Look the other way: fixed and floating charges


Yesterday Graham Wallace, Norman Crighton and Sandy Easdale offered to giving a legal undertaking be security would not be given over Ibrox and Murray Park in return for a loan.

Security over a property asset is only one way for lenders securing that asset, it is not the most popular, or even necessary, for the lender to control assets.  More commonly, a lender will require a floating charge over the assets of the company.

A floating charge ‘floats’ over all assets of a company until it is discharged by full payment, or it converts into a fixed charge over whatever assets the company has at that point in time.  This is usually due to a payment default, but can also be triggered by a weakening in one of the company’s trading indicators (say, poor season ticket sales).  A company can only issue one floating charge over all their assets at a time.

If you get a bank loan for a value which is significant to your size, you’re almost certain to sign over a floating charge over the assets of your company, no matter how good a trading record you have.  This is true for Celtic and Manchester United, and would absolutely be true for Newco Rangers.  Stakeholders at Celtic and Manchester United would not bat an eye at this, as there is zero chance of them defaulting.

It would simply not be possible for Newco to secure a significant amount of conventional borrowing without granting a floating charge.

With the floating charge in place, no other creditor can step forward and make a claim on the assets until the secured creditor is satisfied.  In many circumstances, lenders will prefer a fixed charge, as it prevents the borrower from selling key assets before an insolvency event.  With a floating charge, Newco could still sell Ibrox under the nose of the lender and fans alike.

In the event of an insolvency event, the floating charge becomes a fixed charge over whatever assets the sheriff officers can find.  In terms of Newco Rangers this would mean the stadium, training ground, the bike, loving cup, a hundred weight of marble, balls and stripes.  Ebay would be interesting when that lot was uploaded.

Perhaps this is why Celtic have hidden Lennoxtown up a country lane.  “No training ground here, mister, it’s just a field.  I wouldn’t take that car across those potholes.”  Peter’s not daft, you know.

For Newco, giving a legal obligation that the company will not provide a fixed charge over property assets is, quite literally, not worth the paper it is written on, without also committing not to provide a floating charge over all the company’s assets.  It would be “We promise not to give security over only some of our assets, if we give security, it’ll be for everything”.

Legally prohibiting your company from providing a lender with a floating charge also prohibits you from accessing conventional lending.  It would be ludicrous, and could only be considered if the alternative would bring the wolf to the door immediately, in other words, it might bring in season ticket money, but it would ensure an almighty crash as soon as the ticket money is consumed.

For well over a decade the various episodes at Ibrox have been an exercise in making people look the other way while dirty deeds are done. Still, the world’s Gullible Champions show no sign of figuring out what’s going on.  After season ticket money is banked, keep your eye on the floating charge.

The fate of whatever football team plays at Ibrox was set in a firm direction when Rangers incurred unsustainable debts.  As a consequence of this, their majority owner sold his shares to a liquidation expert.  The train was in motion long before May 2011.

Instead of asking Rangers International for a meaningless commitment, an acknowledgement of the situation should be made.  Reality is:

Key assets cannot legally be put beyond the reach of creditors.

The directors must legally look after the interests of shareholders – or be liable for their losses.

The club has a massive trading deficit to fill next year, the year after, and probably in many subsequent years.  Estimates of this being between £30m and £50m only acknowledge the next few years deficit.

There are no good choices now, only less bad ones.  It would cut ‘Rangers’ fans to the core to become tenants paying a high rent for the use of Ibrox, but flogging this asset might secure them enough cash to reach top flight football – and there is nothing whatsoever fans can do to blackmail the club into retaining this asset.

Whether they consider Newco to be the same club or not, future ‘Rangers’ branded teams will be nothing like those of the past.  There is a possibility they will have a team to support, but it will not be a Champions League team, and Ibrox might not even be the best place for it, a St Mirren Park-type venue, packed out every week, would at least allow them to pay their bills.

The Sevilla keeper moved.  Three referees watching.  Three referees!  Two on the line, whose only job was to check if he moved!  Last night I considered corruption was at play but there is another possibility.  Calling out the keeper was a huge moment for the assistants, each of whom may have preferred one of the other two referees make the call.  It would have been a huge call for the main referee, too, but he could have deferred to his assistants, who were in prime position.

Without clear responsibility, all three were frozen in silence.

Tommy Gemmell is on CQN tomorrow from 13:00 – 16:00.  Tune in and have a ‘chat’.  You can order his autobiography, All the Best, due out next week, from the link below.

Select Maiing Destination

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  1. Hamiltontim is praying for Oscar on




    Humped last night, absolutely humped!!



    Tell CRC…..I won :-)

  2. TBJ says Wee Oscar Knox is in heaven with the angels on




    Drink a litre of vodka … The pain will ease very quickly

  3. Tommy Gemmell is on CQN today from 1-4pm and feel free to ask him about the revelations in today’s DR.



    We thought long and hard about allowing them to have a serialisation. We thought we should do so as we need to reach the supporters who aren’t online.



    Yesterday they ran with how Jinky got WGS drunk at Dundee when TG was the manager and how a Strachan has been T-total ever since.



    Only two people on here have actually read Tommy’s book – myself and SFTBs and his review will be posted by Paul over the next few days. It is a joy of a book.



    In February CQNers asked Tommy questions about his time at the club – he answered every one candidly and I’d reckon this is where the detailed insight is to be found.



    We have now worked with Tommy, Willie and Yogi and all three had issues with the club re how it all ended but all speak so highly of the manager, the club and supporters.



    The DR paid for these features and 100% of the money went to the Big Shot. Not for discussion later.

