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Friday, March 30, 2012

Rangers liquidation inevitable?

A week has passed since my previous post on the subject, and yet the Rangers situation remains as clear as the toilet bowel of a cholera sufferer.

The story this week has mainly been about the potential buyers - who have in general shown their enthusiasm for taking over Rangers with quotes along the lines of “I’d be the first to step aside if anyone with really deep pockets comes forward and wants to do a deal on their own” (Paul Murray) and “I hope to get something in by Friday purely as a fallback for the administrators, should the other bids fall over or not be acceptable” (Brian Kennedy). As one Twitter user suggested to me, they seemed to be fighting each other to get to the back of the queue!

So, as of yesterday, Kennedy appears to be out. An Evening Times article suggested his bid for the club was around £5 million compared to the £10 million Murray and his Blue Knights consortium have apparently offered; both of these offers seem to be dwarved by the mysterious Americans known as Club 9 Sports who appear to be offering £25 million. There is sufficiently little detail known about the bid from the far east that it seems fair to dismiss them as insignificant. In fact, considering some of the guff that has been spouted from Ibrox in the last 6 months, I wonder if they even exist.

None of these offers seems particularly palatable. It may be just as well for Rangers that Kennedy is out of the picture. His derisory (compared to his opponents) offer, coupled with his apparent reluctance to bid, suggests he was simply a chancer hoping to snatch the Gers on the cheap. Kennedy is best known as the owner of rugby side Sale Sharks; what has only briefly touched upon by the press up north is his antics during his previous ownership of a football club. Stockport County were bought by Kennedy in 2003. He instantly moved Sharks to their Edgeley Park ground, making Stockport "second-class citizens in their own home", according to Oliver Holt of the Daily Mirror.

Kennedy sold the club back to a Supporters Trust in 2006, claiming he had lost £4 million. But he retained ownership of the ground, and kept picking up his rent payments as the team plunged down the administration route. This was partly because the trust had the business sense of a snowball salesman in hell, but partly because Kennedy had convinced them to agree to a deal where he got 30% of transfer dealings, more than £1 million of hospitality profits. The accusation from many Stockport fans is that the rugby club thrived, while the football team crumbled. Classy bloke, by all accounts.

Paul Murray's group has the populist support, as well as plenty of positive press. But it is a bid with a lot of baggage. Murray, of course, was a director at Rangers at the time of Whyte's takeover. Though he left that role shortly afterwards, SFA rules suggest that anyone who was "director of a club in membership of any national association within the five-year period preceding such club having undergone an insolvency event" is not permitted to become the director of another club. Craig Whyte, for reasons that are unclear (it may even be out of spite), has inferred that he won't sell to Whyte. In addition, one of the main backers of the Blue Knights, businessman Dave King, is being chased by the South Africa taxmen over £227 million he apparently owes; as a result of this, he is under a restraining order regarding dealing with property in Scotland. From one (alleged) tax dodger to an other (alleged) tax dodger...

As for the Americans, they have made it clear that their intention is to liquidate Rangers, not rescue them, a suggestion that understandably has set up alarm bells around Ibrox. Their intention, presumably, is to start a phoenix club or 'newco', keeping the Rangers name and heritage but dumping all the debt. Certainly I can't see how the HMRC would be agreeable to that, and I understand the law now allows them to pursue newcos for previous debts, if it is obvious that they have been set up just for the purpose of dodging creditors.

From a footballing point of view, though, liquidation is what the suits in the SPL and the SFA are dreading. Of course, we have precedent in the form of Gretna. They were liquidated and the subsequent phoenix club had to re-apply to enter the SFL at the bottom (they, of course, were unsuccessful). And of course if it were, say, Inverness Caley Thistle who were in this mess, then the outcome would be very straightfoward - i.e. the same as Gretna.

But surely they wouldn't dare do that to Rangers, would they? Something to think about, since liquidation now is far from a hypothetical outcome. But we'll know more by the middle of next week, as Duff and Duffer - sorry, Duff and Phelps - have announced next Wednesday as a deadline for bids. Except that they did exactly the same thing a few weeks back...and here we are. So don't hold your breath...

L.

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