WHEN news of Peter Kenyon’s latest takeover initiative involving Newcastle United broke at the end of last week, I joked on social media that the former Manchester United chief executive was beginning to look a bit like Thomas Cook – nice brochures, no money. Nothing that has happened in the last seven days has made that assessment look wide of the mark.

The fundamental flaw in Kenyon’s attempt to buy Newcastle from Mike Ashley for £300m is that he doesn’t have £300m. Or at least he doesn’t have it in one up-front payment, which has always been Ashley’s preferred means of selling up. Newcastle’s current owner has hinted he might be willing to discuss a staggered payment schedule – although ‘relegation clauses’ were a complete no-no when he was in talks with Amanda Staveley – but suggestions he might be willing to accept a down-payment of as little as £125m are pure fantasy.

Kenyon knows that, which means last week’s leaking of the 46-page brochure he produced in association with his Florida-based backers GACP Sports, who own part of French club Bordeaux, was either a fishing expedition to see how Ashley would react or a last desperate attempt to drum up the kind of money that might bring the Sports Direct owner back to the negotiating table.

Either way, with its botched references to Steve Bruce and its out-of-date Premier League logo, the glossy document was hardly the calling card of a purchaser boasting both the means and desire to push through a deal.

Ashley doesn’t say much, and when he does open his mouth, much of what he opines about Newcastle United is nonsense, but when he broke his silence to speak with the Daily Mail in August, he uttered one sentence that immediately rang true.

“The reality with these deals is once it gets out, if it’s not done, it’s probably not going to get done,” said Ashley. “The day someone buys Newcastle, they’ll do their due diligence – and finished. It will happen like Manchester City. By the time the media find out, it’s already complete.”

Which begs the question, ‘If Ashley is so keen to leave, then why hasn’t Newcastle been sold?’ That is the key issue that has vexed Newcastle fans ever since the sportswear magnate first hinted he was willing to sell up almost a decade ago, and which has become even more pertinent in the two years since he placed the club on the market for the third time.

It has sparked a raft of conspiracy theories. Ashley has never actually wanted to sell. He values the ‘free’ advertising for Sports Direct too highly. He is in cahoots with Kenyon, persuading the financier to drip stories to the press to deflect attention from protests and falling attendances. He is holding on to Newcastle out of spite, just to further infuriate the fans.

I’d strongly argue that such theories are nonsense. Instead, I think there’s a much simpler answer to the question of why Newcastle have not been sold in the last couple of years. Because the club is horrendously overpriced and therefore a dreadful investment option for serious players with serious money.

That flies in the face of much that is said within the national media when the ownership of Newcastle is discussed. The club is one of England’s sleeping giants. It is based in a one-club city, with loyal and passionate support. You’re guaranteed an income of £100m-a-season in the Premier League, and if you get it right, you’ll also be guaranteed 52,000 turning up every home game. It has the potential to reclaim a place in the Champions League, then just imagine what you might generate. And unlike Liverpool and Manchester United, who would cost you billions if you could even get near them, you can get your hands on a largely-debt free Newcastle for just £300m.

To which I’d reply, ‘Well you can get your hands on a largely debt-free Sunderland for £40m, and by the start of next season, there’s a decent chance the two clubs could be playing in the same division’.

Clearly, that’s a somewhat facile argument, but the basic point underlying it stands. If you pay £300m for Newcastle tomorrow, what are you buying? I’d argue you’re buying a club that could easily be worth around £120m or so come May.

On the evidence of the opening two months of the season, Newcastle are set for a relegation battle in the remainder of the campaign. On the evidence of last weekend’s horror show at Leicester City, they will go down, so if you’re buying in to Newcastle now, you basically have one of two options.

Either, you gamble that the current squad, perhaps with a change of manager, will be strong enough to survive, and adopt the kind of restrained financial model Kenyon seems to be proposing, with £40m or so available for transfers annually, or you throw a fortune at signings in the January transfer window, say £150m or so, in an attempt to make the squad you have inherited ‘relegation proof’.

Adopt the first model, and there has to be a good chance you’ll be operating in the Championship next season, with your income vastly reduced. Go for the second approach, and you’ll now have spent £450m, but could still find yourself in the second tier come August if your signings don’t immediately hit the ground running.

It can be argued that the same problems would exist if you were buying into any Premier League club outside the established the top six, but thanks to years of underinvestment under Ashley, and a series of questionable recruitment decisions pertaining to both the squad and manager, the situation is especially acute at Newcastle, who sit 19th in the table ahead of Sunday’s game with Manchester United.

If you’re running a Middle Eastern sovereign wealth fund, or are a Roman Abramovich-style oligarch for whom squandering money is genuinely of no concern, perhaps that wouldn’t matter. If you want a Premier League club as a plaything, Newcastle might still appeal.

But if you’re an investor wanting a return, it’s easy to see why you wouldn’t touch the Magpies in their current state. That explains why Ashley has been unable to persuade anyone to meet his asking price, and accounts for the difficulties Kenyon has encountered in his attempts to assemble a consortium able to complete a takeover. And all the glossy brochures in the world are not going to change things.