Got into a brief conversation last night about whether administration and liquidation were likely at Newco Rangers.
The club’s creditors will be few and of comparatively low value, nothing like their predecessor club’s £100m debts. They will owe HMRC vat and PAYE money, utilities and other trade creditors will be owed no more than a small number of money’s month. Newco have not been able to secure bank borrowing, so that’s not a worry, but there may be directors’ loans, as well as wages in arrears.
The upshot of this is that money saved by ditching creditors is limited and unlikely to offset the damage administration would do to a club with less than two years trading history. The only significant action that could be taken in administration would be redundancies. Playing staff could have their contracts terminated by administrators, bringing to an end the Charles Green extravaganza.
Liquidation is an unlikely to occur as a consequence of the short or medium term challenges.
The most surprising element of yesterday’s news is that players were asked for such a modest pay cut. 15% of player salaries will not change the fundamentals and will save very little (circa £300k) between now and season ticket renewal time.
Keep your eye on the sale and leaseback of properties we discussed here since 2012. If Ibrox and Murray Park are sold (potentially to existing investors looking for their payback), Newco could get some relief between now and being able to reach the Premiership, while the investors would become less anxious.
The cynic would say that being able to lay blame for selling Ibrox on players for not taking a modest pay cut is a convenient line. Selling your main/only fixed assets to a commercial investor is a horrendous prospect as you will left to pay the consequences in perpetuity, you also lose collateral, making future borrowing more difficult and expensive, but, right now it’s a decent option for Newco. Their future is screwed, not because of a land deal (delightful irony), because of what has happened on that land over the last two decades.
The fundamentals remain:
Running a football club the size of Celtic, under normal conditions, costs anything between £17m and £22m – before you employ a footballer. Utilities, rates, policing, stewarding, insurances, maintenance, ticketing, PR and the tasks circa 200 people carry do not come cheap for a club of this size. When budgeting for football operations, start to count your football income after you’ve banked money around this level.
Newco Rangers will be a fraction below this at the moment, but if they are to continue to operate a business capable of entertaining (sic.) >30,000 people several times per month they will not be able to eat into these costs significantly. Insurance, rates, police and other costs need to be met; face painting is optional.
A club the size of Newco Rangers, or Celtic, is not viable without regular Champions League income, and is not possible short term without splurging into higher debt. If Celtic slip away from the group stage for an extended period, they will have to downsize all areas of operations. Football budget would be much more like Aberdeen’s.
Keep in mind the words of the magnificent Blue Knights. While ensuring Charles Green was left in an invidious position to start his new enterprise from, they were clear, only a CVA, leaving Rangers in top flight football with access to Europe, was viable.
This BBC article adds insight into what I referred to yesterday about former Southampton chairman, Nicola Cortese: “A presentation to the players in April last year did not ask if Southampton can win the Premier League, but how can they win it?
“Players were asked to fill out questionnaires. What time did they wake up at home? What were their habits? Did their children wake them, did the dog? The results were analysed and changes were made.
“When Southampton travel away from home, the hotel is often booked for two nights rather than one. On the first night, club staff arrive and clean the already pristine rooms. They vacuum up every particle of dust that might cause illness or carry a bug.”
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Tonto you up for a few in the brazen after.?
Big nan
Im gonna save that info and ask the wee grumpy guy in Morrisons why its in the veg section and not with the strawberries and rasps etc ;)
Geordie
Nooooo wayyyyy your gonna have 4 slices .. poor bmcuw would kill for one ;)
Pre game breakie.
Square sausage.
Skinless links.
Stornaway black puddin.
Off to the game today. This is the team I’d like to see:
::::::::::::::::::::::::::::::::::::::: Forster :::::::::::::::::::::::::::::::::::::::
Fisher ::::::::::: Ambrose :::::::::::::: Van Dijk ::::::::: Izaguirre
:::::::::::::::::::::::::::::::::::::: Mulgrew ::::::::::::::::::::::::::::::::::::::
:::::::::: Biton :::::::::::::::::::::::::::::::::::::::::::::: Ledley :::::::::::::
::::::::::::::::::::::::::::::::::::::: Brown ::::::::::::::::::::::::::::::::::::::::
::::::::::::::::::::: Commons :::::::::::::: Stokes ::::::::::::::::::::::::
Beans.
Mushrooms tomatoes.
Spiced beef ham.
An broon toast. Ana a big Mugabe Cha.
Nothing will stick to Sally as long he’s Jack Irvines bedmate IMO
Up early to watch ss jnr at toryglen. Coach wants team in 45mins before K.O. Doesn’t he realise it’s the weekend?.
Up till yon time watching The Big Lebowski as well.
Great film though. Roll on 3pm
Tbj,
No no. Gotta keep some for tomorrow
Brown toast Tony eh?
Wouldn’t want you to be unhealthy ;)
Geordie munroe
Oh aye, I like my toasted brown bread ;)
I’ll have my wicked way with the frying pan tomorrow.
