Munster Debts

First topic message reminder :

http://www.irishtimes.com/sport/rugby/international/irfu-chief-does-not-believe-munster-can-make-debt-repayments-1.2723985

Clearly Philip Browne didn't read the thread on here in which I was told the debts would be repaid without an issue.

Pot, the whole mortgage analogy came from just trying to show that debt is debt regardless of whether it's on an asset or just peed up against a wall. And of for whatever reason you are failing to meet the set out repayment schedule you are in a bad position.

ScarletSpiderman wrote:Pot, the whole mortgage analogy came from just trying to show that debt is debt regardless of whether it's on an asset or just peed up against a wall.  And of for whatever reason you are failing to meet the set out repayment schedule you are in a bad position.

Are Munster in a bad position? No interpros at 5pm on a Friday evening during the world cup would probably cover a mortgage repayment. Munster have an attractive pool this year with Racing, Leicester & Glasgow. A better showing in the Champs Cup (with POM and hopefully Bleyendaal fit along with a host of others) and an emerging Johnny Holland as a good, controlling outhalf. Munster v Maori in November (which will be a sell-out). Most the corporate entertainment sold for that already. New training centre opening next month (now 1 training set ups rather than 2). Running Corporate training courses.

The team training together rather than meeting up twice a week should make a huge difference to the performance on the pitch as well.

Is there any further movement on the naming rights of Thomond being sold?

ScarletSpiderman wrote:Pot, the whole mortgage analogy came from just trying to show that debt is debt regardless of whether it's on an asset or just peed up against a wall.  And of for whatever reason you are failing to meet the set out repayment schedule you are in a bad position.

There is a difference between spending on non assets and assets. The latter is a security. And IRFU own half of it already.

Missing repayment schedule and no hope of paying it back versus hope of paying it back but over longer period is different.

Anyway, we'll see what happens in the next year.

marty2086 wrote:Is there any further movement on the naming rights of Thomond being sold?

No mention of it in recent times. I'd say they are wiser to hold off until Munster gets back to winning ways.

Sin é wrote:

marty2086 wrote:Is there any further movement on the naming rights of Thomond being sold?

No mention of it in recent times. I'd say they are wiser to hold off until Munster gets back to winning ways.

If money is one of the issues preventing it then that would be foolish, fans will be peeved, plenty of us in Ulster were but guess w

Not fans - just the market. Maybe the new EirSport will do a BT Sport on stadium sponsorship!

By the way, not good for Ulster that Bank of Ireland are closing branches in NI. With Brexit, what will the story be with Kingspan? They are based in ROI? Will their business in NI contract?

Sin é wrote:Not fans - just the market. Maybe the new EirSport will do a BT Sport on stadium sponsorship!

By the way, not good for Ulster that Bank of Ireland are closing branches in NI. With Brexit, what will the story be with Kingspan? They are based in ROI? Will their business in NI contract?

That's true but you think they would be putting it out there for businesses to consider

From what I gather BoI isn't a huge thing, just branches not doing much for them.

I think I read a piece about Kingspan using Ulster as a marketing platform in Europe and beyond, they supply globally. The deal will probably have incentives built in, ERCC earns £x, knock out stages are £y etc so they aren't targeting the NI market so should have little impact, though that may depend on where they pay Ulster from.

Kingspan should be fine - they have a foot in both camps. Exports to EU countries from Cavan, internal sales from NI to UK.

If they are paid from EU they should do well.

Those are interesting quotes of Philip Browne in that article. As a guy who has signed off on those accounts, is he really being quoted saying he questions the recoverability of debt. How can he say that and not provide for the shortfall in the accounts? It would be ODCE stuff unless maybe quotes are abridged or taken out of context.

LordDowlais wrote:
I think you will find that some of the Irish provinces are being funded by rich businessmen and that funding does not necessarily get shown on the branches accounts. There must be some sort of legal issues there. But as I have said, that's the IRFU's problem.