  4. TBJ says Wee Oscar Knox is in heaven with the angels on

    A lot of talk around December that we were gonna pick up the young left back that plays for thistle … Freedom of contract



    Apparently the snoddy deal is complete



    However the john terry to Celtic deal crashed when mourinho have him another season on a gazillion squid a month …



    Maybe NFL will spot a good centre half in rio ;)

  5. Blantyretim.



    Fancy a wee gargle sometime next week.Coming into Glasgow someday soon.

  6. TBJ – “Apparently the snoddy deal is complete…”



    Source ?



    Have to say not convinced by this fella.

  7. Bhoycott the Rekord………….



    nuthin’ in it for us…………………………..




  8. What is so appalling that ex-players give their version of a remarkable time in our history?


    Great coach does great things with great but previously under-achieving players. Great coach behaves really badly towards some players and that was the norm for those days.


    If what the players say is true, it is also unsurprising.

  9. Forgot to say – today is your only chance to get Tommy to write a personal message on his new book for you. If you want him to do this for you please email me with your message and I’ll sort – david@CQNMagazine.com



    On way to Celtic Park to drop off copies of All the Best at the warehouse so they should be on sale in all Celtic stores by tomorrow.

  10. winning captains:



    Myths fly and wee Gordon Strachan was not teetotal after Dundee far from it. (Though I did notice in your post you said “a Strachan”)

  11. Stringer Bell on

    The Daily Record, eh?



    How very, very disappointing from all concerned.



    I’m sure there are reasons (exposure and finance) but it still leaves a bad taste.



    We never learn, do we.

  12. Most players doing their story get smsm poddles to ghost write them .Like Henrik getting Jackass to write his. They will put in their own spin and urge the player to come up with something revealing or controversial to sell more copies and maybe sneakly trick them into saying more than they meant to.

  13. TBJ says Wee Oscar Knox is in heaven with the angels on

    Big wavy



    A taxi driver told me ;)

  14. Stringer bell



    Just left Paradise. The warehouse is at the side of main stand and I had a wee look at the ground as the Dundee United fans set out their cup final displays.



    The warehouse manager said when he saw the book – “great, I’ve just been reading about this book – I’ll get it out to the shops straight away.”



    That’s your reason.





    Get well soon,big fella!



    Hope whatever ails you is trivial.

  16. Dontbrattbakkinanger on

    H/Tim- RICE















    – get your leg up on the couch, get some frozen peas out of the freezer cabinet, wrap them in a tea towel and press them against the painful area.



    Get hold of some ibuprofen [ assuming you can take it] ; say 400mg three or four times a day, after meals.

  17. Billy Bhoy 05 on




    05:57 on 16 May, 2014



    Not a ramble but a very well constructed, and for me, instructive blog. Thank you

  18. MWD



    Get well soon D,feel guilty not asking how you were the other week in Paradise..


    ……in my defense I was off to work,drink was not involved.



    Take care big Ghuy.

  19. TBJ says Wee Oscar Knox is in heaven with the angels



    Maybe NFL will spot a good centre half in rio ;)





  20. leftclicktic We are all Neil Lennon on

    Just had a text asking me to settle an arguement:))



    When were celtic & deadco stopped from using open top bus parades to celebrate?


    From Skynews.



    Sepp Blatter tells Swiss media that awarding 2022 World Cup to Qatar was a ‘mistake’



    You don’t say…..

  22. squire danaher on

    Catchin up with the nightshift



    twistsandturns app 06:00



    The most shocking thing about TGs ordering off v the-then West Germany was that a match between those two teams had a referee from Austria





    TBH,I doubt we ever used one.

  24. Met an Insomniac yesterday who was feeling very depressed. Whats the matter sez I. I’m an insomniac he said. Ah cheer up I said only 3 more sleeps till Christmas.

  25. My friends in Celtic,



    Reading back I have some observations :-



    Some former players have had issues with the club. Wow, big deal how many on here have not had issues with their employers.



    The usual suspects beat Celtic up about the living wage, but strangely stay silent when the Scottish parliament vote down mandatory living wage conditions for government contract workers. ( Both are wrong IMO and say much about priorities in an “independent” Scotland )



    Danny McGrain : Respected in ALL footballing circles and the only truly world class player at Parkhead today.



    TD 67 : I hope you are fit & well for Canada and for posting. This blog needs an old fashioned, no nonsense, tell it as you see, Celtic man like yourself.



    HH, always in Celtic.



    Ps : Don’t know much about Baseball, but is Rugger the only sport played with a squashed ball where you get an advantage by booting the ball into the stands. ?? ( Yes I’m showing my ignorance or maybe upbringing.)

  26. leftclicktic We are all Neil Lennon on





    10:04 on 16 May, 2014




    That was my 1st thought.



  27. squire danaher



    10:04 on 16 May, 2014



    “The most shocking thing about TGs ordering off v the-then West Germany was that a match between those two teams had a referee from Austria”



    I never knew that. Hun(lite)believable. Just shows how big countries get the breaks. I’m surprised England never used to get Scottish referees for their games 0-)



    I am sure most of us remember the time Estonia refused to play Scotland in a WC qualifier in a group containing Sweden. I’ll let PC Murdoch and Chief Superintendent Barlow from the Wiki squad take up the story



    “Scotland initially believed that they would be awarded the match by a default score of 3–0, which appeared to be confirmed by the FIFA match delegate.[1] FIFA regulations stated this should be the case “except in cases of force majeure recognised by the organising committee”.[1] This view was contradicted by Lennart Johansson, who was president of UEFA and a vice-president of FIFA.[1]”



    The game was played later and ended 0-0



    Johansson was Swedish!!

  28. Steinreignedsupreme on

    Big Tam’s an honest fulla. I’ll catch up on the Q&A later, by which time Dave King’s latest statement should be hot off the press to give us all a laugh.



    About to hit that back garden and enjoy the sun. Just listening to a bit a Slowdive and enjoying a strong coffee.