The prepack route for Rangers Newco FC


In the event of Rangers facing financial Armageddon after the resumption of their HMRC tax hearing a quick – very quick – recovery scenario is available to them.  At any point during next month’s hearing they may consider their position is no longer tenable and, unable to meet the tax bill, a new company could be formed which attempts a prepack administration.

A prepack offer from a new company, for example, Rangers Newco FC Ltd, would offer an administrator a deal for all assets of the club, including stadium and offer to meet outstanding player wages.  Deals like this seldom offer unsecured creditors much but even a small percentage might realise more cash than the administrator would gamble on raising in an unstructured sale.

In such circumstances, the administrator could accept as little as £4m for the unsecured creditors.

In normal business Rangers Newco FC Ltd would begin trading and this would be the end of the story but football is not normal business.  Rangers Newco FC would own a stadium and would employ some footballers but they would not be part of any league structure. They would need to apply for membership to the Scottish Football League or Scottish Premier League.

In this scenario, the death of Rangers Football Club would leave a vacancy in the SPL, presenting several financial, logistical and sporting challenges.  Without Rangers, the league would have to invalidate all this season’s results involving the club, one team would be without a game each weekend for the rest of the season, current TV contracts and sponsorship deals could be jeopardised, while future contracts would be worth a fraction of their current values.

Every team in the league would have to downsize and some would have to win fresh support from their bankers, which may or may not be forthcoming.

There is, of course, a resolution to this problem.

Rangers Newco FC Ltd could present an offer to the SPL.  The new company, with its stadium and thousands of potential supporters, could take the obligatory 10 point punishment for going into administration and adopt the place of Rangers FC, complete their fixtures and allow every other team in the league to fulfil commercial obligations.

If these events took place before Christmas, Rangers Newco FC could be debt-free and signing players in January to enhance their league challenge.

To force the deal through, Rangers Newco FC would require 10 of the remaining 11 SPL clubs to vote in their favour.  If any two clubs stand against them, they would have to apply for membership of the Scottish Football League, but, having researched this story for several days, I expect Rangers Newco FC Ltd would get enough support to pick-up the place of the defunct Rangers FC.

Any natural sympathies towards Rangers aside (which will not exist in all places), money talks and, apart from Celtic, this league is neck-deep in debt.  Celtic might be in a position to survive Rangers failing but it would cost our club tens of millions.

Crucially, if the other SPL clubs back Rangers Newco FC, they create a template for a snap recovery from their own troubles.  Instead of repaying your debts, simply get yourself into a safe league position, ditch the company, prepack and start again with a clean sheet.

This would create a clear incentive to stiff creditors.  While the banks will get wise and not offer unsecured facilities in future, HMRC and small traders are likely to become perennial fall guys.   Why would any mid-table team pay millions in tax, rates and policing bills, when they have a sporting incentive to ditch creditors without punitive penalty, freeing income streams to buy football bling in the next transfer window?

This would make a mockery of the Uefa predident Michele Platini’s Financial Fair Play initiative and make our league the poster-boy for Financial Doping.

Scottish football will be mortally wounded if it were to parachute a club straight into the upper echelons of the game while establishing a blueprint for the abandonment of creditors.

It is incumbent on all who care about the game, in Scotland and throughout the world, that we insist Scottish Premier League clubs do not allow a prepack company to phoenix into the shoes of a dead football club.

Celtic fans, as well as those from Aberdeen, Hibernian, Dundee United and St Johnstone, together with fans from Motherwell, who could become genuine championship contenders, and from those clubs who would avoid relegation if Rangers failed, must insist their club votes against any prepack company parachuting into the league.

The SFA executive must use whatever influence it can to prevent the name of Scottish football being brought into disrepute.  Politicians, who either have, or aspire to have, tax raising responsibilities, must register their abhorrence that a self-serving oligopoly should attempt to vote themselves an escape from paying tax.

Fifa and Uefa must explain to the Scottish FA that the days of shady financial deals in football are gone.