Do you know that Sam Warburton gets money from Land Rover but that doesn't show in Cardiff's accounts?

Can you imagine that!!?!?!

And you claim to run a business.....

Munchkin wrote:

It isn't extraordinary. It makes perfect sense. The loan has been made, Munster are struggling to pay that loan. The most effective way for Munster to repay that loan is for Munster to succeed, on and off the field. Shackling Munster to the terms of repayment will not bring about the success they need in order to repay that loan. Allowing them the time needed to rebuild, to become a success, is the most effective means. Otherwise Munster fail and no loan is repaid. which in turn hurts the IRFU and the other three Provinces. Nobody wins.

The league wins because it is then a competition based on the merits of the competitors who fail or succeed based on their own investment. That is the very nature of sport.

Munster should be failing but they qualified for EPRC1 based on not having to pay a debt they owe to the rest of the game in Ireland. That debt is also, from memory, not interest bearing.

I'd agree that they should be given time IF the debt was interest bearing.

As it is, they are able to 'succeed' by robbing money from the rest of the game in Ireland and that's not the basis for a fair competition.

Munchkin wrote:
Boo hoo. Sure who cares about a level playing field? It's all about the money. Long live the Toulons of the Rugby Union world.

Anyway, just lobby the Regions owners to cough up more money. You can't really expect WRU to pay for private businesses they don't own, although I do remember the WRU (The Regions Bank) having to bail the Regions out with a loan. What were the terms of that loan?

Toulon raises its own income. You seem to have missed that crucial point here.

The terms of the WRU loan is that it has to be paid back over the term of the RSA. It also doesn't total over €9m to each team.

You're also forgetting that the WRU is a customer of PRW and a customer that underpays for the services it uses.

Munchkin wrote:I was making the point that you complain about the IRFU behaving as a bank for the Provinces, when the Regions can be said to benefit as much from the WRU.

How? Please show me.

PhilBB wrote:

Munchkin wrote:
Boo hoo. Sure who cares about a level playing field? It's all about the money. Long live the Toulons of the Rugby Union world.

Anyway, just lobby the Regions owners to cough up more money. You can't really expect WRU to pay for private businesses they don't own, although I do remember the WRU (The Regions Bank) having to bail the Regions out with a loan. What were the terms of that loan?

Toulon raises its own income. You seem to have missed that crucial point here.

The terms of the WRU loan is that it has to be paid back over the term of the RSA. It also doesn't total over €9m to each team.

You're also forgetting that the WRU is a customer of PRW and a customer that underpays for the services it uses.

Toulon are able to raise their own income to sustain their success because of the large investment from Mourad, without that they wouldn't be able to do what they are doing.

Munchkin wrote:
Munster are a branch of the IRFU. Munster are IRFU owned. Unlike the Regions, Munster are not a private business. If Munster was to fail, it not only has a negative impact on the IRFU, but also the other Provinces. There really isn't the option of allowing Munster to fail, especially when Munsters failings can be reversed with good management. If Munster fails, nobody wins. Munster must be given time, and help needed, to turn things around. I do believe their CEO must be replaced in order for that to happen though. They can recover from this. I have already made these points, but you don't seem to understand.

I thought that Munster were owned by the clubs within the Branch, not the IRFU? That's what the Chief Executive of the IRFU claimed, unless I've not remembering clearly.

Munster's 'failings' could be reversed by selling off assets, not just with 'good management'.

LordDowlais wrote:Look, I have no gripe about the Irish system, it suits them, and it suits them well. Good for them. But what people are not looking at is, we have a league of different types of enterprises. When we are competing in the Pro12, and people need to realise this, who are the Welsh regions competing against ? Other teams, or other unions ?

The 4 teams from Wales, are not competing with teams on an even keel because they are being backed by their union juggernauts, private owned teams need to worry about their finances, union run teams it would seem do not.

If any of the four regions were in as much debt as Munster, they would not be here now.

Cardiff owe more to Thomas than Munster owe to the IRFU.

