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.
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To view latest results of survey as at 1PM today click link below.
View latest results.
The following survey (4 questions) has been created to gather the views of as many supports from as many Scottish clubs as possible re. Rangers FC 2012 and direct entry back in to SPL if/when the existing Rangers FC experience a liquidation event that sees the death of Rangers FC 1873 to 2011.
Please pass to friends/relatives/other football clubs supporters websites via facebook, twitter, email, txt etc.
Take the survey.
MWD
Big Nan says:
27 October, 2011 at 20:41
Great post Sir.
Maybe i’m missing something but why would there be a vote to allow newco mongrels to stay in the SPL?
Surely there are rules in place for just this type of situation, and bending the rules to accommodate any club cannot be condoned.
If the clubs, and I include our club in this; cannot wait the few seasons it would take to see the mongrels back in the SPL then shame on them.
If Celtic collude with others in bending the rules to accommodate the newco mongrels then i’m handing back my season tickets and walking away from the farce that is scottish football.
P.S. Think back to the season just finished. Attacks on our club, our manager, our supporters, the behaviour of referees, hugh dallas, the sfa, the media. And we want to help these people? Count me out!
Eyes Wide Open:
Likewise, couldn’t care less about Scotland in any sporting sense whatsoever.
However, I really do think there is some serious trouble brewing – G Speirs has alluded to a few TFOD websites trying to stir things up.
Big Nan says:
27 October, 2011 at 20:41
Nail, Hit, on the
Fortunes Favour Mibbes says:
27 October, 2011 at 20:26
Yes the shredder makes the difference.
Never finished that,I submitted by mistake.
Continued-
We might be left in a situation where we have absolutely no recourse whatsoever except for the last resort of a bhoycott,why would you dismiss the idea when the support has already used a threat to success?
I’m not saying our host has mentioned it either but he has said today we and I took that as the support,have to be ready to withstand what could end up happening.
I think at this time to totally dismiss the idea and its a sensitive time as I’ve said,can look mischief making and hunnish.
If the other clubs conspire and contrive to allow them to continue under some new assumed name, I think the obvious thing for us to do is simply bhoycot each and every ground apart from Celtic Park. Deprive them of every penny. Let the fraudsters keep them afloat. Those who vote to allow them a second chance deserve all they get.
Lennon n Mc….Mjallby
Oh, I get it. If someone puts forward an argument that you dont agree with, that makes them a hun, does it?
Still waiting for the damning quotes that indicate that I am from the darkside other than your feeling?
Huns jump to conclusions and point the finger of accusation without having evidence to support their argument. Note the ongoing treatment of Neil Lennon!
I’m sure you’re not a hun but tonight you have behaved like one!
Hail! Hail!
Lennon n Mc Mjalby
Are you claiming that anyone who posts that they don’t agree with a boycott is therefore a hun?
Stairheedrammy:
Think they’d flannel you off with the old ‘every attempt is made to vet calls before broadcast’.
Unfortunately, broadcast/print media are driven by audience/reader figures and nowt else.
If the huns come out of this ‘prepac admin’ and its business as usual then Scottish Football is tainted beyond repair forever. Anyone who competes against them is doing so purely for monetary reward, integrity will be gone forever. Anyone who pays to see that is a gullable fool.
Evening all. Long time away.
Paul – apologies if this has been suggested previously but isn’t there a third way such that the other SPL clubs agree to the administration proposal but not until January 2012? If so ….
– Football playing assets could be sold and creditors reasonably remunerated
– The new horribles remain in the league
– The other 10 clubs get their wish of a functioning Rangers but with vastly reduced playing resources thus helping each of their relative positions
Hail Hail
brucecassavetes says:
27 October, 2011 at 20:53
Stairheedrammy:
Just dont listen, I did by default tonight for about 2 minutes and caught that moron(Jimmy). It`s hard to believe we share DNA with fuds like him even more hard to understand that he is allowed to breathe our air, then beyond comprehension that people allow him to speak in public. Then again he is “starring ” alongside intellectual giants like BFDJ and Roughie.
Real Radio manges to do the impossible,i.e. make Delafud and company sound sensible.
