Liverpool declared Toxic

[AA23Northbank]

LOL

It looks like Rafa really left the club in shit shape. Kind of disgusting really. To me it looks like a lack of professional integrity; RB doing whatever he could to keep his job a little longer at the expensive of the club's long term viability.

Imo it's a combination of the Yanks' leveraging a load of debt on the club through the takeover and lending too much money to Rafa to spend, and Rafa making bad buys. Everyone is culprable and Rafa isn't as good in the transfer market or as good a manager as the scousers made him out to be. He left Valencia in a pretty poor financial state when he left them to come to Anfield as well

Precisely. The idea that its solely down to what was spent on players - and there in is a vindication of our decision to not spend more on players - is not actually accurate at all. Just as the argument that the new stadium is the sole reason we made that decision to not spend more is not accurate either. That is down in large part to the cash flow problems created by not selling Highbury to pay off that stadium debt initially, as originally planned.

Why is it a problem they decided not to sell Highbury and develop it?

That's actually a very fair question, and the amswer is quite simple - it created a major cash flow problem within the club, and it was concern about the cashflow that led to a number of decisions such as the premature break-up of the Invincibles and the almost across the board (no not that board ) failure to purchase genuinely adequate replacements for most of them as they departed.

But it also led to other bad business decisions as well as footballing decisions - the front-loaded but pathetically low paying sponsorship and equipment deals, the selling of top players for patheitcally low fees, the forntloading of Thierry Henry's final contract to get him to stay one more year, and the Ashley Cole Fiasco, where we paid him 70K just to sign a contract so well could we could sell him when for 60K a week we could have kept him as long as we like, all to save 5K a week. If that isn't symptomatic of a club trying to manage a bad cash flow, what is?

And that's what the re-development directly created - a cash flow nightmare especially for a club whose investors never put their own money into any aspect of the club's operations. The money from Highbury's sale would have paid off our annual debt obligations on the new stadium for 3-4 years and allowed the rest of the money we made during that peiod to be if needed re-invested in the football team as before. The instability in our cash flow not selling Highbury while paying off the stadium debt created had to be re-dressed somehow and I think's its not hard to see how they did it.

I don't want us to be like City paying stupid money for overhyped players (Milner, Greedybayor), I'm fine with the way things are

I don't want us to be like City either - but neither of these is the only choice we have. There was this club called Arsenal that from 1998-2005 showed a bit more ambition still spent considerably less than its closest fiercest and wealthiest rivals but achieved far greater success on the pitch and with far more special players and without risking the long-term survival of the club. We could fancy having a go doing things their way. Seemed to work out pretty well for everyone assocated with that Club. We could choose to do it their way - after all historically they've always done things the right way

And we give Highbury over to some developer and what? The current development is fantastic, I fear Highbury would've been just any old set of houses and flats and imo the current development is fantastic. This board may not have made the right decisions recently but they're the best bet for the club going forward. Them and Wenger took us from being, say a top 6 premier league team with no chance of challenging United in the 90s to being one of the biggest clubs in the world without the Abramovich spending through making good decisions off the pitch to incredible management off the pitch. So what we haven't spent as much as we did from '98 to '05, we haven't spent much because of a ridiculously inflated transfer market and have had to scout for cheaper options and produce players ourselves, not because of cash flow issues. The debt would not have been paid off any quicker if Highbury was sold to some developer. Hill-Wood may be a plonker and 5 years without a trophy is frustrating, but this board are the best bet we have. And we play some of the best football in the world (and some of the best I'll ever see in my life). So I'm happy with things atm

[USMartin]

And if you doubt our cash flow problems and their impact in every respect on Arsenal consider this:

Citizens living in the nation that is (or was) the Official Travel Destination of Arsenal Football Club cannot travel to the nation of Arsenal's Offical Sponsor and the Sponsor of the new stadium. Forget the poliitics of it - that is just the reality. Although they can fly its national Airline - just not that nation

That shows that our corporate sales reps were under pressure to genearte every penny of cash they could with not a whole lot of concern as to how they did or what conflicts might arise in doing so, which is just very unprofessional and indicative of a club desperate for cash because of problems in cash flow.

