Danny 0 Posted March 7, 2012 Share Posted March 7, 2012 What happens to Craig Whyte? I thought he technically owned the club. I know he's not running it, but he is the owner. Wouldn't a sale have to kinda get his consent first...? 0 Quote Link to post Share on other sites More sharing options...
der Berliner 3,815 Posted March 7, 2012 Share Posted March 7, 2012 They way the admins talk about the sale it seems to me that he has next to no say in it. Why that is the case I don't know, but the way the admins go about their business appears them having all the power to do it. 0 Quote Link to post Share on other sites More sharing options...
calscot 0 Posted March 8, 2012 Share Posted March 8, 2012 (edited) I'm not knowledgeable on this but they way I interpret administration is that a company is deemed unable to pay its short term liabilities and so will fail. Whoever is running the club is deemed incapable of turning round the business and indeed not trusted, due to self interest, to take proper care of the creditors' best interests. The court therefore removes whoever is running the company from control and appoints competent, independent administrators who have control of the company as well as extra powers like that of CVA's and cancellation of contracts. They try to cut costs and run the company more efficiently and often just more competently - streamlining systems, cutting excess staff, cutting unnecessary expenses, selling assets and leasing them back, selling assets that are not needed for core business, closing loss making or non immediate income generating operations (say research), out sourcing inefficient operations etc, etc. Ultimate powers are to sell the company as a going concern if the creditors are agreeable to the terms ie how much they get, or if no solution can be found, they can and must liquidate the company ie it completely ceases to exist and its assets are auctioned off and the proceeds put into a pot to be split by the creditors. The end. In the latter scenario, someone could offer a greater amount for the main assets , pay for them, then start a company and change its name to a similar one to before and start to trade in place of the previous company without assuming any of the previous liabilities as it is a new and separate company. I believe this would only happen if the amount paid for the assets is more or equal to splitting them up and used for whatever reason. Therefore we are lucky that Ibrox is in a bit of a shit area of little commercial value and its main value is as a football stadium but only if there is a club to fill it. Otherwise any potential phoenix company would have to outbid any developers. I'm not sure where MP falls in this scenario. The type of money that liquidation would raise needs to be calculated and shown to creditors that they would be paid more under a CVA if that would allow the company to continue to trade - ie it would be as much as the company could afford but still be able to trade for another year and the debt is then wiped. Selling the club gives a pot of money to pay for the CVA. There are complications over which creditors get priority which is what is being argued about a lot - with Whyte considered number one even though he hasn't put a penny in. That greatly affects how the other creditors will vote as many would receive nothing under liquidation as the money would already be gone by the time it comes to their turn. A lot of the time liquidation doesn't matter too much as it's just one failed company in a competitive market place, but sometimes companies have austere histories that some want to keep intact - which I would think puts them in a weaker position as they will go the extra mile to avoid liquidation. If you take our position, but remove the tax cases and give us a "normal" rich owner. What would happen is that we have something like a 5M shortfall. The owner would most likely borrow from the bank and guarantee it with one of his companies to get us the credit. Liabilities would be met and then costs cut to put the company on an even keel or new sources of revenue found, or if it's a one off the debt could be cleared by a share issue. Our spanner in the works is the big tax case which if we're solvent could cost us say £50M which we would be unable to meet and continue to compete unless given something 25 years to pay - but it has been rumoured that HMRC would not allow that and that's why we're in this position. And why no-one wanted to buy us. The rest about how CW took advantage is already well explained. The thing is that either CVA or liquidation will also clear the big tax bill if there is one and eliminate all other debt which makes others now interested in us if the deal is sweet enough. So yes, in answer to the question, I'm pretty sure that the administrators have the power of sale with no regard to Whyte except as a creditor. Edited March 8, 2012 by calscot 0 Quote Link to post Share on other sites More sharing options...
54andcounting 0 Posted March 8, 2012 Share Posted March 8, 2012 In relation to Danny's question about Craig Whyte still being the owner....back in February as we all know Whyte announced the club was going into administration within two weeks, HMRC came in immediately with a 3.30pm deadline on that day for Whyte to name in HIS administrators, he did so. The judge agreed to them. So in that context does Whyte not still actually have a say at the end of everything? I think that is what Danny is asking. 0 Quote Link to post Share on other sites More sharing options...
forlanssister 3,114 Posted March 8, 2012 Share Posted March 8, 2012 . There are complications over which creditors get priority which is what is being argued about a lot - with Whyte considered number one even though he hasn't put a penny in. That greatly affects how the other creditors will vote as many would receive nothing under liquidation as the money would already be gone by the time it comes to their turn. Whyte is not "number one" creditor that honour is held by Close Leasing by virtue of the fixed charge they insisted upon when Whyte mortgaged off the catering income. 0 Quote Link to post Share on other sites More sharing options...
Zappa 0 Posted March 8, 2012 Share Posted March 8, 2012 Whyte is not "number one" creditor that honour is held by Close Leasing by virtue of the fixed charge they insisted upon when Whyte mortgaged off the catering income. Should the administrators not have told us about this by now? 0 Quote Link to post Share on other sites More sharing options...
der Berliner 3,815 Posted March 8, 2012 Share Posted March 8, 2012 Should the administrators not have told us about this by now? I think they will tell it to all interested parties, but not to the public. 0 Quote Link to post Share on other sites More sharing options...
Calgacus 8 Posted March 8, 2012 Share Posted March 8, 2012 To answer the original point, the administrators can sell the assets and the business, but they can't sell the Limited Company - Whyte owns the majority of the shares, so unless someone can get these shares off him, then we are talking about a new company taking over the business and the existing limited company presumably going into liquidation. It is a scenario that brings its own problems with it. 0 Quote Link to post Share on other sites More sharing options...
Gers4Life 0 Posted March 8, 2012 Share Posted March 8, 2012 I hope it's a big rich sheikh from Dubai who gives Craig Whyte 1p and tells him to fuck off 0 Quote Link to post Share on other sites More sharing options...
der Berliner 3,815 Posted March 8, 2012 Share Posted March 8, 2012 To answer the original point, the administrators can sell the assets and the business, but they can't sell the Limited Company - Whyte owns the majority of the shares, so unless someone can get these shares off him, then we are talking about a new company taking over the business and the existing limited company presumably going into liquidation. It is a scenario that brings its own problems with it. But these share are not tradeable right now, are they? On a sidenote, what was the prize for these shares? 1 pound? 0 Quote Link to post Share on other sites More sharing options...
Recommended Posts
Join the conversation
You can post now and register later. If you have an account, sign in now to post with your account.