Watch the media coverage of these events carefully.  If and when the decision time comes, the case to acquiesce to Rangers Newco’s demands will be overwhelming.  Sincere ‘impartial’ observers will do their upmost to convince us all we must do whatever necessary to save Rangers for the good of the Scottish game.  Some voices will even tell you Celtic need Rangers Newco.  Whatever part of my club is dependent on Rangers I am willing to lose.

Rangers-HMRC tax hearing resumes next month, when there is also a two week international break.  The most important element of making a prepack offer succeed is to offer a fait accompli: ‘Here is a solution, you have no time and you have no alternative’.

Should Rangers go into administration, I believe this is a very, likely scenario. If you are a supporter of Celtic or any other club, make your views known.

Read issue 3 of CQN Magazine free online here or buy a print version at Magcloud.
[calameo code=000390171bb1634f4d942 lang=en page=1 hidelinks=1 width=100% height=500]

Click Here for Comments >

About Author

  1. Pages:
  2. 1
  3. ...
  4. 7
  5. 8
  6. 9
  7. 10
  8. 11
  9. 12
  10. 13
  11. ...
  12. 36

  1. TET



    Mrs awe naw got a cyst removed today at a swanky BKK hospital. Hence my posting today. It’s been great today and the honeymoon. The Mrs will be ordering me around tomorrow but glad I was on the blog today.



    I Hope Mrs TET posts more often ;-)




  2. TET


    So that post last night really was your wife? Brilliant. Also, well done to the Poirot who saw through it so quickly!




  3. Paul,



    Despite all the hot air wasted on it here and elsewhere, the prospective demise of Rangers is simply a non-story.

  4. Apologies for the long post but this Dave King thing intrigues me if not you please scroll on…………



    TheGreenManalishi(WithTheTwoProngedCrown): @ 15:53



    Possibly a bit of poetic licence re: house arrest, but i definitely read some time ago his passport had been surrendered due to his tax investigation, he has now been found guilty of 250m fraud and a jail sentence is still a possibility. I read an article recently (Evening Times ?) that he was on his way over to sort out the MBB


    and wondered how could this be ? as usual lazy journalism on behalf of the LL No way Dave King will be leaving SA at any time in the foreseeable future.



    Are you really sure? I remember reading (but can’t find it now) King being quoted stating that he could travel. I’m also pretty sure that although SARs have put arrestment on King’s known global assets including his R@ngers official share Holdings and his mums house he is digging in his healshe seems to be doing all he can to ensure they don’t get them



    The South African Judge had some choice words in his case………………….



    ”In their heads of argument, Sars’s senior counsel argued: “King’s evidence was duly rejected in scathing terms by His Lordship, Mr Justice Southwood and two assessors. The judgement confirmed the assessments in all material respects. This included additional tax in the maximum percentage of 200% as a result of the fraudulent conduct of King.



    “This conduct was not only in devising a scheme to thwart tax collection, but also as a result of him conducting the subsequent litigation since 2002 on a fraudulent basis for many years until eventually the trustees took control of the litigation in 2007. The Tax Court also held that the trustees did not act in a reasonable manner in allowing King so to do. In the judgement the following finding was made.



    Judge Southwood: “Instead, the Bermuda Trust [being the trustee of the Glencoe Trust and the controller of Ben Nevis in Metlika] did none of these things and assisted King, the apparent wrongdoer, to hide the appellant’s assets, to obstruct the South African tax authorities and prolong the tax collection process. These are all aggravating circumstanced and heavily outweigh anything which happened after June 2007.”



    Southwood continues: “We saw King testify in chief and in cross-examination for four days and are unanimous in finding that he is a mendacious witness whose evidence should not be accepted on any issue unless it is supported by documents or other objective evidence. It was remarkable that King showed no sign of embarrassment or any emotion when he conceded that he had lied to the Commissioner in a number of his income tax returns.



    In our assessment he is a glib and shameless liar….



    “King is a tall, slim man in his fifties. He appeared to be very confident and not in the slightest uncomfortable about giving evidence and being cross-examined. He is intelligent and articulate and appears to be well versed in the intricacies of the financial world and the purchasing and selling of shares on the JSE. Notwithstanding these advantages, he made a very poor impression as a witness. He is extremely arrogant and obviously thinks that whatever he says is so. It was demonstrated that he deliberately misrepresented the facts of the case to his legal representatives, to Sars in correspondence and at the section 74C inquiry and to the representatives and solicitors of the Bermuda Trust.



