Premium Essay

Tottenham Hotspur

In: Business and Management

Submitted By rundolf
Words 4681
Pages 19
9-209-059
REV: MARCH 23, 2009

LAUREN COHEN JOSHUA COVAL CHRISTOPHER MALLOY

Tottenham Hotspur plc
In early 2008, Daniel Levy, chairman of Tottenham Hotspur Football1 Club, was contemplating a bold move for the organization, one that he hoped would help vault the team into the upper echelon of the English Premier League (“Premiership”). Despite the club’s long and storied history, Levy felt that the team’s future success likely required a significant investment in physical assets, notably the development of a new stadium. Tottenham currently played in an old stadium called White Hart Lane with a capacity of only 36,500 fans, but had the opportunity to build a new stadium on some adjacent property. Most of their key competitors, such as Arsenal, Manchester United, and Chelsea, had newer or larger stadiums, and were able to leverage the added revenues these stadiums provided to gain a competitive advantage in the cutthroat player acquisition market. Levy had to decide if the benefits of a new stadium were worth the substantial commitment of time and resources that its construction would entail.

Background
Founded in 1882, the Tottenham Hotspur Football Club was one of the oldest teams in the Premiership. Its rich history featured a successful product on the pitch, as evidenced by major trophies in each of the past six decades--a feat matched only by Manchester United, and a series of innovations off the pitch as well. The club became the first publicly-owned football club in England when it listed on the London Stock Exchange in 1983, and was also the first to introduce corporate hospitality boxes at their stadium. Since 1981, the team’s main shareholder had been ENIC International Ltd, an investment company established by Joseph Lewis. Daniel Levy, Lewis’s partner at ENIC, had served as chairman of the club since 2001, after ENIC bought a controlling…...

Similar Documents

Free Essay

David Beckham

...Jump to: navigation, search David Beckham Beckham in 2009 Personal information Full name David Robert Joseph Beckham Date of birth (1975-05-02) 2 May 1975 (age 38) Place of birth Leytonstone, London, England Height 6 ft 0 in (1.83 m)[1] Playing position Midfielder Youth career Tottenham Hotspur Brimsdown Rovers 1991–1993 Manchester United Senior career* Years Team Apps† (Gls)† 1993–2003 Manchester United 265 (62) 1994–1995 → Preston North End (loan) 5 (2) 2003–2007 Real Madrid 116 (13) 2007–2012 Los Angeles Galaxy 98 (18) 2009 → Milan (loan) 18 (2) 2010 → Milan (loan) 11 (0) 2013 Paris Saint-Germain 10 (0) Total 523 (97) National team 1992–1993 England U18 3 (0) 1994–1996 England U21 9 (0) 1996–2009 England 115 (17) * Senior club appearances and goals counted for the domestic league only and correct as of 18 May 2013. † Appearances (Goals). David Robert Joseph Beckham, OBE[2] (born 2 May 1975)[3] is a former English footballer. He has played for Manchester United, Preston North End, Real Madrid, Milan, Los Angeles Galaxy, French Ligue 1 club Paris Saint-Germain, and the England national team for which he holds the appearance record for an outfield player[4], and also the first English player to win league titles in four countries. He announced his intention to retire at the end of the 2012–13 Ligue 1 season on 16 May 2013. Beckham's professional career began with Manchester United, making his first-team debut in...

Words: 465 - Pages: 2

Free Essay

Alan Sugar

...market value every year. In 1986, he began to sell PCW8256 word processors at £300 each, and Amstrad's stock market value reached around £1.2bn in the late 1980s (although it is now worth approximately £110m). As a result, Sugar enjoys a chic lifestyle that every businessman dreams off. He has a yacht, a private jet and a mansion in Essex - England, as well as houses in Florida and Marbella. And of course, an owner of luxurious cars, out of which is the Rolls Royce Phantom. He's been married for over 35 years, has three grown-up children and five grandchildren. In 1991, however, the entrepreneur also invested in football when he announced he'd joined forces with Terry Venables to buy Tottenham Hotspur Football Club, beating off competition from Robert Maxwell and as well saving Tottenham from bankruptcy paying off £20m of debts. But the Venables-Sugar partnership didn't turn out so well and Sugar has admitted his years as Spurs' chairman were "a waste of my life". Other main businesses founded by Sugar are as follows: • Amsair: an aviation company being run by Daniel Patrick, son of Alan Sugar, offering business and executive jet charters • Amsprop: investment and property firm being run by Daniel Patrick • Viglen Ltd: IT establishment • Amscreen: run by Sugar’s eldest son Simon which specialized in offering digital ad screens for medical, leisure, and retail purposes. Lately, the success of the well-known BBC’s reality TV show The Apprentice has made Sugar a......