And while we didn't lose our sponsor I'm willing to bet that again we lost some money for it. Penny-wise pound-foolish thinking at itts best - or more accurately worst really, and agin clearly symptomatic of a real cash flow problem.

[USMartin]

And we give Highbury over to some developer and what? The current development is fantastic, I fear Highbury would've been just any old set of houses and flats and imo the current development is fantastic. This board may not have made the right decisions recently but they're the best bet for the club going forward. Them and Wenger took us from being, say a top 6 premier league team with no chance of challenging United in the 90s to being one of the biggest clubs in the world without the Abramovich spending through making good decisions off the pitch to incredible management off the pitch. So what we haven't spent as much as we did from '98 to '05, we haven't spent much because of a ridiculously inflated transfer market and have had to scout for cheaper options and produce players ourselves, not because of cash flow issues. The debt would not have been paid off any quicker if Highbury was sold to some developer. Hill-Wood may be a plonker and 5 years without a trophy is frustrating, but this board are the best bet we have. And we play some of the best football in the world (and some of the best I'll ever see in my life). So I'm happy with things atm

AA, What exactly would developers have done differently? Seriously - do you really think the Arsenal Board had any real input on what was done or how - or why? Don't forget the facades were unalterable by Briitish Law and Architectural Standards. Also as the building's history and heritage were their main selling points it would have been bad business to deviate in any way that did not honor and respect the Arsenal-ness of the buildings. Do you seriously believe that had anything to do with why re-developed the buildings ourselves. Even The Board hasn't even made such a claim.

As to the debt excuse me ( Bren get over here! You'll want to see this...) That's absolutely correct, it wouldn't have been paid off one second sooner had we sold Highbury.

Unfortunately this isn't really the point. Had we sold Highbury we'd have paid off the debt the same way on the same schedule but without creating any of the same cash flow problem that caused the club and football team so much difficulty from 2005-2008. The revenue form the sale of Highbury would have paid off the debt during those years and there would have been no need to limit or reduce investment in the football team or transfer funds for the football team over to debt repayment as more than likely happened as again our Board pay for nothing the club does with their own money.

And that is the issue, AA.

[stg]

And we give Highbury over to some developer and what? The current development is fantastic, I fear Highbury would've been just any old set of houses and flats and imo the current development is fantastic. This board may not have made the right decisions recently but they're the best bet for the club going forward. Them and Wenger took us from being, say a top 6 premier league team with no chance of challenging United in the 90s to being one of the biggest clubs in the world without the Abramovich spending through making good decisions off the pitch to incredible management off the pitch. So what we haven't spent as much as we did from '98 to '05, we haven't spent much because of a ridiculously inflated transfer market and have had to scout for cheaper options and produce players ourselves, not because of cash flow issues. The debt would not have been paid off any quicker if Highbury was sold to some developer. Hill-Wood may be a plonker and 5 years without a trophy is frustrating, but this board are the best bet we have. And we play some of the best football in the world (and some of the best I'll ever see in my life). So I'm happy with things atm

AA, What exactly would developers have done differently? Seriously - do you really think the Arsenal Board had any real input on what was done or how - or why? Don't forget the facades were unalterable by Briitish Law and Architectural Standards. Also as the building's history and heritage were their main selling points it would have been bad business to deviate in any way that did not honor and respect the Arsenal-ness of the buildings. Do you seriously believe that had anything to do with why re-developed the buildings ourselves. Even The Board hasn't even made such a claim.

As to the debt excuse me ( Bren get over here! You'll want to see this...) That's absolutely correct, it wouldn't have been paid off one second sooner had we sold Highbury.