    “As his evidence progressed it became clear that he has no respect for the truth and does not hesitate to lie or at least misrepresent the facts if he thinks it will be to his advantage. There can be little doubt that on most occasions King lied as he knew the correct facts and obviously decided to misrepresent these facts….”



    “King testified that over a lengthy period he had falsely stated in his tax returns that neither he nor his children were beneficiaries of a trust whether inside or outside of South Africa. At all times he and his children were beneficiaries of the Caledonia Trust. He did this in his returns for 1994 to 2001. He said he did this because he feared that Sars would disclose this to the Reserve Bank. He conceded that he made an intentional false statement because it suited him (King 415 to 418). For the same reason he did not disclose in his returns the proceeds of the sale of the Republic Ratings shares to the appellant and then to CIBA (King 418 to 419). Ever since 2002 he has refused to file tax returns (King 417).


    Mention has already been made of the fact that when giving this evidence King showed no sense of embarrassment or emotion and he did not attempt to justify his conduct.”



    Could such a man be behind an elaborate scam to buy RFC?



    Although DK always said he was in the running to buy R@ngers this is from the Scotsman before SARs won the case against him.


    ……….SARS cannot see how King can hope to get involve in the ownership of Rangers in the short-term. It is also convinced that King would not be able to create a loophole by transferring some of his private wealth – estimated at 300m – into somebody else’s name for the purpose of backing a bid for Rangers. These monies would be investigated by the Serious Fraud Office and would also come under the preservation order if it was shown that they originated from King’s accounts.



    I think you are wrong in assuming that SARs have got ALL their money (although I could be wrong) and although he’s has got a plethora of criminal charges I do believe he can travel to Scotland. I would be more than happy if you could point me in the direction of the information if I’m wrong.



    I’m not expecting R@ngers to run out of cash until it suits the Third Man.

  5. I'm Neil Lennon (tamrabam) on

    A great article Paul



    I am not admin bankruptcy expert (Although the wife and weans have been trying to bankrupt me for years) so this is great insight into where the huns are heading



    As for FIFA / UEFA and their financial fair play stuff, I don’t reckon anyone in the SFA / SPL will care one jot.



    I would utterly despise anyone at CP who agreed to any single concession to lessen the huns financial issues



    There would be no point in the SPL continuing if clubs like Abahdeen or murderwell voted in favour of the huns continued existence in the SPL



    What are the chances of the the huns financial trouble and possible escape route being copied by the jammy farts from midlothian



    And of course while all this financial talk abounds the one big elephant in the room is


    If the huns change their name, can we still call them the huns? I think we should be told

  6. The Exiled Tim (I have too much time on my hands today)



    Cut and paste from an article I found somewhere. I haven’t checked if it’s correct. (I may have too much time o my hands but I’m not that bored)



    Why 5 Fridays, 5 Saturdays and 5 Sundays don’t occur every 823 years



    The Truth is


    The first three weekdays of any 31-day month are repeated 5 times within that month. So, any month that has 31 days and begins on a Friday has 5 Fridays, 5 Saturdays, and 5 Sundays. And this happens much more often than every 823 years.





    The next time that the 2011 calendar repeats itself is in the year 2022, which is only 11 years later. What’s more, a calendar month that contains 5 Fridays, 5 Saturdays and 5 Sundays occurs nearly every year: Both July 2011 and March 2013 have 5 Fridays, Saturdays and Sundays. The next July with same days as July 2011 is July 2016.



    Even the claim that the year 2834 has the same calendar as the year 2011 is false (see picture). For instance, July 2011 has 5 Fridays, Saturdays and Sundays. 823 years later, July 2834 has 5 Saturdays, Sundays and Mondays. That is a 5th Monday instead of a 5th Friday.

  7. The Honest Mistake (Sickened) on

    So best case scenario for them now appears to be:


    Prepack then Phoenix.


