The Suning Commerce Group

Ethor

Allenatore
Allenatore
Joined
Feb 8, 2019
Messages
7,760
Likes
7,058
Favorite Player
Still here!
Forum Supporter
Don't get it at all. If Lukaku was secretly having talks with Juve before the final, why in the hell wasn't Suning negotiating a sale as well the price couldn't have been higher. They must know the proverbial was going to hit the fan in a year.
 

wera

might be Deadpool
La Grande Inter
Joined
Mar 28, 2011
Messages
32,263
Likes
11,015
Favorite Player
Bea Arthur
10 years of FIF
Most Diverse Poster
Imagine Oaktree owning Inter but putting Zhang Jr. as interim president :lol:
 

CafeCordoba

Moderator
Moderator
Joined
Mar 7, 2004
Messages
35,109
Likes
14,102
Favorite Player
Toro, Barella
10 years of FIF
Don't get it at all. If Lukaku was secretly having talks with Juve before the final, why in the hell wasn't Suning negotiating a sale as well the price couldn't have been higher. They must know the proverbial was going to hit the fan in a year.
Zhangs have put the club on sale and it's been on sale for awhile now. The asking price is too high, there are no byers.
 

Ethor

Allenatore
Allenatore
Joined
Feb 8, 2019
Messages
7,760
Likes
7,058
Favorite Player
Still here!
Forum Supporter
Zhangs have put the club on sale and it's been on sale for awhile now. The asking price is too high, there are no byers.
I know, but not even a nibble, save for that Nordic (?) dude awhile back, who wasn't all that serious. The Zhangs, just holding on till the penny drops I guess. The Oaktree will then negotiate the sale. Just like selling/buying players all the money men can just wait for the price to drop.
 
Last edited:

Puma

Allenatore
Allenatore
Joined
Mar 9, 2004
Messages
5,303
Likes
3,736
10 years of FIF

INTER MILAN OWNERS SUNING POSTPONE REFINANCING OF OAKTREE LOAN

https://onefootball.com/editorial/37980174?language=en

Inter Milan owners Suning have postponed the refinancing of their massive loan from US-based fund Oaktree Capital.

This according to today’s print edition of Italian business newspaper Il Sole 24 Ore, via FCInter1908, who report that the Nerazzurri owners are holding out to see if the conditions on the market change among high interest rates.

The looming due date of a massive loan from US-based fund Oaktree Capital is at the heart of uncertainty surrounding Suning’s future at Inter.

The loan, taken on in 2021, was for €275 million. That money was necessary for Suning to cover operating costs at the Nerazzuri amid pandemic-related financial difficulties.

Whilst that money was vital in order to inject liquidity into Inter, it came with major ramifications.

Suning put Inter up as collateral for the loan. Therefore, if the Nerazzurri owners are to default on the loan, they will lose control of the club.

Paying the loan back, moreover, has become even more difficult. With interest rates rising to 12%, Suning’s debt exposure on the loan will wise to €329.6 million at the end of 2022.

Inter Milan Owners Suning Postpone Refinancing Oaktree Loan

Another possibility before the Inter owners would be to refinance the massive loan from Oaktree.

This would mean that the due date to pay back the full amount plus interest would not loom quite so closely in the distance as it does now.

However, a key issue that could make this course of action problematic is the rising interest rates on the market.

At 12% current interest rates, it would hardly be the most favourable time to refinance the loan.

Therefore, Il Sole 24 Ore report, Suning’s financial advisors have directed them to postpone refinancing.

However, the risk here would be that the interest rates could rise higher in the near future, to as high as 16%.

Meanwhile, Il Sole 24 Ore reports, there have also been contacts with other funds for a possible payment-in-kind loan.
 
Last edited:

Adriano@10

Allenatore
Allenatore
Joined
May 22, 2004
Messages
9,489
Likes
2,415
Favorite Player
Oba
10 years of FIF

INTER MILAN OWNERS SUNING POSTPONE REFINANCING OF OAKTREE LOAN

https://onefootball.com/editorial/37980174?language=en

Inter Milan owners Suning have postponed the refinancing of their massive loan from US-based fund Oaktree Capital.

