hutch

It's been a long 24 hours since Tuesday, Dave. Any news on the date yet? I think the most important bit of news today is that HMRC have NOT appealed the Palace CVA vote, even though they only get 2p in the £. It seems that they only appeal if they think there's been a serious irregularity in the voting process.

Thanks for that. I had assumed Rocha and Ben Haim would go on free's anyway, although thought Rocha was under contract until Feb '12. AFAIK Belhadj hasn't gone, although the club wish he would.

Signing new players (or not, as the case may be) is an interesting sideshow. But keep your eye on the main event - the cash. They are currently £3m short to pay this month's wages. Similar position to us 13 months ago, before Crouch stumped up. If they get that, either by selling somebody, or from Chainrai, then they get to limp into next month. But how much longer is Chainrai going to keep chucking good money after bad? He bought a punt at a quick return to the prem, and what that brings, for a speculation of a few million to fund the administration up to the CVA. But that has now backfired. Realistically they're facing a relegation struggle, and could well end up in L1. To save chainrai from having to put his hand in his pocket again, they needed to bring in £6.75m in July, £7m in August & £4.25m in January from player sales. £18.1m in the year. The remaining squad members I think they're looking to get rid of (although they'll no doubt let some go free to save the wages) are Belhadj, Nugent, Rocha, Ben Haim, Boateng, Mokoena & Utaka. After a month of the window being open, they (and Chainrai) have realised that Storrie's valuations are "a bit optimistic". They would do very, very well to get £10m for all of that lot. And as they're finding out, they can't give some of them away because of the excessive wages. So they're going to be at least £8m short. What that means is, with a little bit of adjustment to Andy's own fragile cash flow forecasts by me, IMO if they stay in Administration Chainrai will have to put another £8m in to get them to the end of the season, and if they get a CVA, that figure will be £11m. (All on top of the £6m he has aready put in to fund the administration since March). I don't see any way they can exit administration without a CVA. The only reason they went into administration in February was to protect themselves from final judgement in the HMRC winding up petition. If they exit without a binding agreement with HMRC, they'll be straight back into Court on the WUP. We'll have to see if Andy's got anything else up his sleeve, but I don't think he has. I've got a feeling Chainrai might tell Andy to take the fuse out of the plug on the life support machine, and put it into the plug on the toaster.

I read it several times, looking for a quote from someone at the FL which says something like "The Football League has given it's consent to Portsmouth to sign three new players", but I couldn't find it.

The Administrators are responsible for all the costs incurred after their appointment. That's the point. Unless "The AA Team" are certain that they will have enough cash coming in in future to meet their liabilities as they fall due, they must liquidate. If for no other reason than their employers at UHY will insist. Unless he can sell players for around £3m this weekend, and get the cash in before the wages are due at the end of the month, he needs more cash from Chainrai. Now. And Chainrai is playing hard ball.

Remember we're only talking about Cash Flow, DM. But as I understand it, I don't think the proposal would reduce the unsecured creditor's entitlement to 20p at the end of the day, but they might not receive 4p this year. In Andy's cash flow forecasts, he allows a total of £19.6m to pay off all the football creditors in full using parachute payments from the PL and Sky TV money from the nPC, and all this year. That leaves him a surplus this year of £2.2m, which he keeps as cash for the club. The problem is that in the written text of the CVA proposal he declared that the footbal creditors, who would be paid directly by the PL/FL, amounted to £22.4m, not £19.6m . And to make matters even worse, in the list of unsecured creditors which he substituted at the last minute at the CVA vote meeting, the football creditors are over £30m. So, if that £2.2m goes to football creditors, as I expect it would, that would leave a closing cash balance at the end of the year of £1.2m, but the CVA creditors would have been paid £3m . Now for the problem. That forecast only works with a massive cash injection from selling players during July and August, and a sizeable injection in January. Total £18.1m in the year. So, in theory, if they can bring in £16.9m (after deductions) from selling players over the year, they will end up at the end of May with £0.00 in the bank, but will have paid the creditors their 4p for this year. You decide whether you think that will happen. If they don't, I think the CVA payments are at the bottom of the pecking order.

