Pompey Takeover Saga

[Kingsbridge Saint]

Offer conditional on players giving up lottery win sized sums recoverable from the PFA in the event of a liquidation. CVA is an irrelevance. Chinny must be his Mothers Pride.

[Glasgow_Saint]

whats the biggest hurdle:

 

a) Shifting TBH and Kanu and co?

b) getting creditors to accept 2p in each £1?

[Torres]

DEBTS PAYABLE AT A FUTURE DATE

23.11 Where a Creditor has proved for a debt of which payment is not due at the date

of the distribution, he is entitled to a distribution equally with other Creditors,

but subject as follows:

For the purpose of the distribution (and for no other purpose) the amount of

the CVA Creditor’s admitted claim (or, if a distribution has previously been

made to him, the amount outstanding in respect of his admitted claim) shall be

reduced by a percentage calculated as follows:

I x M / 12

Where I is 5%, and M is the number of months (expressed, if need be, as, or as

including, fractions of months) between the date of the distribution and the date when

payment of the CVA Creditor’s debt would otherwise be due.

 

This could change the OldCo claims rather drastically

[Kingsbridge Saint]

I am starting to think the end game will come sometime after 21 June when Pini Zahavi puts in a WUP for unpaid wages to his client. they won't be able to pay and Chinny will stack his cards. No fourth admin, just straight around the U Bend.

[stevegrant]

Worth checking out page 43 of that PDF. A hand-written statement of affairs, with the realisation value of Fratton Park having been scribbled out from what looks like £7.3m and hastily amended to £10m to make the shortfall to Chainrai look less

 

The last sentence in section 2.4 is either optimistic or wilfully misleading: "No further points deduction will be applied if this Proposal is approved by the requisite majority of Preferential Creditors and Unsecured Creditors." - we do not know how the Football League will interpret the soon-to-be-confirmed failure of CVA1. To all intents and purposes, the same outcome as occurred as if they hadn't agreed that CVA in the first place.

 

Section 3.3.2 is Chainrai's get-out clause, basically saying that if TBH doesn't waive his right to the remaining money due to him, there's no obligation on Chainrai's part to complete the Sale and Purchase Agreement, and it's down to the administrator to negotiate this.

[pedg]

So how do they get round this clause? Surely if Ben Haim etc just say 'no' the whole thing is scuppered anyway?

 

That the Administrators agree compromise agreements with the PFA,

certain players and certain employees for all outstanding amounts of

salaries, bonuses, future contractual rights and all other forms of

remuneration or income of certain players and certain employees. For

the avoidance of doubt, it shall be the sole responsibility of the

Administrators to agree the above compromise agreements and in the

event that the Administrators fail to agree these compromise

agreements, there shall be no obligation on the Purchaser to complete

on the SPA .

 

Are the PFA going to be responsible for paying the wages if the club goes into liquidation? If it is then given the amounts involved I expect they would be keen to reach an agreement that would cost them less.

[Ken Tone]

Offer conditional on players giving up lottery win sized sums recoverable from the PFA in the event of a liquidation. CVA is an irrelevance. Chinny must be his Mothers Pride.

 

 

Have we ever had the definitive answer to what the players get if the club is liquidated? That is absolutely crucial. The football creditors rule becomes irrelevant is there is no club, so it comes down to whether the PFA or the PL/FA?FL would use the remainaing parachute payments or some sort of insurance fund to pay them off.

 

 

In short if the players will get most of or all of their money regardless, then they really are toast. If however Birch can really threaten "sign a compromise agreement or we go bust and then you get nothing", then it is only a matter of brinkmanship and agreeing amounts.

[Brussels Saint]

As I understand a CVA needs to be agreed by 75% of the total amount owed. As Chainrai is owed a large part of this, does he vote on his own CVA proposal?

[Weston Saint]

If the club are liquidated then Birch is correct, the creditors (excluding the players) will get nothing. The club has no assets. The parachute payments cease. All players contracts revert to Football League. The ground will have a land value but without any planning permission likely at the time of liquidation it is virtually worthless.

 

HMRC will likely contine to reject a CVA but everybody else, less football creditors, are likely to accept.

 

Prediction - PFC will continue to limp along with or without CVA approval, with or without points deduction BUT only if Chainrai can get rid of the big playing contracts. No mention of the gun running son's property!!!!

[Frank's cousin]

Worth checking out page 43 of that PDF. A hand-written statement of affairs, with the realisation value of Fratton Park having been scribbled out from what looks like £7.3m and hastily amended to £10m to make the shortfall to Chainrai look less

 

The last sentence in section 2.4 is either optimistic or wilfully misleading: "No further points deduction will be applied if this Proposal is approved by the requisite majority of Preferential Creditors and Unsecured Creditors." - we do not know how the Football League will interpret the soon-to-be-confirmed failure of CVA1. To all intents and purposes, the same outcome as occurred as if they hadn't agreed that CVA in the first place.

