[You must be registered and logged in to see this link.] wrote:
Let’s not count out administration - as things stand it’s still the most likely outcome for me.
Loads of posturing and gamesmanship going on at the moment and the hard nosed players involved don’t lose their nerve very easily.
Suspect we’re far from out of the woods just yet
I don't really know where we stand on Administration?What do we know?
- Someone has to put us into it
- Somebody has to pay the running costs whilst we are in it.
- Someone has to pay to meet the EFL's criteria to come out of it.Who can put us in it?
- According to Rigby at the ST, just Davies estate and HMRC but that's clearly wrong.
- The owner (Anderson still is I presume) can, and according to Howard,
- So too can outstanding creditors such as Warburton and James and/or substitutes to the two outstanding winders, such as for instance Macron (sportswear) or the house builder, etc.What does it cost to be in Admin?
- Well how long is a piece of string? It obviously depends on the length of time the club is in Admin - it could be days, it could be months, several months!
- Rigby stated it would cost around £750k (but he also said that was not including wages.
- Howard says it would be around £1m per month for about 3 months.What does it cost to come out of Admin?
- Howard tells us that the EFL rules and regs requires all secured creditors to be paid in full (so that's James, Warburton and Anderson) and everyone else a minimum of 25% - people like HMRC, the Town Hall, Heathcote (if they already haven't been paid?), etc, etc. Howard suggested that would be around £20m (iirc?).Why would people NOT put us in Admin?
- Well people on the winders such as HMRC want a fixed one off amount (£1.2m) so there's no point in them pushing for Admin if the costs to do so would be more to them than simply getting their full amount owed to them back from liquidation.
- A logical argument also could be made for James and Warburton as per the HMRC point above - but they could also turn their money owed into putting equity into the club itself - and thus reduce the cost of coming out of Admin by up to those amounts (James £5.5m, Warburton £2.5m). Whether they would do so is another matter and even if they did would whoever is buying the club from Admin still have enough to cover all the other outstanding liabilities as well ongoing wages and showing proof to the EFL to fund next season (I have in my mind from somewhere that new owners had to provide proof of funds to keep the club going for three seasons - but maybe I've made that up?)
- Eddie's estate, on the basis that to put the club in Admin they have to reclaim ownership of it from the outstanding debt on the load secured against Anderson's share ownership shares. Taking the club back also means taking on ALL THE debts as well. Hardly likely to do that unless they had an immediate buyer, which leads me on to my next point...Company Voluntary Agreement's (CVA or Pre Pack Administration).
- This is basically when someone gets all the creditors agreement for the company to go into Admin and immediately come out of it again as everybody has agreed to what they will settle for as per the penny in the pound owed to them. Howard explained that the EFL no longer allows that. I think this is where the rule about secured creditors receiving 100% owed to them and a minimum of 25% to unsecured comes from.
- If however CVA CAN meet those targets then I guess going down the CVA route would be permissible with the EFL?Other Odds and Ends
- Hillary at the last Winder pleaded that if necessary the judge put the club in Admin rather than liquidate it? I can only assume that implied Anderson (as owner) would fund the club whilst in Admin - which considering all the non payments mounting up, seemed a bit contradictory - so something more technical that I don't understand must be available to the judge to act on?
- Ken claimed he was going to put the club into Admin so Team Basran could buy it - just before Bassini did! How convenient and all that. Was it true, could he have done so? I guess so. He was (is?) still the owner and if someone went down the CVA path and the EFL is happy with it, then why not?
- Even if Bassini does become the owner I guess there's nothing stopping him putting the club into Admin - even on the day EFL gave him permission! It would look very bad though!
- Does Ken want anybody looking into his dealings if Admin/Liquidation happens as Howard implied a lot of 'creative' accountancy at work shall we say! Not to say there has though or that anything at all is untoward under his ownership.
I'm non the wiser myself after putting all this down in words as to if we possibly would/would not go into Admin anytime soon but at least I've listed things as best as I can as to the options there are, as I understand them to be.