Sheffield

I think that the Administrators are bound by law (or maybe by their rules) to liquidate if they cannot be certain that they have the funds to continue. No doubt one of our IP's will correct me if I'm wrong. So, unless Chainrai agrees to pump more cash in, Andy may not have many options left. The question for Chainrai is now when (or if) he will get it back.

He can't. He's too busy on the phone to Hong Kong at the moment. They've run out of cash again. The £4m opening cash balance in the CVA forward cash flow forecast is gone. That was what was left from the £6m Chainrai's put in so far to fund the administration. You can be very sure that he was told then that it would be the last time, and that from then on cash would come from the sale of players. Hasn't happened though, has it? It's squeaky bum time. No CVA, and no prospect of getting one. No player sales worth talking about. Can't even give them away for free (Ben Haim). Wage bill still double the forecast. Transfer embargo in place for the foreseeable future. Relegation battle looming in the league. Unless Chainrai's turned into a patient benefactor with very deep pockets, the outcome in the next few weeks is far from certain. Even if they keep the squad, and Chainrai agrees to provide more funds for the wages, that's still the same squad that finished bottom of the PL last season before the points were deducted, without the loan & out-of-contract players. Whichever way you look at it, without a CVA, the numbers just don't add up. Even with a CVA, they weren't much better. The forecast has £18m income from player trading this year (including Jan. window). Every penny of that that they fail to achieve must come out of Chainrai's pocket.

Looking at it a different way, the closer we get to the end of the window without either: a) Any sign of movement away by our key players (Lambert/Schneiderlin/Lallana); or b) Antonio/Papa signing up with another club the happier I get.

It does if they're still paying his wages.

300,000 Euros, if I remember right.

I thought I would have a look and see if our optimism over HMRC's chances of winning the appeal are just wishful thinking. But they're really not. HMRC have played a blinder, and have shafted Andy royally, and it looks to me as if it was deliberate. At the creditor's meeting on 6th May Andy was authorised to produce a CVA proposal and put it to the creditors for a vote. Chapter 3 of the Insolvency Rules (1986) states: Andy duly did his duty and sent out the notice on 28th May, with the required copy of his proposal with the statement of affairs and list of creditors with the amount of their debts attached, scheduling the meeting for 17th June. The important page of his proposal is page 52. Note the figure for VAT,PAYE & NIC, and also that he has NOT included the football creditors. He did include Agents, which I think are football creditors, but we can forgive him for that little slip up. So far so good, and all in line with the rules. Remember, at that time, Andy was confident the HMRC would vote in favour, because he agreed to their demand to liquidate the Company after 9 months and then conduct a forensic inquisition. In his published proposal, HMRC have 42% of the unsecured creditor's voting rights. Then, unfortunately for Andy, and after his proposal was published and in the public domain, HMRC had a change of heart. Now they're going to vote against. Oh shyte. Very angry phone calls between Portsmouth and Hong Kong ensue. What to do? Plan A - reduce HMRC's debt to 24m. Good plan, but still gives them 29%. Oh shyte shyte. So why not include the "secured" unsecured football creditors as well? They'll all vote in favour anyway because they get 100%. Job done. Now HMRC only have 22%. Phew. But did he send out a revised notice with the amended proposal to the creditors? It looks as though he forgot. So HMRC turn up on the 17th expecting to vote 42%, and find that they're only voting 22%. I don't think they were chuffed. The right to appeal is in the Insolvency Act (1986): and that's what HMRC are doing. But they are also challenging him under the rules, which state: Andy did have the right to reduce part of a creditor's debt, but only if he had no doubt that it was correct to do so. If he had any doubt, he was obliged to let them vote the full amount, and then himself challenge that part which he felt was wrong. In other words, the CVA should have failed at the meeting, and Andy appeal to the Court to have it passed by reducing HMRC's debt in Court! And a couple of other points. Andy's report on the meeting filed at the Court states that the CVA was approved without modification. I don't think so. The proposal attached to the report, which he says was approved, is not the same as the one sent to the creditors before the meeting. And finally, although not strictly relevant, I found this in the rules Well it made me

I haven't seen that confirmed. Clubs say deal agreed at £3.75m, and last Monday (10 days ago) Lampitt I think it was, was quoted as saying they were just waiting for confirmation that he had passed the medical. It's been all quiet since then. Last word from the player himself was that he has no intention of going to Qatar. Who can blame him?

