Plenty of inconsistencies but similarities just as worrying

Sports writer

Wednesday 30 May 2012

The Rangers support is exactly where Charles Green wants them to be: too worried that the club might be liquidated to challenge his intentions.

Fans queried Bill Miller but have accepted Charles Green unthinkingly. Picture: EPA

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Richard Wilson

Twelve months on from Craig Whyte buying his majority shareholding for £1 and leaving the club in debt to his Wavetower group, Green and his consortium are about to buy Rangers for £2, and leave the club in debt to Sevco, their holding company. The similarities should be enough to raise indignation among fans, but instead there is only uncertainty.

The mood is one of fatigue. Supporters have become drained by the endless setbacks and Green's pursuit of a Company Voluntary Arrangement had offered a rare moment of hope. Yet that should have been countered by the contents of the CVA Proposal published yesterday. Green's £8.5m offer is a loan, to be paid back by or before 2020, with interest thought to be 8%. So Rangers will come out of administration in debt, even although two weeks ago Green pledged that the club would never be in debt again.Inconsistencies have become the hallmark of Green and administrators Duff & Phelps. When the deal was first announced, the Englishman spoke of a consortium of 20 investors, only to admit later that "five or six" were involved. He claims to have raised £20m, but spent last weekend frantically contacting Scottish businessmen asking for investment. The CVA proposal going out was due to trigger the first seven-figure instalment of his purchase price, believed to be £2.7m, but as late as Friday he had only raised £1m.According to the CVA proposal, Green's loan will be drawn down in mid-July, so what about the club's running costs? Duff & Phelps had demanded that all bidders provide funds to meet those from 1 June onwards over and above their offer price. All of them did, except Green. A £3.6m Administration Trading Shortfall is included in the proposal and is deducted from Green's offer price. So the creditors are effectively paying the club's running costs.With huge fees generated by Duff & Phelps of £3m, then a further £1.8m in legal fees, the costs of the administration are almost as much as the creditors are receiving from the Green consortium's loan. The administrators' fees are unchallenged, even although there is an argument that Duff & Phelps have destroyed value during the process. The proposal also includes £2m in Player Transfer Fees (factored), even although Rangers are due £3.7m in transfer monies. The £1.7m has been written off; to cover more running costs?The creditors also have justifiable cause to question why Duff & Phelps opted for Green's bid when the considered opinion of several financial experts Herald Sport consulted is the CVA proposal does not represent better value than some other offers. Assets which should have fallen to the creditors are falling to Green's group, including any recoveries made from payments claimed back from Phil Betts and Regenesis of around £500,000.Each of these factors alone should have caused alarm among supporters, but together they are reasons for fans to bring more scrutiny to bear on the men who are about to take control of their club. Green's consortium is even gaining a fixed security over the main assets, Ibrox and Murray Park, in the same way as Whyte, yet supporters are wary of the consequences of challenging him."We're pleased that the CVA process has commenced," says Andy Kerr, president of the Rangers Supporters Assembly. "But I'm not comfortable with [the £8.5m being a loan]. It's the alternative to a bad lot, in terms of finding a way to start to move forward. The exact terms in which that loan is serviceable is something we'll need to consider."Early in the administration, Duff & Phelps declared they would not sell to "another Craig Whyte". Green's background apart, the administrators admit they do not even know the identities of all the members of the consortium who will end up owning the club. They have also signed a deal that allows Green to buy the assets in a newco scenario, even although an open bidding process at that stage would likely raise more than £5.5m.When Bill Miller was named preferred bidder, Rangers fans were fully engaged with investigating the American and questioning his means and motives. The same is not happening with Green and his consortium. This is due to several factors: the season is over, so fans aren't congregating and talking together in numbers; the three main fans' groups were all backers of the Blue Knights, and so fear that coming out against Green will only cause friction with other fans; and the realisation that liquidation is ever closer because the money runs out on June 1.Yet of the four final bidders, two are still ready to move immediately should Green's offer collapse, and even as late as last week were preparing for that eventuality because of doubts about his funding. All three of the other bidders have decided to keep a low profile since losing out in the final auction, but they have not withdrawn their interest. "I'm still apprehensive that there are a lot of large hurdles to overcome," cautioned Kerr.Rangers fans need to judge Green on his pledges and his actions, not on the basis that it seems as if he is the last man standing.

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Plenty of inconsistencies but similarities just as worrying

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