The Blue Knights and Duff & Phelps – Guest Post by Den

In the aftermath of the decision to appoint Mr Miller as preferred bidder for Rangers, the Blue Knights via Mr Murray sought to get their views into the media. A statement came from Blue Knights HQ. To say the least the Knights and D&P no longer see eye to eye.

Den was good enough to do some analysis of the BBC report of the matter, and his post commences below,

Den, it’s all yours!




The Blue Knights statement with my comments in bold.

The Blue Knights surprised by Rangers choosing Bill Miller

The Blue Knights consortium that has failed to become Rangers’ preferred bidder is “surprised and disappointed” that rival Bill Miller has been chosen.

In a statement the group warns about the “complexities” of Miller’s newco Rangers plan to exit administration.

It added: “The likely loss of European football for a minimum period of three years may carry longer term financial consequences to Rangers.”

I take it they are implying that Miller’s deal will ultimately lead to liquidation.

The Blue Knights had proposed a Company Voluntary Arrangement (CVA).

A CVA was ruled out by D&P as a strategy, as part of a strategy after having hived off anything of value then giving creditors the choice of Like it or lump it they see it as potentially workable.

It had submitted an improved offer last weekend after being told that its joint bid with Sale Sharks owner Brian Kennedy would be unacceptable to creditors.

I have been involved in just a few bids but they are either open auctions where the hammer comes down or sealed bids where the bids on the table are assessed in a scrupulously fair process. This is a hybrid where the administrators are sharing info on bids to push up price. There has been an unusual outbreak of “after you Claude in the negotiations that I have mentioned before.  Anyway TBK apparently didn’t offer enough. Hang about though.

Administrator David Whitehouse, of Duff & Phelps, was clear that the firm had made the right choice after weeks of negotiations with Miller, the Blue Knights, Kennedy as a sole bidder, Bill Ng and a German consortium.

Rangers’ administrator Paul Clark

“Firstly, creditors have already given us sanction to complete the proposal; that’s under the terms of the administration proposals which have been agreed,” he said.

“Aside from that, we have already been in consultation with the largest creditor, HMRC and they are fully aware of and are supportive of the bid.

“HMRC and Ticketus are both creditors of the company and the creditors have voted in favour of the proposals which enable us to do this deal.”

HMRC are fully aware and supportive of the bid!  Have voted in favour. As a tax payer (or mug) I feel a bit let down.

HMRC, for their part, offered a different take on claims that they have voted in favour of Miller’s proposals. “We will consider our position when any package is put to us,” they said in a statement to BBC Scotland.

Hold it – somebody is maybe misinformed.

The Knights’ membership comprises Paul Murray, Paul Mackenzie, Douglas Park, Ian Hart, Scott Murdoch and Kennedy.

They argue that they have “the best interests of Rangers Football Club at heart” and claim their “thorough understanding” of Rangers’ position in Scottish football would have benefited the club.

The Blue Knights’ statement continued: ”Our primary interest since 14 February 2012 has been to ensure the survival of Rangers Football Club and to preserve its history and heritage without having to transfer the business and assets into a newco structure.

“We strongly believe that we could have achieved this objective by a CVA arrangement which would have allowed Rangers Football Club to continue to trade in its present legal structure with a substantial refinancing being provided by the consortium.

Not a lot wrong there, their heart is in the right place. The substantial refinancing was just not substantial enough it would appear.

“Indeed, until today’s announcement, we had been making extremely good progress with our due diligence process having commenced, after being advised as recent as Saturday evening (28 April) that the quantum of our CVA offer was acceptable to Duff & Phelps [Rangers administrators].

“We believe that our bid was and remains the best bid for Rangers Football Club and its supporters.”

They were doing due diligence, I thought you had to lay down the cash and be preferred bidder before the books were opened.

However, the statement acknowledged that the formation of a new company would be easier for the administrators to effect.

And it is really about the Administrators at the end of the day

Former Rangers director Murray, the Blue Knights spokesman, had urged Duff & Phelps to make its decision soon so that team manager Ally McCoist could plan for next season.

“This deal effectively ring-fences the Craig Whyte issues from the on-going trade of the business”

David Whitehouse Rangers administrator

The Blue Knights’ bid was conditional on the administrators delivering Craig Whyte’s 85% shareholding in the club.

The statement added: “It is only in recent days this issue been seen as an impediment to overcome in enabling us to make an unconditional CVA offer to Duff and Phelps.

“Until the time of today’s preferred bidder announcement, discussions were however on-going with Mr Whyte in this regard.”

The man who holds 85% of the shares, is secured creditor and knows where the cash went, wasn’t seen as an impediment.

Whitehouse, though, was bullish that the former club chairman, who purchased Sir David Murray’s shares in May last year, could not stand in the way of Miller’s bid being completed.

