Lxxx Posted March 8, 2020 Share Posted March 8, 2020 3 hours ago, Derek Flint said: Maybe an integrated sea and air transport company could run cost neutral? On the face of it it's a no brainer. The issue is we have no brains to make it happen. 4 Quote Link to comment Share on other sites More sharing options...
b4mbi Posted March 8, 2020 Share Posted March 8, 2020 3 hours ago, thesultanofsheight said: £124M to buy it, £35M for the new Liverpool terminal about £60M being raises for two new boats as a minimum. It’s well over £200M already. How will the debt reduce? Will you be paying it off? No. £38m to buy IoMSPC, £76m in as loan. New user agreementv was signed, and company will raise £150ish through private placement to repay the £76m loan and provide additional funds for new vessel. Company is very profitable and will be itself able to pay the loan back over 10-15 year period. So actual cost to government £38m + £40m for new terminal liverpool = £78m, not £200m - big difference in terms of iomg finances.. 1 Quote Link to comment Share on other sites More sharing options...
thesultanofsheight Posted March 8, 2020 Share Posted March 8, 2020 (edited) 8 minutes ago, b4mbi said: No. £38m to buy IoMSPC, £76m in as loan. New user agreementv was signed, and company will raise £150ish through private placement to repay the £76m loan and provide additional funds for new vessel. Company is very profitable and will be itself able to pay the loan back over 10-15 year period. So actual cost to government £38m + £40m for new terminal liverpool = £78m, not £200m - big difference in terms of iomg finances.. The loan replacement was still part of the purchase price you can’t just conveniently discount it like we didn’t write a cheque for £76M on top of what we paid for the equity. Doesn’t matter about the private placement either. The SPC will be borrowing the amount and will be paying it back to the borrower (ie, refinancing) so as I said over £200M spent or committed to be spent so far however you want to look at it. Edited March 8, 2020 by thesultanofsheight Quote Link to comment Share on other sites More sharing options...
b4mbi Posted March 8, 2020 Share Posted March 8, 2020 27 minutes ago, thesultanofsheight said: The loan replacement was still part of the purchase price you can’t just conveniently discount it like we didn’t write a cheque for £76M on top of what we paid for the equity. Doesn’t matter about the private placement either. The SPC will be borrowing the amount and will be paying it back to the borrower (ie, refinancing) so as I said over £200M spent or committed to be spent so far however you want to look at it. It's not that complicated to get your head around what the eventual cost to the government is, surely? Yes, the initial cash outlay by the govt was £124m, but the govt will get back £76m when IoMSPC refinance. Eventual govt NET spend £38m. Plus £40m for liverpool is £78m cash flow out from govt. - not the £200m you seem to think. Quote Link to comment Share on other sites More sharing options...
TheTeapot Posted March 8, 2020 Share Posted March 8, 2020 8 minutes ago, b4mbi said: It's not that complicated to get your head around what the eventual cost to the government is, surely? Yes, the initial cash outlay by the govt was £124m, but the govt will get back £76m when IoMSPC refinance. Eventual govt NET spend £38m. Plus £40m for liverpool is £78m cash flow out from govt. - not the £200m you seem to think. You mentioned raising £150m from private placement. Just wondering what makes you think that will be achievable? Quote Link to comment Share on other sites More sharing options...
thesultanofsheight Posted March 8, 2020 Share Posted March 8, 2020 5 minutes ago, b4mbi said: It's not that complicated to get your head around what the eventual cost to the government is, surely? Yes, the initial cash outlay by the govt was £124m, but the govt will get back £76m when IoMSPC refinance. Eventual govt NET spend £38m. Plus £40m for liverpool is £78m cash flow out from govt. - not the £200m you seem to think. Firstly we haven’t got the £76M back yet so it’s a minimum of £124M plus £40M for the terminal at this stage. Secondly even if the SPC does re-finance to pay the £76M back that is still a cost to the taxpayer as a % of it’s profits as investor will be forgone to service the new higher debt levels (£150M private placement debt) in the business so whichever way you choose to look at it the investment required has been around the £200M mark. Quote Link to comment Share on other sites More sharing options...