    Process contested by HMRC, the police, other football teams and other creditors.


    Years of litigation.


    No European football for 3 years at least.


    The need to refinance to get credit for operations.


    The threat of phoenix tax up front.


    Loss of fans due to season tickets being ripped up.


    The threat of the debt being reaportioned to the phoenix.


    The need for 10 out of 11 football teams to vote for their readmission to the SPL.


    Restructuring to be sold as a going concern.


    Goodbye history.



    Anything else I’ve forgotten?

  8. The name John Wilson may be pertinent in all this.



    No! Not that John Wilson.



    John F Wilson – Rangers Chairman in 1952 who backed Robert Kelly against the massed masonic forces of the Loyal Orange Lodge (Grand Master George Graham of the SFA) and Masonic Order (Harry Swan of Hibs/SFA).



    John F Wilson and Rangers backed Celtic to keep flying the tricolour.



    Perhaps time to return the favour?




    Hail hail




  9. James Forrest is Lennon on

    The Honest Mistake (Sickened):



    A nice summation mate. What you just described as the “best” case scenario is one fraught with difficulties and dangers and whilst their reinstatement in the league needs to be opposed, the wiping out of their entire history ain’t no small thing.

  10. Pearcesdad 15:38


    Lennart Norgren represents the following players.


    ( apologies if already posted)



    The Onlooker



    Jonas Lantto Age 24 Attacking Midfield Value £1.1m


    Mikael Dahlberg Age 26 Centre Forward Value 350k


    Mattias Nyland Age 31 Right Fullback Value £225k


    Andreas Lindberg Age 30 Keeper Value £225


    Oyyind Svenning Age 31 Defence Value £175k


    Fredricc Lundquist Age 35 Right Fullback (Retiring)

  11. Awe Naw



    Best wishes to the wife.


    Aye she would lighten the blog, she has submited her book deal and they seem happy so far, she is currently working on a short funny story deal, it’s superb stuff, especially the story about twins who were adopted and one ended up a loyalest, and one a Republican, and how things transpired, eat your heart out Tom Sharpe.





    Roughly what time did she post last night, must have missed that one ?

  12. Paul67,




    Been out all day and come home to your article. The worst news I have read in months. Such a scenario has been mooted on CQN already, I know. But some were saying the taxman would win out, not matter what. Anyway, I would like to state here that, as a shareholder of Celtic, in such a situation, I would use my vote to demand that we do not let them return to the Scottish game. Let them rot.

  13. As I walked through George Square last Sunday (on my way to the game), I saw a small group of Aberdeen fans. They were giving a little bit of the vocals to let us know who they were but all in a normal, supporters` way. There were a few Tims around and they made a few comments but, again, nothing serious and both groups had a bit of a laugh. All good natured ,football rivalry stuff. Two thoughts struck me ( I know, I had to sit down for a minute!). One was that the proposed new Law has already declared that this genuine banter could be seen as offensive therefore a crime. Pathetic. The second thought, relevant to today`s article and responses, was: Is this how Glasgow would be if Rangers did not exist? It felt good.


    I, too, find our Home games against Them tremendous affairs (I only go to Home games) and would miss that astonishing bedlam. On the whole, though,the feeling I had in George Square about a Glasgow without Rangers overpowered any loss I might feel concerning no longer having Home games against Them.


    In conclusion, should the scenario described so well by Paul 67 unfold, then I, too ( a very positive supporter) would not renew my season ticket.




  14. cadizzy says:


    27 October, 2011 at 16:31




    Someone e-mailed me that the other day, I also googled it, and same as you found it was wrong, must admit, I posted to see who would be the first to correct me, I knew someone would :>)


    You win a cyber bottle

  15. I'm Neil Lennon (tamrabam) on



    regarding john F wilson



    i do think its time to repay the favour, show a bit of concilliation at this time


    a freind in need and all of that



    yes its time we voted that the tricolour should fly over ibrox, that should be us quits and then we put them to the wall

  16. Regarding the word hun, which is now conveniently classified as sectarion/religious in Scotland, can we not try to introduce it for use in normal parlance at work, both wriitten and spoken, and in company as a word meaning terrible/bad/horrendous/unwanted. Instead of having the runs we say we have/had the huns, if we have had a bad night’s sleep we say we have had a hun of a night, if the weather is particularly bad we say that it is a hun of a day, etc. just introduce the word hun into society in a way that id derogatory but cannot be claimed to be sectarian.

