Huns are History?

[fabienleclerq]

They'll never go bust.Might take a hiding from the taxman but they wont go bust.

As for a name change

[southside1874]

Pish.

According to reports Rankers are owe HMRC a barrow load of billions and some. They get 1st dibs, no invester will touch them with yours, for obvious reasons.

 

Its not really that complicated.

 

I've never mentioned the tax man mate. If the tax man is investigating just now how does anyone know what they are due until the end of the investigation? The banks are probably happy that they are servicing the debt just now but if there is another one out there thats not getting paid he can raise an action and if the debt isn't paid then it starts the admin process. I thought the workers got first dibs with their wages but maybe I'm wrong.

[Commander Harris]

I think CH is commenting more on the principle behind this thread and not the intricacies of the business end. I agree with him.

correct. I'm not making any comment about the security, or otherwise, of Rangers.

 

 

[Scallywag]

The whole Webster thing was a bit of a mystery !

 

I cant help feeling the Huns are heading for D-Day. The various immenent buyouts that dont happen, the selling of key players mid season, the tax case etc etc etc. Rangers are up the creek without a paddle.

[Saint Jambo]

The tax enquiry still has a long way to run but it doesn't look good for them.

 

It seems logical to use their eventual sale as a barometer as to whether or not they're donald ducked. If a sale goes through then the due dilligence has probably shown they are ok..... If no sale happens then that shows there are potential problems aplenty.

 

I think the tax enquiry was mooted to be something which could take a year or so.

The reports of negotiations was that the potential buyers wanted to insulate themselves from any further debt as a result of the HMRC negotiations - Murray would guarantee to pay that debt. But the direct liabilty can't be shifted from Rangers so this only works if the buyer is confident Murray is going to be able to cover any new HMRC debt. Given that David Murray's current net worth is reportedly ?110M, and the HMRC case could cost up to ?100M it is hard to see how a buyer could be confident he would cover this amount. So why would any interested buyer go for the club now rather than in 6-12months when the situation is clear?

 

 

Pish.

According to reports Rankers are owe HMRC a barrow load of billions and some. They get 1st dibs, no invester will touch them with yours, for obvious reasons.

 

Its not really that complicated.

More complicated than you make it.

- The amount Rangers owe HMRC will be decided by a court case and could still be ?0 or ?100M.

- HMRC do not get 1st dibs as they are no longer a preferential creditor. This is actually generally taken to have worked against football clubs as HMRC have become much more hawkish in taking legal action against clubs. They no longer have the luxury of knowing that if they give the club a period of grace and things get worse that they will still get their money first.

[Tiberius Stinkfinger]

I've never mentioned the tax man mate. If the tax man is investigating just now how does anyone know what they are due until the end of the investigation? The banks are probably happy that they are servicing the debt just now but if there is another one out there thats not getting paid he can raise an action and if the debt isn't paid then it starts the admin process. I thought the workers got first dibs with their wages but maybe I'm wrong.

 

Your wrong.

 

Rankers will bimble along until the Revenue have been squared up, thems the facts.

 

What happens after that may be of interest but IMO its years away.

[Gods a Jambo]

correct. I'm not making any comment about the security, or otherwise, of Rangers.

 

 

I never once stated you were.

[Commander Harris]

I never once stated you were.

 

I never once stated you did.

[CJGJ]

So lets get this straight -- a club who could have sold players to survive the administration just 3 weeks ago suddenly are going to go into admin -- utter tosh.

 

Like it or not Rangers have sellable assets and could have cleared all their debt if they had to -- they could still have sold Bougherra to Russia only this week -- a nice thought but just not on at present -- the only real issue they have is the ongoing enquiry into image rights -- putting that aside they are running at a profit and have been cutting costs both on the playing and non playing side.

[RENE]

Is the hmrc case not being held in April, which means of anything is going to happen it would be next season

[Scallywag]

One point on player sales is that nowadays the players decide where they go !

 

Boughera will have better offers than Russia so its not a supride he would bide his time.

[Lego Knees]

Maybe they should hire Colin Hendry as their Financial Advisor ?

[Broxburn_Jambo]

I heard from a source at HMRC that the amount they would be seeking to settle the case is ?57m.

[Gods a Jambo]

I never once stated you did.

 

Touche.

[portobellojambo1]

A Rangers diehard told me tonight that the fans are resigned to administration for Rangers FC. They reckon that once the league challenge has been extinguished (maybe this Sunday!), that Rangers will go for the points penalty and move on.Thsi could even mean a change in name for the team and the exodus of any saleable assets.

