The Administration Thread

[strawhillram]

Just now, Jimbo Ram said:

The minimum it would take….c30 mill ?

So £29m or do would mean 15, therefore only  £1m or do extra to earn 15 points back

[CornwallRam]

29 minutes ago, Carnero said:

£27m-£30m to avoid the -15.

Who knows what Kirchner had bid, probably closer to £20m.

Surely that depends on  HMRC? Isn't it more like £27m to £47m?

[Carnero]

6 minutes ago, CornwallRam said:

Surely that depends on  HMRC? Isn't it more like £27m to £47m?

Yes, depends on HMRC, assuming they'll receive a preferential rate around 33%.

[duncanjwitham]

54 minutes ago, Tyler Durden said:

Am totally lost. Am reading that his bid won't be enough to avoid us being deducted 15 points. Which if true means there is another minimum cut off level to make an acceptable bid to the administrators but which doesn't satisfy the EFLs creditors rules. 

We basically have to pay football creditors in full, Quantuma’s fees in full (just their actual fees though, not the £10m listed above), and then pay the remaining unsecured creditors enough that they think it’s a better deal than liquidation. That’s the absolute minimum threshold to exit admin and stay a league member. That’s assuming the MSD loans are dealt with somehow (Morris carries on paying the interest for now, or council buy pride park etc).

[Tamworthram]

11 minutes ago, duncanjwitham said:

We basically have to pay football creditors in full, Quantuma’s fees in full (just their actual fees though, not the £10m listed above), and then pay the remaining unsecured creditors enough that they think it’s a better deal than liquidation. That’s the absolute minimum threshold to exit admin and stay a league member. That’s assuming the MSD loans are dealt with somehow (Morris carries on paying the interest for now, or council buy pride park etc).

24 minutes ago, Carnero said:

Yes, depends on HMRC, assuming they'll receive a preferential rate around 33%.

Am I right in thinking that, because they rank as preferential creditors, HMRC have to be repaid in full before any funds are available for lower ranking creditors such as non football unsecured creditors? I thought that was how the ranking of creditors worked. Or is it the case that HMRC could be offered a “preferential rate” and other creditors a lower rate as I think you’re suggesting?

[duncanjwitham]

4 minutes ago, Tamworthram said:

Am I right in thinking that, because they rank as preferential creditors, HMRC have to be repaid in full before any funds are available for lower ranking creditors such as non football unsecured creditors? I thought that was how the ranking of creditors worked. Or is it the case that HMRC could be offered a “preferential rate” and other creditors a lower rate as I think you’re suggesting?

I think (not an expert…) that the preference only directly applies in the case of liquidation. In the case of a CVA, or similar, creditors can theoretically agree to whatever they want. Obviously the preference drives what they might agree to though.

[Carnero]

6 minutes ago, Tamworthram said:

 

HMRC are entitled to a preferential rate, compared to the other unsecured creditors, not necessarily 100%.

[Tamworthram]

3 minutes ago, Carnero said:

HMRC are entitled to a preferential rate, compared to the other unsecured creditors, not necessarily 100%.

Mmm. I'm happy to take your word for it but I thought the concept of preference related to the order they have to be paid rather than the rate they are offered. Maybe, as @duncanjwitham suggests, it's different for a creditors agreement than in liquidation.

[CornwallRam]

My understanding is that HMRC have to be paid after the administrators and any fixed charge secured creditors. They are entitled to 100%, but also have the power to waive or defer any proportion of the debt that they see fit.

Without HMRC agreement, there can be no CVA or Creditor agreement. I'm not sure about a court imposed restructuring plan  though.

 

[jono]

14 hours ago, kevinhectoring said:

Certainly agree with that. But I’d rather MM did a deal with CK before 7 May than a desperate deal with the City at the 11th hour.  Can’t believe the City is exactly nimble when it comes to this sort of thing. 

Shame they’ve signalled they might step in is all I’m saying 

In the short term I am not worried about the stadium. Mel needs income from it. It surely can’t be difficult to establish a reasonable rent to new owners. Longer term, I’d much rather the council bought it and the club pays the council. In a way it helps the fans “own” the fabric of the club. This can take its time while the council do their stuff - or Mel hurries them along by reducing the price ! 

[Bubbles]

?

 

[B4ev6is]

4 minutes ago, Bubbles said:

?

 

Or perhaps that he needs to keep private for now until the deal is done here.

[Bubbles]

2 hours ago, B4ev6is said:

Or perhaps that he needs to keep private for now until the deal is done here.

Hopefully, B4. I just find it kind of strange how this gentleman asked him a genuine question, especially one that has come out after Preston’s recent statement, and has decided to block him

[Oldben]

6 hours ago, jono said:

In the short term I am not worried about the stadium. Mel needs income from it. It surely can’t be difficult to establish a reasonable rent to new owners. Longer term, I’d much rather the council bought it and the club pays the council. In a way it helps the fans “own” the fabric of the club. This can take its time while the council do their stuff - or Mel hurries them along by reducing the price ! 

