Rangers Takeover

[Victorian]

d.p.

[Footballfirst]

Craig Whyte owns a company called Liberty Capital. The following was taken from a cached copy of the website which is conveniently "under construction" at the moment.

About us

 

Liberty Capital provides funding to businesses that are capable of strong cash generation within 12 months of our investment. We also acquire existing businesses for our portfolio where there is already strong positive cashflow.

 

Liberty also specialises in providing finance to ?Turnaround? situations where an established business has cashflow problems and requires both cash and expertise to turnaround the business.

 

Liberty Capital was founded by entrepreneur Craig Whyte and has offices in London and Scotland. Liberty currently has investments across several market sectors including Marketing, Communications, Ticketing and Commodities Trading, with operations in the UK, The Netherlands, Switzerland, Russia and France.

 

Email:[email protected]

 

 

 

We buy distressed companies and assets

 

Do you have a loss making company that has a turnover in excess of ?5m per year?

 

Would you like to get out of it quickly and get away from the hassle?

 

If so we might be able to help. It might even be worth more than you think.

 

We are in a unique position to acquire loss making businesses. We can look at the situation from a different angle, knowing exactly what it will take to restructure the business.

 

So if you?d like to sell your loss making company quickly get in touch with us now on 020 7332 2200 or email [email protected]

 

 

[VALDOS]

It all round looks like a good deal for them. Debts cleared, bank of their back and my reckoning is they must have plans to cover the tax bill if it comes to it.

[Das Root]

It all round looks like a good deal for them. Debts cleared, bank of their back and my reckoning is they must have plans to cover the tax bill if it comes to it.

 

 

Uh huh

[Dusk_Till_Dawn]

Jim panzee the main thrust was that a number of firms in which whyte is involved have had financial problems, some quite severe

[Dusk_Till_Dawn]

Incidentally, I still don't think this takeover will happen

[Deevers]

HMRC will continue to pursue Rangers to pay the bill as it is Rangers who have the liability and it is they who have taken their appeal against the tax demand to the tribunal.

 

HMRC won't worry about how or who gives the money to Rangers, but ultimately it is Rangers who have to pay. If they can't then HMRC will seek a winding up order against them.

A number members of the Rangers board are still very unhappy with Whyte and his finance arrangements for the "take over". However with no other obvious takers it looks like "the drowning man clutching at the last straw". I've got a feeling that Rangers financial worries are not over by and long stretch.

[Coburg Hearts]

No take over tonight......technical issues. According to a BBC tweet.

[jamboinglasgow]

No take over tonight......technical issues. According to a BBC tweet.

 

just like last week when the Daily Record said the Royal Wedding delayed the takeover. (That really was a story.)

[Coburg Hearts]

just like last week when the Daily Record said the Royal Wedding delayed the takeover. (That really was a story.)

 

Long may the delays continue, but I have a feeling this will go through. Whether it will be good for Rangers only time will tell.

[The Gasman]

A number members of the Rangers board are still very unhappy with Whyte and his finance arrangements for the "take over". However with no other obvious takers it looks like "the drowning man clutching at the last straw". I've got a feeling that Rangers financial worries are not over by and long stretch.

 

This takeover seems to be a great deal for Murray & Lloyds, who will get their money, and walk off into the sunset with Johnston who leaves at the end of the season.

 

There's an expression to do with sinking ships and rodents that keeps springing to mind...!

 

The tribunal with HMRC (and any subsequent appeal by either party) is not expected to be finally resolved until the end of the year. Craig Whyte seems to be having serious cash issues with more than one of his other businesses, and has only (publicly) agreed to match the ?5m/pa that Walter Smith is currently struggling with by selling assets.

 

To this layman, it looks like Rangers real financial problems have not even started yet.

[jamboinglasgow]

This takeover seems to be a great deal for Murray & Lloyds, who will get their money, and walk off into the sunset with Johnston who leaves at the end of the season.

