Grizzly Posted January 21, 2009 Share Posted January 21, 2009 quote:Originally posted by Grandstander Lost in this once again is George Gillet. Without George Gillet Saputo is way out of his league. He needed George Gillet to make this deal happen. Saputo is not cash rich, despite the family (meaning family as in it is not all Joey's money)worth pegged at around 4 bil. I mean seriously, out here we have an owner willing to fund a stadium to the tune of 80 to 100 million dollars, Joey was looking for financing deals to add more space to his undersized stadium. Does that sound cash rich to you? This is completely untrue. The one who is not cash rich is Gillet. He has a lot of paper assets that were purchased on credit. He was brought in for his expertise in running a franchise and for cross marketing purposes with the Habs/Liverpool not for the money he could bring to the table. The Saputo's are extremely rich and have many physical assets bringing in a steady stream of income. Joey already admitted he could afford what MLS wanted, he just thought they wanted too much money. As far as Joey not having access to the full family fortune this is not true, the whole family and in particular his father are behind the team, Joey is just the one who runs things. Just because you have money doesn't mean you like to spend it. Link to comment Share on other sites More sharing options...
dbailey62 Posted January 21, 2009 Share Posted January 21, 2009 quote:Originally posted by Grizzly This is completely untrue. The one who is not cash rich is Gillet. He has a lot of paper assets that were purchased on credit. He was brought in for his expertise in running a franchise and for cross marketing purposes with the Habs/Liverpool not for the money he could bring to the table. The Saputo's are extremely rich and have many physical assets bringing in a steady stream of income. Joey already admitted he could afford what MLS wanted, he just thought they wanted too much money. As far as Joey not having access to the full family fortune this is not true, the whole family and in particular his father are behind the team, Joey is just the one who runs things. Just because you have money doesn't mean you like to spend it. Yes. As of 2007, the Saputo family were acknowledged to be #12 on the richest Canadians list with a worth of $2.77 Billion! They have the money. It's just a matter of how they want to spend it ... and I suppose that is how you stay rich. Link to comment Share on other sites More sharing options...
Guest Jeffery S. Posted January 21, 2009 Share Posted January 21, 2009 So basically we are saying that Saputo arguing over the franchise fee is like one of us buying shoe laces on sale to save a dollar and a quarter. Barça has signed a three-year agreement with Claure's club Bolivar, from the Bolivian league. Not too many details, though it is possible Barça will get involved in some aspect of youth development at Bolivar, the S. American team will come to Barcelona to train with the first team (recently Rivaldo's team from Uzbekistan was here doing just that, playing a friendly, and paying for the privilege). And there is talk of Barça going to Bolivia at some point in time, though that could not be a big marketing priority for the club. All part of their MLS bid alliance. Link to comment Share on other sites More sharing options...
Guest Jeffery S. Posted January 21, 2009 Share Posted January 21, 2009 So basically we are saying that Saputo arguing over the franchise fee is like one of us buying shoe laces on sale to save a dollar and a quarter. Barça has signed a three-year agreement with Claure's club Bolivar, from the Bolivian league. Not too many details, though it is possible Barça will get involved in some aspect of youth development at Bolivar, the S. American team will come to Barcelona to train with the first team (recently Rivaldo's team from Uzbekistan was here doing just that, playing a friendly, and paying for the privilege). And there is talk of Barça going to Bolivia at some point in time, though that could not be a big marketing priority for the club. All part of their MLS bid alliance. Link to comment Share on other sites More sharing options...
Cheeta Posted January 21, 2009 Share Posted January 21, 2009 ^More like settling for a new Cobalt in the driveway instead of over paying for an H3. The H3, grotesques as it is, is certainly more eye catching, will let you go off-roading (if you want) and can handle winter snow better. And best of all that H3 won't let your brothers show you up at those family functions you need to attend every year. Huge plus that. But even with its limits the Cobalt meets your needs, is way cheaper to buy and operate and absolutely the better value dollar for dollar. But most importantly with the money you saved by not buying the H3 you have enough cash left over to go on trips to Mexico and Central America during the off season. I've got a feeling if things are as bad in the USA as the media would have us believe (and I'm sorry to say they probably will be) that Saputo & Co are going to work out some deal with MLS which will get Montreal into that league sooner rather than later. Some face saving scheme for both parties. Saputo bumps up his cash payment a couple of millions with the remainder of the $40M expansion fee getting drawn from Montreal's share of future league revenues (profits, future expansion fees, etc) or something like that. These are clever men, they can make this work if they want to. Speculation of course. Impossible to read peoples minds. Link to comment Share on other sites More sharing options...
