New accounts show impact of loan on Burnley’s finances

0

Burnley is paying between 7.9% and 9.5% interest on the loan that ALK took from MSD UK Holdings to help fund the deal, the latter’s accounts show.

The US investment firm struck a leveraged deal last year and it is understood that ALK paid £ 102million for the takeover, with around £ 60million raised through a loan provided by MSD UK Holdings of Michael Dell, who also loaned money to Southampton, Sunderland and Derby County. .

This loan was taken out by Burnley FC and the interest payments will therefore be made by the club, although they are now owned by Velocity Sports Partners, the sports investment arm of the American management company ALK Capital, so that companies are linked.

READ MORE: ALK Capital submits offers to remaining Burnley shareholders as Alan Pace speaks

The remainder of the upfront payment was made up of club cash as well as ALK’s equity.

MSD UK Holdings’ accounts were released this week, covering the period up to December 31, when Burnley’s takeover was announced, and show loans to football clubs are repayable at an interest rate included between 7.9 and 9.5%.

President Alan Pace has always said Burnley fans don’t have to worry about the club’s financial situation as it aims to spend wisely to build on the Clarets platform.

He invested in the playing squad with Sean Dyche backed in the summer transfer market while the Clarets chief was also awarded a new four-year contract.

The financial structure of the deal has raised concerns in some quarters, although the president decided to allay those fears upon his arrival.

“I would tell you that the way we did this, I’m absolutely sure it’s never been done the same way before,” Pace said.

“It has everything to do with making that fan base comfortable that this is the most lasting form of what we could have done. Without exception. I think people will realize that over time.

“We can’t talk about it for a whole bunch of reasons, but if I was in front of a number of fans at one point, I could put my hand over my heart, look them in the eye and say ‘you should be proud of how this club did what they did. And you should be happy to know where it can go and will go with the structures that have been put in place. ‘”

Download the LancsLive app for free at iPhone here and Android here.

Don’t miss out on the club you love! For all the latest updates on Burnley, sign up for our free newsletter with all the latest news here.


Source link

Share.

About Author

Leave A Reply