The Administration Thread

[Carnero]

5 minutes ago, Animal is a Ram said:

Two things - in excess of £40m, and, the £21.4m was using the 35% over three years calculation. As I put at the end of that sentence, this will drop slightly given others want to use 25% as it's cheaper.

Please read it all.

This.

Plus the fact that the administrator fees can be open to negotiation (hence Ashley's legal threats, probably) whereas Kirchner probably just accepted the whole bill.

[Comrade 86]

2 hours ago, Brailsford Ram said:

Please no, we are all suffering battle fatigue ?

Feel like I've skipped the 'battle fatigue' and headed straight to PTSD. 

[Macintosh]

2 minutes ago, Mostyn6 said:

the way MSD have been offering us cash, I would be confident that they will accept a restructuring of the loan/debts.

Only guessing though. I have no ITK. But if I was one of the bidders, I would (via the Administrators) ask if the MSD debts can be paid over 5-7 years, and not starting until next season. This would make the initial investment less. There's no rule that clubs mustn't be in debt, just that they must not be defaulting on those debts.

Except it comes at a huge cost, take Burnley as an example going this route: ALK Capital took out their £65m loan from MSD Holdings to finance the buy out and currently pay only interest – at 8 per cent – on it. The full amount is due to be repaid in 2025. That is £5.2m each year or £21m interest they will have paid. You can buy Pride Park for that and have your own car space!

[TuffLuff]

34 minutes ago, atherstoneram said:

Do you wonder why reputable journalists keep at arms length?

They are not going to comment on an administration which is in progress, if they report something which brings the process into question they would find themselves in front of a judge. People forget this is a judicial process.

Yeah, probs best for everyone to leave it alone actually.

Guys there a judicial process that we need to follow here! Probs best locking the thread until it’s done too?

[atherstoneram]

18 minutes ago, Phuket Ram said:

The MSD debt is £24m. This is cleared by whoever buys the stadium. Anything above that amount is used to pay football creditors, and then unsecured creditors like HMRC.
 

Others know more precisely, but I’d imagine it needs to be around £18-20m. But unsecured creditors can optionally be paid 35% of what they are owed through a 3 year repayment plan. Obviously this makes it more difficult to buy/loan/sign players as it is an ongoing expense. Similarly if the ground is leased - same problem (ongoing expense).

So we’re looking for a buyer to pay a total of around £42m to reduce unnecessary ongoing costs and avoid the points penalty.

We would also own the stadium again. 
 

Appleby is rumoured to have bid £40m. I don’t think that’s true, but if it was - I would take it. 

HMRC are not unsecured creditors.

[Animal is a Ram]

16 minutes ago, Curtains said:

Why are you assuming it’s in excess of 40 million offer !

'In excess of' were not my words. I'm not assuming anything - that way lies danger.

[jimtastic56]

1 hour ago, Unlucky Alf said:

What on earth is "mothing"? is it a sexual act between 2 consenting people under a lamppost at night? 

Bitty?

[duncanjwitham]

29 minutes ago, Animal is a Ram said:

Very much agreed, and it depends on how much stock you take in what various people have said - but let's break it down.

Taking things at face value:  

Nixon 'report' that new bidders are looking to do it cheaper by taking the 25% hit
Nixon 'report' EFL want creditors paid in that initial money within 10 days of completion

Appleby's 'in excess of £40m' would cover:
the £21.4m for creditors (as agreed under the CK 'deal') - assume this would drop using a 25% calculation
the £20.5m for MSD/Mel for the stadium.

See above. It would also be said that Ashley would look to buy the stadium outright too, given his quote in the Telegraph/Percy piece.

How can it possibly, given the numbers we know above? Also, the EFL will test for this, think there was a reference to £100m of funds in the early times of the CK interest? (Yes, I know about how useless the EFL have been...)

 

 

It's certainly a bit more obvious when you're talking about "a bid in excess of £40m" or whatever the quote is.  Obviously the Ashley reports of "£28m in a bank account" makes shuffling the pieces around a bit more complicated.  And we definitely had cases early on in the process were people were reporting "bids worth £Xm", which were including some funding injected into the club, so it's not completely impossible that bids are still including this.