Free kick Posted January 21, 2009 Share Posted January 21, 2009 quote:Originally posted by Cheeta ^More like settling for a new Cobalt in the driveway instead of over paying for an H3. The H3, grotesques as it is, is certainly more eye catching, will let you go off-roading (if you want) and can handle winter snow better. And best of all that H3 won't let your brothers show you up at those family functions you need to attend every year. Huge plus that. But even with its limits the Cobalt meets your needs, is way cheaper to buy and operate and absolutely the better value dollar for dollar. But most importantly with the money you saved by not buying the H3 you have enough cash left over to go on trips to Mexico and Central America during the off season. I've got a feeling if things are as bad in the USA as the media would have us believe (and I'm sorry to say they probably will be) that Saputo & Co are going to work out some deal with MLS which will get Montreal into that league sooner rather than later. Some face saving scheme for both parties. Saputo bumps up his cash payment a couple of millions with the remainder of the $40M expansion fee getting drawn from Montreal's share of future league revenues (profits, future expansion fees, etc) or something like that. These are clever men, they can make this work if they want to. Speculation of course. Impossible to read peoples minds. Not sure that that analogy applies. Purchasing an MLS club is an investment whereas, unless I am mistaken, the Cobalt and H3 are vehicles. Vehicles, unless they are antiques or collectibles, depreciate in value. What is likely to appreciate more in value at this moment? and MLS or USL club? Also, unlike the vehicles, there is revenue potential and consequencies in choosing one option over the other. What if his fan base becomes tired and disinterested in USL after his rivals have all made the jump. Link to comment Share on other sites More sharing options...
Grizzly Posted January 21, 2009 Share Posted January 21, 2009 The key to this is what happens to Vancouver. It doesn't look like Portland is going to get into MLS. If Vancouver were to stay in USL, USL becomes viable again as a competing league to MLS and it is possible the Saputos made the right move. If Vancouver goes MLS the USL will have to develop some strong franchises fairly quickly. I am sure Garber is aware of this so that is why unless there are major problems in Vancouver's bid, they are pretty much guaranteed to have their bid accepted. Link to comment Share on other sites More sharing options...
Gordon Posted January 21, 2009 Share Posted January 21, 2009 A bird in the hand over a $40 million bird in the bush, plus stadium upgrades is the question. As an investment vehicle, Is an MLS Franchise in Montreal worth the cost in terms of return. It is not uncommon in the private sector to have a reasonable expection of a 15% annual return on investment before investing in a venture. Assuming just the $40 million, we are talking about a $6 million profit ($3.2 million at a more modest 8%), add the required stadium upgrades (apparently the sticking point as Saputo & Co. were offering a total of $40 million including stadium upgrades) and a much higher profit number is required. Currently only a small number of teams actually make a profit, 3 IIRC, and most teams have only losses to show for their entire existence, so as an investment vehicle, there is not a lot sense for him to shell out for an MLS franchise. As an "investment" he would be better off to invest that money in other ventures. Link to comment Share on other sites More sharing options...
rdroze Posted January 21, 2009 Share Posted January 21, 2009 It may well make financial sense if you also look at the (expected future) total value of the franchise. Many other pro sports teams in the last few decades may not have made much profit on a money-coming-in vs money-going-out basis, but when you take into account the total value of the franchise, there are plenty of teams that have done well just from franchise value appreciation. Link to comment Share on other sites More sharing options...
