http://www.onlinegooner.com/exclusive/index.php?id=377
Usual thread starter – Would you be tempted to cash in if you’d bought a share a year ago for £4,000 and it had doubled in value? There is a theory that Danny Fiszman might be seriously tempted before 12 months are up, and his words about not selling are just an attempt to stabilise the high price until his tax status allows him to sell without paying capital gains tax (er… I think!). Hardly in the best interests of the club if that is the case. Who knows though…
A Gooner’s Guide to Arsenal’s Finances Part 2 (3/8)
Very good article
I like the article, and I commented on Part 1 before to point out the deficiencies in the view of Arsenal finances, though also acknowledging that I may be jumping the gun because you may address the valuation issues later. I won't repeat my previous comments but want to point out two things in line with my previous comments. The current GBP466m value you alude to is actually the equity value, which DOES take debt into account. Without the debt, the value of Arsenal is GBP466m plus GBP260m, about GBP730m. This is referred to as Enterprise Value and means in simple terms that once the debt is paid off, that will be the value of the club. This is important because it addresses one of the reasons why the current shareholders would choose to sell (or not). If they believe that the club will be able to settle the debt over time without a problem, they will hold on to the shares because they will be worth some 55% more over time. This is excluding any success the club has, say in the CL, which may result in more cash flows and a much higher EV than my R730m. You think about it then, why would they sell since we know that the club's income far exceeds the interest and capital obligations? They would be stupid to do so, which again brings back a question I have asked repeatedly: what are David Dein's motives in wanting the club sold?