 

It is a possible option they could consider, depending on when the points deduction takes place. If, after this weekend, they feel their league challenge is over (which you have to think is unlikely or strange given if they win their games in hand and lose to Celtic they would still only be two points behind) and they can take the hit this season they may go for that option, rather than potentially start next season way behind the rest.

 

All depends when, rather than if, HMRC present their bill to Rangers, a bill which could well be around ?60 million. It makes sense then for Rangers to go into administration, and the bill be paid from whatever can be sold, including potentially the stadium, and I think those who have been reported as having an interest in buying the club would probably then resurface and pick it up very much on the cheap. They would then be able to start next season effectively debt free, and with money to spend on players.

 

Time will tell I suppose.

[The Don]

For anyone interested in the legal aspects of Football clubs in administration. Just so there are no doubts or conflicts. Taken from Edinburgh University (Sport & The Law)

 

A Football Club as a business is a unique entity that differs from other companies in many respects, but is still subject to the same legal ramifications.

In the current economic climate many companies have incurred financial difficulties and Football Clubs are no exception. Despite the constant income that fans generate it is inevitable that because of the credit crunch and lack of commercial income that the legal issues of debt and insolvency will begin to appear in the sporting arena.

When a Football Club becomes insolvent the growing trend is to resort to Administration. This topic dominates the sports headlines and casts a shadow over many clubs. However, many fans fail to understand the legal developments that their beloved club is undergoing and fear for its future.

Leeds United is one of the more famous casualties with Crystal Palace going into administration in January 2010. Portsmouth is the latest big club to face the legal implications of administration.

 

HM Customs and Revenue; an Unhappy Creditor.

One of the main sources of consternation in this unhappy marriage between sport and law is the role that HM Customs and Revenue (HMRC) plays when football clubs meet financial difficulties and go into administration. The government purse has come under pressure in this fiscally challenging period and it needs to pursue every penny to deal with government debt.

HMRC, once reluctant to pursue football clubs to preserve its public image has shown an increased willingness to ensure that it is paid in full following a series of cases in which it was forced to settle with administrators. This has sparked a flurry of winding up orders as it seeks to recover debts while clubs still have necessary funds to pay them and forced the League to rethink the rules to ensure clubs stay financially secure.

A company goes into Administration either voluntarily or more usual in the world of football, when creditors file a petition against it. Under league rules, clubs pay football related debts such as salaries and player transfers first and HM Customs and Revenue with what is left over.

HM Custom and Revenue therefore is often one of the first to file a petition against a football club highlighting the unique position that football has in law.

 

Financial Challenges of Football Clubs

A football clubs inability to pay HMRC and other creditors is more often than not linked to its on field performance and the bonuses that come with it. A certain respect in which football differs from other business?s is that they have the substantial fixed overhead of their players who are on long term contracts. If clubs have budgeted for levels of income that cannot be sustained due to the recession and failure on the football field (e.g. getting relegated and therefore losing out on TV and sponsorship rights), then while their income drops rapidly, their costs cannot be reduced quick enough to match this downturn.

The temptation is always there for directors to pay these otherwise unsustainable wages in a bid for success on the ever unpredictable football pitch. If this success does not arise and relegation occurs, a downward spiral begins for the club. There is an interesting co-relation between relegation from the top-flight and going into Administration a year later .Examples include (relegation year followed by administration year) Middlesbrough (1985/1988), Crystal Palace (1998/1998), QPR (1996/2000), Wimbledon (2000/2002), Leeds United (2004/2006) and Southampton (2005/2009).

In the pre-recession days this did not have as disastrous effect as it is having currently. However with the decline in government revenues, HM Revenue and Customs have a greater desire to collect taxes owed by football clubs or in extreme cases to wind them up so as to limit the level of the Crown?s ever increasing debt.

 

Administration Process

Administration however is not the end of the world for a football club. It offers an alternative to liquidation and is built on a ?rescue culture?. The enactment of the Insolvency Act 1986 brought a number of new insolvency regimes into English Law that were intended to facilitate the reorganisation of an entity structure, hopefully leading to a better financial outcome than would be achieved through the traditional liquidation route. Without it, the future of football clubs that incur financial difficulties would be much bleaker. It has become a commonly used mechanism in the football because it functions as a rescue and allows them to carry on running their business. After the administration, the football club re-emerges with new directors and a refreshed balance sheet. Since the Insolvency Act 1986, over 70 football clubs have gone into Administration.

