Debt in a traditional corporate finance model is good

Because it’s cheaper than equity. But traditional corporate finance does not apply to football as equity is effectively free as dividends are never paid.

So, in football finance, debt is always more costly than equity unless it is interest free, or the interest is never paid.

Am I missing something?

Posted By: SimonOTBC on August 12th 2024 at 16:55:53

Message Thread

Can we start waiving tenners around now singing we're f***ing loaded? (n/m) (NCFC) - Trent_Canary, Aug 12, 14:25:12
- Converting debt to equity doesn't change that much (NCFC) - Worthing Yellow, Aug 12, 14:43:38
  - Debt in a traditional corporate finance model is good (NCFC) - SimonOTBC, Aug 12, 16:55:53
    - I don't really understand corporate entities TBF. (NCFC) - usacanary, Aug 12, 20:01:44
  - True, but I seriously doubt Delia and Micheal would write of such a huge amount of money (NCFC) - Kev, Aug 12, 16:33:41
    - They’ve already invested c£70m (n/m) (NCFC) - SimonOTBC, Aug 12, 16:56:13
  - While true that if we're not paying it off it's not a matter for cash flow (NCFC) - jamesward, Aug 12, 14:45:41
- are we debt free now? (n/m) (NCFC) - Bristol Graham, Aug 12, 14:32:44
- Where's USAC when you need him? (n/m) (NCFC) - Cardiff Canary, Aug 12, 14:28:21
  - I'm here..... (NCFC) - usacanary, Aug 12, 15:45:56
  - Bristol (n/m) (NCFC) - Bristol Graham, Aug 12, 14:32:57
- Whilst wearing an 'on loan to the Championship' tee (n/m) (NCFC) - inutero, Aug 12, 14:27:18
- Can anyone confirm if we are? (n/m) (NCFC) - SCC 28, Aug 12, 14:26:58
  - We've just wiped out £59m of internal debt, so we're more loaded than before! (n/m) (NCFC) - Trent_Canary, Aug 12, 14:29:42
  - My dad reckons we are debt free come March/April next year. Ha ha Brilliant! (n/m) (NCFC) - Thegelman, Aug 12, 14:29:05

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