 

Section 3.3.2 is Chainrai's get-out clause, basically saying that if TBH doesn't waive his right to the remaining money due to him, there's no obligation on Chainrai's part to complete the Sale and Purchase Agreement, and it's down to the administrator to negotiate this.

 

But surerly Steve the FL will not interpret CVA1 to have failed if teh CVA1 creditors vote for the CVA2.... What is most sickening is that we could end up with a situation, where no further punishment is forthcoming, and pompey who have racked up over 120mil of non-footballing debt (assumes the foootballing debts have been paid) will in effect pay back 500k.... if the FL feel this is acceptable, then the shame is well and truely on them, not just those down the road.

[pedg]

This could change the OldCo claims rather drastically

 

Where is the newco to Baker Tilley debt schedule again? Need that and a calculator so we can figure out what value they put on the CVA1 debt.

[Frank's cousin]

On the 'failed' CVA 1 - is it possible (mathematically) that the Baket Tiley could vote against, yet CVA2 still be passed... suely that would be a final **** take too far? Eg it may be considered legaly that CVA1 has not failed as CVA2 replaces it, yet the creditors of CVA1 did not agree... this truely is a sickening mess..

[Weston Super Saint]

As I understand a CVA needs to be agreed by 75% of the total amount owed. As Chainrai is owed a large part of this, does he vote on his own CVA proposal?

 

****ed up isn't it

 

It's what makes the Pompey takeover saga so interesting

 

All players contracts revert to Football League.

 

No mention of the gun running son's property!!!!

 

I'm sure the FL will then be able to 'sell' or give the remaining players to other clubs, with the FL only being responsible for the shortfall in wages on the current contracts, so no where near as much liability as paying off the contracts in full....

 

No mention of the gun running son's property, in the same way that there is no mention of the houses and businesses adjacent to FP. None of the land is owned by PFC, so it is irrelevant to put it into the CVA.

[pedg]

On the 'failed' CVA 1 - is it possible (mathematically) that the Baket Tiley could vote against' date=' yet CVA2 still be passed... suely that would be a final **** take too far? Eg it may be considered legaly that CVA1 has not failed as CVA2 replaces it, yet the creditors of CVA1 did not agree... this truely is a sickening mess..[/quote']

 

Well the clause above found by Torres implies their effect in the vote will be significantly reduced from what it might otherwise be.

[Torres]

Where is the newco to Baker Tilley debt schedule again? Need that and a calculator so we can figure out what value they put on the CVA1 debt.

 

As detailed above PFC10 is obligated to make a contribution to the Liquidation which ensures a dividend of 20 pence in the pound, before costs and expenses, is paid to all unsecured creditors. I have detailed below the dates and quantum of the contributions due. Please note that the percentages are that of 20 pence in the pound:

Contribution due - Due on

15% of 20% of the unsecured creditors’ claims agreed - In equal installments on 1 April 2012 and 15 August 2012

25% of 20% of the unsecured creditors’ claims agreed - In equal installments on 1 April 2013 and 1 September 2013

30% of 20% of the unsecured creditors’ claims agreed - 1 April 2014

The balancing figure required in order to comply fully with the CVA proposal document approved by creditors on 6 May 2010 - By 17 June 2015

 

YOu can do that pedg, I can't be arsed.

[Saint Lindford]

That's TBH paid till Wednesday then

 

http://www.portsmouth.co.uk/sport/pompey/pompey-past/pompey-fan-power-set-to-land-windfall-1-3929188

 

The £30,000 prize cannot be used to pay off debts or fund wages.

Like a little rule will stop them doing what they like with it.

[St Marco]

So basically for this to get passed they need the people who agreed to the last CVA (and didn't get a penny) to agree to this CVA which means they will get even less IF they actually pay up?

 

Not really read the details of who is owed what but surely they are taking the ****? If someone is owed £1000 they are being offered £50. Anyone who accepts that deserves to be shot imo.

[Frank's cousin]

YOu can do that pedg, I can't be arsed.

 

sound to me like Baker tiley creditors from CVA1 will be owed only 15% of their 16mil (or 24 mil?) of which they will get 2p in the pound.... either way, Chinney wins, creditors completely scewed the stinking mire of a club gets away with it again... IMHO

[Torres]

Oh n0, hang on

 

For the purpose of the distribution (and for no other purpose) the amount of

the CVA Creditor’s admitted claim (or, if a distribution has previously been

made to him, the amount outstanding in respect of his admitted claim) shall be

reduced

 

So it's only for paying, not for voting?

 

But if so, they have a massively disproportionate vote for the amount they'd actually get paid.

 

I'll admit it, I don't know.