Leeds United is a good example of the possible ?phoenix? like nature of Administration. They have returned to being an economically viable business and have lost their uncontrollable debts. While the numerous fans of Leeds United are delighted to see their club is no longer on the brink of financial meltdown, HMRC were not a happy player in the Leeds deal.

The ?rescue? goals of the administrative procedure are set out in the Act but there is little evidence of any justification for the advantageous position that football clubs have.

Three possible objectives are listed:

1. Priority is given to ?rescuing the company as a going concern?. This is the number one priority the Administrator must pursue and ensures the survival of the football club.

2. If the first objective is not practical the second objective is ?achieving a better result for the company?s creditors as a whole than would be likely if the company were wound up.? Thus preservation of the company as a going concern, to the benefit, for example of employees is not essential if the creditors would be worse off as a result. The situation in Football however contradicts these rules somewhat with the super-creditor rule.

3. ?Realising property in order to make a distribution to one or more secured or preferential creditors.

While this process can ultimately serve the football club quite well, it works to the detriment of HMRC and other creditors. It is quite evident that the unique situation in football contradicts this statute somewhat with non football related creditors often suffering. ?Footballers Rule?: The Bane of HMRC.

Financial regulations set by the Football Association and the Football League means professional football clubs have a unique way of dealing with debts that are contrary to the aforementioned law.

Under current football league rules, clubs in administration must first pay off football super creditors first, which include players, managers, other football clubs, the Professional Footballers Association and the league, before paying preferential creditors as required by law .

Since the abolition of Crown Preference with the Enterprise Act 2002, the Inland Revenue has lost its right to be paid out before the others. It now has to stands low down the order of preference after the ?super-creditors?.

While this ?rule? has no basis in law, it has his has left Administrators dealing with two contradictory sets of rules, business and tax law, quoted by the revenue, and the super creditor regulations quoted by the football league.

As it is not deemed a preferential creditor HMRC is typically only paid 5-10% of what it is owed. A study in 2008 found that 18 clubs owed approximately 31.7 million to Revenue but paid back only 3.5 million, meaning the public purse lost out in more than ?28 million. The debts owed to HMRC are substantial because large player salaries mean big income tax and national insurance bills. This highlights the link between relegation, high wages and administration.

Leeds United, mentioned already as an Administration success story, went into Administration in 2007 owing nearly ?7 million to the Revenue. The revenue and other creditors were initially offered a penny in the pound; it contrasts starkly with former players who were paid hundreds of thousands of pounds each to honour their contracts. HMRC challenged the offer but are still likely to only get 10p in the pound in the pound, meaning it will have to write off more than ?6 million pound of public money.

The HMRC are in quite an awkward position with club spokespeople bleating to the press (often with a local newspaper with whom they are friendly) complaining about the blood thirsty, penny-pinching antics of HMRC.

On the other hand critics claim that HMRC are too lenient on football clubs e.g. Simon Kuper of the Financial Times who has suggested that ?The government has quietly accepted that many football clubs will never pay their taxes.? These conflicting interests have left HMRC with a very difficult balancing act.

 

 

 

[Harry Palmer]

**** Rangers.

[adayinmay]

The hearing for Rangers and HMRC is scheduled for May.

[Gizmo]

What's interesting is that mention of any debts outwith the HMRC debt is barely mentioned, certainly not in the press by those with their tongues lodged firmly up Murray's jacksie.

 

I'd imagine the huns will only look at administration after the outcome of their court case with the taxman. Did Motherwell ever actually get a points deduction for going into administration?

[JAYEL]

Jim hears the news of the huns demise.....

 

 

 

LOL , if only if only it were true

[Mr Romanov Saviour of HMFC]

What's wrong with Jim White? He if ******* hilarious.

 

'So Brian, why are you so good?'

 

WHY ARE YOU SO GOOD?!?!

[jamboinglasgow]

What's interesting is that mention of any debts outwith the HMRC debt is barely mentioned, certainly not in the press by those with their tongues lodged firmly up Murray's jacksie.

 

I'd imagine the huns will only look at administration after the outcome of their court case with the taxman. Did Motherwell ever actually get a points deduction for going into administration?

 

they didn't but Gretna got a 9 point deduction when they did.

[EreWeG0..]

Cant see it happening, but if it did i'd be first in the queue to watch Chick Dung jump in the clyde

[southside1874]

Your wrong.