“He has no role in this and he can’t block this deal,” he said.

“If we were to go down the CVA process without the newco route at the moment, we would need to either take action to secure those shares – which to date no purchaser requires us to do – or alternatively a purchaser would have had to do a deal with Craig Whyte.

“I think everybody would accept that the preferable solution is that a deal is not done with Craig Whyte and those shares are secured in a structured manner over the coming months.

“This deal effectively ring-fences the Craig Whyte issues from the on-going trade of the business and enables us to transfer the business to a newco and deal with Craig Whyte through the litigation in due course

Whyte can’t block the deal. As major shareholder he can stop the merger which is planned. As secured creditor he can grab the cash that is put into the Oldco. If in due course it proves too difficult or expensive to “deal” with Whyte they will maybe claim to have been duped. Rangers will then be liquidated. Litigation – D&P have had their days in court so far and the outcomes have not been  positive: still with time and practice and cost they may get the hang of it.


Posted by Paul McConville, with the assistance of Den



Filed under Administration, Guest Posts, Rangers

8 responses to “The Blue Knights and Duff & Phelps – Guest Post by Den

  1. Niall Walker

    Craig Whyte is not a secured creditor, and has no floating charge on the assets, it appears he is liable for any Ticketus loss.

    • Richboy

      Niall or Paul or anyone else, please explain why he is not (or is) a secured creditor and has no floating charge. This seems to be a matter of opinion as I have read both sides on many different blogs and newspaper commentaries.

      PS Didn’t he transfer the floating charge to Liberty or one of his other companies? I am confused.

      • Niall Walker


        I agree it is very confusing, D&P have confirmed no such floating charge exists ( Its a piece of paper), I believe CW gave Ticketus a guarantee but D&P reject the notion one can guarantee an advance against assets one did not own. This is the legal-financial consequences of misrepresenting the provisional nature of the funds in acquiring the shares. The Ticketus money is not a loan but an advance, a bit like long term factoring, it is very unusual to factor money up to 3-4 years, normally its a 60-90 day cashflow solution.

        We will soon find out, CW will try and block the sale of the assets for 11.2 million if he has transferred his 30 million personal guarantee to Ticketus onto RFC and its assets.

    • Den

      Niall, I have seen his claim to floating charge dismissed by D&P, is there any corroboration. I thought their challenge to Ticketus was a non scoring draw and so far I don’t think they have really tested the Whyte claim.

      I hope that his claims are challenged and defeated but he has a nuisance value in the meantime and they haven’t done anything except pretend he isn’t there.

      If it is down to Craig Whyte what do you see as Ticketus chances of seeing one penny !

  2. Richboy

    Great comments Den. How can anyone believe a word that D&P say?

    TBK already doing due dilligence yet not the best bidder, HMRC agreeing to the deal when HMRC say they haven’t, Craig Whyte irrelevant (they did walk that back though) etc.

    My greatest concern throughout this entire tragedy is that D&P were not acting in the interests of the creditors and were behaving in an incompetent manner. Den’ post has only reinforced those concerns.

    • Gopaul

      D&p say their proposals to creditors allow deal to proceed, but there were a lot of proposals as Paul outlined and we don’t know which proposals the like of hmrc have backed, but it seems at least one was……..

      As ever devil in detail

  3. joe crawley

    Where is the benefit to the creditors in all these dealings? moving asset valued by Rangers in excess of £30 million+ and putting up £11 millions for all the creditors to split,sorry but this does not make sense!

  4. Kenny McCaffrey

    Good clean copy Den – clear comments and easily understood. D&P, though, awful, and probably their last administration job.

    It all has a smell to it, and not a good one – stench maybe a better word. D&P have done next to nothing to help creditors. Scandalous. They also treat the wider world with utter contempt – we know what you’re doing guys, just don’t talk about it as if it’s all above board or the natural course of things.

    There are elephants all over the place – not just in the room, but on the park, in the boardroom, everywhere. Orcs will be happy – not hard to please anyway – but any decent Rangers fan will be ashamed.

    Why are we not talking about penalties any more? Why is the media’s subtext ‘poor normal Rangers people, it’s good that a way out is being found’? The majority of decent people know that Rangers have cheated for years – YEARS – David Murray cheated, players were bought unfairly, other clubs were treated like dogs doodoo, even charities lost money.

    When will they pay? Why is any creditor taking this excrement? Too bad bears, it doesn’t matter who did the wrong things – wrong things were done in your name and there’s a price to pay. There’s MILLIONS owed. There’s penalties to be given out for the whole sorry shambles. Transfer ban? That should be least of your worries, guys.

    Rangers should be stripped of titles, assets, players, whatever it costs to clear their name and pay for what has happened – they should then wipe the slate clean, start at the bottom, work their way up, get righteous and have something to be righteous about for a change. If they don’t, the elephants will be there forever.

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