Grandstander Posted January 21, 2009 Share Posted January 21, 2009 quote:Originally posted by Grizzly This is completely untrue. The one who is not cash rich is Gillet. He has a lot of paper assets that were purchased on credit. He was brought in for his expertise in running a franchise and for cross marketing purposes with the Habs/Liverpool not for the money he could bring to the table. The Saputo's are extremely rich and have many physical assets bringing in a steady stream of income. Joey already admitted he could afford what MLS wanted, he just thought they wanted too much money. As far as Joey not having access to the full family fortune this is not true, the whole family and in particular his father are behind the team, Joey is just the one who runs things. Just because you have money doesn't mean you like to spend it. Then why refinance your stadium expansion instead of cutting a cheque for the money out right? To get the cash he probably needs to sell assets he wants to keep. I'm speculating here, but the question needs answering. The 40 mill. price tag was no secret. When a bid was submitted they knew how much was going to be needed. There has to be a reason as to why he was OK with 40 mil. before his bid submission and why he didn't want to pay up after bid submission? I doubt it has anything to do with wanting to keep his money. Being worth 2.77 billion does not mean that's what you have in cash, liquid, ready to move within days. So unless, I find out otherwise, The Saputo's aren't cash rich. Gillet has half owned Liverpool for a year and a half with everyone who runs day to day operations of the club actually in England. So what experience does he bring? He's a billionare with assets. He brings money. His money plus Saputo's money equals 40 mil. franchise fee. I'm sure either could afford the fee if they sold off some assets (busines or personal). Joey isn't being up front about this. Link to comment Share on other sites More sharing options...
Gordon Posted January 21, 2009 Share Posted January 21, 2009 quote:Originally posted by rdroze It may well make financial sense if you also look at the (expected future) total value of the franchise. Many other pro sports teams in the last few decades may not have made much profit on a money-coming-in vs money-going-out basis, but when you take into account the total value of the franchise, there are plenty of teams that have done well just from franchise value appreciation. It might, but that would assume a belief that this appreciation would occur at the required levels. But to keep it in perspective, assuming that the team only broke even every year (and bear in mind that most MLS teams have never even done this), the value of the franchise would have to double every 5 years (using the compound interest formula) or every 6.67 years (using a simple interest formula) to be equivalent to a 15% return. Obviously, if there were annual profits, then the appreciation required would be lower. Link to comment Share on other sites More sharing options...
Mr.Impact Posted January 21, 2009 Share Posted January 21, 2009 I don't think the Saputo's were looking at the MLS to make a profit. Much like the Stadium, their Intent was to give back to the community by offering a team playing in a league that is deemed to be of higher caliber. Of course they don't want to be reaching into their pockets to cover losses, thats where George Gilette comes in to reduce the risk, by cutting Saputos exposure by half. Link to comment Share on other sites More sharing options...
Cyrus Posted January 21, 2009 Share Posted January 21, 2009 quote:Originally posted by rdroze It may well make financial sense if you also look at the (expected future) total value of the franchise. Many other pro sports teams in the last few decades may not have made much profit on a money-coming-in vs money-going-out basis, but when you take into account the total value of the franchise, there are plenty of teams that have done well just from franchise value appreciation. That's a legitimate argument when your league has become an established long-term presence with solid marketing growth. Yes, in theory, a $40 Million franchise fee may net you a "Somewhere FC" that may be worth a cool half-billion in twenty years, if you can find somebody to buy it. Or an MLS franchise in twenty years might have a value of... $40 Million. Or the league might fold around you, and then the franchise'll be worth nothing. MLS just doesn't seem that rock-solid yet. Link to comment Share on other sites More sharing options...
RustyTWH Posted January 22, 2009 Share Posted January 22, 2009 absolutely agree. at $40 million plus stadium costs plus plus plus, and a new CBA due next season, this puppy won't be profitable for at least ten years. by all means, buy in now, but do not buy in to flip it any time soon. this is a long-term growth fund. or a ten-year write down. Link to comment Share on other sites More sharing options...
ag futbol Posted January 22, 2009 Share Posted January 22, 2009 ^ I think that's a pretty conservative outlook to be making considering the teams in this league who have made the right business decisions and invested the money are already profitable. Seattle with their season seat sales and rent-free agreement are pretty much gauranteed to be in the green as well. If you have decent elements for success (stadium in a good location, good lease agreement, city with interest in the sport) it looks like you can start out as being profitable. Problem overall with the league is, there's a lot of deadweight that needs to be cut loose. BTW, i don't think you'll see anything too crazy out of the next CBA. The cap will bump modestly, players will probably have more free agent rights, and job security will go up, but that's about it. Most of these guys realise that asking for too much will mean a less stable league and vastly higher salaries will mean different players as opposed to themselves. Link to comment Share on other sites More sharing options...