Words: 712 - Pages: 3

Premium Essay

Tottenham Hotspur

... Chapter 7 1. A process by which organizations select objectives, establish processes to achieve objectives, and monitor performance is |a. |enterprise risk management | |b. |internal control | |c. |organizational governance | |d. |risk assessment | ANS: C 2. A process, effected by an entity’s board of directors, management and other personnel, applied in strategy setting and across the enterprise, designed to identify potential events that may effect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives. |a. |enterprise risk management | |b. |internal control | |c. |organizational governance | |d. |risk assessment ...

Words: 11772 - Pages: 48

Premium Essay

Polymold

...do you find in the income statements as a result of the purchase? What causes those changes? b. What differences do you find in the balance sheets as a result of the purchase? What causes those differences? 2. If you were deciding whether or not to purchase CAD/CAM, what financial statement information would you consider? What other information would you take into account? 3. Should the Polymold Division be allowed to purchase the CAD/CAM? Tottenham Hotspur plc 1. Assuming Tottenham Hotspur, plc continues in their current stadium following their current player strategy. a. Perform a DCF analysis using the cash flow projections given in the case. Based on this DCF analysis, what is the value of Tottenham Hotspur, plc? b. Perform a multiples analysis. Based on the multiples analysis, is the value of Tottenham any different? c. Is Tottenham fairly valued? 2. Using a DCF approach, evaluate each of the following decisions: d. Build the new stadium e. Sign a new striker f. Build the new stadium and sign a striker Note that the past 10 years of premiership revenue and point total data suggest that for every 1% increase in a team’s point total, a team could anticipate a 1.52% improvement in revenues. Kelly Services, Inc.......

Words: 5498 - Pages: 22

Free Essay

Book, Story

...RABODIRECT PRO12 RUGBY Munster v Treviso (3:10pm ET) L [HD] 03:00 P 03:30 P HYUNDAI A-LEAGUE Brisbane Roar vs Melbourne Victory (4:40am ET) R [HD] UEFA CHAMPIONS LEAGUE UEFA CHAMPIONS LEAGUE ROUND OF 16 - 2nd Leg: Real ROUND OF 16 - 2nd Leg: Borussia Madrid CF (ESP) vs FC Schalke 04 Dortmund (GER) vs Football Club (GER) L [HD] Zenit (RUS) L [HD] 04:00 P 04:30 P 05:00 P HYUNDAI A-LEAGUE HIGHLIGHTS D [HD] SCOTTISH PREMIERSHIP HIGHLIGHTS D WORLD CHAMPIONSHIP OF PING PONG Round 2 D [HD] UEFA CHAMPIONS LEAGUE ROUND OF 16 - 2nd Leg: Chelsea FC (ENG) vs Galatasaray A.S. (TUR) D [HD] UEFA CHAMPIONS LEAGUE ROUND OF 16 - 2nd Leg: Manchester United FC (ENG) vs Olympiacos FC (GRE) D [HD] UEFA EUROPA LEAGUE ROUND OF 16 - 2nd Leg: SL Benfica (POR) vs Tottenham Hotspur FC (ENG) D [HD] RABODIRECT PRO12 RUGBY Leinster v Zebre D [HD] AVIVA PREMIERSHIP London Irish vs Bath D [HD] CONCACAF CHAMPIONS LEAGUE QUARTERFINAL 2nd LEG: Cruz Azul (MEX) vs Sporting Kansas City (USA) R [HD] 05:30 P 06:00 P 06:30 P 07:00 P SCOTTISH PREMIERSHIP Kilmarnock vs Celtic (3:40pm ET) R [HD] SUPER LEAGUE RUGBY Leeds vs London Broncos D [HD] UEFA EUROPA LEAGUE ROUND OF 16 - 2nd Leg: Real Betis Balompié (ESP) vs Sevilla FC (ESP) D [HD] AVIVA PREMIERSHIP Worcester vs London Wasps D [HD] SCOTTISH PREMIERSHIP Hearts vs Dundee United (3:40pm ET) R [HD] 07:30 P 08:00 P 08:30 P 09:00 P UEFA CHAMPIONS LEAGUE HIGHLIGHTS D [HD] AUSTRALIAN RULES FOOTBALL LEAGUE Carlton vs Port Adelaide R [HD] NRL FULL TIME D UEFA......