This according to today’s print edition of Italian business newspaper Il Sole 24 Ore, via FCInter1908, who report that the Nerazzurri owners are holding out to see if the conditions on the market change among high interest rates.

The looming due date of a massive loan from US-based fund Oaktree Capital is at the heart of uncertainty surrounding Suning’s future at Inter.

The loan, taken on in 2021, was for €275 million. That money was necessary for Suning to cover operating costs at the Nerazzuri amid pandemic-related financial difficulties.

Whilst that money was vital in order to inject liquidity into Inter, it came with major ramifications.

Suning put Inter up as collateral for the loan. Therefore, if the Nerazzurri owners are to default on the loan, they will lose control of the club.

Paying the loan back, moreover, has become even more difficult. With interest rates rising to 12%, Suning’s debt exposure on the loan will wise to €329.6 million at the end of 2022.

Inter Milan Owners Suning Postpone Refinancing Oaktree Loan

Another possibility before the Inter owners would be to refinance the massive loan from Oaktree.

This would mean that the due date to pay back the full amount plus interest would not loom quite so closely in the distance as it does now.

However, a key issue that could make this course of action problematic is the rising interest rates on the market.

At 12% current interest rates, it would hardly be the most favourable time to refinance the loan.

Therefore, Il Sole 24 Ore report, Suning’s financial advisors have directed them to postpone refinancing.

However, the risk here would be that the interest rates could rise higher in the near future, to as high as 16%.

Meanwhile, Il Sole 24 Ore reports, there have also been contacts with other funds for a possible payment-in-kind loan.
How does this make any sense? Or am i reading it wrong? Like if our debt exposure has risen cause of rising rates it would mean that we got a loan with floating interest rates right? So refinancing it now or later really should not make a difference in terms of the rate you get...
 

Anne Marie

Capitano
Capitano
Joined
Jul 16, 2008
Messages
1,191
Likes
452
Favorite Player
Matrix, Pupi, C
Could someone explain different possibilities of re-financing Oaktree loan? With the risks of constantly losing our values and floating interest rates, re-financing sounds to me like you crash your car again and again until it is fully broken.
 

ADRossi

Administrator
Administrator
Joined
Jul 17, 2010
Messages
18,802
Likes
19,453
10 years of FIF
Forum Supporter
Could someone explain different possibilities of re-financing Oaktree loan? With the risks of constantly losing our values and floating interest rates, re-financing sounds to me like you crash your car again and again until it is fully broken.
It's going to be very challenging in this environment. I think they'll be able to get it done, because the collateral is strong. But the astronomical interest rates we'll have to absorb means our spending abilities will suffer even more.

We should all be rooting for a default or an outright sale at this point.
 

brehme1989

La Grande Inter
La Grande Inter
Joined
Jan 17, 2005
Messages
34,108
Likes
16,533
10 years of FIF
Nostradamus
Most Passionate Member
Someone please make these guys fuck off
 

KevinB

La Grande Inter
La Grande Inter
Joined
Nov 25, 2010
Messages
12,315
Likes
2,219
Favorite Player
Adriano
10 years of FIF
Where are those Curva pricks when you need them. It's just getting ridiculous
 

wera

might be Deadpool
La Grande Inter
Joined
Mar 28, 2011
Messages
32,263
Likes
11,015
Favorite Player
Bea Arthur
10 years of FIF
Most Diverse Poster
So we sold Onana so we can miss on all of our targets?
 

.h.

Part time Lazarus
La Grande Inter
Joined
Jun 8, 2005
Messages
29,088
Likes
7,082
Favorite Player
Inter1-0Wanda
Old username
browha
Forum Supporter
10 years of FIF
Could someone explain different possibilities of re-financing Oaktree loan? With the risks of constantly losing our values and floating interest rates, re-financing sounds to me like you crash your car again and again until it is fully broken.
This is gonna be one of my long winded posts, so I apologise


I had this discussion with another member on the forum (cant remember who) quite recently, actually. A few months back, but I cant dig it up now. I'm not a finance professional, so my views are my own only - I get the impression they were, so i'll relay on their views too.