 

If that's the case though, CVA1 creditors would get pretty much nothing at all - a % of a % of a %. It would make almost no difference to them whether it was passed or not, they'd get f-all.

Edited 8 June, 2012 by Torres

[carljack]

It looks like TBH has the future of PFC in his hands,500k oh how the mighty have fallen,PMSL.

[Frank's cousin]

Oh n0, hang on

 

 

 

So it's only for paying, not for voting?

 

So they get a 16mil share of the vote, but only entitle to 15% of that at 2p in the pound? = £48,000 from the original £82,000,000...

[tony13579]

£500,000.

 

 

F\/cking hell.

I could afford that!

[pedg]

YOu can do that pedg, I can't be arsed.

 

Actually its not going to have as large an effect as I thought. its 5% per year effectively.

 

7.5% on first April 2012: = 7.5%

7.5% on first August 2012 = 7.5 * (100 - ((5*3)/12))/100 = 7.4%

12.5% on first April 2013 = 12.5 * (100 - ((5*9)/12))/100 = 12.0%

12.5% on first September 2013 = 12.5 * (100 - ((5*16)/12))/100 = 11.7%

30% on first April 2014 = 30.0 * (100 - ((5*21)/12))/100 = 27.4%

20% on 17th June 2015 = 20.0 * (100 - ((5*34)/12))/100 = 17.2%

 

Total 83.2%

 

I think.

[Torres]

It's more complex than that FC.

 

In fact, it's a ridiclulous calculation.

[pedg]

sound to me like Baker tiley creditors from CVA1 will be owed only 15% of their 16mil (or 24 mil?) of which they will get 2p in the pound.... either way' date=' Chinney wins, creditors completely scewed the stinking mire of a club gets away with it again... IMHO[/quote']

 

The figure is a reduction of 5% per year (as it says 5% * number of months / 12 months in a year) so its not quite that bad. See above. Again I think!

[Ken Tone]

The summary of assets, page 43 ,seems to me to value Fratton Park at £10 million, but leaving chainrai to claim a further £8.3 million from the £14 million parachute payments still due. Am I reading that right?

 

If so he gets the ground plus £8.3 million in return for his £500k and promises to cover football creditors' debt .. IF those come down to a level he is prepared to accept.

 

Not bad deal for him if the FC debts aren't too high. 3 years of covering a bit of loss, but with £8.3 million to outweigh that, then he can liquidate anyway, wait a bit to get planning, and then sell the ground for building land.

[holepuncture]

It looks like TBH has the future of PFC in his hands,500k oh how the mighty have fallen,PMSL.

 

Hi Andrew

 

Having received the PKF administrators report this morning, I am unsurprisingly shocked at the insulting 'offer' put towards creditors.

 

2p in the pound offer gives myself as a creditor of the first CVA the following:

 

£3000 - CVA MKI = £600 + CVA MKII = £12

 

Now if you think that is fair, then the shame falls on the football authorities just as much as Portsmouth FC.

 

If you think it is right for a club to take £120m of debt into a CVA (MKI), not pay a penny of it, subsequently bundle it into a CVA MKII and only end up paying just £500k

 

Can you confirm you see this as fair and proper? My £3000 becomes £12... overall debts of £120m become £500k...

 

Just looking at those numbers makes me feel nauseous.

 

If nothing is done to stop this shocking act, which has destroyed my life, my business and significantly damaged the lives of my wife and children, I will begin publicly campaigning against the Football League outside Gloucester Place and will highlight this travesty for all to see.

 

I don't really have anything to lose, as I have pointed out my business has been destroyed, and nobody seems to give a dam.

 

Disgusting.

 

Regards

[channonball]

Perhaps the Eastenders scriptwriters have been reading this as inspiration for their current story line.

[toofarnorth]

Hi Andrew

 

Having received the PKF administrators report this morning, I am unsurprisingly shocked at the insulting 'offer' put towards creditors.

 

2p in the pound offer gives myself as a creditor of the first CVA the following:

 

£3000 - CVA MKI = £600 + CVA MKII = £12

 

Now if you think that is fair, then the shame falls on the football authorities just as much as Portsmouth FC.

 

If you think it is right for a club to take £120m of debt into a CVA (MKI), not pay a penny of it, subsequently bundle it into a CVA MKII and only end up paying just £500k

 

Can you confirm you see this as fair and proper? My £3000 becomes £12... overall debts of £120m become £500k...

 

Just looking at those numbers makes me feel nauseous.

 

If nothing is done to stop this shocking act, which has destroyed my life, my business and significantly damaged the lives of my wife and children, I will begin publicly campaigning against the Football League outside Gloucester Place and will highlight this travesty for all to see.

 

I don't really have anything to lose, as I have pointed out my business has been destroyed, and nobody seems to give a dam.

 

Disgusting.

 

Regards

 

Wher's that from?