Guest Jeffery S. Posted January 22, 2009 Share Posted January 22, 2009 quote:Originally posted by Free kick Not sure that that analogy applies. Purchasing an MLS club is an investment whereas, unless I am mistaken, the Cobalt and H3 are vehicles. Vehicles, unless they are antiques or collectibles, depreciate in value. What is likely to appreciate more in value at this moment? and MLS or USL club? Also, unlike the vehicles, there is revenue potential and consequencies in choosing one option over the other. What if his fan base becomes tired and disinterested in USL after his rivals have all made the jump. No, the analogy is fine. As long as you add that if you get the Cobalt you can only drive on city lanes, cause the streets are for the H3. And that when you go cruising with it you are going to pick up a lot less girls and if and when you do, they won't be as hot. You'll drive, you'll screw, but you'll still be 2nd division. And all because you were too damn cheap to pay for the better vehicle when money was no issue at all. Link to comment Share on other sites More sharing options...
BearcatSA Posted January 22, 2009 Share Posted January 22, 2009 quote:Originally posted by Jeffrey S. No, the analogy is fine. As long as you add that if you get the Cobalt you can only drive on city lanes, cause the streets are for the H3. And that when you go cruising with it you are going to pick up a lot less girls and if and when you do, they won't be as hot. You'll drive, you'll screw, but you'll still be 2nd division. And all because you were too damn cheap to pay for the better vehicle when money was no issue at all. Lol. Good job with continuing the analogy, Jeffrey. Link to comment Share on other sites More sharing options...
Richard Posted January 23, 2009 Share Posted January 23, 2009 If the girls make themselves available just because you drive an H3 they will most likely be bimbos. If you're looking for a lasting relationship you're probably better off going with the Cobalt girls. Link to comment Share on other sites More sharing options...
Guest Jeffery S. Posted January 23, 2009 Share Posted January 23, 2009 quote:Originally posted by BearcatSA Lol. Good job with continuing the analogy, Jeffrey. I stole the lanes and streets idea from My Winnipeg, where he describes how the taxis were licenced for one or the other. Brilliant movie. Link to comment Share on other sites More sharing options...
Cheeta Posted January 23, 2009 Share Posted January 23, 2009 Ohhhh... You're a bad man. A very, very, bad man... Link to comment Share on other sites More sharing options...
BearcatSA Posted January 23, 2009 Share Posted January 23, 2009 quote:Originally posted by Jeffrey S. I stole the lanes and streets idea from My Winnipeg, where he describes how the taxis were licenced for one or the other. Brilliant movie. Haven't seen it or any other Maddin movies? Perhaps I'll give it a looksy. Link to comment Share on other sites More sharing options...
BearcatSA Posted January 23, 2009 Share Posted January 23, 2009 quote:Originally posted by Richard If the girls make themselves available just because you drive an H3 they will most likely be bimbos. If you're looking for a lasting relationship you're probably better off going with the Cobalt girls. Lol. Thanks for the relationship advice, Ward Cleaver. I can't wait for this thread to transform into a special Voyageurs' edition of "Keys to the VIP." Link to comment Share on other sites More sharing options...
piltdownman Posted January 23, 2009 Share Posted January 23, 2009 quote:Originally posted by Richard If the girls make themselves available just because you drive an H3 they will most likely be bimbos. If you're looking for a lasting relationship you're probably better off going with the Cobalt girls. H3 it is then Link to comment Share on other sites More sharing options...
BearcatSA Posted January 24, 2009 Share Posted January 24, 2009 quote:Originally posted by piltdownman H3 it is then Precisely! Link to comment Share on other sites More sharing options...
ag futbol Posted January 24, 2009 Share Posted January 24, 2009 Ok back to topic: What happens when there are only 2 H3 hummers left on the lot and 5 people who want them? Do you give it to the owner you like the best? What about the one with the most steady financing? Gerry Dobson says you give the Hummers to the people who are least likely to have mechanical problems. Or if your Joey Saputo maybe you pick up a used Hummer once it depreciates a bit. http://www.sportsnet.ca/soccer/blogs/2009/01/24/dobson_expansion_dero/ Interesting stuff and i generally do agree that he says, but the conclusion at the end pegging Ottawa as being in the driver's seat seems illogical to me. Personally I'd say Vancouver and Miami are in the lead at this point. Everyone else is bad in the financing department or have some other major issue holding them back. Ottawa has a good bid, however I think that it's more likely MLS will prioritize other markets first. Link to comment Share on other sites More sharing options...
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