Derby County Administration (with the slight possibility of Liquidation still there)

[Charlie George]

I see the club adverts aren't on here anymore. 

[CornwallRam]

6 minutes ago, StarterForTen said:

Hmmmm. So of that £50m black hole, £30m is owed to HMRC, who are not a preferential creditor - they'll be lucky to get 25% of that.

I'm not saying that is a good thing - its abhorrent to shirk responsibility to the public purse - but I can't help feel there are plenty keen to paint a darker picture than it might actually be in reality.

Taking on debts of circa £35m for Derby as a League One club wouldn't, in my opinion, preclude a sale. There is a crop of young talent that, in the right selling conditions, might cover a lot of that over the next few years.

The rules changed last year, we now have to pay back HMRC in full as part of a CVA.

[Spanish]

1 minute ago, Charlie George said:

I see the club adverts aren't on here anymore. 

there is a thread on this

[Carnero]

Do we know for sure that Mel Morris won't fund the administrator in the short term?

[StarterForTen]

 

7 minutes ago, CornwallRam said:

The rules changed last year, we now have to pay back HMRC in full as part of a CVA.

I thought they had earned 'Crown Preference' status from April last year? That just means they get first dibs of what is in the pot after the football creditors have been paid. Probably gives them a bit more sway on the value of the CVA terms but highly unlikely to get them payment in full.

For example, Buyer offers £20m to the Administrator for the business. £10m is needed to clear the football creditors, leaving £10m to service the £30m HMRC debt and £10m unsecured creditors debt. That would mean all £10m would go to HMRC (if they were prepared to take 33p in the pound) and the unsecured creditors get bob-all.

Of course HMRC might reject the CVA terms (and as the biggest unsecured creditor that would have some sway) but they will also know that a liquidation would probably follow if they do and that would net them bob-all as well.

[RoyMac5]

Post stolen from Popside:

"The positives are that revenues pre COVID were £30 million. if we had stayed up this year then next year our losses would have been zero with existing staff. That’s as a Championship club sky is the limit in the premier if we ever were to return again.

So debt of £60 million compared to £30 million revenues so only twice income , less than people borrow for their mortgages.

We have a crop of promising youngsters playing for us plus another crop coming through plus two polish internationals who would fetch a fair few Bob in normal circumstances.

Plus I think PPS will come back into the equation as a buyer of the club would probably want to buy the ground too ."

Too positive? 

[Sparkle]

10 minutes ago, StarterForTen said:

 

I thought they had earned 'Crown Preference' status from April last year? That just means they get first dibs of what is in the pot after the football creditors have been paid. Probably gives them a bit more sway on the value of the CVA terms but highly unlikely to get them payment in full.

For example, Buyer offers £20m to the Administrator for the business. £10m is needed to clear the football creditors, leaving £10m to service the £30m HMRC debt and £10m unsecured creditors debt. That would mean all £10m would go to HMRC (if they were prepared to take 33p in the pound) and the unsecured creditors get bob-all.

Of course HMRC might reject the CVA terms (and as the biggest unsecured creditor that would have some sway) but they will also know that a liquidation would probably follow if they do and that would net them bob-all as well.

If the EFL had allowed us the £8 million in January the HMRC would have already had that 

[QuitYourJibbaJivin]

27 minutes ago, Carnero said:

Do we know for sure that Mel Morris won't fund the administrator in the short term?

Wouldn’t that negate the very (very) few positives that admin brings? If Mel was to fund the admin, there would be no point putting us into admin and incurring a 12 point deduction. Also if Mel was funding the admin, any buyers he spoke about would just sit back and let him cover the bills for a few more months. 

[kevinhectoring]

2 hours ago, RoyMac5 said:

Do you think they've done any *real* research? They're probably using quoted figures or 2018 accounts!

Exactly. Plus, players on high wages who are not marketable will be told: you’re out the door unless you agree to a pay cut 

But MSD interest is probably now at an eye watering figure 

[Carnero]

15 minutes ago, QuitYourJibbaJivin said:

Wouldn’t that negate the very (very) few positives that admin brings? If Mel was to fund the admin, there would be no point putting us into admin and incurring a 12 point deduction. Also if Mel was funding the admin, any buyers he spoke about would just sit back and let him cover the bills for a few more months. 

Not if it wasn't revealed to potential buyers.

[Malagaram]

On 18/09/2021 at 17:07, Spanish said:

Err explain a bit more because the club don’t own either

It seems to me a very bad state of affairs when 50,000 supporters can lose their Saturday entertainment through the ineficiency of the clubs owner in running the club beyond his means.

Also when the said owner tells the clubs fans he has pumped in 200 million into the club,does he not realise that so many fans have paid for season tickets,and match tickets they could properly afford.Morris should be put into administration,his riches stripped from him,and used to pay his debts(no it is not the clubs debt,Morris was the one who got us into this mess.