Have I missed something? AFAIK they've only brought in around £400k so far.

I think that's quite an important point. The Insolvency Act has 2 grounds for appealing the CVA vote. HMRC, according to it's statement at the time, has appealed on 3 grounds, the 3rd being the conduct of the Chairman. If that was just his conduct at the meeting, then that would be dealt with in the second ground. So I reckon they're after his removal. They will certainly get more from a Griffinesque CVA than from AA. And AA will pull the plug and liquidate if at any time Chainrai decides that's best for him. And in answer to trousers, yes. It is publicly published, but only the (working) day before. The Parties will know before, so it might be reported in the press.

For anoraks (like me) it's CPR Part 39. Trinity Term at the High Court ends on July 31st (30th this year) & Michaelmas starts on 1st October. In the intervening 2 months (vacation), there will be one Judge, from each division, sitting to hear urgent cases. Either Party can apply to the Court to have their case heard as urgent during vacation. There will be an awful lot of urgent applications for one judge to handle, given that the Judge also requires time to read all of the supporting documents in advance. A case could be made by Pompey that their case is urgent, given that delay could be preventing them from exiting administration and taking part in the early stages of the league competition without the inconvenience of being in administration. The Court might, however, take the view that the administrator, who has been in office since February, could reasonably have foreseen a challenge to his proposed CVA as permitted under the law, and have set his timetable accordingly, and that he is, therefore, the architect of his own inconvenience. I still don't believe that AA really wants this to be heard urgently. It's hard to see an acceptable outcome for him if he loses. IF an application has been made, I expect he's been advised that it will fail and the case will be held over until next term.

They won't. Pompey know this. They've got as much chance of lifting the embargo by the back door as they did of getting their licence to play in Europe this season. It's all hype, fodder for the News, so that when they get turned down they can cry "foul" and blame everybody else except themselves. It's a damage limitation excercise by AA. Has Sonko joined them in San Diego yet? Have they signed a 'keeper yet?

No. It's Handy Andy bending the rules (a bit too far in this case). In previous football admins, the football creditor's received the same proportion as all the other unsecured creditors (xxp/£) from the CVA, and voted alongside the unsecured creditors. The outstanding amount to take them up to payment in full (required by league rules) was then made by the new incoming owner from his own pocket. New money, in effect, not the club's money. In this case Handy Andy has proposed to pay some of the unsecured creditors (the football creditors) 100% and the others 20% with the club's money i.e. from the parachute payments - money which belongs to the club.

No he didn't. But he said he did.

Let's face it, there are some people who just won't sleep at night until we have a first team of 11 "too good for this league, nPC/PL-quality" players, with 11 "too good for this league, nPC/PL-quality" players as back up, and another 11 "too good for this league, nPC/PL-quality" players as back up for the back up. And even if we did, there will still be some wet n'windy Tuesday nights up north where we don't get the result we want. And the odd Saturday afternoon in East London. It's part of the excitement of being a football fan. I genuinely believe that, even if we don't make any more signings, we'll get promoted. But it would be nice to make a couple more good signings, and do it with style.

Of course there is. Don't you read the News?

He couldn't, because HMRC's follow-up question would have been "In that case can you please explain why you have not similarly reduced the level of debt of those voting in favour, and which you acknowledge you expect to reduce substantially after the vote".

As (AFAIK) the only member here who lives in SA, I wouldn't recommend it for gap-year type adventure travelling. Holiday, yes. I travel extensively throughout Africa on business, and for adventure working type holidays, I would say Tanzania tops. Or, if your French is good enough, Senegal. My 2 favourite African countries.

Or, played 4 halves, won 1 half, drew 1 half and lost 2 halves. Always look on the bright side.