Last Saturday Charles Green spoke to Rangers fans at Ibrox for their match against Alloa. I wrote about what he was recorded as saying here. It would appear that not all that Mr Green was noted as saying was 100% accurate. I am sure the apparent discrepancies noted below were entirely as a result of oversight or error, and not a deliberate clouding of the issues or declarations of bravado to appeal to his audience.
There are two specific paragraphs I want to mention initially, which are reproduced exactly as they were written by the original poster on a Rangers message board.
3 – All footballing debt have been paid apart from the 31k to Dundee Utd which he has a letter confirming would be paid by the SPL.
6 – Rangers owed hearts the remainder of the Lee Wallace fee, Hearts were so desperate for the money eventually offering a 100k discount if we paid the cash two weeks ago. Thats why the couldn’t pay the wages.
My interpretation of that was as follows:-
- Hearts have been paid for Lee Wallace.
- Mr Green negotiated a discount for prompt payment.
Now though it appears that, at least according to Chick Young on the BBC, neither of those statements by Mr Green was accurate.
Mr Young writes:-
Hearts have rejected an offer from Rangers to renegotiate the terms of payment for defender Lee Wallace. With Hearts under the threat of a winding-up order over a tax bill of almost £450,000, Rangers said they would hand over £500,000 now.
But Rangers wanted to close the deal with that gesture and Hearts owner Vladimir Romanov has dismissed it. Rangers had said they would pay Hearts £300,000 in January and settle the bill in July with a final payment of £500,000.
That suggests that Mr Green was wrong to say there was no more football debt.
At first I also thought that the rejection of the deal suggests that Hearts are confident that they will be able to stave off the winding up order sought by HMRC. What use would it be to Hearts for its liquidator to receive £800,000 when settling for £500,000 now would allow HMRC to be paid?
The reason why the calculation is not that simple comes though when you check the debt figures and the security situation.
Whilst HMRC might be due as much as £4 million from Hearts, depending on the tax tribunal set for this month, the interest and penalties on that sum, and the remaining tax debt due by the Gorgie Road team, this is dwarfed by the debt owing by Hearts to UBIG. Mr Romanov’s bank is a creditor for over £22 million.
In addition, UBIG hold a security over the ground, and a floating charge over the remainder of Hearts assets.
If Hearts fall into liquidation, then once the liquidator is paid, the remaining cash and assets (after statutory payments to redundant staff) will go to UBIG.
So there are at least three possibilities.
- Hearts are confident that they can stave off winding-up and accepting a full settlement now simply means they would need to raise an additional £300,000 by the summer anyway.
- Hearts are not confident that they can survive, even with the Wallace cash, and its owners would rather see the money in their hands than paid over to HMRC.
- Mr Romanov is not prepared to accept a deal whereby Rangers get a 37.5% discount, even at the risk to his club.
It also raises the question about why Mr Green said that the only dent was to Dundee United, or why Rangers issued a statement saying that there was no “external debt”.
And before anyone says that the money due to Hearts is not a “debt” because it is not yet due, then that argument does not work.
I have a mortgage. I pay my monthly instalments as they fall due. The mortgage company cannot ask me to repay the balance due. I still owe that money to the mortgage company. It is a debt.
If Mr Green has been inaccurate regarding points 3 and 6 as noted above, I wonder how he will do with points 8 and 9? Remember, this was what he was saying to fans on Saturday 3rd November.
8 – Share issue prospectus to be made public in a 21 page document end of this coming week or just after.
9 – Over 20 pension fund groups have an interest in the share issue. Corporate roadshow to start this week re share issue Glasgow, Edinburgh and then London for seven days.
The prospectus is not out yet, so it must be assumed to be coming tomorrow or Tuesday?
Does anyone know where the corporate roadshow took place this week? Mr Green is not a man for hiding his light under a bushel. One would have expected him to be making, quite rightly, a big thing of the start of the floatation process, as he meets with the twenty or more pension fund managers clamouring to buy shares with the anticipated 100% return.
What could be the reason for his uncharacteristic reticence?
Could it be, heaven forbid, that the prospectus is not as imminent as he said, and that the corporate roadshows have not started? Do those pronouncements fall into the same category as the statement in June that all questions would be answered “within seven days”? There are still lots of questions, and we are now in mid-November.
Posted by Paul McConville