But the rest of your post is right so maybe you will finally stop with your drivel about seeing a relative improvement in PRW performance.

marty2086 wrote:
Toulon are able to raise their own income to sustain their success because of the large investment from Mourad, without that they wouldn't be able to do what they are doing.

How much was this large investment and when was it made?

Sin é wrote:
The difference between Munster and a lot of clubs is that Munster didn't spunk its money on wages. Its got the ability to develop other revenue streams from their investment.

So how do you explain that, many years in, their main asset is loss making and they are unable to meet the repayment terms that have already been negotiated down once?

Sin é wrote:Didn't the WRU bail out the Dragons?

No.

Top knowledge, there, though.

marty2086 wrote:

LD, except they could be. The IRFU is limited by its own income and the Regions are reliant on the WRU too hence the NDCs.

Privately owned teams aren't just reliant on what income they generate but what their owners can pump into them, in Saracens case they are overly reliant on theirs, in Toulons case they developed a business plan that meant they could evolve to be self reliant. In the Provinces case they are overly reliant on the IRFU.

The IRFU are wanting to evolve, theirs, the provinces and Pro12s to increase and improve revenue streams.

Ulster were able to generate serious income from selling the naming rights to Ravenhill, this has helped finance the Piutau and Coetzee deals.

You do know how NDCs work, right? And how much the NDC pot is, yes? If so, please could you explain how PRW are 'reliant on the WRU', thanks.

How much did Kingspan pay?

No idea of exact dates and amount but Mourad himself stated he had pumped money in to take them to the top but was creating a business model so the club was self sustaining, the cafes, shops etc built around the brand.

For all that I loathe about him he cant be faulted for that and its something most in the game could learn from

PhilBB wrote:

marty2086 wrote:

LD, except they could be. The IRFU is limited by its own income and the Regions are reliant on the WRU too hence the NDCs.

Privately owned teams aren't just reliant on what income they generate but what their owners can pump into them, in Saracens case they are overly reliant on theirs, in Toulons case they developed a business plan that meant they could evolve to be self reliant. In the Provinces case they are overly reliant on the IRFU.

The IRFU are wanting to evolve, theirs, the provinces and Pro12s to increase and improve revenue streams.

Ulster were able to generate serious income from selling the naming rights to Ravenhill, this has helped finance the Piutau and Coetzee deals.

You do know how NDCs work, right? And how much the NDC pot is, yes? If so, please could you explain how PRW are 'reliant on the WRU', thanks.

How much did Kingspan pay?

Without the WRU the Regions could not bring those players into their ranks, that's how they are reliant

£5M wasn't it

marty2086 wrote:No idea of exact dates and amount but Mourad himself stated he had pumped money in to take them to the top but was creating a business model so the club was self sustaining, the cafes, shops etc built around the brand.

For all that I loathe about him he cant be faulted for that and its something most in the game could learn from

What on earth could you loathe about him? He's the best thing to happen to rugby in years.

For your point to hold water, you'd need to know how much he spent and when he spent it.

marty2086 wrote:

Without the WRU the Regions could not bring those players into their ranks, that's how they are reliant

£5M wasn't it

You're missing the point hugely, as ever.

NDC money is a sop to part fill the gap of the underpayments in the RSA in relation to the market rate for the services provided. The WRU couldn't pay the market rate because Lewis agreed covenants with Barclays. Therefore, the NDC money has to be flexible because it cannot be guaranteed.

It's not the largesse of the WRU at play with NDCs, it's a part admission of the underpayment elsewhere.

And you're out by a factor of double. The WRU's contribution to NDCs is £2.5m.

No the £5m is the Kingspan amount

Which areas would they be then?

PhilBB wrote:

marty2086 wrote:No idea of exact dates and amount but Mourad himself stated he had pumped money in to take them to the top but was creating a business model so the club was self sustaining, the cafes, shops etc built around the brand.