Words: 1370 - Pages: 6

Free Essay

Business

...Manchester United at Stamford Bridge on January 19, 2014 in London, England. (Photo by Mike Hewitt/Getty Images)Liverpool consider shock swoop for former Chelsea star Eto'o as Rodgers looks to bolster striking options REVEALED: Find out who is the Premier League's most popular player when it comes down to shirt sales Man United BAN supporters from bringing in iPads and tablets into Old Trafford ahead of the new season FA facing new Wembley low with just 10,000 tickets sold for Norway friendly Khedira is NOT for sale: Ancelotti insists midfielder is going nowhere as Arsenal and Co are dealt transfer blow Drogba could miss the start of the season after picking up ankle injury Football - Tottenham Hotspur v FC Schalke 04 - Pre Season Friendly - White Hart Lane - 14/15 - 9/8/14 Tottenham Hotspur manager Mauricio Pochettino Mandatory Credit: Action Images / Jed Leicester EDITORIAL USE ONLY.You want to kill him! Pochettino made stars walk over hot coals. His methods pay, but his players say... 'he works you like a dog' Mangala becomes most expensive defender in British football history after completing £32m move to City Newcastle storm as Ashley scraps free tickets for coaches and staff Townsend, Soldado and Sandro could lead White Hart Lane exodus Mourinho must win trophies this season, says ex-Blues boss Gullit Rory McIlroy with his two Major trophies of 2014, the US PGA Championship and The Open Championship From his Instagram account......

Words: 8604 - Pages: 35

Premium Essay

Tottenham Hotspur Case

...Tottenham Hotspur Case There are many football clubs listed in the London Stock Exchange among them Tottenham Hotspur Football is a one of the leading English professionals’ club and also a member of Premier League. This club has also been listed at London Stock Exchange. Since 2001 Daniel Levy is the chairman of Tottenham Hotspur plc and is thinking of possible options and potential players to take his club to the top position of the British Premier League. In order to succeed in his objective and to establish a sound foundation for the long term financial success, he thinks two things are very important Building of new stadium, Improvement in team quality through prudent player achievements In order to achieve these two main objectives of the chairman the following are the three alternatives which have been scrutinized using Discounted Cash Flow Analysis: either to operate the current stadium which has 36,500 seats and keep a single goal scorer, either to build a new stadium having 60,000 seats capacity with an external financing, signing of new top scorer, playing in newly built stadium. Under the first alternative solution, the Net Present Value for Tottenham Hotspur plc, during the last 13 year forecasted period, was calculated and found to be £67.68M. This calculation will encourage the stakeholders to keep the current stadium in use. While the company has a high operating current cost with Net Income coming to about 2% of total revenues. If Tottenham Hotspur......

Words: 2051 - Pages: 9

Premium Essay

Sports Economics

...teams from the same cities on attendance in the scope of the English Premier League. In spite of the abundant data available from the premier league website as well as other statistics sources, hardly any previous research was found to have specifically inquired in this issue. In this research, we will look at data existing in the Premier League official website (Premierleague.com, 2011) and the football teams’ official websites for the 2009 through 2011 season to test whether a derby match (between 2 rival teams in the same city) gives rise to the attendance. Each local derby match will be treated as a “differentiated product” in the considerable monopolistic market model of the PL. London derby teams are among Chelsea, Arsenal, Tottenham Hotspur, Fullham and Westham United; Manchester derby teams are between Manchester United and Manchester City; Liverpool derby teams are between Liverpool and Everton (Premierleague.com, 2011). To avoid non-comparable data from derbies of other areas or provinces, we categorize clubs in terms of their cities (i.e. Manchester, London, and Liverpool). This also helps classifying different derby couples in terms of city population, stadium capacity and each team’s number of fans. In the effort of capturing the proper impact of these matches, we will build a regression model to test the relation between variables such as match attendance, stadium capacity, and the average related indexes. We also try to bring in dummy variables for factors......

