What most people here fail to recognise is that not only has this deal eliminated $10 million dollars of current debt but also the rezoning of the western playing fields and carpark from 'private recreational' to 'residential' has changed the balance sheet value of those holdings hugely.
The "Private Recreational" property holdings of the Sharks have been traditionally a liability rather than an asset. They require upkeep, maintenance and rates but offer no viable income stream.
Up until yesterday, the Sharks were servicing a $13.5M debt on a combined asset of around $9.8M.
With the $10M injection into the coffers from Bluestone within 90 days, that will see a reduction of current debt to around $3.5M.
Bear in mind that the signing of the instrument and its implied rezoning now takes the value of the Sharks land holdings to around the $35M mark.
To put it simply, servicing a $3.5M debt on a $35M holding puts you in the finance buyers market.
Interesting times ahead.
I must say that with all the new cash injections into the competition, that I'm particularly happy about supporting a team that has historically exercised fiscal prudence and strong financial management.