Unfortunately this isn't really the point. Had we sold Highbury we'd have paid off the debt the same way on the same schedule but without creating any of the same cash flow problem that caused the club and football team so much difficulty from 2005-2008. The revenue form the sale of Highbury would have paid off the debt during those years and there would have been no need to limit or reduce investment in the football team or transfer funds for the football team over to debt repayment as more than likely happened as again our Board pay for nothing the club does with their own money.

And that is the issue, AA.

Just so I know what would of been the best plan for the board to have taken back in say 2000 when they decided that they wanted to move?

[USMartin]

I would say to move as planned but to sell Highbury. This at least would have ensured the cash flow problem that arose would not have.

In a perfect world we wpould have stayed at Highbury. But wonderful as it was it could not be sufficiently expanded to allow ius to continue to compete at the level we were competing at. A new larger venue was unfortnuately essential moving forward.

However the problem was again not simply borrowing to build the new stadium but not selling Highbury to help pay for that borrowing created a real cash flow crisis that was very harmful to the football club for several years and has yet to prodiuce real benefit for the football club despite the extra profit it created.

[USMartin]

By the way I thought this thread would be about them announcing Anfield had been built on a landfill, or that they had the same kind of irradiated seats we had at Highbury

[Barriecuda]

Honestly thought this was about the city of Liverpool in general, not the club!!

LOL

It looks like Rafa really left the club in shit shape. Kind of disgusting really. To me it looks like a lack of professional integrity; RB doing whatever he could to keep his job a little longer at the expensive of the club's long term viability.

Imo it's a combination of the Yanks' leveraging a load of debt on the club through the takeover and lending too much money to Rafa to spend, and Rafa making bad buys. Everyone is culprable and Rafa isn't as good in the transfer market or as good a manager as the scousers made him out to be. He left Valencia in a pretty poor financial state when he left them to come to Anfield as well

Precisely. The idea that its solely down to what was spent on players - and there in is a vindication of our decision to not spend more on players - is not actually accurate at all. Just as the argument that the new stadium is the sole reason we made that decision to not spend more is not accurate either. That is down in large part to the cash flow problems created by not selling Highbury to pay off that stadium debt initially, as originally planned.

Don't get me wrong, I don't blame Rafa solely for the sorry state of Liverpool's financial affairs. But I do believe he did not act with Liverpool's future interests in mind in his later years as coach. Risking 20m buying Aquilani because he "might prove to be a steal" is extremely irresponsible when your club is already in massive debt. Even if things were falling apart at the top, Rafa could have tried to mitigate the damages instead of overstaffing the team.

Say what you will about Wenger, he has always acted to ensure that Arsenal will be left strong and secure well into the future. He is a consummate professional. That being said, he probably needs to spend more...

[USMartin]

Honestly thought this was about the city of Liverpool in general, not the club!!

LOL

It looks like Rafa really left the club in shit shape. Kind of disgusting really. To me it looks like a lack of professional integrity; RB doing whatever he could to keep his job a little longer at the expensive of the club's long term viability.

Imo it's a combination of the Yanks' leveraging a load of debt on the club through the takeover and lending too much money to Rafa to spend, and Rafa making bad buys. Everyone is culprable and Rafa isn't as good in the transfer market or as good a manager as the scousers made him out to be. He left Valencia in a pretty poor financial state when he left them to come to Anfield as well

Precisely. The idea that its solely down to what was spent on players - and there in is a vindication of our decision to not spend more on players - is not actually accurate at all. Just as the argument that the new stadium is the sole reason we made that decision to not spend more is not accurate either. That is down in large part to the cash flow problems created by not selling Highbury to pay off that stadium debt initially, as originally planned.

Don't get me wrong, I don't blame Rafa solely for the sorry state of Liverpool's financial affairs. But I do believe he did not act with Liverpool's future interests in mind in his later years as coach. Risking 20m buying Aquilani because he "might prove to be a steal" is extremely irresponsible when your club is already in massive debt. Even if things were falling apart at the top, Rafa could have tried to mitigate the damages instead of overstaffing the team.