Words: 846 - Pages: 4

Premium Essay

Tottenham Hotspur

...Flow analysis, it is clear that Tottenham Hotspur plc. will continue to succeed in the event of neither a new stadium nor a new striker. C. Multiples Analysis of Tottenham Hotspur plc. Due to the large differences between the different teams in the Premier league (Exhibit 2), the teams in the league were to be split into two groups, with those with relatively high Enterprise Values and Revenues into one group, and those with relatively low enterprise values and revenues into another. Group one includes Manchester United, Arsenal, Chelsea, and Liverpool. Group 2 includes Newcastle United, Tottenham Hotspur, and Aston Villa. Group 2 will be the focus of this multiple analysis, as the companies are the most comparable in Debt, Revenue, and Enterprise Value. Using revenue multiples, different multiples for group 2 are as follows: Newcastle United 1.92, Tottenham Hotspur 2.08, Everton 1.83, and Aston Villa 1.80. Using these multiples, an average of the product of the multiples times the terminal value for Tottenham Hotspur plc. was found to be £140.38M. Exhibit 3 details the calculations for the multiples analysis. From comparison of the Net Debt multiple, it is clear that Tottenham Hotspur plc. holds the first position in the second group of teams with a net debt multiple of 0.12. When compared to other teams in group 2, Tottenham Hotspur plc. appears to be very healthy financially. From this analysis, the enterprise value for Tottenham Hotspur plc. for continuing......

Words: 1589 - Pages: 7

Premium Essay

Fvvc

...LSE / Lent Term – 2015 FM421 – Applied Corporate Finance Case Assignments • You will find an Excel file with all the exhibits from the case on Moodle. • Assignments MUST be submitted before class on Moodle. • Your assignment should not exceed 5 pages including appendices. “Tottenham Hotspur” To Do 1. Read case: HBS 9-209-059: Tottenham Hotspur Plc. There is an Excel spreadsheet to help you with the base numbers. 2. Read lecture slides. Case Preparation Questions State clearly all assumptions that you make and defend their choices whenever possible. 1. Assume that Tottenham Hotspur continues in their current stadium following their current player strategy. Perform a discounted cash flow (DCF) analysis using the cash flow projections given in the case. For all CAPM calculations, use the risk-free rate given in Exhibit 1 and assume a market premium of 5%. Also assume that Tottenham’s debt has zero beta. At its current stock price of £13.80, is Tottenham fairly valued? 2. Provide an alternative valuation of Tottenham based on multiples. Compare your findings with those from Question 1 and, in the light of your results, discuss the relative advantages and disadvantages of multiples versus DCF valuation methods. 3. Using a DCF approach, evaluate each of the following decisions: a) Build the new stadium b) Sign a new striker c) Build the new stadium and sign a new striker. • Note that the past 10 years of......

Words: 293 - Pages: 2

Premium Essay

Vl; Kdvsvdlkvdsl; K

...Case Tottenham Hotspur 1a) Change in NWC = cash requirements + inventory + receivables – payables. There will be no cash requirements, because of the hint in the question excess cash should not be included so therefore change in NWC will be 1,17 + 19,99 – 64,40 = -43,24 for the year 2007. For the next years until 2020 will use the revenue growth as a measurement to calculate the NWC for the next years. The revenue growth is 9 percent per year so the NWC will grow by 9 percent per year. FCF = (Revenue – Costs – Depreciation) x (1 – tax rate) + Depreciation – Capital Expenditure – change in working capital. So when I fill in this formula I get: 71,1 – 69,1 – 2,2 x (1 – 0,35) + 2,2 – 2,26 - -43,24 = 45,79. See for the next years the last page of this document. 1b) that is because most of the football clubs won’t have a large sum of accounts receivables and have a small inventories. “Normal organizations” will have much higher accounts receivables and much bigger inventories. 1c) E(R) = RFR + βstock (Rmarket – RFR) according the case the risk free rate is 4,57% and the beta is 1,29 and the market risk premium will is given in the question 4,57% + 1,29 x 5% = 11,02 % is the expected return on equity. 1d) Cost of debt can be calculated by dividing the interest expense / amount of equity x 100%. So if we put in the numbers we get the following: (2,26/ 45,73) x 100 = 4,94%. For calculating the weighted average cost of capital after tax we use the following formula: WACC =......

Words: 298 - Pages: 2

Premium Essay

Valuing Wal-Mart

...Piyashi Bhattacharyya, John Freese, David Underdown Finance 7410 Case 1 – Tottenham Hotspur plc Tottenham is faced with the possibility of building a new stadium, the potential acquisition of an additional goalscorer to complement its newly acquired player, Roman Pavlyuchenko, or possibly doing both. Daniel Levy, the team’s chairman, believes that building a new stadium will “modernize the club’s match-day facilities.” He believes that the new stadium is also a “crucial component of long-run success in the Premiership, in part because the added revenues would allow the Spurs to compete more aggressively in the acquisition market for superstar international players.” Tottenham lost two of its star players to a higher-end team. The stadium project is expected to increase attendance revenue by 40 percent and sponsorship revenues by 20 percent. Signing a new goalscorer is forecasted to give Tottenham an increase of 12 net goals per season. This would increase its ranking in the Premiership, which would lead to higher revenues. It is important to conduct three separate valuations because if Tottenham acquires the new player without building a stadium the team would probably not gain much of the revenue increases that would result from the team’s performance. Acquiring a new player and building a new stadium must be valuated separately because if the club does not get a newer stadium similar to the top teams in the league, then it would only get one-quarter of the...

