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.

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  1. embramike remembering wee Oscar on

    Scotland U17s concede v Switzerland just on the drinks break (~20 min). 0 – 1



    Been pinned in their own half . A point needed for qualification. Eurosport 2.

  2. South Of Tunis on

    Tiny Tim



    Sanko .



    Reportedly much coveted in Italy. Much weeping ,wailing and gnashing of teeth when Utd secured him .

  3. tonydonnelly67





    15:26 on



    15 May, 2014



    Basketball I never got into, the rest I did and of course after a time you get into it, what you had to do was pick a team, Ice Hockey I picked The Toronto Maple Leafs, ( last time they won the Stanley cup was in 1967 so a no brainier there)



    *last time the Maple Laffs won the Big Cup their captain George Armstrong couldnae get served in a bar in Hogtown as he was a Native American. There’s an oxymoron, a Native called George Armstrong, that was Custer’s first 2 names.



    Personally I preferred the Canadiens, could never support a team that changed it’s name from Toronto St Pats to the Leafs and colours from green and white to blue, never saw a blue maple tree yet.



    In Baseball it was the Yankees as the Archdiocese of NY owned the real estate rights to ole Yankee Stadium, it was gifted to them from the KoC as the Archbishop at the time was a huge Yankee fan.



    Basketball it has to be the Celtics.



    College Football – Notre Dame and NFL it used to be the 49’ers when Joe Montana former ND star was quarterback, now it’s either the Giants or Steelers whose owners have an Irish background.



    Here’s a wee bit of useless trivia, the wee lassie, Rooney Mara who starred in the “Girl With The Dragon Tattoo”, is the great-granddaughter of both New York Giants founder Tim Mara and Pittsburgh Steelers founder Art Rooney, Sr. and the latter’s son Dan is the US Ambassador to Ireland.

  4. TnT



    Any thoughts on Colebrooke – I see he is 8/1 with Bet365.



    Possibly worth an e/w double with Dawn Commander?








  5. Hope the best right back I have had the pleasure to watch in a Celtic jersey fully recovers. Get well soon, Danny.



    Sad day, being the anniversary of the finest player I ever saw in a Celtic jersey, Bobby Murdoch, the Greatest, imo, and that of the greatest fan who had the privilege to wear the Hoops, Tommy Burns. Eternal rest grant to you both and thank you for what you gave to Celtic.

  6. 67Heaven ... I am Neil Lennon, supporting WEE OSCAR..!!.. Ibrox belongs to the creditors on

    billy bhoy 05



    11:41 on 15 May, 2014



    Do you really believe that things WILL change for the better in respect of the poor, the unemployed, the homeless, the sick, the disadvantaged irrespective of the vote ……..If it did, it will be the first time in my lifetime……politicians ? ……joke

  7. 67Heaven ... I am Neil Lennon, supporting WEE OSCAR..!!.. Ibrox belongs to the creditors on

    Just heard about Danny……….if anyone canpull through it will be oor Danny…

  8. Pogmathonyahun aka Laird of the Smiles on

    Just in to get the news about Danny.


    Get well soon Danny, a truly world class player in his day.

  9. South Of Tunis on

    weeminger @ 17 23 .



    Silver Apples .



    Yes, I have the first 2 Lps and the first 2 45s .Memories of 6th year at school and my first year at Yooni.



    I saw them supporting Procul Harum —they didnt go down well !

  10. Bob Dylan Has Released The Latest Track From His Forthcoming Album…



    ‘The Frank Sinatra Song-Book’….



    ‘Full Moon And Empty Arms’….



    Was Originally A Hit For Ol’ Blue Eyes ..



    Way Back In 1945….










    In Other News,Don William’s Latest Greatest Hits Compilation…



    Is Riding High In The Kremlin Top-50..



    Signalling A Return To Wholesome Western Values…



    Viva Donny Toadily..!

  11. Forgot to mention the Buffalo teams, Sabres and Bills, lot’s of Polish and Irish in Buffalo and I believe that nearby Niagara has a strong connection to the Fenian Brotherhood. Oh aye and the eldest Ms. TT got her Masters at Canisius College a private college founded by the Jesuits and named after St Peter Canisius.

  12. Dontbrattbakkinanger on

    SofTunis- I will definitely be up for a beer [or two] when you are back in Scotland.



    I have been listening to the Rails, a modren folk-rock combo featurin’ the daughter of Richard and Linda Thompson.

  13. Parkheadcumsalford





    17:31 on



    15 May, 2014



    Sad day, being the anniversary of the finest player I ever saw in a Celtic jersey, Bobby Murdoch, the Greatest, imo,



    *first saw in in a Celtic jersey in a green v whites midweek trial game and then on the Saturday when he opened the scoring in our opening League Cup game against the latest team to step out of admin. Hard to believe that prior to the Big Mhan coming he was contemplating emigrating to Oz.