 

There's an expression to do with sinking ships and rodents that keeps springing to mind...!

 

The tribunal with HMRC (and any subsequent appeal by either party) is not expected to be finally resolved until the end of the year. Craig Whyte seems to be having serious cash issues with more than one of his other businesses, and has only (publicly) agreed to match the ?5m/pa that Walter Smith is currently struggling with by selling assets.

 

To this layman, it looks like Rangers real financial problems have not even started yet.

 

makes you think why is it that a property developer and a man who made his money taking over companies with serious money issues are trying to buy Rangers, a club who have some serious financial skeletons and a sizable plot of land in an area of Glasgow which could be used to persuade the council for urban renewal. All I saying is to Rangers fans, if it sounds too good to be true, it is usually is. Takeovers by owners rarely act out like the buyer claims it will. And the lack of media scrutiny of Whyte and Ellis is a curious one, only non-Scottish media have put anything remotely like scrutiny (see the Private Eye) its almost as if that Murray wants this to go through to get his money so has instructed his media cronies not to rock the boat by asking questions about the possible new owners. To me that is very curious, and the nonsense that Murray is wanting to make sure the best owners take over for his legacy doesn't wash with me.

[Martin_T]

VC's like Whyte who buy distressed companies such as Rangers, usually attempt to return the company to profitability by really hammering down on costs (wages and transfer fees in the huns case) and maximising income. They then look to sell the company on for substantially more than they paid for it a couple of years later. Interesting times ahead...

[Victorian]

it could be argued that there is a model for whyte to follow... fergus mccann's takeover of celtic.

 

mccann bought over the financially distressed celtic and reshaped them into a far healthier business and his exit strategy was very successful.

 

maybe a few 'wearrapeepuls' are clinging to the hope that whyte will perform an identical magic trick. they may be disappointed.

[Footballfirst]

Summary of my thoughts

 

Rangers are currently have debts of ?29m expected to drop to about ?22M by the end of the season. Lloyds hold secuity of Rangers assets (Ibrox and Murray Park) against their borrowing.

 

Whyte's backers(venture capitalists) raise the cash to pay off the ?22M to Lloyds and buy off SDM

 

Whyte delists Rangers as he controls 90% plus of Rangers (he then has a year without the need to disclose any actions)

 

Whyte transfers his debt back onto Rangers, taking Ibrox and Murray Park as security for the debt (This protects those assets from HMRC as they are not a secured creditor) Similar to what happend at Liverpool and Man Utd.

 

If Rangers win the tax case then the value of Whyte and his backers investment goes up significantly and a new buyer will be found. (Rangers is profitable without debt)

 

If Rangers lose the tax case (more likely) they will go into administration.

 

Whyte takes ownership of Ibrox and Murray Park

 

Administrator asks HMRC to sign a CVA at a few pence in the pound after the sale of remaining assets (players)

 

HMRC as the biggest creditor refuse and force Rangers into Liquidation, taking whatever they can get out of the sale of anything that moves.

 

Rangers 2012 is born and applies and is accepted into the SPL, with backing of "Rangers minded" businessmen. (and a vote of confidence from Celtic)

 

They rent Ibrox, from Whytes company, register their colours as blue, orange, red white and blue or whatever.

 

With no debt and potential 50K crowds they attract a few decent bosmans and loan signings.

 

Within a couple of years they are back challenging for the SPL and the world will go on as if nothing had changed.

 

If Rangers are successful, they raise the cash and buy back the ground from Whyte (at a profit for him and his backers)

 

Simples

[jamboinglasgow]

VC's like Whyte who buy distressed companies such as Rangers, usually attempt to return the company to profitability by really hammering down on costs (wages and transfer fees in the huns case) and maximising income. They then look to sell the company on for substantially more than they paid for it a couple of years later. Interesting times ahead...