Paul67
Not quite Guy Fawkes night but definitely light blue touch paper and retire.
Ever since 2009 I have dismissed the suspicion Celtic had more to lose by winning the title that year than losing it.
Allowing your scenario to unfold would make me rethink and I would have no problem not putting another penny into a corrupt game.
I want to watch football with a feeling of joy not anger and resentment at being shafted in the past and goaded in tne future by a support who were more than happy to have done so.
There are much bigger issues at play than saving Rangers.
UEFA should be approached for financial help for the remaining clubs as it has been the pursuit of CL geld that created the conditions that led to Rangers recklessness in the first place.
Had Celtic won the title in 2009 chances are Rangers with £31M debt would have folded then. It is ironic that it is the lack of UEFA cash this season that is sinking them, not the tax bill. Then of course Celtic have also suffered from honest mistakes and a hostile SFA because not winning a title meant Rangers folding.
Celtic are now in a position to set conditions for the continuation of Scottish football, not to be dictated to and if that meant shutting up shop then, if the mood of the support is they would not pay another penny on corrupt football, the game is a bogey without our leadership anyway.
Big Nan says:
27 October, 2011 at 20:41
1994 and what nearly happened to us is THE reason why I want them to get what they and the whole of Scottish Football wished on us then…nobody outside the Celtic family came rushing to our aid.
I had two things to celebrate in 1994:
4th May – Wee Fergus slayed the blues
4th June – I wed Mrs. LB
The Phoenix rose thanks to Fergus, we are still going strong and so are me and Mrs. LB…
Down with them I say, off with their five stars, cheating swindlers (better add allegedly would not wanting the whyte knight suing me as well as Aunty…:)
Keep the Faith!
Hail Hail!
jmccormick:
Too true, bud. Think after tonight, the line has well and truly been drawn.
THE EXILED TIM 20:37
I know but they know the support wouldnt walk away in sufficient numbers, Phil Mac on recent various podcasts talks about when he asked Lawwell at the AGM about spending in January and PL treated him as if he was thick.
Was told net spend was irrelevant when it comes to squad improvement. Im no great fan of all Phil says but glad he is looking into PL and his nonsense, what he says on podcasts re-inforces my views of PL and how he views the support, even the most investigative of the support.
EN
Lennon n Mc….Mjallby
Only saw part one of your post.
I assume you are talking of an away boycott.
I’ve heard a lot of people on here tonight demanding action. What? When? How?
I’m not opposed to an away boycott, if you had bothered to ask! Just sceptical as to how this would work to force pressure on the other clubs to exclude the huns.
Hail! Hail!
Hamilton
That’s not what I’m saying,to dismiss it totally and in the context of knowing there are types who come on here and try to set hunnish agendas coupled with how explosive today article is it fair gets the antenna going.
btw I’m sorry for your loss and hope your bearing up well to all the organisation your having to do at such a sad time.
Mersey
I’m not often wrong about spotting a hun on here,perhaps I your anti boycott stance today,when I never read many other well Kent posters opposing the idea caught me a bit,I still don’t understand why at this stage you think its a bad idea especially as it could be our only option.
Eyes Wide Open
It does you no favours, nor does it favour Neil Lennon or Celtic to broadcast your hatred for Scotland. Hate will not get you or us anywhere. Anger I can understand, but the expression of hatred for a whole nation, one of which many of us on here are part of, will not solve any of the problems you have correctly identified. If what you say of Real Radio is true, then that radio station is in breach of the terms of its’ license. Let’s flag that up!
Will the rest of the SPL tell the Huns to take a hike. Hmm let me see…..
Aberdeen – Heavily in debt. Pittodrie is a crumbling mess. Need to finance a new out of town stadium. Currently signing players from England`s League 2 (Rory Fallon, Scott Vernon etc) for pennies.
Dundee Utd – Heavily in debt. Already embarked on cost cutting measures but allegedly will need money to finance compensation for Houston and fund a new manager.
Kilmarnock – Carrying lots of debt, an 18,000 stadium that isnt even half full for the visits of Celtic and Rangers and a quarter full the rest of the time. Signing players from English non league.