Re the stadium, we seem to know that Appleby wants to buy it, but we don't know for sure that he intends to clear the whole MSD loan - it could be transferred over to the club as part of the takeover and paid back (in whole or part) over time, for example.

And even beyond the headline figures, if Appleby (and maybe Morgan too?) is scrabbling around for investors, some of whom might be abroad, he might have a higher bid, but riskier than Ashley with the money sat in a UK bank account.  

Honestly, my comment was probably as much about the people saying "Appleby has bid £40m, why haven't Quantuma accepted it yet" than your comment in particular.

[PistoldPete]

25 minutes ago, Alty_Ram said:

But having a football club that cannot field a viable side is surely just a money sink ? I agree that we will likely lose players and therefore have a lower bill but at what cost in terms of people's willingness to pay good money to see it ? We are struggling at all levels for viability. Our U23s got relegated because the have been heavily plundered to patch up the first team and have been just to give us a bench. As far as I can see our value continues to nosedive the longer this goes on because it is becoming a bigger and bigger task to rebuild with less and less playing asset.

The seven players we do have are extremely good players for a League one side. So the problem is not quality but quantity . 
 

if Rooney , Lawrence , roos,  Forsyth and a few others go that will save millions in wages which are already less than half what they were at the peak of Morris madness. 

[Red Ram]

1 hour ago, PistoldPete said:

But you are assuming that we have to do a deal before the start of the season. We don’t. We , or rather some very wealthy rams fans , May have to provide guarantees that the club can keep trading until  a buyer is found. 

You're right - I was assuming exactly that! If there are people prepared to do that it certainly puts things in a different light. I've seen rolling headlines to that effect on Sky but do we know for certain that there wealthy benefactor fans who are willing to bridge the gap?

Any such reassurance would be gratefully received?

[CornwallRam]

13 minutes ago, Mostyn6 said:

the way MSD have been offering us cash, I would be confident that they will accept a restructuring of the loan/debts.

Only guessing though. I have no ITK. But if I was one of the bidders, I would (via the Administrators) ask if the MSD debts can be paid over 5-7 years, and not starting until next season. This would make the initial investment less. There's no rule that clubs mustn't be in debt, just that they must not be defaulting on those debts.

Actually, there's another more likely option. No one, other than Mel, can buy the club whilst the MSD charge exists its cross security means that the club could be repossessed if Mel didn’t make the loan repayments. 

However, I think pretty much every owner we've had has borrowed against the ground. The new owners could buy the ground and instantly borrow against it. We could easily be back to Glick's, 'debt free other than the mortgage on the stadium' situation. 

[Premier ram]

10 hours ago, downsouth said:

For me there are two important outcomes for DCFC here: the first is the obvious one - just making it through this crisis.  The second is to find a way out of this that means that whoever comes out of this administration owning you isn't just a puppet for the previous regime (i.e. you've at the very least got a clear route to owning your own stadium/training ground, etc.)

I've seen too many clubs either threatened or ruined by shysters masquerading as saviours in recent years; including my own club on a few occasions unfortunately.  Ultimately it's fans like you or me that go through the grief/anguish worrying about whether we'll have a club to support.  At that point it becomes less about who we support; and more about the fact we're supporters of clubs that support our communities.

Keep fighting and stay proud.

Well said mate and thanks for your comments , good luck for the new season , hopefully the Rams and Pompey have something to celebrate at the end of it

[Mostyn6]

9 minutes ago, Macintosh said:

Except it comes at a huge cost, take Burnley as an example going this route: ALK Capital took out their £65m loan from MSD Holdings to finance the buy out and currently pay only interest – at 8 per cent – on it. The full amount is due to be repaid in 2025. That is £5.2m each year or £21m interest they will have paid. You can buy Pride Park for that and have your own car space!

that's the risk worth considering though. Restructure and free up money for squad improvements and hope to be in a better position (higher division) with bigger turnover/profit. Or pay as much now and have to find other ways to fund the squad rebuild.

