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HMRC Reject Rangers’ CVA

Tue 12th Jun 2012 | Football Club Administration

HMRC have rejected the CVA proposed by Rangers forcing the liquidation of the Glasgow club.

Paul Clark, joint administrator at Duff and Phelps, said in a statement: "We have been informed by HMRC they will not support the proposal for a Company Voluntary Arrangement at the meeting of creditors on Thursday, June 14.

“As a result of this decision, the Sale and Purchase Agreement in place with the consortium led by Charles Green will take effect and Rangers Football Club will continue within a new company structure.

Charles Green, who is leading the Sevco consortium aiming to acquire the club, said in a statement: “I am hugely disappointed by the decision of HMRC not to support the CVA proposal and that disappointment will be felt acutely by Rangers fans across the world.”

HMRC cite strong evidence of non-compliance and the club’s indebtedness as the reasons behind their decision.

"The reasons HMRC have given to us for their decision to vote against the proposal are as follows. HMRC has cited its general policy of not agreeing to a CVA where there is strong evidence of non-compliance by a company with its tax liabilities,” Clarke added.

“HMRC had agreed to consider a CVA proposal along with all other options in the case of Rangers but having taken into consideration the extent of funds which will be made available to creditors through the CVA option, they have decided that it is not acceptable given The Rangers Football Club plc's level of indebtedness to HMRC. It has also been made clear to us that other offers tendered for the Club, which took the form of a CVA, would have been treated in the same way and that the rejection is not a reflection of the Green consortium bid.

"HMRC has taken the view that the public interest will be better served with the liquidation of The Rangers Football Club plc as a corporate entity. The Club will continue to operate as it has always done but within a new company structure.

“HMRC consider that the decision will enable a liquidator to instigate a wider investigation into all of the financial affairs and management of the Club in recent years and to bring to task those they believe are responsible for its collapse.

"Furthermore, HMRC believes there will be an enhanced recovery of funds for creditors by pursuing those individuals who they believe are responsible.

Rangers will now face a three year ban from UEFA competitions and the new company will need the consent of the other SPL clubs to the transfer of the share in the SPL, in order for Rangers to continue playing in the SPL.

Once the CVA proposal is formally rejected, Green and the Sevco consortium will move towards completion of an acquisition of the business and assets of The Rangers Football Club plc. expected to be completed within a few days.

Posted by: Aaron Gourley

http://www.buttonshut.com http://www.buttonshut.com http://www.buttonshut.com

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