Dear Roker Report,
I do agree with most that you have said, with the exception of the parachute payments being a moot point. We have to believe that when the sale went through we were completely debt free, because this was what SD told us. Also, the price SD paid for the club was £40 million of which he put £5 million of his own money, with him agreeing to pay the balance of £35 million over the next 2 years, so this could allow him to invest his money over this period (his words). However, after a few months when we received the parachute payments he immediately paid ES the balance of £35 million and then tried to sell the club for £40 million. Why would you buy a club for £40 million and then a few months later sell it for the same amount?? All of this was widely publicised and in many statements both SD & CM put out.
Are we to believe that the club was only worth £5 million, the amount SD paid personally, but due to the fantastic job in taking us forward it is now worth 800% more!? Hardly, the club has gone backwards and is at the lowest point in its history. Not to mention all the clubs assets secured against a loan, that SD now says he has not even used and didn’t need. So why take it out? Unless the US consortium are fairy godmothers, it is certain we will be paying a very high interest rate.
Since May 2018, we get a different version every time our 2 owners open their mouths.
Ed’s Note [Tom]: Hi Sam, thanks for writing in, I hope you are safe and well. I think you are replying in relation to the article entitled: “Rights & Wrongs: Thoughts on Methven & Donald after watching Sunderland Til I Die” by David Holloway. As such, I asked him to give a response to the points you raised.
DH: Back in May 2018 the club was technically insolvent with an owner who was on record as saying that he would no longer fund it. Given the commitments to player contracts, transfer fees owed, external financiers combined with shrinking income, the value of the club was likely to be negligible.
Whatever the rights and wrongs of the deal, the owners took on a huge risk. I merely made the point that the parachute money would have left the club in any event. The other liabilities - as we are lead to understand it have been settled. So in reality it makes little difference. The article was also highly critical of the communication around the deal and was trying to put a balanced view out there. We will all know more when the financial statements are released, hopefully at the end of this month.