From The MEN:
Manchester City won a £30m cash boost - the biggest financial fill-up in
the club's 108 year history.
The jubilant board revealed the innovative deal at the same time as
reporting a £13m loss.
Although the plunge into the red has raised eyebrows it reflects the board's
backing of ambitious boss Kevin Keegan who has led the Blues back to the big
time.
The £30m bond - which could rise to £44m in the future - has been arranged
by US investment bank Bear Stearns, and was clinched after City's directors
spent nearly a year thrashing out a way of bringing new long term finance
into the club.
City's loyal fan base was a crucial factor in the deal, said chairman David
Bernstein.
"The deal is secured on the future sales of season and match day tickets and
the loyalty of our supporters was a key factor.
"Other clubs have tried and failed to raise money in this most difficult
climate for football finance, and when we presented in London the fact that
we had 28,000 fans in second division was crucial.''
Mr Bernstein, who has been chairman for just over four years stressed that
the fundraising was needed to restructure existing debt and to provide
additional working capital for the club.
Building block
"This is not a bonanza, the substantial funds need careful handling. This
creates a building block for the future, and provides the club with even
more stability.''
Mr Bernstein said that if the club was to attract a further investor the
structure of the deal allows an extra £14m to be raised.
The chairman described the deal as a "coup'' and it is understood the Blues
were able to secure this funding up until 2027 even though other major
soccer clubs have been unable to make similar provision.
The timing of the deal is ideal for the club as Kevin Keegan has spent £21m
since the year end - on new players. It has also continued to invest in the
state of the art training facilities at Carrington and in preparing the
former Commonwealth Games stadium at Eastlands ahead of the club's arrival
next year.
The club's financial report reveals that despite relegation last season the
turnover dipped by just £4m from £32m to £28m. Despite a slide in TV cash
and gate receipts, merchandising and sponsorship activities all rose
impressively.
As Keegan rebuilt the squad for the Premiership, bringing in the likes of
Eyal Berkovic, John Macken and Ali Bernarbia, the club's wage bill
inevitably rose from £16.2m to £21.8m.
Confirming the refinancing, Nitin Bhandari, MD at US investment bank Bear
Stearns said: "This innovative financing has enabled one of the best
supported football clubs in the UK to access competitive long term funding
via the capital market.''