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The naked emperor

I have a friend who has Rangers Football Club in his DNA. From very early in what is now a four-month saga, he and I have been agreed that in spite of all the posturing by the company’s administrators, and their insistence on pursuing a Creditors’ Voluntary Agreement, liquidation was inevitable, given the size of current and possible unquantified debts to HMRC. Today, it seems we have been proved correct. The taxman has decided that such a deal would create an unacceptable precedent, and the CVA will fail at Thursday’s creditors and members meeting. The alternative agreement struck by Messrs Duff and Phelps, the administrators, will now proceed. Instead of putting £8.5m into the creditors’ pot, a mysterious consortium of unidentified individuals, fronted by Mr Charles Green, will now acquire the assets of Rangers PLC from D&P and will put them into a new company. But not, it seems, for £8.5m; no, the purchase price being quoted is £5.5m.

Why do I find that lower figure so striking? I do so because, by a remarkable coincidence, it is the precise sum quoted in the CVA proposal, as the cost of the administration. In other words, Messrs Duff & Phelps’ fees, which would have been met in full from the £8.5m CVA fund. Under the newco arrangement, they will still walk away fed and watered, the creditors among them the UK tax-payer, will receive approximately zero, and the assets of a global brand, with its considerable property holding, will pass to Mr Green’s unknown crew on the basis of a loan which the ongoing business will have to repay out of trading, with interest running at 8% per annum.

But hold on.  The assets of a liquidated Rangers have to be worth more than £5.5m. The administrators must know that, and yet they have done their closed doors deal without seeking other ‘newco’ bids, and with no apparent thought to the duty of a liquidator to obtain the maximum possible return to the creditors. This cannot be right, and it must be challenged, in the courts if necessary.

Trust me, I am no Bluenose. If this was happening to Celtic, I’d be saying exactly the same thing. If Mr Green is allowed to take over from Mr Whyte, the best case scenario is that things will have gone from bad to no better.

Categories: Uncategorized
  1. June 13, 2012 at 6:07 pm

    Is it only me or are the Rangers supporters just the latest victim of a rip-off culture that is deluging this country. They used to say that you could divide our country between the ‘haves’ and ‘have nots’ Now it’s a case of ‘those that rip-off’ and those that ‘get ripped off

    What makes it worse is, those who are doing the ripping off, be it MPs/Banks/Local Authorities/Utility and Fuel Companies/Administrators et al, well their ability to ‘rip-off’ seems to be in line with their ability to be bloody incompetent in everything they do.

    Sorry end of rant.

  2. June 13, 2012 at 6:15 pm

    Don’t be sorry. You’re right. I’d suggest that you add HMRC to the list. They could and should have vetoed any CVA on day one, but instead they allowed the hare to run for months unchecked, and allowed D&P to run up a fee account that’s going to swallow virtually all the available cash. Then there’s the EBT case. Will the Tribunal ever report?

  3. Fred in Sunny Sydney
    June 14, 2012 at 2:20 pm

    Somewhat ironic that Rangers should finally be put to the sword by two individuals who between them form the name of their hated rivals colours.

    Green and Whyte.

    You couldn’t make it up if you tried..’

    Rangers would have had my sympathy, but their ‘new’owners carry on in an even more arrogant manner than what used to pass as normal behaviour from the Ibrox club.

    It is everybody else’s fault it appears, rather than their own.

  4. June 14, 2012 at 2:33 pm

    An irony lost on no-one. I am beginning to believe they could actually go under. If it’s true that Ally is resigning, or worse being fired, many fans might feel there’s nothing left. This is worth a read: http://www.bbc.co.uk/sport/0/football/18413384

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