D W Stadium - Wigan Warriors

[Whippet13]

1 hour ago, Padge said:

That post was particularly tongue firmly in cheek, and yes anything is only worth what someone will pay. The £30m is only an accounting number yes, but when Whelan was struggling to offload the soccer club he had to put it on the books of Wigan Athletic to make them a more viable proposition. I suspect the Hong Kong buyers were unaware of the very restrictive covenants that were on the land or if the were aware didn't realise the implications. The stadium in real terms is probably worth nowhere near £30m, hence Latics were sold for £22m (if reports are right) including the 85% share in the stadium.

What also may have spooked the current owner is the fact that the rugby club took on the athletic stadium next door as a headquarters and training facility, it could be turned into a tidy rugby ground. If WIgan did that then they would have the DW owners over a barrel, they have already said (apparently) that it isn't viable without the rugby in it.

Wigan Rugby now have a rival facility next door which they use as a pre-match bar keeping people out of the stadium pre-match reducing stadium income from the bar and food.

 

Interesting points regarding the financial impact of Robin Park. The DW lost £1.5m in 2019 and that was before Warriors opened up right next door and directly hit stadium revenue.

It also used to be a regular RFL match venue, but Bolton is the preferred local 25k option now and I can't see that changing anytime soon.

[Man of Kent]

16 minutes ago, Padge said:

Sorry that was badly worded, WIgan Rugby get nothing from the bars, that is why they have set up a rival bar next door for fans pre-match.

Ah. 10% gate receipts + 100% bar takings doesn’t seem such a very good deal.

[haskey]

Why did Wigan leave Central Park in the first place, to share a ground with a football club. They were once the name synonomous with Rugby League throughout the world .Not any more, did greed take over ?

Why should the RFL put up the cash to buy the DW , as there is just as many lower division clubs in dire straits due to many reasons. Bradford a few years ago springs to mind, and Odsal now.

Rugby League cannot afford to have have 2 bodies running the game, anyway Wigan are a Super League club so it is up to them to deal with any fallout

[Eddie]

8 minutes ago, haskey said:

Why did Wigan leave Central Park in the first place, to share a ground with a football club. They were once the name synonomous with Rugby League throughout the world .Not any more, did greed take over ?

Why should the RFL put up the cash to buy the DW , as there is just as many lower division clubs in dire straits due to many reasons. Bradford a few years ago springs to mind, and Odsal now.

Rugby League cannot afford to have have 2 bodies running the game, anyway Wigan are a Super League club so it is up to them to deal with any fallout

Why did they leave a dump of a(n albeit iconic ground) to move into a brand new stadium?

[Damien]

Interestingly looking at the Stadium company accounts the latest net book value of the stadium has fallen to £27.9 million.

[haskey]

It may have been a dump , but look where you could be now.

[Padge]

4 minutes ago, haskey said:

Why did Wigan leave Central Park in the first place, to share a ground with a football club. They were once the name synonomous with Rugby League throughout the world .Not any more, did greed take over ?

Why should the RFL put up the cash to buy the DW , as there is just as many lower division clubs in dire straits due to many reasons. Bradford a few years ago springs to mind, and Odsal now.

Rugby League cannot afford to have have 2 bodies running the game, anyway Wigan are a Super League club so it is up to them to deal with any fallout

Because the NatWest bank insisted that two of the directors stepped down as a condition of extending the clubs overdraft facility after they had twice appeared in court accused of dodgy practices, something they did get off with but the bank wasn't happy and were insisting on a new board.

Dave Whelan wanted to buy CP and move Latics in with the Rugby Club, he wanted to redevelop the ground*. Robinson was adamant that this would not happen.  So to get himself out of the corner he had painted himself into his only recourse was to sell Central Park and move WIgan Rugby somewhere else, this way he could keep the club and ensure Latics never set foot on Central Park. 

Robinson hadn't a real plan, or clue, and eventually had to stand down and sell the club.

WIgan could have stayed at Central Park and had it redeveloped by Whelan but Robinson's pride would not allow it.

 

*I am not sure if this would have been acceptable to the council, a soccer stadium right in the town centre would be very difficult to police, especially as on soccer days you need segregation. I think Whelan knew this and just wanted the ground to flog off for a profit and his plan was always to have a new stadium for both. When the Council objected to his plans he would have had a scapegoat for getting shut of Central PArk.

 

 

[M j M]

15 minutes ago, Damien said:

Interestingly looking at the Stadium company accounts the latest net book value of the stadium has fallen to £27.9 million.

The depreciated book value in the accounts isn't supposed to reflect actual market value so that doesn't mean anything in particular.

[Damien]

3 minutes ago, M j M said:

The depreciated book value in the accounts isn't supposed to reflect actual market value so that doesn't mean anything in particular.