Say what you will about Wenger, he has always acted to ensure that Arsenal will be left strong and secure well into the future. He is a consummate professional. That being said, he probably needs to spend more...

Here's the trick its the manager's job to use the resources his employers will provide - its the club's board's job to determine what funds they can afford to and will provide.

If anything this is proof of that. The problem is - and its the same thing that led Hicks Tevas Rangers to end up bankrupt - that the Liverpool Board -or more accurately owners - even as it saddled the club with significant debt for its borrowing to buy the club, but did so without making any alterations to its investment in thee football team.

Now some will argue this would justify what has occurred at Arsenal, but again its the Cash Flow crisis created by not selling Highbury to pay off the stadium loan that is primarily if not exclusively responsible for those decisions which would have been unecessary had we sold Highbury as originally planned.

[QuartzGooner]

Citizens living in the nation that is (or was) the Official Travel Destination of Arsenal Football Club cannot travel to the nation of Arsenal's Offical Sponsor and the Sponsor of the new stadium. Forget the poliitics of it - that is just the reality. Although they can fly its national Airline - just not that nation

That shows that our corporate sales reps were under pressure to genearte every penny of cash they could with not a whole lot of concern as to how they did or what conflicts might arise in doing so, which is just very unprofessional and indicative of a club desperate for cash because of problems in cash flow.

And while we didn't lose our sponsor I'm willing to bet that again we lost some money for it. Penny-wise pound-foolish thinking at itts best - or more accurately worst really, and agin clearly symptomatic of a real cash flow problem.

Israel is no longer the travel destination of the club, it was a one season deal.

The deal did not cost Arsenal money. Why do you say that?
It earned the club £350,000.

The Emirates Airline were informed of the deal and did not cancel any of their own deals with Arsenal because of this.
One spokesperson of theirs made a statement saying he was disappointed by it, but aware of it before it was signed.

Why do you say it was brokered because the sales reps were under pressure?

The deal was signed by Keith Edelman.

[USMartin]

Citizens living in the nation that is (or was) the Official Travel Destination of Arsenal Football Club cannot travel to the nation of Arsenal's Offical Sponsor and the Sponsor of the new stadium. Forget the poliitics of it - that is just the reality. Although they can fly its national Airline - just not that nation

That shows that our corporate sales reps were under pressure to genearte every penny of cash they could with not a whole lot of concern as to how they did or what conflicts might arise in doing so, which is just very unprofessional and indicative of a club desperate for cash because of problems in cash flow.

And while we didn't lose our sponsor I'm willing to bet that again we lost some money for it. Penny-wise pound-foolish thinking at itts best - or more accurately worst really, and agin clearly symptomatic of a real cash flow problem.

Israel is no longer the travel destination of the club, it was a one season deal.

Hence my uncertainty reflected in putting (or was) in parentheses

The deal did not cost Arsenal money. Why do you say that?
It earned the club £350,000.

No I said I am willing to bet that it did in terms of our sponsorship money for Emirates Air. I am fairly we had to had to give some money back in some way. I suspect their disappointment was allayed by some financial concession on ourp art.

Why do you say it was brokered because the sales reps were under pressure?

The deal was signed by Keith Edelman.

I should have been clearer here. Whoever was brokering these marketing deals was under immense pressure to produce as much as cash as they could because not selling Highbury while taking on the new stadium debt created a very real cash flow problem.

Now other than the cash flow problem being exacerbated by this sort of thing the decision was not a bad one as there would be supporters for various reasons concerned by our arrangements with Emirates Air rightly or not. But again when you make a decision that creates are real cash flow problems which the company’s owners are unwilling to rectify using their own funds you can’t just be that short-sighted.

[USMartin]

By the way there is no disputing that we made more money from re-developing Highbury than we would have from selling but whilke they is no way to determine this with certainty, how much of that did we give back ahead of time through the decisions we made to address the cash flow problems re-developing Highbury created?