Had to make do with porrage this morning.
Salt, nae milk. You can hold the bowl upside down and the glop stays in.
Big fry up wi broon breed who you kiddin?
Southside
Tin hat on, I need sugar in my porridge , :(
So McCoist had no idea things were so bad. Doesnt say much for the ludge. Or maybe he’s not been attending the Monday night knuckle crushing session at hisThornliebank branch. Surely they’d have tipped him the wink, or are the brotherhood also still under Chuck Green’s spell?
Masty
Am tellin yi, broon bread ;) good fibre, and it hastens your ablutions for an AM deposit, instead of trying to have one at half time in the Holy Ground ;)
Southside – I’ve had two weekends now up at 6am taking oldest for tournaments starting at 7am. A real pain (but worth it for the joy in his face)
Picking my footie teams this morning and noticed a pattern :
Hibs
Middlesbrough
Rotherham
Chelsea
Wasn’t deliberate but might be an omen…and for a fiver pays 60 quid
Sugar and salt is just about acceptable.
Anything else and it’s just ready brek.
Tony
Sugar on porridge….snap. Canny whack it. ( syrup also nice)
Ok offski to the shops, put my line on, and get the butcher meat, Tims all over the world who can’t get any square sausages this weekend, and lurking Huns? GIRUYs.
Tony we havin beers before sfter or both?
Td67
Thats the English way. You sure your fae the Sooside?
Tony
pmsl nina has just handed me a plate of toast broon breed ha ha
marrakesh express
09:49 on 18 January, 2014
So McCoist had no idea things were so bad. Doesnt say much for the ludge. Or maybe he’s not been attending the Monday night knuckle crushing session at hisThornliebank branch. Surely they’d have tipped him the wink, or are the brotherhood also still under Chuck Green’s spell?
—
Am sure, going by some of the posts about our team, that he posts on here!! So you would have thought he would have gleaned his info on all things Sevco and their current plight from this CELTIC blog :))
tonydonnelly67
09:25 on 18 January, 2014
Sad ending to that kids disappearance, cops press releases never looked convincing enough for me, I think they knew from the off dodgy dealings where at hand, but have to go along with they way these things are dealt with, sad world we live in, may he rest in peace.
———————————————–
No doubt TD…the feelings of most of the nation were similar to the Police, they have to treat it accordingly with sensitivity due to the nature, may that wee boys soul rest in peace.
Mr Steak bake, now there’s a character who just keeps on highlighting why most Celtic supporters saw through him decades ago. This eh man, has more of a brass neck each day, how he uses words and the press accommodate his use of them never ceases to amaze me and I know, no surprise.
I wont be selling any players, the club might, does he not have a shareholding in the club.
Cheeky monkey that he is…
dontlikethepersonneverhave csc
Ayrshire is Green and White
Pukki and Blade up front today?
Tragic news regarding young Mikaeel. Sadly the whole story had an inevitability about the outcome. Rest in peace wee man, and may your God bless you.
twists n turns
09:54 on 18 January, 2014
Yuch………..porridge on it’s own is best, boiled in water as opposed to milk…..then milk when served…….yummy……
Gallger
Thanks mate…I’ll look out for that.
67heaven
Correct…the only way.
Right time to get up, tea and toast in bed, served by the blonde one… she’s no the worst.
Boys football this morning, better get cracking, then to Celtic Park.
You’ve just got to love Celtic, it’s who and what we are……
HH
the johnatron
10:05 on 18 January, 2014
Tragic, and so sad………..God bless you, Mikaeel …..
67 Heaven…I’m with you all the way on the cooking, and adding a wee bit milk at the end…as my maw used to make it…but I’ve always added a spoonfy soogar…….
Masty
Will I get my grandson into the pub after the game for half an hour? His ma’s picking him up. He’s 10.
Anybody fancies a wee punt on the CQN Coupon here are this week’s picks:
Lennybhoy – Leyton Orient
PF – Wigan
BT – Scunthorpe
GL2 – ‘Boro
Jobo – Aberdeen
TTT – Fleetwood
Pog – Reading
AWATR -Burnley
Seven out of eight last week and we have had eight of eight earlier this season.
Keep the Faith!
Hail Hail!
Tony Donnelly, 09:38
Beef Ham? Beef? Ham?
Td @ 0949
Minging but I did actually laugh out loud.
Gordon j…..yes please.
Celtic goals stats for this season are interesting from a timing perspective. We have scored 15 goals and only conceded 1 in the last 15 minutes in the SPL. Motherwell have scored 6 and conceded 6 in that same 15 minute period. So, if we are still drawing, or even a goal behind going into that last 15, ktf……it’s coming :-))
Porridge sachets- best thing ever invented.
Cook with 50/50 milk/water, 2 mins in microwave
A dash of cold milk, nothing else, what a start to the day.