I know market value is different, I'm referring to an earlier figure that had it as more than that.

[Padge]

7 minutes ago, M j M said:

The depreciated book value in the accounts isn't supposed to reflect actual market value so that doesn't mean anything in particular.

HOw do you work out the deprecated value of something like a stadium, over how long do you spread the deprecation. I am no accountant so have no idea.

Maybe as someone who knows a lot more about this stuff you could enlighten us.*

 

*I am not taking the pee, I would like to know how you do it?

[EagleEyePie]

It's incredibly unlikely that the administrators are going to consider selling the stadium. They are trying to sell the club and all its assets together and it's hardly going to entice someone to buy the club if they sold off the stadium to someone else first.

Perhaps a co-ownership agreement could be reached, but there's no way that any money would be coming from Wigan RL directly. Whether Lenagan has the money or the desire to buy a share in the ground remains to be seen, but I highly doubt it. I can only see the administrators agreeing to such a deal if things were looking really bleak and they need the money as quickly as possible. As for the RFL getting involved, I just don't see any logic behind that at all, especially not during the biggest crisis the sport has faced in decades.

I think there's more chance of Ian Lenagan buying into Latics as part of a consortium with other local businessmen than actually trying to buy the stadium for the Warriors. He's a Latics fan, has previous experienced owning a football club (Oxford Utd) and is a former chairman of the Football League, so I do wonder if it's something that might cross his mind. Speculating on how someone else might spend their money seems a bit weird though.

I can't see Wigan RL wanting to be responsible for the ground though. The current deal works very well in our favour. The new facilities at Robin Park will hopefully help to reduce one of the negatives that is the lack of income from hospitality. If the ground was owned by Wigan RL we'd be more dependent on the income from Latics than they are on income from RL right now. Everyone can see the ground is far too big for the attendances that both clubs are getting right now. There's always the opportunity to bring in money by other means like hosting concerts and other events, but ultimately Wigan is not the most desirable place to hold events. The local economy will play some part in how much the stadium can generate away from football and rugby.

[Wigan Riversider]

36 minutes ago, Padge said:

Because the NatWest bank insisted that two of the directors stepped down as a condition of extending the clubs overdraft facility after they had twice appeared in court accused of dodgy practices, something they did get off with but the bank wasn't happy and were insisting on a new board.

Dave Whelan wanted to buy CP and move Latics in with the Rugby Club, he wanted to redevelop the ground*. Robinson was adamant that this would not happen.  So to get himself out of the corner he had painted himself into his only recourse was to sell Central Park and move WIgan Rugby somewhere else, this way he could keep the club and ensure Latics never set foot on Central Park. 

Robinson hadn't a real plan, or clue, and eventually had to stand down and sell the club.

WIgan could have stayed at Central Park and had it redeveloped by Whelan but Robinson's pride would not allow it.

 

*I am not sure if this would have been acceptable to the council, a soccer stadium right in the town centre would be very difficult to police, especially as on soccer days you need segregation. I think Whelan knew this and just wanted the ground to flog off for a profit and his plan was always to have a new stadium for both. When the Council objected to his plans he would have had a scapegoat for getting shut of Central PArk.

 

 

There's always two sides to every story. 

[M j M]

34 minutes ago, Padge said:

HOw do you work out the deprecated value of something like a stadium, over how long do you spread the deprecation. I am no accountant so have no idea.

Maybe as someone who knows a lot more about this stuff you could enlighten us.*

 

*I am not taking the pee, I would like to know how you do it?

Most fixed assets are just depreciated on a, frankly rather arbitrary in my experience, straight line basis over X number of years, X being some estimate of how long you think it's useful life is. You buy it for £100 and charge £10 depreciation a year and after 10 years, it's nil. By which time for most bits of small kit you'd be hard pressed to find it to prove to anyone it exists anyway.

Property is a bit different and for smallish companies like Rugby League clubs it's a hodge-podge. Leeds for instance had Headingley valued by the real estate experts Weatherall, Green & Smith back in 1997 (at £7m or so from memory, including the cricket ground) and revalued it in the accounts that year at that amount. They've taken a policy on not revaluing it since then so everything that's been built on the site has been added to that starting point at cost and everything sold or demolished but which was there in 1997 has been given a 1997 value and a deducted from it. Leeds have a policy to depreciate property over between 20 and 50 years depending on what it is. All of which means the book value as at the 2016 accounts of £11.3m was utterly meaningless.

Wigan Football's accounting policy is for property depreciation is to write the cost of it off "over the remaining term of the 99 year lease with some assets being written off over an estimated useful life of 32.5 years". They don't give any more detail but I'd have thought the stadium itself would be the 32.5 years with the land if they paid a sum for it being 99 years but could be wrong. Although the 99 years is important as that's driven by a lease, you can see how the useful lives for other things are very often just plucked out of the ether and auditors tend to operate on a "seems reasonable" basis.