Decisions such and the front-loaded but underpriced endorsement and equipment contracts with Emirates Air and Nike, the final front-loaded deal given to Thierry Henry and his underr-priced sale to Barca the following year, the final 70 K a week deal with Ashley Cole which was necessitated by the Board's unwillingness to pay 60 K a week to keep him.

There is no way to know for sure but it's clear the cash flow issue led to several penny-wise pound-foolish decisions and if we knew just how pound-foolish they actually were it might call the decision to re-develop Highbury into even more serious question. And that we don't know just how much it cost even as itmade that extra 30 million doesn't mean it's irrelevent - except to investors and stock analysts.

[QuartzGooner]

I have no information that we had to give cash back to the Emirates Airline because of the Israel deal.
I would like to know where that came from because you are the first person to mention it.

The new stadium was delayed by one year because of trouble finding the eventual six banks to lend construction money, so it is well known the club needed money up front, irellevant of anything to do with Highbury.
You in the USA may not have bee aware of it but demolition of the buildings on the site, and the levelling of the ground of the podium happened very quickly, but then work stopped for a while until funds were secured. I made it my business to regularly pass the area when it was a construction site (I did not live far away at the time), it was boarded off but you could peak in through the gates, and there was a period of time when little happened there.

I agree that the front loaded deal for Henry was ridiculous, unless he had to give money back to the club when we sold him, but I do not know i that was meant to happen or if it happened.

[USMartin]

I have no information that we had to give cash back to the Emirates Airline because of the Israel deal.
I would like to know where that came from because you are the first person to mention it.

The new stadium was delayed by one year because of trouble finding the eventual six banks to lend construction money, so it is well known the club needed money up front, irellevant of anything to do with Highbury.
You in the USA may not have bee aware of it but demolition of the buildings on the site, and the levelling of the ground of the podium happened very quickly, but then work stopped for a while until funds were secured. I made it my business to regularly pass the area when it was a construction site (I did not live far away at the time), it was boarded off but you could peak in through the gates, and there was a period of time when little happened there.

I agree that the front loaded deal for Henry was ridiculous, unless he had to give money back to the club when we sold him, but I do not know i that was meant to happen or if it happened.

We don't know that that happened for sure - although if it did Arsenal and Emirates Air certainly wouldn't have been the first companies to resolve a conflict that way. The sole reason it may not have happened is if Emirates Air people calculated that their endorsement contract had been so porrly negotiated by the club and was so advantageous to them it was not worth pursuing extra money

But even if that were the case it does not disguise the reality that some poor decisions were driven by anxiety about our cash flow, such as this.

We read forums then too y'know - yes we are aware of those story behind the story so to speak. If anything the delay securing that financing minimized the need to produce more money ourselves - after all the sooner we have to pay the loans back the greater any potential cash flow problem - certainly if we had decided not to sell Highbury at that time already.

If anything that delay only calls the re-development decision into even further question.

I seriously doubt the froont-loaded money was given back, or it would have been no incentive whatsoever. I suspect that as much as he loves Arsenal, Henry was leaving in frustration as he saw the reaalty was, well, what, we all have seen since then. And we simply could not afford for his departure to cast a massive pall over the opening season at the Emirates and potentially even undermine tcket sales and profits.

Henry and more specifically his agent had an overwhelmingly strong bargaining position and pressed that advantage in all likelihood here.

The truly galling thing is that unless Arsenal somehow got Hney and Darren Dein to agree that about returning front-loaded money which is difficult to see happening really in this modern world, that it means the woeful price we got for Hnery relative to his value to Arsenal Football Club and it's football team was in fact truly pathetic. and even borderline irrespeonsible especial;ly given the difficuties we were having with cash flow at the time.

[Big_G]

I could have declared Liverpool as toxic...its full of degrading shit, whats new

[USMartin]

I could have declared Liverpool as toxic...its full of degrading shit, whats new

Bad- ump-bump!