Hearts – Almost £30 million in debt. Cant pay wages. Need a new stadium. Team top heavy with Kaunas no marks who are cheap if nothing else.
Hibernian – Carrying no debt. Fans disappearing like snow of a dyke. Team full of League 1/2 level diddies (Akpo Sodje, Thornhill etc) Chairman shares Dermot Desmond`s love of luxurious taches and sexy balance sheets. Would do anything for money. Understandable as they need to fund Pat Nevin`s considerable soup bill.
Motherwell – Already been in administration. Not sure what their current level of debt is, but a club who are pro-Rangers to the core and who are desperate for money (they`ve sent me a letter today trying to flog me Celtic End tickets for 6th Nov) .
St Mirren – rumoured weekly wage £500 basic.
St Johnstone – Are trying to raze a stand to the ground to save some money.
Inverness – Can anyone name five of their players? I can`t.
Dunfermline – John Yorkston. Enough said.
Anybody watching tennis?
What a fabulous game Radwanska vs. Zvonareva.
Estadio Nacional
Anybody ever told you you have a dopleganger. Ivan Sproule. Is he your spitting image puppet? :o)
MWD
Lennon n Mc Mjalby
Thank you for your kind words.
Like most posters and lurkers, I avidly read some posters and tend to scroll by others.
I always read Kilbowie Kelt, he talks sense and his posts are always reasoned and considered. I agree with him, to label someone a hun is quite an insult. I may be naive, gullible or plain thick but the only people I’ve referred to as Huns on here, have, well definitely been that way inclined.
Gordon Strachan outstanding on 5 live there
EN
Depends on what you mean by sufficent numbers, 10k 20k mighty signicant I would say, the difference of 5 or 10 mill. on season books alone, not to mention the loss of revenue from merchandising, could be fatal.
Even 10k supporters walking, and I personally think it would be more, the PLC would struggle, unless they even further downsized, that worries me.
What then ?
Reading between the lines of Pauls leader today, he may well have the same fears.
Save the hun has been ongoing for the last few years, and the media pressure ain’t even got off first base yet, this will be down to the supporters.
Hamiltontim
Cultsbhoy is defo wan. That right Cultsbhoy.
:o)
MWD
Greenlion2 says:
27 October, 2011 at 21:14
What was he saying?
You recovered then?
Keep the Faith!
Hail Hail!
Gl2,
spill the beans, general jist
ThisIsTheOne says:
27 October, 2011 at 20:44
Big Nan says:
27 October, 2011 at 20:41
Great post Sir.
hear hear
the glorious balance sheet says:
27 October, 2011 at 21:07
…
St Mirren – rumoured weekly wage £500 basic.
…
——–
Peterhead were able to offer more wages to out of contract Brechin City hitman Rory McAllister than St Mirren during the summer
Monteblanco
Exactly.
An idea might be they sell their high value players, set a wage ceiling for the rest that can be paid for by advances on TV money and match day revenue and continue to seasons end, at which point the result of the big tax case will be known and they liquidate if necessary, pay their creditors and take it from there.
There should be no rush job to accommodate them otherwise.
(tell ma boy I’m having a ball)
MWD
Really laughed aloud at that!
Cultsbhoy, not that I think yer a hun mind :)
Amidst all this talk of the huns demise and quick resurrection can someone tell me why the feck Kayal got booked last night apart from the obvious fact he is a Celtic player who happened to be on the park attacking Sproules boot. This is the real problem for us indiscriminate booking of our players while we are being booted off the park. Big dan also booked for his first challenge> I think it was around 12 fouls before a Hibs was shown a yellow,
Moonbeams WD 21:13
Last time we met someone guessed we might be brothers, probably the best compliment you or I have had, after that Ive been on a high, dont even know who Ivan Sproule is…
En
martybhoy59 says:
27 October, 2011 at 21:23
Come on, he stood beside a hibs player aggressively !
Estadio Nacional says:
27 October, 2011 at 21:24
When I read MWD post that very thought crossed my mind, that you were twins…Sproule, you wouldn’t want to know who he is but he hit the ball that cannoned off Dan last night, he ggot sent off AND he is an orc…
Keep the Faith!
Hail Hail!