Bielsa sacked - have the Club made the right decision?

[CheeznOnionPasty]

He'll likely have more than 200 million reasons.

Our valuation in the PL will be $400-600m, maybe even higher, (valuations of football clubs don't follow the same rules as other businesses tend to, and are more prone to people paying higher multiples as a strategic/vanity acquirer) in the Championship it'll be $50-100m max.

Normally business is valued as a multiple of profits based on future discounting (what will your profits be worth in 3, 4, 5 years time), so make $100m profit and someone comes along and makes an offer based on a multiple of 5 or 7 or 10 (based on a bunch of different market variables) and pays you $500m-$1b for your business. If you can't value based on bottom line, or for some industries (Software as a Service being the case in point in todays world) where growth tends to be very high early on in the businesses lifecycle, or where there is lots of recurring revenue sources, you can value on top line and the multiples are smaller (because revenue is obviously much higher than profit in 99.999999999999% of businesses). So perhaps you do $250m revenue each year and someone comes along and offers 1, 2 or 3x revenue, so at 2x revenue they pay you $500m for your business.

Football clubs are nearly always running at a negative bottom line, so they get valued based on their top line revenue over a period of time. So, due to the HUGE gulf in revenues between PL and Championship, your football clubs valuation will drop through the floor if you get relegated.

This is what the moneymen worry about, they don't really care about whether the club is making money and has a positive cashflow on a day to day basis (that's only really useful for servicing debt), they are concerned with the multiples and how they increase them, so that when they sell they get a much higher return than when they bought. This is the basis for many of the acquisitions that go on in the world in all industries, you try and buy a business at a low multiple, then change it (by stripping costs, increasing sales.. or getting promoted to the PL) so that you can sell it at a high multiple.

So yeah, our valuation will reduce significantly, not by a few percent but by a whole factor of ten, you can literally just cross a 0 off the end of the number, $500m now equals $50m.

None of this matters to us as fans, but it will be scaring the living daylights out of Radz and the 49ers.

[Barlow Boy]

How Radz felt any manager could come in and change / improve performances mid season from a group of players who have been coached and drilled to a degree where plays become more or less become muscle memory is beyond me.

He will have 200 million reasons to reflect on his stupid decision and ridiculously short sighted lack of investment in the summer, when when we get relegated.

Only one person can tell you that mate, and that’s Radz himself. Terrible, terrible decision.

I’ve zero sympathy for however much brass he loses, you reap what you sow.

[Barlow Boy]

He'll likely have more than 200 million reasons.

Our valuation in the PL will be $400-600m, maybe even higher, (valuations of football clubs don't follow the same rules as other businesses tend to, and are more prone to people paying higher multiples as a strategic/vanity acquirer) in the Championship it'll be $50-100m max.

Normally business is valued as a multiple of profits based on future discounting (what will your profits be worth in 3, 4, 5 years time), so make $100m profit and someone comes along and makes an offer based on a multiple of 5 or 7 or 10 (based on a bunch of different market variables) and pays you $500m-$1b for your business. If you can't value based on bottom line, or for some industries (Software as a Service being the case in point in todays world) where growth tends to be very high early on in the businesses lifecycle, or where there is lots of recurring revenue sources, you can value on top line and the multiples are smaller (because revenue is obviously much higher than profit in 99.999999999999% of businesses). So perhaps you do $250m revenue each year and someone comes along and offers 1, 2 or 3x revenue, so at 2x revenue they pay you $500m for your business.

Football clubs are nearly always running at a negative bottom line, so they get valued based on their top line revenue over a period of time. So, due to the HUGE gulf in revenues between PL and Championship, your football clubs valuation will drop through the floor if you get relegated.

This is what the moneymen worry about, they don't really care about whether the club is making money and has a positive cashflow on a day to day basis (that's only really useful for servicing debt), they are concerned with the multiples and how they increase them, so that when they sell they get a much higher return than when they bought. This is the basis for many of the acquisitions that go on in the world in all industries, you try and buy a business at a low multiple, then change it (by stripping costs, increasing sales.. or getting promoted to the PL) so that you can sell it at a high multiple.

So yeah, our valuation will reduce significantly, not by a few percent but by a whole factor of ten, you can literally just cross a 0 off the end of the number, $500m now equals $50m.

None of this matters to us as fans, but it will be scaring the living daylights out of Radz and the 49ers.

Thank you for that, very insightful.

[Wigan White]

How Radz felt any manager could come in and change / improve performances mid season from a group of players who have been coached and drilled to a degree where plays become more or less become muscle memory is beyond me.

He will have 200 million reasons to reflect on his stupid decision and ridiculously short sighted lack of investment in the summer, when when we get relegated.

Only one person can tell you that mate, and that’s Radz himself. Terrible, terrible decision.

I’ve zero sympathy for however much brass he loses, you reap what you sow.

