Wednesday, 30 May 2012

Possible Dividend for Creditors

Whilst D&P have made it clear that there are many anomalies, this appears to be the most accurate indication of the dividend available for the unsecured creditors of The Rangers Football Club Limited.

Feel free to ask us any questions using the comment box below.


  1. Are there factors that mean the available funds for a CVA are likely to be much less than that stated above? ie, further cost of administration, running costs during CVA process, etc.

    1. Thanks BC. There are three options for creditors at the meeting scheduled for 14 June -

      1. Accept
      2. Reject
      3. Propose variations

      If variations are proposed and accepted by creditors, the CVA proposal will be changed at that time.

      There has not been much chat surrounding this yet, but often HMRC propose variations, and the meeting may well be adjouned for 14 days in order that D&P can incorporate any proposed variations.

      If sufficient creditors in value accept the CVA proposal, then the proposal is set in stone. If the Company fails to meet the terms of the CVA proposal once it has been agreed, then the CVA will be demeed to have failed.

      Hope this helps.

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  3. Should D&P not provided similar information as a guide to creditors
    If you can produce it in a day

    There are a large number of TBC in the list of creditors including debenture holders at £7m
    what will the impact of that be
    and what will happen if the FC is found to be valid

    1. Hi DM,

      Very fair comment. Paul Clark stated yesterday that there were "too many moving parts" to give an accurate indication to creditors. However, if I was a creditor, I'm sure I would be thinking "what am I actually being asked to vote on here". They could certainly have provided the full range of estimated dividend possibilities, but due to the number of anomolies, that may have confused the position even further.

      It is fair to assume that these creditors simply haven't lodged their claims yet. In a typical CVA, the proposal would not be tabled unless the Company had made a full disclosure of it's liabilities. But there are severe time pressures in this case, and creditors (HMRC & TuS) will have to take a view on this. In our own CVAs, we incorporate a clause allowing for variations in creditors claims upto a value of 10%. But this is far from a typical CVA proposal.

      Regards the FC (floating charge). To be honest, I can't quite get my head round this. D&P are clearly stating that whilst it is valid FC, there is no sums due to the holder of the FC. From a creditors perspective, further questions need to be asked of D&P regards this.