b4mbi Posted March 8, 2020 Share Posted March 8, 2020 (edited) 29 minutes ago, TheTeapot said: You mentioned raising £150m from private placement. Just wondering what makes you think that will be achievable? The company has a 20+ year user agreement giving them a virtual monopoly it generated iirc £18m cash inflow last year but at least £10m for last decade govt has A credit rating and could (as owner) provide guarantee of company's performance Company will have a new vessel that a charge can be taken over. Plenty of scope to raise £150m at between 3-4%. Edited March 8, 2020 by b4mbi Quote Link to comment Share on other sites More sharing options...
sir nige Posted March 8, 2020 Share Posted March 8, 2020 6 minutes ago, b4mbi said: The company has a 20+ year user agreement giving them a virtual monopoly it generated iirc £18m cash inflow last year but at least £10m for last decade govt has A credit rating and could (as owner) provide guarantee of company's performance Company will have a new vessel that a charge can be taken over. Plenty of scope to raise £150m at between 3-4%. so a cash payment out by iomg of around £400m- £500m time you add in 2 new boats....... Quote Link to comment Share on other sites More sharing options...
b4mbi Posted March 8, 2020 Share Posted March 8, 2020 11 minutes ago, sir nige said: so a cash payment out by iomg of around £400m- £500m time you add in 2 new boats....... Sorry, that is just completely misleading and plain wrong. Quote Link to comment Share on other sites More sharing options...
sir nige Posted March 8, 2020 Share Posted March 8, 2020 7 minutes ago, b4mbi said: Sorry, that is just completely misleading and plain wrong. sadly its not its not when you look at the calmac mess with new boats...... Quote Link to comment Share on other sites More sharing options...
TheTeapot Posted March 8, 2020 Share Posted March 8, 2020 31 minutes ago, b4mbi said: The company has a 20+ year user agreement giving them a virtual monopoly it generated iirc £18m cash inflow last year but at least £10m for last decade govt has A credit rating and could (as owner) provide guarantee of company's performance Company will have a new vessel that a charge can be taken over. Plenty of scope to raise £150m at between 3-4%. Fair enough, thanks for answering. I don't think I'm as sure as you are that they'll be able to raise it that easily, but I don't really know what I'm talking about when it comes to high finance. Or much else tbf. Quote Link to comment Share on other sites More sharing options...
sir nige Posted March 8, 2020 Share Posted March 8, 2020 12 minutes ago, TheTeapot said: Fair enough, thanks for answering. I don't think I'm as sure as you are that they'll be able to raise it that easily, but I don't really know what I'm talking about when it comes to high finance. Or much else tbf. taxpayers have bought the company........iomg are going to borrow money.......for taxpayers to repay via fares....... you must think of the ps/cs pensions....... Quote Link to comment Share on other sites More sharing options...
b4mbi Posted March 8, 2020 Share Posted March 8, 2020 37 minutes ago, TheTeapot said: . Or much else tbf. Not even tea? 1 Quote Link to comment Share on other sites More sharing options...
b4mbi Posted March 8, 2020 Share Posted March 8, 2020 1 hour ago, thesultanofsheight said: Firstly we haven’t got the £76M back yet so it’s a minimum of £124M plus £40M for the terminal at this stage. Secondly even if the SPC does re-finance to pay the £76M back that is still a cost to the taxpayer as a % of it’s profits as investor will be forgone to service the new higher debt levels (£150M private placement debt) in the business so whichever way you choose to look at it the investment required has been around the £200M mark. Sigh. Look at it this way then, effectively £124m was spent (£76m of which will be repaid within 2 years of the deal) to purchase a company that is pretty much guaranteed to generate at least £250m cash over the next 25 years, but crucially it also purchased control over our vital sea route. It was a great deal. 1 Quote Link to comment Share on other sites More sharing options...
b4mbi Posted March 8, 2020 Share Posted March 8, 2020 44 minutes ago, sir nige said: sadly its not its not when you look at the calmac mess with new boats...... Calmac mess is not analogous. Iomg will not insist vessel is built in ramsey shipyard. New board has global ship building experience and will get design/specification right from start and not change it halfway through the build. Quote Link to comment Share on other sites More sharing options...
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