy of which was only received by me this evening.

The letter is to give notice of passing shareholder resolutions to increase the share capital by up to £45m. The resolutions will all be passed as Vincent Tan already holds the vast majority of hares in issue.

The reason that the shares are 1p ones rather than existing 10p ones is that new shares cannot be issued at a nominal value greater than their market value - it will come as no surprise to most to see that the club is worth less than 10p per share.

I have had it confirmed that the shares are being issued to enable a further debt to equity conversion but don`t know if the full £45m will be converted. If all or most of the £45m is converted this will greatly improve the club`s balance sheet and go a long way to recommencing Vincent Tan`s promise to convert all debt into shares which has been held up recently by financial constraints due to Covid.

What any conversion won`t do, in contradiction of what Steve Borley said in his tweet, is have any impact on the Profitability and Sustainability (FFP) position as debt to equity just improves the balance sheet and has no impact on the profit and loss account

Hope this helps

Keith

[Lawnmower]

And we got them Tim

Now that the game has finished I can comment on the shareholder letter, a copy of which was only received by me this evening.

The letter is to give notice of passing shareholder resolutions to increase the share capital by up to £45m. The resolutions will all be passed as Vincent Tan already holds the vast majority of hares in issue.

The reason that the shares are 1p ones rather than existing 10p ones is that new shares cannot be issued at a nominal value greater than their market value - it will come as no surprise to most to see that the club is worth less than 10p per share.

I have had it confirmed that the shares are being issued to enable a further debt to equity conversion but don`t know if the full £45m will be converted. If all or most of the £45m is converted this will greatly improve the club`s balance sheet and go a long way to recommencing Vincent Tan`s promise to convert all debt into shares which has been held up recently by financial constraints due to Covid.

What any conversion won`t do, in contradiction of what Steve Borley said in his tweet, is have any impact on the Profitability and Sustainability (FFP) position as debt to equity just improves the balance sheet and has no impact on the profit and loss account

Hope this helps

Keith

Thanks Keith. 👍