Words: 1968 - Pages: 8

Free Essay

Blank

...questions key to the future of Tottenham Hotspur in the coming years: 1. Using a DCF, what is the value of Tottenham, and at its current price, is Tottenham fairly valued? The value of Tottenham is £13.80, and at it’s current price of is £, is overvalued. Executive Summary: This case analysis answers a few questions key to the future of Tottenham Hotspur in the coming years: 1. Using a DCF, what is the value of Tottenham, and at its current price, is Tottenham fairly valued? The value of Tottenham is £13.80, and at it’s current price of is £, is overvalued. Executive Summary: This case analysis answers a few questions key to the future of Tottenham Hotspur in the coming years: 1. Using a DCF, what is the value of Tottenham, and at its current price, is Tottenham fairly valued? The value of Tottenham is £13.80, and at it’s current price of is £, is overvalued. Executive Summary: This case analysis answers a few questions key to the future of Tottenham Hotspur in the coming years: 1. Using a DCF, what is the value of Tottenham, and at its current price, is Tottenham fairly valued? The value of Tottenham is £13.80, and at it’s current price of is £, is overvalued. Executive Summary: This case analysis answers a few questions key to the future of Tottenham Hotspur in the coming years: 1. Using a DCF, what is the value of Tottenham, and at its current price, is Tottenham fairly valued? The value of Tottenham is £13.80, and at......

Words: 771 - Pages: 4

Premium Essay

Tottenham

...Net debt for all different scenarios was assumed to be the value from t=0 • NWC = Current assets07 – current liabilities07 – excess cash07 (Working Capital Turnover Ratio: 58% of sales)1 was kept constant • Terminal Value = 2020 − discounted from 2019 • Pos. NPV = GBP 188.43m • As shown on the next slide, the stock at its current pricing of GBP 13.8 is undervalued according to the DCF – it should be GBP 18.27 or GBP 17.29 depending on which net debt is used o Since the Net debt/EV ratio shown in Exh. 2 does not match the EV calculated from the balance sheet figures, both results are shown at the bottom 1 As calculated in Berk & DeMarzo. (2013). “Corporate Finance” EV appx. GBP 195m http://www.transfermarkt.de/tottenham-hotspur/startseite/verein/148, calculated with FX rate. Accessed 2016-04-02 2 Official 1 BASE CASE 188.43 Current Forecast 0 2007 Revenue 1 2008 2 2009 3 2010 4 2011 5 2012 6 2013 7 2014 8 2015 9 2016 10 2017 11 2018 12 2019 13 2020 74.10 80.77 88.04 95.96 104.60 114.01 124.27 135.46 147.65 160.94 175.42 191.21 208.42 216.76 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 4.00% 3.56 4.38 5.26 6.20 7.21 8.27 9.41 10.60 11.86 13.17 14.55 15.97 16.61 % Growth EBIT 2.80 %......

Words: 5003 - Pages: 21

Premium Essay

Tottenham Case

...9-209-059 REV: MARCH 23, 2009 LAUREN COHEN JOSHUA COVAL CHRISTOPHER MALLOY Tottenham Hotspur plc In early 2008, Daniel Levy, chairman of Tottenham Hotspur Football1 Club, was contemplating a bold move for the organization, one that he hoped would help vault the team into the upper echelon of the English Premier League (“Premiership”). Despite the club’s long and storied history, Levy felt that the team’s future success likely required a significant investment in physical assets, notably the development of a new stadium. Tottenham currently played in an old stadium called White Hart Lane with a capacity of only 36,500 fans, but had the opportunity to build a new stadium on some adjacent property. Most of their key competitors, such as Arsenal, Manchester United, and Chelsea, had newer or larger stadiums, and were able to leverage the added revenues these stadiums provided to gain a competitive advantage in the cutthroat player acquisition market. Levy had to decide if the benefits of a new stadium were worth the substantial commitment of time and resources that its construction would entail. Background Founded in 1882, the Tottenham Hotspur Football Club was one of the oldest teams in the Premiership. Its rich history featured a successful product on the pitch, as evidenced by major trophies in each of the past six decades--a feat matched only by Manchester United, and a series of innovations off the pitch as well. The club became the first publicly-owned football......

Words: 4662 - Pages: 19