If a deal has been agreed for the full sale if the club to the 49ers, it's also possible that a sale price has been agreed so it won't make any difference to Radz what division we are in.

[Barlow Boy]

How Radz felt any manager could come in and change / improve performances mid season from a group of players who have been coached and drilled to a degree where plays become more or less become muscle memory is beyond me.

He will have 200 million reasons to reflect on his stupid decision and ridiculously short sighted lack of investment in the summer, when when we get relegated.

Only one person can tell you that mate, and that’s Radz himself. Terrible, terrible decision.

I’ve zero sympathy for however much brass he loses, you reap what you sow.

If a deal has been agreed for the full sale if the club to the 49ers, it's also possible that a sale price has been agreed so it won't make any difference to Radz what division we are in.

I’m no expert Al, but surely the price Radz receives will be based upon which league we are in.

As pointed out, the income stream differences between the leagues are astronomical, I find it hard to believe the 49ers will give Radz what he wants regardless of the division we are in.

[Wigan White]

How Radz felt any manager could come in and change / improve performances mid season from a group of players who have been coached and drilled to a degree where plays become more or less become muscle memory is beyond me.

He will have 200 million reasons to reflect on his stupid decision and ridiculously short sighted lack of investment in the summer, when when we get relegated.

Only one person can tell you that mate, and that’s Radz himself. Terrible, terrible decision.

I’ve zero sympathy for however much brass he loses, you reap what you sow.

If a deal has been agreed for the full sale if the club to the 49ers, it's also possible that a sale price has been agreed so it won't make any difference to Radz what division we are in.

I’m no expert Al, but surely the price Radz receives will be based upon which league we are in.

As pointed out, the income stream differences between the leagues are astronomical, I find it hard to believe the 49ers will give Radz what he wants regardless of the division we are in.

Don't disagree Kev, just speculating but would be a pretty strong reason for the lack of transfer window investment.

[CheeznOnionPasty]

No sensible acquirer, and lets make the safe assumption that 49ers are sensible enough, would agree a purchase price without conditions based on what division we are in. It really really matters. See my post above about valuations.

If there is a contract in place with an agreed purchase price, there will be a term sheet with clauses that cover relegation. 49ers lawyers and risk management people would not let them sign a contract without it, it would make zero business sense.

[The last Waltz]

Just to clarify a few things. The 49rs already own circa 44% of the club. The £200m hit to Radz reflects circa half the $530m option price they have to purchase the entire club. They do not have to exercise that option until January 24 and would be unlikely to do so if the club was in the championship.

[NottinghamWhite]

According to the Daily M*il Marcelo is favourite to land the Bolivian national sides head coach’s job.

[NottinghamWhite]

Eddie Gray speaks out.

EXCLUSIVE: Leeds were RIGHT to axe Marcelo Bielsa, says Eddie Gray - as club legend speaks about the Elland Road hotseat, Don Revie, Brian Clough... and how the family name is set to be continued
The sign above his front door reads 'Nobody gets out sober' and Eddie Gray has had every reason to enjoy a drink of late.
The first cause for celebration came with Leeds' 94th-minute victory against Norwich, when Gray was housebound because of Covid but went 'crazy' in his living room instead. Then it was that stoppage-time comeback win over Wolves, which had the 74-year-old 'jumping up and down' in the directors' box at Molineux.
'That passion never leaves you,' the Leeds legend tells Sportsmail from his home in the picturesque village of Kirkby Overblow near Harrogate. 'It was such an important moment for our position in the league.
'At 2-0 down at half-time, you are thinking this puts us in real trouble. There is no hope. But a win like that changes everything. It is so crucial we stay up.'