Does the council have the budget.

Many councils are financially struggling plus does that mean a temporary reduction in services for disadvantaged groups until the income comes in from the stadium.

Would the council need to take the risk of a very large loan.

It might be better to find a someone willing to risk acquiring the ground.

[Oldben]

6 hours ago, Bubbles said:

?

 

Possibly, he's under some kind of legal restriction where he can't discuss such things without litigation.

[jono]

57 minutes ago, Oldben said:

Does the council have the budget.

Many councils are financially struggling plus does that mean a temporary reduction in services for disadvantaged groups until the income comes in from the stadium.

Would the council need to take the risk of a very large loan.

It might be better to find a someone willing to risk acquiring the ground.

I don’t know if it is still done but local authorities have for years raised money by selling fixed interest bonds to the general public. Effectively offering modest but safe none speculative returns slightly better than a building society. I am pretty certain The council could easily buy the stadium as their credit is good and rental income would exceed borrowing costs .. it’s buy to let on a bigger scale and pretty safe. 

[FlyBritishMidland]

Interesting that PNE have put out a statement and it seems a PNE fan has asked him about it.  Maybe they should read the Q&A……

When asked about why he pulled out of purchasing Preston North End he said

“Let’s do a hypothetical here… Ever buy a car? If someone raises the price halfway through the deal by 10% over what you agreed then wants to force you to buy options and packages you don’t want/need with the car, would you buy it?”

“We started comparing every other club to Derby in terms of infrastructure. The other clubs we looked at needed significant improvements to produce players through the academy at the level we want long term.”

He never said the price went up by 10%, he gave a hypothetical example.  He talks about the infrastructure, etc and I think some posters talked about buying land for the PNE academy.  Rather than the actual purchase price, maybe it’s things like this that were added in/discovered during due diligence that increased his investment.  Maybe not at the time of initial purchase but in the months/years following.  That probably made us more attractive as in our case it already in place, just needs to be maintained.  To use his car analogy, for us, he doesn’t need to buy the car, just keep it serviced.

[CBRammette]

5 hours ago, Bubbles said:

Hopefully, B4. I just find it kind of strange how this gentleman asked him a genuine question, especially one that has come out after Preston’s recent statement, and has decided to block him

There are loads of nasty comments from PNE fans under his tweets so perhaps he just had enough and blocked them all. His twitter his choice. Why does everything have to be a big conspiracy? 

[Crewton]

The problem with engaging personally with fans on social media is that they suddenly think that they as individuals are your special friend to whom you owe total candour. 

There's clearly reasons why Kirchner pulled out of the deal with PNE but if there's confidentiality issues I can understand why he's clammed up. It was probably a mistake to engage with them in the first place. 

There's clearly concern among DCFC fans though about whether he has the chops to complete the deal for the club this time and he needs to concentrate on providing surety on that rather than spend time engaging with every fan who wants to feel special. 

[CBRammette]

23 minutes ago, FlyBritishMidland said:

Interesting that PNE have put out a statement and it seems a PNE fan has asked him about it.  Maybe they should read the Q&A……

When asked about why he pulled out of purchasing Preston North End he said

“Let’s do a hypothetical here… Ever buy a car? If someone raises the price halfway through the deal by 10% over what you agreed then wants to force you to buy options and packages you don’t want/need with the car, would you buy it?”

“We started comparing every other club to Derby in terms of infrastructure. The other clubs we looked at needed significant improvements to produce players through the academy at the level we want long term.”

He never said the price went up by 10%, he gave a hypothetical example.  He talks about the infrastructure, etc and I think some posters talked about buying land for the PNE academy.  Rather than the actual purchase price, maybe it’s things like this that were added in/discovered during due diligence that increased his investment.  Maybe not at the time of initial purchase but in the months/years following.  That probably made us more attractive as in our case it already in place, just needs to be maintained.  To use his car analogy, for us, he doesn’t need to buy the car, just keep it serviced.

Yes exactly and he probably just really liked everything about the first car and finding the price had been lowered a little or the previous owner was out of the picture so he could buy the dream car was straight back in there.  

I dont mean you at all with these questions FBM but I am not blindly in favour of him, after Mel probably will never trust an owner again really, but why are some of our fans trying so hard to undermine him and get him to withdraw as PB? At least give him a chance. Remember the opinion of Wayne as manager initially? Remember the opinion of Mel as owner initially? How right we were!! Or are some so hellbent on another buyer who could have become PB at any point between December and now if they had actually wanted to, that they will not accept the only one who seems to want to actively take us on? It may be a disaster but it might not