Rangers' prospective new owner makes call to creditors
Last Updated: May 29, 2012 9:15pm
Ibrox: Rangers hope creditors will approve CVA at meeting on 14th June
Charles Green wants Rangers' creditors to approve the Company Voluntary Arrangement - despite not knowing precisely what they are being offered.
A 75 per cent majority, based on sums owed, is needed to pass the proposal which was issued by administrators Duff and Phelps.
Green's prospective ownership consortium has pledged £8.5million - £8.3million of which is a loan to be repaid back with interest by 2020.
In a statement released on the Ibrox club's website, it was claimed the final amount available to creditors could be in excess of £25million, depending on the outcome of litigation.
However, Duff and Phelps, who hold secure creditor status, have accrued operating charges and legal fees of over £5.5million which has to be paid while the outcome of a tax tribunal could send the club's debt above £134million.
"I fervently hope that creditors will form the view that the best interests of everyone will be served by Rangers continuing as the successful club it is and recovering as a business in the forthcoming seasons."
Charles GreenQuotes of the week
Charles GreenQuotes of the week
Consequently, the CVA document was unable to offer a 'pence in the pound' figure to creditors but in a statement Green asked them to think about the future of Rangers
when they meet to consider the plan at Ibrox on 14th June.
when they meet to consider the plan at Ibrox on 14th June.Milestone
He said: "Today is an extremely important milestone for Rangers to begin the journey back to where the club belongs - as a leading sporting institution that can hold its head high both on the field and off it.
"I have great sympathy with creditors, particularly small local businesses in the community around Ibrox, who have suffered in the lead-up to administration.
"However, I fervently hope that creditors will form the view that the best interests of everyone will be served by Rangers continuing as the successful club it is and recovering as a business in the forthcoming seasons.
"The consortium I am leading can only do so much to heal the wounds of the past, but we can do something about the future and that is where our main focus must lie.
"I hope creditors will approve this proposal and we can begin the task of rebuilding Rangers in earnest."
Paul Clark, from Duff and Phelps, was also sympathetic to the plight of the creditors as he asked for their help in getting the club back on track.
"We should remember there are many stakeholders who have suffered financial losses as a result of Rangers being placed into administration. Regrettably, there is no solution available that allows these parties to recover their losses in full."
Paul ClarkQuotes of the week
Paul ClarkQuotes of the week
Catastrophic
He said: "This proposal offers the best return for all stakeholders given the position the club is in. If approved by the creditors, the CVA proposal will rescue the club and finally enable the company to exit administration.
"Since our appointment, it has been our principal objective to propose a CVA, which is the preferred solution to what has been a catastrophic period for the club. That view is shared by everyone with Rangers' interests, and those of Scottish football, at heart.
"For some time, the prospect of presenting a CVA proposal with a realistic chance of success appeared remote. However, we are delighted now to put forward a solution which we think will take things forward as originally envisaged.
"We should remember there are many stakeholders who have suffered financial losses as a result of Rangers being placed into administration. Regrettably, there is no solution available that allows these parties to recover their losses in full.
"However, after a very intensive bidding process for the club we can now say that the offer being put forward as part of the CVA is the best solution available to creditors and we hope they will approve the proposal.
"Having issued the proposal, it is now a matter for the creditors to consider what is on offer and it is their decision entirely as to whether the terms of the CVA are acceptable."
The CVA proposal is being sent to approximately 400 trade creditors, over 6,000 fans holding debentures and all shareholders within the club.
If the plan is approved at the June meeting, there would then be a further 28-day cooling-off period meeting before Rangers could come out of administration.
If no CVA is agreed, Green plans to push through a newco purchase of the assets.
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