 

Rankers will bimble along until the Revenue have been squared up, thems the facts.

 

What happens after that may be of interest but IMO its years away.

 

I fail to see how they "bimble" along with falling attendances and no money from TV and champions League football. The fact they have to service their debt and have very little money to pay wages without having the money to buy players as is the culture of the club makes me believe they are well and truly up the swanny. I don't think Rangers will wait until the taxman closes them. They'll do it when they know that someone will buy the reduced goods. Financially it may look like years away, but without the revenue to invest in players, there is little point in them trying to compete as they have no track record in bringing on youth.

Rangers will not let this drag out so they lose their fanbase. Someone will come in and buy the name and the ground and start the whole thing rolling again. I think you fail to realise the impact these clubs have on our society. They don't give two proverbials about the taxman> I actually think the weegie teams have been used as some sort of political tool to prevent Scottish folk thinking about independence. that old imperial divide and conquer still works wonders in the west.

[parwj]

The paper this morning says it's a done deal ! 33 million take over !

[Coco]

What's wrong with Jim White? He if ******* hilarious.

 

'So Brian, why are you so good?'

 

WHY ARE YOU SO GOOD?!?!

 

He's the link between the old football coverage, Arthur Montford and Ian Archer and Jim Red White and Blue in a hound's tooth jacket with a Hitler moustache ... and the new coverage Georgie Thompson and Twitter and 'breaking news' ... and he's done it seamlessly in his own inimitable style.

 

Why is he so good?

[Jam Tarts 1874]

I can't see Rangers going into administration. However one way or another they are going to have to pay HMRC at some point which will surely weaken them considerably.

 

Perhaps it will put them in the same position that they were in pre-Souness. Due to the spending on the then new stadium they had nothing, a repeat of these circumstances would be great news for us.

[Napoleon Wilson]

A Rangers diehard told me tonight that the fans are resigned to administration for Rangers FC. They reckon that once the league challenge has been extinguished (maybe this Sunday!), that Rangers will go for the points penalty and move on.Thsi could even mean a change in name for the team and the exodus of any saleable assets.

 

 

[Mr Brightside]

Im sure administrayshuuuun comes around when your debts are greater than your assetts. A hibs fan on here will no doubt correct me. But Rangers are no where near that stage.

I think that is insolvency you are referring too, some people would argue that hearts are in this position.

 

Most critical thing for a business is cash flow, plenty of business with strong order books have went under due to cash flow.

 

If Rangers went into liquidation their supporters would buy out a third division team and start again, within 5 years they would in the top half of the spl.

[Marvin]

Won't happen, unfortunately!

 

but the 25 point deduiction will be funny

[Nookie Bear]

Are these not exactly the same rumours that used to be aimed at us about once every fortnight?

 

I miss those days of JKB meltdown........

[Nookie Bear]

Never happen, where have all the masonic bankers gone FFS.

 

Was there not talk in last weeks press of an imminent takeover.

 

The GFA need a strong old squirm, Celtic need a strong Rangers. Admin, no way..

 

 

The SFA would do everything in its power to protect the huns and I seriously believe that celtic would do the same. They need each other.

[Chester™]

The paper this morning says it's a done deal ! 33 million take over !

 

They said that last year with Ellis, before Xmas with Whyte and last month with Whyte. Until a cheap scarf etc etc is above Whyte's head and him saying 'I now own Rangers', with Minty at his side telling why he sold, believe nothing about them.

[Midfield Dynamo]

A Rangers diehard told me tonight that the fans are resigned to administration for Rangers FC. They reckon that once the league challenge has been extinguished (maybe this Sunday!), that Rangers will go for the points penalty and move on.Thsi could even mean a change in name for the team and the exodus of any saleable assets.

 

Two things that won't happen and Two things that will happen if they go in to administration.

 

Won't happen: No name change and League challenge won't be extinquished this weekend. (Look at league table)

 

Will happen: Deduction of points and sale of assets. (McGregor, Bougera, Davis, Jelovic, Naismith)

[millano]

Whyte is still in for the club and the deal should be tied up by the end off this month and that comes from someone who has strong connections with Murray and Rangers.

I'm afraid to say they will not go into admin, although I wish it would.

[Footballfirst]

The sticking point for the sale of the club has to be who picks up on any tax liability.