 

to be honest long term that might be best for Rangers, as others say a sort of Fergus McCann who cuts costs and makes the club run much better then move quickly on when the first offer comes. Problem is the Rangers fans. They will be like junkies going cold turkey. And if Rangers are not winning the attendances fall meaning less revenue.

[Mysterion]

Regardless of the tax case - I think Rangers are going to get lucky financially and be better than many think.

 

If Whyte concludes the deal they will remove debt/interest payments to the bank quickly.

They are in pole position just now to have a crack at the Champions League.

 

The tax case is the major issue - I can see them getting around it through a repayment deal or a bank loan.

 

A quick search and the Scotsman has a story on the JJB sports deal. It expires in 5 years and brings in ?3mill a year - when it expires you'd expect Rangers would earn more than ?3mill per year from merchandising. A financial org may take a punt on Rangers over a 10 year loan if the JJB/Merchandising money was ringfenced.

 

I can see them getting away with murder - especially if they make it to the Champs League next season.

[The Gasman]

Summary of my thoughts

 

Rangers are currently have debts of ?29m expected to drop to about ?22M by the end of the season. Lloyds hold secuity of Rangers assets (Ibrox and Murray Park) against their borrowing.

 

Whyte's backers(venture capitalists) raise the cash to pay off the ?22M to Lloyds and buy off SDM

 

Whyte delists Rangers as he controls 90% plus of Rangers (he then has a year without the need to disclose any actions)

 

Whyte transfers his debt back onto Rangers, taking Ibrox and Murray Park as security for the debt (This protects those assets from HMRC as they are not a secured creditor) Similar to what happend at Liverpool and Man Utd.

 

If Rangers win the tax case then the value of Whyte and his backers investment goes up significantly and a new buyer will be found. (Rangers is profitable without debt)

 

If Rangers lose the tax case (more likely) they will go into administration.

 

Whyte takes ownership of Ibrox and Murray Park

 

Administrator asks HMRC to sign a CVA at a few pence in the pound after the sale of remaining assets (players)

 

HMRC as the biggest creditor refuse and force Rangers into Liquidation, taking whatever they can get out of the sale of anything that moves.

 

Rangers 2012 is born and applies and is accepted into the SPL, with backing of "Rangers minded" businessmen. (and a vote of confidence from Celtic)

 

They rent Ibrox, from Whytes company, register their colours as blue, orange, red white and blue or whatever.

 

With no debt and potential 50K crowds they attract a few decent bosmans and loan signings.

 

Within a couple of years they are back challenging for the SPL and the world will go on as if nothing had changed.

 

If Rangers are successful, they raise the cash and buy back the ground from Whyte (at a profit for him and his backers)

 

Simples

 

This is the only type of strategy that I can see working. The big financial loser in this scenario is HMRC, but I don't know what, if anything, they can do to stop it?

 

The other obvious problem would be "New Rangers" being in the SPL, but that decision may rest with the SPL themselves, rather than the SFL or the SFA. Could this be done seamlessly, and would the remaining eleven teams vote for it? It may be in our interests to vote against it, and hope for a few years of second place!

 

It might also be in the interests of the teams worried about finishing bottom to vote against it, as if Rangers "disappear" from the SPL there would be no relegation that season.

 

Could that be connected to the seemingly increasing pressure on a ten team SPL, with increased "parachute" payments?

 

Or is that a conspiracy too far?

[Footballfirst]

This is the only type of strategy that I can see working. The big financial loser in this scenario is HMRC, but I don't know what, if anything, they can do to stop it?

 

The other obvious problem would be "New Rangers" being in the SPL, but that decision may rest with the SPL themselves, rather than the SFL or the SFA. Could this be done seamlessly, and would the remaining eleven teams vote for it? It may be in our interests to vote against it, and hope for a few years of second place!

 

It might also be in the interests of the teams worried about finishing bottom to vote against it, as if Rangers "disappear" from the SPL there would be no relegation that season.

 

Could that be connected to the seemingly increasing pressure on a ten team SPL, with increased "parachute" payments?