Not sure the Burnley deal was the same as I am thinking of though. The MSD loan to us must've already had a repayment plan. The Burnley owners put the loan against the club to leverage the ownership, MSD quite cleverly put clauses in that relegation meant a quick repayment. Not sure any such clauses exist, save the Stadium being the collateral.

I believe the MSD interest rates were quite decent at the time. Whether a restructure at this stage would have crushing interest rates, who knows. BUT, it is worth having the conversation to see what options are available, especially if it means the initial bid investment can be less and satisfy the rest of the creditors.

[Phuket Ram]

6 minutes ago, atherstoneram said:

HMRC are not unsecured creditors.

They are mate. 

They are preferential unsecured creditors - which means they get to make the first agreement after secured creditors. 

[Premier ram]

                                

 

                                                           some of the fans on here, round and round and round , have a day off some of you

[Animal is a Ram]

7 minutes ago, duncanjwitham said:

It's certainly a bit more obvious when you're talking about "a bid in excess of £40m" or whatever the quote is.  Obviously the Ashley reports of "£28m in a bank account" makes shuffling the pieces around a bit more complicated.  And we definitely had cases early on in the process were people were reporting "bids worth £Xm", which were including some funding injected into the club, so it's not completely impossible that bids are still including this.

Re the stadium, we seem to know that Appleby wants to buy it, but we don't know for sure that he intends to clear the whole MSD loan - it could be transferred over to the club as part of the takeover and paid back (in whole or part) over time, for example.

And even beyond the headline figures, if Appleby (and maybe Morgan too?) is scrabbling around for investors, some of whom might be abroad, he might have a higher bid, but riskier than Ashley with the money sat in a UK bank account.  

Honestly, my comment was probably as much about the people saying "Appleby has bid £40m, why haven't Quantuma accepted it yet" than your comment in particular.

Sorry if my reply came across as a bit of an attack - it wasn't intended that way, more just a demonstration of my logic.

When so much of this is done behind closed doors, and quite rightly too, it's hard, nigh on impossible even, to compare offers, as you said. Just have to take each one on it's own merit.

[May Contain Nuts]

8 minutes ago, Premier ram said:

                                

 

                                                          

 

some of the fans on here, round and round and round , have a day off some of you

 

I am! Can't be bothered fending off the rabid horde for a few days, it's like trying to surf against a tsunami of groupthink (or rather group-not-think) and takes up too much energy.

Hoping the Mike Ashley Mind Control Drones have some malware installed on them in the meantime, but I won't hold my breath.

Also can't spend my entire working week not doing work, I'm probably 10 hours behind where I should be already.

 

Edited June 17, 2022 by Coconut's Beard

[duncanjwitham]

Just now, Animal is a Ram said:

Sorry if my reply came across as a bit of an attack

I didn't read it that way at all, but now you mention it... ?

[GB SPORTS]

1 hour ago, Elwood P Dowd said:

Neighbours finishing hardly counteracts all the bad things that @admira lists out in his dream but it does prove good things do happen ?? 

Rack off Bouncer !!!

[CornwallRam]

9 minutes ago, atherstoneram said:

HMRC are not unsecured creditors.

Technically, they are, aren't and they might be counted as such. ?

For taxes that the club collected from others, like VAT, PAYE and employee's national insurance contributions, they are a secondary preferential creditor.

For taxes that the club owes directly, like employer's national insurance or corporation tax etc, is is an unsecured creditor. 

Just to complicate things things further, I believe that the EFL are counting the whole HMRC debt as unsecured in the 25/35% rule. I don't think that's particularly relevant though, as I can't see HMRC accepting less and any deal needs their approval. 

I can't remember where I read it, but someone said that the HMRC deal is 25% now followed by another 25% over three years. I think (without checking) that the total is £36m, meaning we'd repay £9m upfront and another £9m over the next three years. No idea how true this is, but doesn't sound too far-fetched.