One last thing, it's not entirely anything goes in these figures: if there's an indication that the asset is actually worth less than the book value in the accounts then you'll need to post a provision against that. Proving this is difficult short of paying for a revaluation. From my auditing days I seem to recall we asked clients to get a valuation done every three years if it was borderline.

[del capo]

Padge has previously used the word shady in relation to these Hong Kong based manoeuvres involving off sure companies based in tax havens.

It does seem strange that within 4 weeks of a majority shareholder transferring 75% to a minority shareholder Latics are now in administration with ordinary creditors not likely to get much by way of their debts being paid. EFL need to be answering questions about their  ' due diligence ' processes and not for the first time.

Is there a danger of asset stripping here ?

Euxton training grounds acquired from Bolton when they faced a similar problem was bought by Huron ( one of Dave Whelans  companies I believe ) for 2.2 million a few years ago and is in the Latics portfolio . The land has 3 full size pitches and stands on what many years ago was a brownfield site.

Christopher Park also has at least 3 fields and stands in a corner of Standish Lower Ground under extreme pressure for housebuilding  and once earmarked by Wigan Council for such development.

And then there is the newish  now vacant building next door to the DW  which has housed both a gym and a restaurant/ nightspot in recent times. Worth a pretty penny as it stands.

Latics could always train at the Wigan owned arena next door......

[Man of Kent]

To my eye it appears the former owner has sold to a new (essentially the same as the old) owner via a loan to the club. Isn’t it merely the new/old owner looking to get first dibs on Wigan’s assets from the administrator with no f***s given about the football club?

[Whippet13]

Wigan Athletic were never going to be a powerhouse of English soccer and are not significantly well supported (relatively speaking for the sport in England) so one has to wonder at the motives of the Hong Kong consortium by buying the club in the first place.

[TIWIT]

45 minutes ago, Wigan Riversider said:

There's always two sides to every story. 

Three sides. The truth is always somewhere in the middle.

[Padge]

By the way, the stadium was not built/paid for by Dave Whelan, the vast majority of the costs were from the old City Challenge Funds, EU funds and Wigan Council acting as facilitators and investors.

Whelan often says "I built the Stadium", he is talking bollards.

[Gooleboy]

2 hours ago, Eddie said:

Why did they leave a dump of a(n albeit iconic ground) to move into a brand new stadium?

Didn't they have to sell Central Park to avoid going bust?

[Padge]

12 minutes ago, Gooleboy said:

Didn't they have to sell Central Park to avoid going bust?

No

 

[Padge]

The big question must be, if this is an asset stripping exercise, then how did some Hong Kong asset strippers get to know that a minor soccer club in a small Northern England town have assets to strip.

Mr Whelan may have to answer questions on that one, when he wanted shut of the massive drain on his funds that is Wigan Athletic and couldn't get shut, he added assets to the mix. 

After adding the assets his agent could offer tremendous development opportunities.

Latics also own other facilities that may be considered prime building land.

[del capo]

Latics lost an important rates appeal last October . Only reported last December and then only in a  limited  way

Can't dig out the link direct ( that skill  is far above my now non existent pay grade ) but if you google Wigan athletic Holdings v Wayne Cox  it gives you UPPER TRIBUNAL ( LANDS CHAMBER)  Click on that for a decent if convoluted , technical   read.

Para 9 and 29 are interesting. Basically Latics  Chairman pleaded and it was accepted by  the Court and the Rates people that Wigan RL could not be treated as potential alternative tenants as their business model was entirely different to the soccer one , that the stadium overheads were too high for them,  and that the average SL stadium was 12k - 20k capacity. DW therefore too big for Wigan crowds on a regular basis. The Court noted that Wigan  RL were at the top of their game  in SL so   could not significantly draw much bigger gates ( as opposed to Latics ) and that the added capacity was therefore not such a  plus as to make them likely alternative tenants if the ground ceased to be a pro soccer outlet...…..

[del capo]

Just now, SL17 said:

He’ll buy it back.

And at  much less than the £22 million he  is reported to have sold it for ?

[fieldofclothofgold]

There were Covenants on the McLaren Field ground at Bramley. There are houses built on that now! I'm also concerned about Leeds RL ,I've just read big cuts across the board in order to stay Afloat . Looks like the club have lost all their much vaunted corporate facilities for the foreseeable future.  Could this be the mid 90s revisited? 

[The Future is League]

16 hours ago, Whippet13 said:

Companies house has the stadium with a net book value of £29.7m at June 2019.

Stadium losses were £1.5m for the year, a third of this being depreciation.

I would suspect it would have dropped in value now due to the Covid-19 outbreak