  14. The “Whites” team that night was:



    Fallon; Young and O’Neill; Clark, Cushley and Price; Johnstone, Carroll, Rooney, Murdoch and Byrne.



    Not a bad wee team for the “Stiffs”.

  15. Oh and the team in his debut 3 days later was:



    Haffey; McKay and Kennedy; Crerand, McNeill and Price; Lennox, Gallagher, Hughes, Murdoch, Byrne

  16. embramike remembering wee Oscar on

    Talking about US sports, will be in Chicago for a month from 27th and will probably take in Chicago Fire v LA Galaxy on Sunday 1st June.



    Like the way you can book online (called “Pub to Pitch”) for transport (option 1), transport plus ticket (option 2) or transport, ticket, beer and hot dog (option 3).



    Also entitles you to food/drink discounts at pick up pub of your choice. Bus seat guaranteed if you book midweek before the game.



    The home fans are Section 8 and they are mental ! The rotating song leaders have their own podium facing the fans, and the Latino home fans have their own wee standing area ! Quaint !



    Probably take in a Cubs baseball game again – 4 hours of beer bought at your seat, hot dogs etc., Drawback unfortunately watching the Hibs of MLB. As they say over there ” Everybody’s entitled to a bad century” !

  17. rwe


    16:46 on 15 May, 2014



    From your commentary it sounds like the Undead need a HAIL MARY.


    And I can’t see them being able to complete that.

  18. tontine tim


    17:51 on 15 May, 2014


    Oh and the team in his debut 3 days later was:



    Haffey; McKay and Kennedy; Crerand, McNeill and Price; Lennox, Gallagher, Hughes, Murdoch, Byrne



    Dunkie McKay was a big hero to me in the early 60s.


    He was often the only silver lining going home on a dank miserable Saturday after a defeat.


    He left a couple of years too soon.


    Great player, team captain and sadly almost forgotten.

  19. South Of Tunis on

    DBBIA .



    Good ! Likely to be late September / early October.



    Hope you bought the recently reissued ( Light in The Attic ) -Bobby Charles Lp .



    A gem from 68 ———every home should have one .



    Off oot -dug walking time .

  20. Bjm



    Sorry bud, fell asleep!



    Colebrooke? I’ll try tomorrow to see if anyone has been in touch with Dan Skelton ( he bought Colebrooke from Mrs Robeson) but at this point I know nothing except he is a very temperamental horse who seems to be loving the change of scenery. I know he was fancied last time out but no news for tomorrow as yet.

  21. 67Heaven ... I am Neil Lennon, supporting WEE OSCAR..!!.. Ibrox belongs to the creditors on

    tontine tim



    17:44 on 15 May, 2014



    So correct……I used to sit outside his house just to see him setting off to the games…!!

  22. Hamilton Tim



    Just saw your question about when the minutes of the last Supporters Forum would be published.



    My recollection is that they were published on CQN a couple of weeks after the meeting, but I’ll need to check back and see just when. There might be a visibility issue to address though if it got lost.



    One of the reasons for delay was the time it took to turn discussions into Action points within the club. This is normal in any business if a meeting is not to be just a talking shop and indeed was something I was hoping would happen.



    The follow up Supporters Forum in 9th June will pick up on progress on those Action points plus any new items to be added to the agenda.



    I was going to volunteer in last week of May to ask for points to be raised, trawl through any responses, group them and send them to the SLO on behalf of CQN posters, but if anyone else wants the job, wire in.



    Similarly it does not have to be me who attends the Forum itself, in fact spreading it around is something I already discussed with the SLO. I am retired after all and it would be good if others got the chance to see how the Supporter Forum worked as new eyes see new room to improve.



    At one of the first Open Meetings you may recall a question was asked about how to turn discussions there into action.



    The Supporters Forum provides an opportunity to address that particular issue as well as involving supporters at large who cannot attend the Open Meetings.



    It is a process still under development but if done properly will be the way to give the support at large a voice as well as giving the club issues they must attend to and to be seen to be doing so.



    Win win.

  23. embramike remembering wee Oscar on

    Great move and Scotland u17s go 2-1 up with 25 to go.



    Germany getting beaten too, so it looks very good for qualification for the semi finals

  24. Tontine Tim,



    I can’t remember the particular game you refer to but I was probably there. I would have been about 9 at the time. Haffey, McKay and Kennedy, Crerand, McNeil and Price is the first defence I was aware of and knew off by heart.

  25. Danny McG



    Professional example to all the budding Islam Feruz’s.



    Get well soon Danny.




  26. TnT



    Cheers mate – I look forward to hearing any info you get tomorrow.



    Appreciate it !!!