  17. i love the artical. lossing the huns would be worth the millions that we WILL lose because no one from outside will want to watch our league without the O.F. we will have to try and get into an other league because without the huns(good that it would be) it would get pretty boring.


    could the huns apply to start at the bottom in england and work there way up?? i really want to see us get out of the spl with or without them, i can’t see much of a future for our club if we don’t so we HAVE to…

  18. Cadizzy



    “For instance, July 2011 has 5 Fridays, Saturdays and Sundays. 823 years later, July 2834 has 5 Saturdays, Sundays and Mondays. That is a 5th Monday instead of a 5th Friday.”



    Are you sure you have too much time on your hands? o:-)






    PS When are you next up for a game?

  19. The Honest Mistake (Sickened) on

    James Forrest is Lennon 27 October, 2011 at 16:35:


    Whoever buys them will need deep pockets and money to throw away.

  20. TET


    I t must have been your post around 10 last night where you said Goodbye to CQN. I thought that that was what was being referred to today.



    JJ (No Poirot,me !)

  21. I have already done this at work, used the word hun at meetings, in reports etc. No one has dared question me, even the known huns


    Again,I haven’t read back entirely,so I may well be repeating a post from someone else.



    I’ve noticed a disturbing trend amongst a few posters along the lines of “we need them” and “can you imagine not playing them,it’s what we live for”



    Not an argument which carries much creedence when we discuss decamping to England,and starting outwith the EPL.



    Not,in all honesty,an argument which carries much creedence at all.



    They have sinned,and must serve their penance.



    Beat that for irony…..

  23. Jungle Jim says:



    27 October, 2011 at 16:43






    “For instance, July 2011 has 5 Fridays, Saturdays and Sundays. 823 years later, July 2834 has 5 Saturdays, Sundays and Mondays. That is a 5th Monday instead of a 5th Friday.”



    Are you sure you have too much time on your hands? o:-)






    PS When are you next up for a game? ”



    Not any time soon…I just don’t have the time 0->)





  24. Steinreignedsupreme on

    Paul67 –



    A great piece with valid points that just can’t be ignored. I have no problem with a new Rangers starting afresh from the Third Division – I believe that would be fair enough.



    We have to have faith in our own club blocking any new club stepping into the shell of the rotting corpse – the Celtic board has made reference to the manner of who a club should be run on more than one occasion. We’ll find out soon enough if they were simply playing to the gallery or if they are willing to take a stance on cheating.



    For the record, I don’t think Hearts will back Rangers. If anything Romanov is likely to take a contrary stance to the Scottish media just for the sake of it.



    So, it’s a major decision for Celtic. I for one will not miss Rangers. They are a cancer on Scottish football.

  25. GerryAdamsBeard is Neil Lennon on

    Thanks, Paul67. An excellent, if chilling, article. Agree we need to apply pressure wherever we can to avoid this coming to pass.



    Haven’t read the comments yet, so apologies if this has been said before, but how many times have we heard fans of other teams spout off about how they hate the ‘OF’ and how dreadful Celtic and Rankers are for Scottish football? Now that there’s a distinct possibility of Rankers going out of business, which would not only get rid of ‘one half of the problem’ (I don’t accept that we’re even a tenth of the problem, BTW) – surely there’s no chance these ‘true football fans’ would accept Rankers’ being allowed straight back into the SPL. Surely?



    Hail! Hail!

  26. Marrakesh Express on

    A particularly good thread this one, prompted by Paul 67’s excellent piece. Many great contributions in the last 3 hours have really got my head spinning. Although the big bang hasn’t happened yet, this is turning into a gripping best seller. There are so many ifs and buts to be resolved and so many twists and turns to be negotiated that I’ve began to wonder what the discernable Hun is really making of all this.