Gray knows this the hard way having been at Leeds - as player and then manager - the last two times they dropped out of the top flight.
Of course, the Scot is remembered by fans for his successes, the two League titles and FA Cup won under Don Revie in the 1960s and 70s, and he has been voted the club's third greatest player of all time.
'I played for the youth team, the reserve team, the first team. I coached the youth team, the reserve team, the first team. It's not bad, you know?' grins the man they call Mr Leeds United. But despite all of that, Gray admits that, to this day, he reflects on the disappointments he suffered at Leeds more than his many notable achievements.
'People talk about me winning the FA Cup, but the games that stick in my mind are the finals I lost - against Sunderland and Chelsea,' says Gray.
'It's the same with relegation. It hurts everybody terribly and it takes a long time to get back. When we went down in 1982, it took us eight years, then after 2004 it was 16 years.
'There is no guarantee that any team will come back up. That's why it's so important now that the club maintains its position in the Premier League.'
Jesse Marsch's men, who now sit seven points clear of the drop zone, are certainly in a better position to do so than Gray's side were 18 years ago.
Having previously managed Leeds from 1982 to 1985, Gray was placed in temporary charge again in November 2003 after Peter Reid was sacked with the Whites bottom of the table. But he could not turn things round and a team who had reached a Champions League semi-final only three years earlier - when he was an assistant to David O'Leary - went down following a 4-1 defeat at Bolton
'That was one of my saddest days,' he admits. 'I was disappointed in myself and I always will be. You always think you should have done better and about what you could have done differently.
'But the circumstances weren't great. The club had no money and our best players were gone or were going. Players would come in to training and say, "The club tried to sell me last night".
'Because of that, they had lost that bit of desire. They were just waiting to find out when they were going to leave the club.
'It was still disappointing and it plays on your mind, but time moves on. I never regret taking it on. I am just pleased to see the club back in the big league. You saw the other night at Wolves that the current group have the desire and passion for the club to stay in the Premier League.'
Gray's medal haul may be the envy of his peers, but you would never know it sitting in his home of 50 years. 'They are in a box under the ground somewhere, they are not on show,' he says in his distinctive Glaswegian drawl. 'If you've played at the highest level and won things, you know you've won them. You don't need a medal to prove it.'
The only one on display is from the Fairs Cup and only because Gray likes the way it looks, coming in the form of a mini replica of the trophy. Other than that, hanging up in the same corner of the kitchen is his first Scotland cap, while on a cabinet is a framed black-and-white photo of Revie racing his player Jack Charlton in training as Gray watches on.
'What I am most proud of about my career is having the privilege of playing with great players,' he reflects. 'A lot of the boys are no longer with us but I made some great friendships. They were terrific times and that was all down to one man - Don.'
Gray, as you would expect, speaks glowingly of Revie, in particular the personal touch he had with his players. 'He brought the group together like a family,' he says.
'When I was still an Under 15, I remember he would come out and set up a five-a-side match with us in the car park at lunchtime and join in. Don would do anything for you and your family. He used to come up to my house in Glasgow just to make sure my mum and dad were all right. If anyone was ill, he'd send flowers. He also loved nothing more than a sing-song after the game. Everybody had to sing their own song.'
The unique bond Revie shared with his squad was something Brian Clough could never come to terms with when he replaced him as manager in 1974 - an ill-fated spell lasting just 44 days.
Clough certainly got off on the wrong foot with Gray, telling the injury-plagued winger that if he had been a horse, he would have been shot.
'That was just how Cloughie was, but I don't think the club gave him long enough,' says Gray surprisingly. 'He came in like a bull in a china shop and he did it wrong. He admitted that to me later in life. But I'd still have given him longer. He proved himself to be one of the greatest managers this country has ever produced.
Talk of great managers past brings us to the modern day and Marcelo Bielsa. When he was sacked last month, the club revealed plans for a permanent tribute at Elland Road, leading to speculation of a statue to match those of Revie and Billy Bremner.
'If that was the case, I would go along with that,' admits club ambassador Gray. 'I don't think any Leeds United fan - me included - will ever forget what he did for the club.
'His legacy will last a long time. He brought us out of the doldrums and the club can't thank him enough.'
That said, Gray still believes Leeds were correct to call time on the Argentine's four-year reign.
'The club did the right thing,' he says. 'You couldn't see the run of defeats coming to an end. Marcelo never really showed any emotion. I never saw him pat a player on the back when he was substituted. That's just how he was and he was successful with it. The players responded to him.
'But when you are struggling and you don't have that personal affinity with the players, it becomes difficult. When things start going wrong, you need an arm around you and that wasn't his nature.'
It is, though, very much the nature of Bielsa's touchy-feely American successor Marsch. 'So far Jesse has done very well,' says Gray.
'If you come in and communicate with the players, you get their respect and everything runs smoothly. Don was like that.
'Jesse is a completely different type of personality to Marcelo but he shows the type of passion and enthusiasm that Leeds fans like.
'He's bought into the club. I met him at a fundraiser at Elland Road and he really appreciates the opportunity and realises what it means to the people of Leeds for the club to be in the Premier League.
'In recent times, the atmosphere at Elland Road is the best it's ever been. They need to make the stadium bigger as 38,000 is not enough. They could fill double that.
'This season is all about survival but Jesse is clever enough to know Leeds fans are a different breed and don't settle for mid-table.
'We have to strive to be in the top six, challenging for places in Europe. If West Ham can do it, so can we.'
As Gray finishes by pondering a brighter future for the club he first joined almost 60 years ago, he notes the role his wider family may have to play in it.
His great nephew Archie Gray - grandson of Frank and son of Andy, both ex-Leeds players - has made the first-team bench twice this season and has captained England Under 16s.
Archie's 13-year-old brother Harry is also in the Leeds academy, as are two of Gray's 17 grandchildren - Jacob and Charlie - who play Under 10s.
'Archie is still at school so you don't want to get carried away, but he is doing very well,' adds Gray.
'There could be a few Grays at Leeds for a few years yet!'