In their view, it seemed most likely that Inter was just going to refinance with Oaktree, and continue to get milked for interest on our revenue for ever increasing amounts. What the 'end game' of that is, I dont know - seems weird because I dont think it can last that much longer, esp in a higher interest rate environment. If we re-fi 300mil at 15%, for example, we are talking years of runway left, not decades, before negative equity hits.


If we park the financials for a sceond and go from Zhang's perspective, it seems clear to me he wants to try to cling on to the club. The thing that doesnt make any sense is... to what point? Even if China changed its capital outflows rules - which it wont, after seeing what happened to Russian wealth after the invasion of Ukraine - Suning is not a positive business right now, and the Zhangs shareholding of Suning is significantly reduced. So there's no 'easy' prospect to return to subsidising the club as they did in the first few seasons. That, with also the new FFP regulations, just takes that kinda off the board. It's not like Inter is some great asset they can hide internationally from the CCP - we're not a cashflow producing asset, and we're practically just a massive liability on a balance sheet for now, so its surely just an ego play?

A minority investor could be an option, but I dont know why you'd do that. If I was to buy 40% of Inter, say, for 400m, I have no decision making power, its not a cashflow producing asset, and realistically, the revenue of the club isn't going to significantly change in the next few years. In terms of 'achievable' revenue, we've got all the easy stuff. We're in the CL. We've got our shirt sponsor, main sponsor, etc, locked in for years. The only obvious revenue points I see left are minor (training ground sponsor, training kit sponsor), or risky/capital intensive (regular CL SF appearances, or building a new stadium). As a minority investor, too, you'll be constantly dipping into your pocket to re-capitalise the club every season. So its not 400m for 40% (unless you want to have share dilution), its 400mil for 40% now but probably 20-40mil a season for the next few years until we break even.

From a sale perspective, things also get dicey. To buy this club, you'd want to wipe our debts (Whether they are wiped as part of the transaction, or kept with the owner doesnt matter) - so between the bonds and loans you're looking at like 600mil already. You've probably got a 3-5 year plan to break-even, which means subsidising maybe another 150-350mil to the club in that time. That means you're looking at like 800mil already before you're paying anything for the equity of the club.

The thing is for us, we're in a difficult position. As mentioned above, there isnt loads of 'easy revenue' for us to grab. Yes, I know, there are people on here who will be like BUT NEWCASTLE. Well, that's the big difference - investing into Newcastle (e.g. pumping cash to sign players) means you can get into the CL, you can get into the top side of the Premiership teams. The TV revenue and the prize money from the CL is *massive*, so you've suddenly massively increased revenue (and thus your FFP compliance). Look at how PSG are about to get fucked if Mbappe leaves on a Bosman, for example - and, again, they got fake sponsorships etc to help them drive their revenue through the roof.



The problem, for me anyway, is that we arent really an attractive asset. As mentioned above, you're looking at like 800mil euros just to wipe our debts and subsidise the club, and then if you have to pay another 500mil+ for the equity, suddenly you're at 1.3bil. The next best investment you can make at Inter is a new stadium - well, if Milan are going solo, then we're looking at maybe another 800mil cost, so suddenly the cost is 2.1 billion. For 2.1 billion, you can buy almost any non top-6 (?) premiership club, inject in several hundred million in signings, and massively increase revenue by aiming to make the CL. The problem is from where we are, the ease of incremental revenue is now very hard. I need to see if the data backs this 100%, but I cant think off the top of my head in recent years that any Italian club was bought when already in the CL? Milan, Roma, us, all of these transactions were made when the clubs were out of the CL - presumably, specifically to try to drive significant revenue increases by getting into the CL.