 

Or is that a conspiracy too far?

 

The only way I see HMRC getting their money back is to agree a long term repayment deal (with interest) say at ?5M a year or a %age of Turnover. That coud be a worst case scenario for Rangers as they end up with no stadium, having to pay rent and what would effectively be a large and crippling mortgage round their neck. That would limit their funding for player wages or transfers..

 

I'm certain that the SPL teams would vote them back. The TV deal will be held up as key, as it would lose value if there were no OF derbies, or so Neil Doncaster will tell us.

[Victorian]

does anyone know of a similar payment plan (football or otherwise) that HMRC have entered into? a 5-10 year plan? seems a bit out of the ordinary.

[zdrastvway]

HMRC will petition for winding up.

[The Gasman]

does anyone know of a similar payment plan (football or otherwise) that HMRC have entered into? a 5-10 year plan? seems a bit out of the ordinary.

 

It would certainly be unusual, but the pressures on HMRC to get their money (rather than "settle" for pennies in the pound) may actually force them to consider something like that.

[Victorian]

It would certainly be unusual, but the pressures on HMRC to get their money (rather than "settle" for pennies in the pound) may actually force them to consider something like that.

 

I'm thinking there could be potentially dangerous precedents being set in that scenario. Possibly something along the lines of all kinds of companies challenging for similar terms in order to settle their own liabilities.

[The Gasman]

I'm thinking there could be potentially dangerous precedents being set in that scenario. Possibly something along the lines of all kinds of companies challenging for similar terms in order to settle their own liabilities.

 

In the majority (if not all) of other cases, HMRC are a "preferred creditor", so have first call on any assets. My understanding is that football is unique in how it's treated, so maybe HMRC would be that bit more desperate to try to maximise their income (especially in the current political / financial climate) rather than being fobbed off with a couple of quid, while the football club carries on. Time will tell.

[Dusk_Till_Dawn]

does anyone know of a similar payment plan (football or otherwise) that HMRC have entered into? a 5-10 year plan? seems a bit out of the ordinary.

 

Before Leeds United went into administration in 2007, they were paying back HMRC at a rate of ?200,000 a month. But they missed payments for March and April and went into administration in early May after HMRC issued a winding-up petition (on the back of those missed payments). All the same, LUFC's debt to HMRC was declared at ?7.7million so it couldn't be said that the club were on top of that bill.

 

One point worth making (and I've bored people with this many times before) is that HMRC has completely lost patience with football clubs and, more specifically, the system of insolvent clubs repaying football debts in full while paying unsecured creditors a pittance. As I understand it, clubs can no longer rely on help or support from HMRC which has basically taken the view that it wants its money and will be as obstructive as possible if clubs are trying to dodge tax bills.

 

What can HMRC do if a club goes into administration and offers them a few pence in the pound? Not a great deal. BUT - and this is only based on my experience of how things work in England - Football League rules state that insolvent clubs must exit administration with a CVA approved by at least 75% or their creditors (that is to say, creditors who hold at least 75% of the debt). Since HMRC tends to be owed plenty of money by clubs, they often have a big enough perecentage of the vote to block or attempt to block a CVA. In the case of Leeds, their ?7.7m was about 20% of the total debt. I don't want to get too complex with the situation at Leeds, but basically HMRC did everything it could to bring down the CVA and ultimately succeeded through court proceedings. Leeds exited administration without a CVA and were therefore deducted 10 points for entering administration and another 15 for failing to exit administration with a CVA as per Football League rules.

 

So the question is this - does the SPL have the same rules on insolvency as the Football League and, if so, would that leave Rangers facing a huge points deduction if HMRC made it impossible to exit administration via an agreed CVA?

 

It's early in the morning so sorry if this is making your brain go soft....

[Geoff Kilpatrick]

I'm finding it amusing that Lieutenant Dan is rumoured to be selling them for ?1. What an ignominious end to an era that has trashed Scottish football in so many ways.