For all that I loathe about him he cant be faulted for that and its something most in the game could learn from

What on earth could you loathe about him? He's the best thing to happen to rugby in years.

For your point to hold water, you'd need to know how much he spent and when he spent it.

What can I loathe? Other than threatening to sack players etc? Talking of spending below the salary cap when players are paid by different entities to get around it

No I don't need to know the specifics, I know that he financed Toulon and has now turned it into a self sustaining business

PhilBB wrote:

LordDowlais wrote:
I think you will find that some of the Irish provinces are being funded by rich businessmen and that funding does not necessarily get shown on the branches accounts. There must be some sort of legal issues there. But as I have said, that's the IRFU's problem.

Do you know that Sam Warburton gets money from Land Rover but that doesn't show in Cardiff's accounts?

Can you imagine that!!?!?!

And you claim to run a business.....

No i did not know that. I presume Sam declares that to HMR&C himself.

Does anybody pay for facilities for Cardiff Blues from outside the business like the Irish regions get ?

LordDowlais wrote:

PhilBB wrote:

LordDowlais wrote:
I think you will find that some of the Irish provinces are being funded by rich businessmen and that funding does not necessarily get shown on the branches accounts. There must be some sort of legal issues there. But as I have said, that's the IRFU's problem.

Do you know that Sam Warburton gets money from Land Rover but that doesn't show in Cardiff's accounts?

Can you imagine that!!?!?!

And you claim to run a business.....

No i did not know that. I presume Sam declares that to HMR&C himself.

Does anybody pay for facilities for Cardiff Blues from outside the business like the Irish regions get ?

If you read the Telegraph, Guardian, or a lot of UK newspapers, you'll often find at the end of an article written by a player/former player words to the effect of "X is an ambassador of the (Product Name) programme/brand. This kind of commercial endorsement/agreement with players has been going on for years.

David Shubotham publicly gave a no-strings attached €2.2m gift to Leinster which they publicly acknowledged for their new training facility in UCD. The agreement was signed in April 2011. Bit difficult to hide that from Revenue since everyone knows about it.

Commercial sponsors have given clubs financial and other facility support on plenty of occasions as well.

PhilBB wrote:

Munchkin wrote:

It isn't extraordinary. It makes perfect sense. The loan has been made, Munster are struggling to pay that loan. The most effective way for Munster to repay that loan is for Munster to succeed, on and off the field. Shackling Munster to the terms of repayment will not bring about the success they need in order to repay that loan. Allowing them the time needed to rebuild, to become a success, is the most effective means. Otherwise Munster fail and no loan is repaid. which in turn hurts the IRFU and the other three Provinces. Nobody wins.

The league wins because it is then a competition based on the merits of the competitors who fail or succeed based on their own investment. That is the very nature of sport.

Munster should be failing but they qualified for EPRC1 based on not having to pay a debt they owe to the rest of the game in Ireland. That debt is also, from memory, not interest bearing.

I'd agree that they should be given time IF the debt was interest bearing.

As it is, they are able to 'succeed' by robbing money from the rest of the game in Ireland and that's not the basis for a fair competition.

Actually, Phil, the loan to Munster Branch is interest-bearing - it is based on effective cost of funds to the Union.  So the longer it continues and balance doesn't reduce, it will cost Munster more.

IRFU Annual Report 2015/16:

The Union advanced funds to the Munster Branch in order to assist with the development of Thomond Park. The amounts advanced are secured on the Branch’s share in Thomond Park Stadium Company Limited and on the loan advanced by the Branch to that company. Interest is chargeable on the loan to the Branch based on the effective cost of funds to the Union.
The schedule of loan repayments is as follows:
30 April 2016 - €200,000
30 April 2017 - €4,200,000
30 April 2018 - 30 April 2026 (per annum) - €500,000
30 April 2027 - €761,778
The loan is to be fully repaid by 30 April 2027.