 

Rangers have paid out approx ?48M into Employee Benefit Trusts over the last 10 years (from their annual reports). If HMRC are successful in their claim that this money should have been declared as UK income, then the tax liability will be around ?25M (40% tax + 12.8% Employers Nat Ins + 1% Employees Nat Ins). Add to that a penalty charge of up to 100% and Rangers own legal fees, then the final bill could take the club close to administration.

 

I suspect the the Lloyds Bank influence on Rangers is more to do with them managing the cumulative debt of the MIH group of businesses. Rangers will be viewed as a cash cow, with regular revenue streams from STs, TV deals, other match day and commercial income.

[portobellojambo1]

Whyte is still in for the club and the deal should be tied up by the end off this month and that comes from someone who has strong connections with Murray and Rangers.

I'm afraid to say they will not go into admin, although I wish it would.

 

If said person buys the club in its present state you would have to ask how it is being packaged. Liability for payment of the HMRC bill at this moment will lie with Murray International Holdings, so potentially anyone taking over the club takes on that liability (which will be around ?60 million, give or take a couple of million). If that liability is taken into account in the sale then I would think rather than any potential new owner having to pay to buy Rangers it is just as likely to assume MIH will pay the new owner a sizeable sum just to get Rangers out of the MIH Group. Because there is absolutely no way Rangers value at present is anywhere close to ?60-?80 million, in the present financial climate the sale of the ground and the few sellable players they have would only raise a fraction of that amount.

 

If Rangers were still a separate entity David Murray might be willing to write off a huge loss as a bad piece of business, however since Rangers became part of the overall group their (MIH) shareholders have constantly voiced concerns about the amount of money that has been wasted on Rangers. I would suspect they might prefer a means of securing as much return as possible, and that could involve placing RFC into administration and selling anything and everything that has any value.

[Hackney Hearts]

Stranger things have happened.

 

Like Skacel and Webster returning to Hearts, for instance.

[Dunks]

Even if they do go into administration, they won't be docked 25 points.

[Wotta Lad]

Even if they do go into administration, they won't be docked 25 points.

Why...?

[Ben Dover]

The paper this morning says it's a done deal ! 33 million take over !

 

 

Wishfull thinking by the Weege Meeja

 

MIH has taken massive losses over the years due to Rangers being part of the group, such as the ?50m share issue that flopped with MIH having to buy 90% of them back themselves. That is probably why Rangers PUBLISHED debt is only ?24m or something, a figure they SHOULD be able to service comfortably with their much greater incomings than us, but maybe explains why there is a Lloyds presence on their board ?

 

The way I'm reading it is that HMRC are looking too get anywhere between ?20 -?60m from RFC

( in unpaid tax and a large fine for evading it )

That belongs to and remains with RFC from what I'm reading and cannot be shoved sideways and hidden somewhere in MIH.

However we're led to believe Murray has asked them to take a payoff of ?10m or thereabouts and they have said GTF. However that might sound better than getting a pittance in the pound in a liquidation fire sale?

As for a 10point penalty........I'll bet the GFA will do there best to quash that if possible

 

 

It surely all rests with HMRC.................although Lloyds see RFC as the goolies of the MIH group and might not let go so easily to an incoming buyer anyway

[Dunks]

Why...?

 

Since the formation of the SPL, 4 clubs have entered administration. None of them received a 25 point penalty.

 

The SPL rulebook states 10 points.

 

 

A6.8 Where a Club takes, suffers or is subject to an Insolvency Event

that Club shall be deducted 10 points. Where the Insolvency

Event occurs during the Season, the points deduction shall

apply immediately. Where the Insolvency Event occurs during

the Close Season the points deduction shall apply in respect of

the immediately following Season, such that the Club starts that

immediately following Season on minus 10points.

 

[Ben Dover]

I suspect The GFA would not enforce a 10 point loss if it was to be applied April / May.................that would cause utter carnage when you consider they cant even have last day league decider for public safety reasons !

[Rods]

if this is true maybe all the glory hunting Edinburgh rangers fans will start supporting Hearts.

[Ben Dover]

if this is true maybe all the glory hunting Edinburgh rangers fans will start supporting Hearts.

 

As long as they leave their 'baggage' on their last trip to IBROX............if they've ever been !

[Slap]

A Rangers diehard told me tonight that the fans are resigned to administration for Rangers FC. They reckon that once the league challenge has been extinguished (maybe this Sunday!), that Rangers will go for the points penalty and move on.Thsi could even mean a change in name for the team and the exodus of any saleable assets.

 

Cant see it.................wish it was true thought