[Jamdub]

HMRC will petition for winding up.

 

The only sensible way to go..........

[Das Root]

In the majority (if not all) of other cases, HMRC are a "preferred creditor", so have first call on any assets. My understanding is that football is unique in how it's treated, so maybe HMRC would be that bit more desperate to try to maximise their income (especially in the current political / financial climate) rather than being fobbed off with a couple of quid, while the football club carries on. Time will tell.

 

Not any more. HMRC are the same as everyone else these days. It's only the value of the debt that makes them preferred in that sense on this occasion.

[Dusk_Till_Dawn]

Not any more. HMRC are the same as everyone else these days. It's only the value of the debt that makes them preferred in that sense on this occasion.

 

Correct. They're unsecured creditors like most normal punters. So, to hark back to Leeds United yet again, when they went into admin, Danny Mills was owed just over ?200,000 and HMRC was owed ?7.7m. Under Football League rules, Mills had to receive every penny he was owed, despite not having played for the club for four years or so. HMRC were initially offered 1p in the ?, which amounted to a grand total of ?70,000. And people wonder why HMRC is on the warpath.....

[Wotta Lad]

Regardless of the tax case - I think Rangers are going to get lucky financially and be better than many think.

 

If Whyte concludes the deal they will remove debt/interest payments to the bank quickly.

They are in pole position just now to have a crack at the Champions League.

 

The tax case is the major issue - I can see them getting around it through a repayment deal or a bank loan.

 

A quick search and the Scotsman has a story on the JJB sports deal. It expires in 5 years and brings in ?3mill a year - when it expires you'd expect Rangers would earn more than ?3mill per year from merchandising. A financial org may take a punt on Rangers over a 10 year loan if the JJB/Merchandising money was ringfenced.

 

I can see them getting away with murder - especially if they make it to the Champs League next season.

I couldn't help but read this in my head in Mysterions voice

[Deevers]

These "Technical Difficulties" seem to be taking an inordinate amount of time to resolve.

 

I wonder what they can possibly be?

 

[jamboinglasgow]

These "Technical Difficulties" seem to be taking an inordinate amount of time to resolve.

 

I wonder what they can possibly be?

 

 

Probably the Rangers directors trying to pick their jaws off the floor after Whyte has told them his real plans about cuts and no transfers. We are at the point where the directors are thinking up their excuses why they allowed it and Murray is about to kick them up the backside to force it through.

[269miles]

These "Technical Difficulties" seem to be taking an inordinate amount of time to resolve.

 

I wonder what they can possibly be?

 

 

His printing press is broken.

[Coburg Hearts]

There is no question of this Rangers takeover going through. The sticking point, as explained to me today, is an utter frippery.

 

Graham Spiers..........5minutes ago

[Coburg Hearts]

There is no question of this Rangers takeover going through. The sticking point, as explained to me today, is an utter frippery.

 

Graham Spiers..........5minutes ago

 

He has now said he left out the word "not" after "takeover", meaning it will definitely go through. What a farce.

[Das Root]

Probably the Rangers directors trying to pick their jaws off the floor after Whyte has told them his real plans about cuts and no transfers. We are at the point where the directors are thinking up their excuses why they allowed it and Murray is about to kick them up the backside to force it through.

 

 

More likely they are making sure they get their cut of the deal and power after it.

[Sawdust Caesar]

does anyone know of a similar payment plan (football or otherwise) that HMRC have entered into? a 5-10 year plan? seems a bit out of the ordinary.

 

I work for HMRC in the department that pursues outstanding debts and, as far as I'm aware, nobody will get that amount of time. We are pursuing the debts more vigorously than before and usually demand a substantial payment first before entertaining in to any time to pay arrangements (to avoid liquidation) and even then we would want the debt a lot sooner than 5 years. Not that long ago football clubs did get treated slightly differently to other Plc's but not any more.