Sorry for the long winded post, but its useful to be detailed sometimes. It doesnt boil down to a single flippant answer, as much as that will undoubtedly turn me into 'CCCP SHILL .h.'

tl;dr I think the only real option for Inter is to be sold. That being said, I think Zhang is likely to try to refinance. In the new interest rates, though, that new loan would be fucking killer for us potentially. In a refinanced world, in the long term, its likely to be a default, but honestly, Zhang dont win at all out of that. It just doesnt make any fucking sense to me at all for them to do that. And you'd also end up with Oaktree having to inject money to cover bonds, etc. I dont think - despite some precedent like Elliott - that Oaktree want to run a football club, and with mounting interest/principle as we re-finance, you quite quickly end up to a place where the outstanding loan is worth not far off what Inter is worth... in which case 'default and quick profit' isnt a business strategy.
 
Last edited:

Anne Marie

Capitano
Capitano
Joined
Jul 16, 2008
Messages
1,191
Likes
452
Favorite Player
Matrix, Pupi, C
I got the point. Basically, there are no incentives for either minor investors or outright buyers, (even if Zhang wants to sell us cheap).

But I read somewhere that Inter has not used much of the 275m, which is 350m now? and Sunning did inject a few tens millions in the last two years or so? Could this mean we can refinance with a much smaller amount? (I know default is our best option, I just try to see if Zhang family have real chance to drag this situation on for another few years)
 

CafeCordoba

Moderator
Moderator
Joined
Mar 7, 2004
Messages
35,109
Likes
14,102
Favorite Player
Toro, Barella
10 years of FIF
Long post @.h. , I'm agreeing most of it. But I'm just gonna comment on few things. What is this 800m€ debt? Inter have 415m€ debt. Oaktree loan is NOT Inter's debt. If someone buys Inter, it doesn't include that Oaktree loan. Only the 415m€ loan whose due date is early 2027 (it was refinanced in early 2022)

Majority investors COULD have incentive to buy the club if the price was right. But it's not right since Zhang wants 1 billion. Milan getting bought for 1.2bn is very different since they are debt free thanks to Elliott.
 

Anne Marie

Capitano
Capitano
Joined
Jul 16, 2008
Messages
1,191
Likes
452
Favorite Player
Matrix, Pupi, C
But potential buyers have to pay the loan too, right?
 

.h.

Part time Lazarus
La Grande Inter
Joined
Jun 8, 2005
Messages
29,088
Likes
7,082
Favorite Player
Inter1-0Wanda
Old username
browha
Forum Supporter
10 years of FIF
Long post @.h. , I'm agreeing most of it. But I'm just gonna comment on few things. What is this 800m€ debt? Inter have 415m€ debt. Oaktree loan is NOT Inter's debt. If someone buys Inter, it doesn't include that Oaktree loan. Only the 415m€ loan whose due date is early 2027 (it was refinanced in early 2022)

Majority investors COULD have incentive to buy the club if the price was right. But it's not right since Zhang wants 1 billion. Milan getting bought for 1.2bn is very different since they are debt free thanks to Elliott.

My point on the Oaktree loan is that in the transaction for the equity, even if we arent directly paying for the loan, the 'value' of the loan is in the equity purchase. paying 1.5billion where 415m goes on Inter's bond debt is equivalent to paying 1.5 billion where 415m goes on Inter's bond debt and 350m goes on the Oaktree loan. This is, of course, partly why the valuation for Inter is 'so high'

I'm also not sure what legal ability Zhang has to sell Inter while it's security for a loan. I'm not familiar so much with the laws in this side - it probably means immediate repayment of the loan I guess?


re Milan - yeah, indeed. Also they were quite close to profitability, and indeed were profitable this year with their CL revenue, which just changes the maths completely in terms of both what an investor is willing to pay, but also the 'pool' of investors who might consider buying the asset. And of course at that point, supply and demand come into the game which also further pads the asset valuation.

Spending 1 billion when you'll need to spend hundreds of millions more is a very narrow type of investor compared to spending 1 billion and immediately generating positive cashflow
 
Top