PhilBB wrote:

LordDowlais wrote:Look, I have no gripe about the Irish system, it suits them, and it suits them well. Good for them. But what people are not looking at is, we have a league of different types of enterprises. When we are competing in the Pro12, and people need to realise this, who are the Welsh regions competing against ? Other teams, or other unions ?

The 4 teams from Wales, are not competing with teams on an even keel because they are being backed by their union juggernauts, private owned teams need to worry about their finances, union run teams it would seem do not.

If any of the four regions were in as much debt as Munster, they would not be here now.

Cardiff owe more to Thomas than Munster owe to the IRFU.

But the rest of your post is right so maybe you will finally stop with your drivel about seeing a relative improvement in PRW performance.

Which is why he is pretty mad in his inconsistencies. Budgets etc count when it suits his agenda. It's why I sometimes wonder if our good lord is a bit of a troll.

PhilBB wrote:

Sin é wrote:Didn't the WRU bail out the Dragons?

No.

Top knowledge, there, though.

I'm a little surprised that anybody thinks this to be honest.

RiscaGame wrote:

PhilBB wrote:

Sin é wrote:Didn't the WRU bail out the Dragons?

No.

Top knowledge, there, though.

I'm a little surprised that anybody thinks this to be honest.

This is what I was thinking of. The WRU bought a share in the Dragons because the Benefactor, Tony Brown was unwilling to cover the losses.

http://news.bbc.co.uk/sport2/hi/rugby_union/welsh/3173040.stm

I can't see that written anywhere. Interesting that our understanding of the word bought differs.

PhilBB wrote:

Sin é wrote:
The difference between Munster and a lot of clubs is that Munster didn't spunk its money on wages. Its got the ability to develop other revenue streams from their investment.

So how do you explain that, many years in, their main asset is loss making and they are unable to meet the repayment terms that have already been negotiated down once?

Lucky you not to notice that there was a financial meltdown in the rest of the world over the last few years. There has been mass immigration from the south west of Ireland and Limerick in particular, which 3/4 years ago the unemployment rate was 14%.

Things are improving economically, a lot of people are migrating back, unemployment in Limerick has come down to about 9%, so hopefully Brexit doesn't hit us too hard. The future looks good.

RiscaGame wrote:I can't see that written anywhere. Interesting that our understanding of the word bought differs.

Why did the WRU buy a share in the Dragons then? Was it not to save them from going into Administration because of the financial losses?

Sin é wrote:

RiscaGame wrote:

PhilBB wrote:

Sin é wrote:Didn't the WRU bail out the Dragons?

No.

Top knowledge, there, though.

I'm a little surprised that anybody thinks this to be honest.

This is what I was thinking of. The WRU bought a share in the Dragons because the Benefactor, Tony Brown was unwilling to cover the losses.

http://news.bbc.co.uk/sport2/hi/rugby_union/welsh/3173040.stm

Sin e? Sin O'Dowlais more like

Sin é wrote:

RiscaGame wrote:I can't see that written anywhere. Interesting that our understanding of the word bought differs.

Why did the WRU buy a share in the Dragons then? Was it not to save them from going into Administration because of the financial losses?

They didn't buy it, they took over Ebbw Vale's share of the merger in order to prevent another standalone, which would have made a mockery of their regional experiment.

Dragons enter administration

Tony Brown
Brown feels he is bearing too much of the Dragons' financial burden

The Dragons have decided to put themselves into administration because of increasing financial difficulties.

The option was discussed - and dismissed - at a meeting last month but the regional side's executive has made a dramatic U-turn after predicted losses of over £1 million.

PricewaterhouseCoopers were appointed as administrators of Gwent Rugby Ltd on Wednesday.

Sin é wrote:
Dragons enter administration

Tony Brown
Brown feels he is bearing too much of the Dragons' financial burden

The Dragons have decided to put themselves into administration because of increasing financial difficulties.

The option was discussed - and dismissed - at a meeting last month but the regional side's executive has made a dramatic U-turn after predicted losses of over £1 million.

PricewaterhouseCoopers were appointed as administrators of Gwent Rugby Ltd on Wednesday.