I wonder how he can sleep at night when tomorrow he will be telling many people they will at best be paid for less hours and at worst they will be loosing their jobs

[MackworthRamIsGod]

2 hours ago, BramcoteRam84 said:

The Athletic article is a good one worth a read but the figures are off. They say wage bill of £2.5m per month nearly half of what it used to be. That implies our wage bill was £60m a year which it has never been, £47m at peak. Mel is saying £1m-£1.3m a month, that’s either true or he’s lying but it would make sense considering the players that have departed. It could all be wages maybe not as other debts but also we do have revenue streams back online. Selling out on match days will help significantly. 
 

The biggest most worrying revelation in the article is who the administrators are. Andrew Hosking who was involved in the Wimbledon to MK Dons administration and the concerning one Andrew Andronikou who was involved in the first Portsmouth administration. The article says Portsmouth were back in admin 2 years later, however a Pompey fan has commented on the article saying Andronikou is an awful man has been sanctioned by his own governing body for misconduct. When Portsmouth went back into admin he was there again and HMRC had to fight to get him removed as administrator before the court appointed Trevor Birch. 

They also said the HMRC bill is close to 30 million, it was reported at 26 million yesterday. But if they are rounding up that one debt by 4 million, what else are they inflating for the sake of an even more negative slant on our situation.

 

[Malagaram]

1 minute ago, Malagaram said:

It seems to me a very bad state of affairs when 50,000 supporters can lose their Saturday entertainment through the ineficiency of the clubs owner in running the club beyond his means.

Also when the said owner tells the clubs fans he has pumped in 200 million into the club,does he not realise that so many fans have paid for season tickets,and match tickets they could properly afford.Morris should be put into administration,his riches stripped from him,and used to pay his debts(no it is not the clubs debt,Morris was the one who got us into this mess.

I wonder how he can sleep at night when tomorrow he will be telling many people they will at best be paid for less hours and at worst they will be loosing their jobs

should read could not properly afford

[Grumpy Git]

An observation regarding administrators;

business X has not enough cash to pay it's debts yet administrators charge eye-watering amounts per hour for their services (£500/hr senior staff and £150/hr for an office clerk not uncommon) and THEY ALWAYS GET PAID, go figure!

[atherstoneram]

4 minutes ago, Grumpy Git said:

An observation regarding administrators;

business X has not enough cash to pay it's debts yet administrators charge eye-watering amounts per hour for their services (£500/hr senior staff and £150/hr for an office clerk not uncommon) and THEY ALWAYS GET PAID, go figure!

If business X had been run correctly in the First place there would be no need for administrators to be brought in.

[Grumpy Git]

1 minute ago, atherstoneram said:

If business X had been run correctly in the First place there would be no need for administrators to be brought in.

What I'm trying to say, is despite the business not being able to pay their debts, there's always a few grand down the back of the sofa for the administrators invoice, while Joe Bloggs the local plumber gets bugger-all.

[Spanish]

13 minutes ago, Malagaram said:

It seems to me a very bad state of affairs when 50,000 supporters can lose their Saturday entertainment through the ineficiency of the clubs owner in running the club beyond his means.

Also when the said owner tells the clubs fans he has pumped in 200 million into the club,does he not realise that so many fans have paid for season tickets,and match tickets they could properly afford.Morris should be put into administration,his riches stripped from him,and used to pay his debts(no it is not the clubs debt,Morris was the one who got us into this mess.

I wonder how he can sleep at night when tomorrow he will be telling many people they will at best be paid for less hours and at worst they will be loosing their jobs

that's the basic concept of corporate separate legal identity with a limited company having a limit on owner exposure

[atherstoneram]

1 minute ago, Grumpy Git said:

What I'm trying to say, is despite the business not being able to pay their debts, there's always a few grand down the back of the sofa for the administrators invoice, while Joe Bloggs the local plumber gets bugger-all.

Yes i know what you mean,it's always the little man that finishes up on the wrong end of the pile,personally i think Joe Bloggs etc have already been impacted by the clubs situation. If we can't pay HMRC i doubt the small businesses have seen any money either.

[Grumpy Git]

3 minutes ago, atherstoneram said:

Yes i know what you mean,it's always the little man that finishes up on the wrong end of the pile,personally i think Joe Bloggs etc have already been impacted by the clubs situation. If we can't pay HMRC i doubt the small businesses have seen any money either.

Exactly, the RoadRider bus being the most obvious example.

I've no doubt that some suppliers will have unpaid invoices going back 6 or even 12 months, I've been there myself.

Edited September 21, 2021 by Grumpy Git

[atherstoneram]

55 minutes ago, Sparkle said:

If the EFL had allowed us the £8 million in January the HMRC would have already had that 

The HMRC issued a winding up order in Jan 2020, Covid didn't begin to have an impact until 13th March 2020 when the EFL decided to suspend the league so i don't see how the club can blame Covid for the HMRC situation.