    I think its safe to say that they have accepted the inevitable, which by the way the majority of, were still in denial a few weeks ago. That was however until the LL began to come clean with the real truth (which Phil could have told them about 6 months earlier), and as their last bastion of hope (LL propoganda machine) crumbled, they have finally admitted defeat.



    My stomach is actually churning with a kind of nervous excitement sometimes when I read some of the posts, as if its 1-1 in a final against the huns and we have a last minute penalty. I get excited when I read about the possible senarios presented by expert opinions. I chuckle when I read about planned bevvy sessions in celebration. Is this all based on hatred? I dont like to use the word because I’ve always thought it portrays a weakness in the hater. However, the hatred I’ve experienced over 40 odd years from the other side has came in many forms and has been frequent. For all that though, lets just call it rivalry, and it is arguably the biggest in the world. So we cant be blamed for enjoying whats happening to them. As Kitalba said earlier, they were ready to dance on our grave in 94, and I dont just mean the Rangers supporters.



    They dont deserve an ounce of sympathy and no matter how they fold or how they morph, we should all remember what they stood for and how they ended up where they are.




  27. Vinibhoy - Named Neil Lennon on his birth certificate on

    Evening bhoys.



    Quick question…


    If the new huns are registered in England and are told that they will have to start at the bottom of the Scottish leagues.



    Could they simply apply to join the bottom tier of the English leagues instead?

  28. Cadizzy


    You could try to come up in December (which has six Saturdays for the first time in 823 years).




  29. Neil canamalar Lennon hunskelper extrordinaire on

    As I said, HMRC are contesting their unsecured creditor status, they will challenge on the grounds that the tax bill is a statutory debt.


    Statutory debt are required to be dealt with before anyone else.

  30. Awe Naw, re the offer of a settlement on EBT’s.



    It is difficult to see what incentive there is for employers in this; HMRC has not given much detail about the terms of the offer as each case is to be settled on a facts specific basis so an employer cannot know what to expect until it has taken up the offer. Additionally, as is to be expected, HMRC is retaining the option to take matters further if a settlement cannot be agreed.



    It is likely that there are employers who are sufficiently confident in their own plans that they would be quite happy for the matter to go to court so, for them, a settlement holds little appeal. Other employers may be very wary of entering into a settlement only for HMRC subsequently to lose in court on another similar case since it is doubtful if those employers who did settle would be able to claim a refund of the settlement amounts.

  31. Estadio says:



    27 October, 2011 at 16:47



    Where is the use of ‘hun’ deemed sectarian or religious? What if Rangers’ supporter designates themselves so?




    Since Rangers fans persuaded BBC etc a few years ago by showing footage from Northern Ireland of an orangemens walk and they are being harangued by youths telling them to ‘go home ya huns’


    Folly Folly says:



    27 October, 2011 at 13:04






    If this isn’t a stupid request, regquiring lots of time: can you give us an educated guess as to who the ‘unsecured creditors’ are likely to be in this case?



    And an opinion as to why any of these might creditors (other than through contracted terms: although even then, one would imagine there should be some form of ‘get out’ clause allowing traders to cut their losses when the company they are supplying is so obviously so near to death) continue to offer services to RFC at this time?







    Does anyone know if the company which employs Craig Thomson is being paid on demand by Rangers?



    It might be interesting if they had no payment problems with them,while other invoices are being routinely filed under “R for rubbish”

  33. If Rangers are pre packed and allowed to continue as is and Celtic do not resign from the SPL then I will personally never ever set foot in an SPL ground again.



    And I hope I am not the only one…..




  34. Ron



    That makes it ‘an opinion’. Not a legal statement.



    I can understand some being offended by it (who wants to compared to a rampaging medieval warlord or genocidal maniac?), but as far as I am aware there is no Civil law or right that says people have the right ‘not to be offended’. The BBC can make all the cosmetic decisions it likes but it doesn’t make use of the term illegal.



    hail Hail




  1. Pages:
  2. 1
  3. ...
  4. 7
  5. 8
  6. 9
  7. 10
  8. 11
  9. 12
  10. 13
  11. ...
  12. 36