CandH Exclusive by Sean Whetstone
West Ham shareholders David Gold and David Sullivan are to be paid back money they loaned the club ten years ago.
The joint-chairman gave the club £52.2m in the form of shareholder loans between 2011-2014 primarily to plug the gap in finances after relegation to the Championship.
In 2017 they cut the amount of interest they charged on their loans from an average of 6-7% to 4% earning over £20m in interest over the decade together with £8.2m of the capital also paid back over the years.
The outstanding balance of Gold and Sullivan shareholder loans now stands at £44m according to the latest accounts and that is the amount they will receive back together with any interest accrued over the past 12 months which should be around £1.8m based on previous years.
These loans were supposed to be paid back several times over the past ten years but were always deferred several times due to the club not having the funds to pay back the shareholders.
The pair will be paid back this £45.8m from the £150m capital injected by Czech billionaire Daniel Křetínský who bought 27% of the club.
Tripp Smith will also get back his £9.5m interest-free loan at the same time due to cause that meant the club was obligated to pay out if Sullivan’s shareholding dropped before 50%.
The remaining £95m plus will be used to pay down other debts such as the MSD holding credit facility to put the club back onto a better financial footing.
The settlement of these historic loans will mean that the joint-chairman can no longer be accused of taking money out of the club in the form of interest from these loans saving the club nearly £2m per year in interest.
“The joint-chairman gave the club £52.2m in the form of shareholder loans between 2011-2014 primarily to plug the gap in finances after relegation to the Championship. In 2017 they cut the amount of interest they charged on their loans from an average of 6-7% to 4% earning over £20m in interest over the decade together with £8.2m of the capital also paid back over the years.”
Wow.
It’s little wonder that there’s some residual anti-board feeling amongst some fans. Relegation to the Championship, those same fans might argue, was a direct result of the myopic decision to appoint, and then persist with, the very obviously-inept Avram Grant. Those same fans may then go on to question whether they themselves, or anyone they know, would profit in quite the same way from having made similarly catastrophic decisions in the workplace, regardless of how long ago those decisions were made or how rosy the workplace was currently.
I’m not suggesting for a second that I’m one of those sorts of fans, to be clear………..
History lesson – turned out alrite in the end. Good things come to those who wait 🙂
One does wonder…..
IIRC their first ‘error’ was to fire Zola & Clarke… who had been working under extremely difficult circumstances… the best move was to fire the CEO
Side note: How is Scott Duxbury allowed to still be involved in football?