That's it O'Dowelais misinterpret part of a Web link and use it to try and support your erroneous argument.

I asked this question. Note the ?.

Sin E wrote:Didn't the WRU bail out the Dragons?

Can you explain what happened please rather than just having a go.

Thanks!

Sin é wrote:I asked this question. Note the ?.

Sin E wrote:Didn't the WRU bail out the Dragons?

Can you explain what happened please rather than just having a go.

Thanks!

The WRU also bailed out both Neath and Swansea RFC when they went bankrupt. This has enabled the Ospreys to operate without any of the debts of their founder clubs, giving them a significant advantage over the other three regions who are still servicing these debts.

Stone Motif wrote:
That's it O'Dowelais misinterpret part of a Web link and use it to try and support your erroneous argument.

Can you please stop using my username in that manner.

Yourself and Risca are starting to troll again I see.

Seagultaf wrote:

Sin é wrote:I asked this question. Note the ?.

Sin E wrote:Didn't the WRU bail out the Dragons?

Can you explain what happened please rather than just having a go.

Thanks!

The WRU also bailed out both Neath and Swansea RFC when they went bankrupt. This has enabled the Ospreys to operate without any of the debts of their founder clubs, giving them a significant advantage over the other three regions who are still servicing these debts.

Thanks for that info.

LordDowlais wrote:

Stone Motif wrote:
That's it O'Dowelais misinterpret part of a Web link and use it to try and support your erroneous argument.

Can you please stop using my username in that manner.

Yourself and Risca are starting to troll again I see.

You understand the definition of troll as much as you do debate then. Stick to carpets.

Sin é wrote:

Seagultaf wrote:

Sin é wrote:I asked this question. Note the ?.

Sin E wrote:Didn't the WRU bail out the Dragons?

Can you explain what happened please rather than just having a go.

Thanks!

The WRU also bailed out both Neath and Swansea RFC when they went bankrupt. This has enabled the Ospreys to operate without any of the debts of their founder clubs, giving them a significant advantage over the other three regions who are still servicing these debts.

Thanks for that info.

It's not entirely correct mind.

I thought The Whites" went into voluntary liquidation.

Stone Motif wrote:

Sin é wrote:

Seagultaf wrote:

Sin é wrote:I asked this question. Note the ?.

Sin E wrote:Didn't the WRU bail out the Dragons?

Can you explain what happened please rather than just having a go.

Thanks!

The WRU also bailed out both Neath and Swansea RFC when they went bankrupt. This has enabled the Ospreys to operate without any of the debts of their founder clubs, giving them a significant advantage over the other three regions who are still servicing these debts.

Thanks for that info.

It's not entirely correct mind.

Not entirely?

PhilBB wrote:

marty2086 wrote:No idea of exact dates and amount but Mourad himself stated he had pumped money in to take them to the top but was creating a business model so the club was self sustaining, the cafes, shops etc built around the brand.

For all that I loathe about him he cant be faulted for that and its something most in the game could learn from

What on earth could you loathe about him? He's the best thing to happen to rugby in years.

For your point to hold water, you'd need to know how much he spent and when he spent it.

http://www.punditarena.com/rugby/cmalone/toulon-threaten-giteau-wage-cuts/

marty2086 wrote:

PhilBB wrote:

marty2086 wrote:No idea of exact dates and amount but Mourad himself stated he had pumped money in to take them to the top but was creating a business model so the club was self sustaining, the cafes, shops etc built around the brand.

For all that I loathe about him he cant be faulted for that and its something most in the game could learn from

What on earth could you loathe about him? He's the best thing to happen to rugby in years.

For your point to hold water, you'd need to know how much he spent and when he spent it.

http://www.punditarena.com/rugby/cmalone/toulon-threaten-giteau-wage-cuts/

Sounds reasonable enough to me. 8 matches missing.

In what world would an employer just shrug his shoulders at losing one of his prized assets for that amount of crucial time?