Cronulla Death Watch

[Jeffles]

Clubs are usually a bit quieter when they put the feelers out for a merger. Penrith, Canterbury, Easts, et al did it as a way of expansion. Cronulla are looking for a saviour.

[broncos]

I can't really see the benefit in amalgamation for the partner. They take on the Sharks massive debts and would they really be picking up any valuable assets out of the merge (the land I guess)?

[bazza]

I can't really see the benefit in amalgamation for the partner. They take on the Sharks massive debts and would they really be picking up any valuable assets out of the merge (the land I guess)?

Cronulla Panthers?

Yeah - I agree
The club is in a pretty poor location with little through traffic and a small number of residents in the area

[Jeffles]

Yet they have 18,000 members. That's impressive.

The beenfit is in the location if they can ever get aything built or approved there. When SOuths Leagues Club entered a deal with Holmes a Court the iodea was to downscale the Leagues Club and use other parts of the building for profitable purposes (gym, offices, retail, etc). Such a project at Cronulla would be less controversial than the Neo-Swamp Suburb proposed meaning it might be more of a goer at the Council and with financiers.

Cronulla should link up with a club somewhere else in the Shire where there is passing traffic (Miranda, Caringbah, Sutherland). The name, however poisoned it is elsewhere - resonates down there and a "second Leagues Club" in the area could do well.

[bazza]

Yet they have 18,000 members. That's impressive.

yeah - not too bad. I am guessing a lot of Sharks fans join up for support but would rarely go there outside of game days due to the inconvenience

The beenfit is in the location if they can ever get aything built or approved there. When SOuths Leagues Club entered a deal with Holmes a Court the iodea was to downscale the Leagues Club and use other parts of the building for profitable purposes (gym, offices, retail, etc). Such a project at Cronulla would be less controversial than the Neo-Swamp Suburb proposed meaning it might be more of a goer at the Council and with financiers.

something like a smaller club with a large supermarket or similar might work.
There proposal for a retirement village would be ok (though looks like not getting through) as it would give the club some customers and potential for other retail.
There is a proposal for some residential development near Wanda so that could give some potential to increase the catchment area.

Cronulla should link up with a club somewhere else in the Shire where there is passing traffic (Miranda, Caringbah, Sutherland). The name, however poisoned it is elsewhere - resonates down there and a "second Leagues Club" in the area could do well.

Somewhere like Gymea Tradies would be great - but the Tradies wouldn't need it.
There are probably a few smaller clubs struggling in Caringbah and Miranda that would be good sites

[Cheesie-the-Pirate]

The thing about the Sharks is that their balance sheet is rubbish and potentially terminally rubbish.

All of their assets are illiquid and all of their debts are current. It's potentially terminal because there's a significant feedback effect combined with a gigantic millstone.

The feedback effect is that their debts are current because they' were (maybe still are) techincally in breach of their debt covenants. Usually your debts becoming current also means you breach the current ratio debt covenant, so that's a double blow. It also makes it harder for your auditors to sign a clean opinion, which would also be a normal debt covenant, as would having your financial reports lodged with ASIC on time. Meanwhile, breached debt covenants mean it's harder and more expensive to get finance which makes it harder to get a profit which makes your balance sheet worse. It's a death spiral.

Then there's the millstone, being the football club. The leagues club can cut the grant as much as they want, but in the end the Leagues Club is probably going to have to pay up when the football club again starts to struggle for solvency, simply because nobody else will (and the football club's bigger creditors may have sought guarantees from the leagues club anyway).

[Jeffles]

I smell a bail out then. They've been that lucky before.

[bazza]

I smell a bail out then. They've been that lucky before.

A little ray of sunshine from the Gymea Tradies club

http://www.smh.com.au/rugby-league/leag ... 16luy.html

[Jeffles]

That's almost what I suggested earlier on this page. Not rocket science really.

[bazza]

That's almost what I suggested earlier on this page. Not rocket science really.

yep - I didn't think the Tradies would have been interested though

[Jeffles]

If the finance for the development can come they'd be interested. In the mean time, their reserves keep creditors/administrators for the Sharks at bay. Risky strategy but not impossible.

[Jeffles]

This thread's always close to the top.

Ricky Stuart has a go at his former employer.

http://www.smh.com.au/rugby-league/leag ... rom=smh_sb

Gavin Miller returns serve.

http://www.dailytelegraph.com.au/sport/ ... 6009129218

Cronulla EGM tonight to vote on a development plan. I think it will pass but I'm not sure it will save them.

[Cheesie-the-Pirate]

98% apparently. They can't even rig a vote correctly.

This proposal is much better than the last one, but I'm cynical. They'll get a bunch of cash and some annuity income but unless they can run the fundamental business better and use that capital well it'll all be gone after a while anyway. It's a leagues club and a football club, they're not bloody residential property developers and they shouldn't pretend otherwise.

[Timbo]

Seems like the rabbit may be pulled out of the hat after all.

And I'm kind of glad. As much as Sydney needs team rationalization, I don't want the Sharks to go. They're like that special needs kid in your year two class you couldn't help but feel sorry for.

[Boba Fett]

98% apparently. They can't even rig a vote correctly.

This proposal is much better than the last one, but I'm cynical. They'll get a bunch of cash and some annuity income but unless they can run the fundamental business better and use that capital well it'll all be gone after a while anyway. It's a leagues club and a football club, they're not bloody residential property developers and they shouldn't pretend otherwise.

It's Cronulla - you know they'll find a way to f*ck it up.

This simply postpones the inevitable in my view.