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Are Arsenal Broke ?

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I've obtained a copy of the financial analysis of Arsenal that was made by the investment bank Lazard Brothers in support of Alisher Usmanov's proposal that the club should raise up to £150m in a rights issue.It's a chunky 35-page document. But its conclusion can be summed up very simply: Arsenal has too much debt to pose a serious challenge to Europe's biggest clubs; or to use the jargon, it is over-leveraged, too thinly capitalised.This is a verdict that has been rejected by Arsenal's board, which has been advised by NM Rothschild.The North London club's directors argue that paying down debt would have only a marginal impact on the availability of financial resources.Of course, as an Arsenal-supporting BBC journalist, I couldn't possible take sides in this dispute between the Uzbekistani plutocrat and Arsenal's directors.But some of you will be interested in Usmanov's point of view.Here are a few bullet points from the Lazard document:) It believes that Arsenal's earnings before interest, tax, depreciation and amortisation (EBITDA) will fall from between £55m-60m in 2009 to £35-40m in 2010. The most striking contributor to this squeeze that it cites is a 12-14% increase in costs to £179m "as a result of players being compensated for tax changes and a number of step-ups in wages for individual players".2) It predicts that cash flow will fall by more than that because of some pre-payments on assorted deals that were taken in 2007.3) It says that Arsenal's fans are already paying 40% more than the average for the big four English clubs for match tickets and 24% more for season tickets - implying there's little scope to increase gate revenues, especially in a recession.4) It calculates Arsenal's gross average annual spend on new players as £18m, compared with £37m for the big four; and the net annual spend, including sales, as precisely zero, compared with a £20.2m big four average5) Perhaps most germanely of all, it fears that redevelopment of Arsenal's former Highbury stadium into luxury apartments may not turn out to be profitable - and that refinancing £140m of property-related debt over the next couple of years will be neither cheap or easy.So Usmanov - the second-biggest shareholder in Arsenal with a 25 per cent stake - suggests that investors stump up a maximum of £150m via a rights issue of new shares.This would provide additional funds for Arsene Wenger to augment the playing squad, and/or pay off some of the property debt, and/or pay down a substantial portion of the £242m of separate debt incurred to fund the development of the new Emirates stadium.As I say, Arsenal's board has said no to all this, following detailed scrutiny by bankers from Rothschild - which included those bankers sounding out the most important individual at the club, Arsene Wenger.
PMSLcharity_box.jpgHeard all the other prem managers gonna have a whip round for Arsene
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Pretty much old news, money definitely isn't growing on trees for us at the moment. Would feel no way to go ahead with Usmanov's plan.

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Who cares though, being broke and having a team that can fight on all four competitions is better than a club whose spent 200 million and NEEDS to win in order to please and financially return the deeds to arab/american owners.Arsenal fans are happy, we are comfortable, no pressure to win trophies like Villa, Tottenham, Man u, Chelsea, Man City, Liveprool - just anything we do win will be a massive bonus.I'd rather be in this position when anything the club turns over is profit rather than debt, no pressure and enjoying your season >

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No pressure to win trophies? And 'Arsenal fans are happy with this'? :lol: :lol:

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Who cares though, being broke and having a team that can fight on all four competitions is better than a club whose spent 200 million and NEEDS to win in order to please and financially return the deeds to arab/american owners.Arsenal fans are happy, we are comfortable, no pressure to win trophies like Villa, Tottenham, Man u, Chelsea, Man City, Liveprool - just anything we do win will be a massive bonus.I'd rather be in this position when anything the club turns over is profit rather than debt, no pressure and enjoying your season >
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Rothschild aye, Taking advise from the Illuminati.

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LOL I HAVE READ THIS BEFORE AND IT IS IN THE MOST PART GASITS THAT ECONOMICS EDITOR FROM THE BBC WHO SPEAKS IN A MONOTONEEVERYBODY KNOWS WE ARE MAKING PROFITS AND HAVE THE STADIUM TO PAY FORLOL BROKE

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So the guy who wants to take over our club has got someone to produce a report that downplays the value of our club? And people can't read between the lines. SMH.

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still not like hes jesus and making wine out of waterthere has to be substance to it

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lol @ arsenal
700m+ in the red?
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And to be fair, they did cop Arshavin for 20 mill. So it's not like they are looking to sign a bunch of washed out European journeymen on loan and only buying 17 year olf Franch-Africans for 6 figure sums.

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U kno Lol at any united fan laughing at thisArsenall will be fine financialynot like Wenger made a habit of making big moneysignings before anyway this is their transition period got a new stadium out of it and they are looking alright fo the future winning loads and loads today should not be chosen over long term stability

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U kno Lol at any united fan laughing at thisArsenall will be fine financialynot like Wenger made a habit of making big moneysignings before anyway this is their transition period got a new stadium out of it and they are looking alright fo the future winning loads and loads today should not be chosen over long term stability
quote of the dayespecially the part in bold top man
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U kno Lol at any united fan laughing at thisArsenall will be fine financialynot like Wenger made a habit of making big moneysignings before anyway this is their transition period got a new stadium out of it and they are looking alright fo the future winning loads and loads today should not be chosen over long term stability
quote of the dayespecially the part in bold top man
Yeah but you could argue by winning loads and loads you will get loads more income from winning the competitions, more money from sponsors and more money from fansIt evens out imoMaybe even more in the other direction but i guess its up to the individual to decide
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Funny how i said this a few days ago and then suddenly all these articles coming out about arsenal being broke :lol:

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we been broke for years

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U kno Lol at any united fan laughing at thisArsenall will be fine financialynot like Wenger made a habit of making big moneysignings before anyway this is their transition period got a new stadium out of it and they are looking alright fo the future winning loads and loads today should not be chosen over long term stability
quote of the dayespecially the part in bold
C/S thisso true
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U kno Lol at any united fan laughing at thisArsenall will be fine financialynot like Wenger made a habit of making big moneysignings before anyway this is their transition period got a new stadium out of it and they are looking alright fo the future winning loads and loads today should not be chosen over long term stability
quote of the dayespecially the part in bold
C/S thisso true
c/s
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