[edprice1984]

Hi Andrew

 

Having received the PKF administrators report this morning, I am unsurprisingly shocked at the insulting 'offer' put towards creditors.

 

2p in the pound offer gives myself as a creditor of the first CVA the following:

 

£3000 - CVA MKI = £600 + CVA MKII = £12

Now if you think that is fair, then the shame falls on the football authorities just as much as Portsmouth FC.

 

If you think it is right for a club to take £120m of debt into a CVA (MKI), not pay a penny of it, subsequently bundle it into a CVA MKII and only end up paying just £500k

 

Can you confirm you see this as fair and proper? My £3000 becomes £12... overall debts of £120m become £500k...

 

Just looking at those numbers makes me feel nauseous.

 

If nothing is done to stop this shocking act, which has destroyed my life, my business and significantly damaged the lives of my wife and children, I will begin publicly campaigning against the Football League outside Gloucester Place and will highlight this travesty for all to see.

 

I don't really have anything to lose, as I have pointed out my business has been destroyed, and nobody seems to give a dam.

 

Disgusting.

 

Regards

 

I really feel for you! That it absolutely disgraceful and I am sure you are not alone with this scenario. If I were you I would look to get together as many of the smaller creditors as possible and protest outside Football League/FA HQ - invite the press, it isn't even about Pompey anymore. No club should be able to get away with this!

[trousers]

Down the pub....Just about to slap my colleague....and I quote: "You Saints fans have got a cheek banging on about Pompey seeing that you went into administration not so long ago....stones and glass houses..."

 

Sigh...

[Weston Super Saint]

Hi Andrew

 

Having received the PKF administrators report this morning, I am unsurprisingly shocked at the insulting 'offer' put towards creditors.

 

2p in the pound offer gives myself as a creditor of the first CVA the following:

 

£3000 - CVA MKI = £600 + CVA MKII = £12

 

Now if you think that is fair, then the shame falls on the football authorities just as much as Portsmouth FC.

 

If you think it is right for a club to take £120m of debt into a CVA (MKI), not pay a penny of it, subsequently bundle it into a CVA MKII and only end up paying just £500k

 

Can you confirm you see this as fair and proper? My £3000 becomes £12... overall debts of £120m become £500k...

 

Just looking at those numbers makes me feel nauseous.

 

If nothing is done to stop this shocking act, which has destroyed my life, my business and significantly damaged the lives of my wife and children, I will begin publicly campaigning against the Football League outside Gloucester Place and will highlight this travesty for all to see.

 

I don't really have anything to lose, as I have pointed out my business has been destroyed, and nobody seems to give a dam.

 

Disgusting.

 

Regards

 

You seem to be forgetting that it is all LESS EXPENSES!

 

Also, the complicated sum from above, so in effect, £3000 becomes :

 

83.2% of £12 = £9.99, less expenses, probably original CVA expenses AND current PKF expenses.

 

So from £3000 original debt, you MIGHT have enough to buy some photo paper for your photo business, as long as it doesn't cost more than about £7!

 

You've gone from being able to afford a Cannon 5D to being able to afford a few bits of photo paper - which will remain blank as you've no camera to take pictures with - assuming you are still using the photographer small business example

[Torres]

Pedg - just done the maths too and I concur. The amount they're owed would be reduced by about 16% overall.

 

And they'd get 2% of that.

[pedg]

Pedg - just done the maths too and I concur. The amount they're owed would be reduced by about 16% overall.

 

And they'd get 2% of that.

 

Think the main thing is that it appears to state this is for distribution only, not voting values in which case BT + HMRC should have enough the vote it down and the reduction given BT even less incentive to vote in favour. In fact odd that its there as it would appear they would need BT to vote for the CVA so why include a condition that gives them even less??

[stev2001]

It does make me wonder why the national press doesnt pick up on this. I think it'll make interesting reading to most football fans. Are they worried about losing a few skate readers?

[Torres]

Well that's the curious thing Pedg. I posed a question a while back as to whether it would be standard practice in this kind of situation for the administrators to make contact with the major unsecured creditors and put out some feelers as to a figure that might be acceptable to them.

 

There's 3 scenarios, I guess:

1) PKF have had no indication from BT.

2) BT have indicated that this % is satisfactory.

3) BT have indicated this is not satisfactory but PKF have gone ahead anyway because they have no other option.

 

We shouldn't forget that Trevor Birch and PKF have to consider their own reputations in this. Getting a CVA agreed is the best outcome for their reputation - that's their "success". Failure to present a CVA and liquidating straight off is the worst - that's total failure. Presenting a CVA proposal but having it voted down by creditors allows them to then liquidate whilst saying "Well, we tried our best but the creditors blocked it" and at least allows them to walk away with some credit. I wonder....

[Verbal]

I hope the players' union are on to this. The pressure the high earners are under now is relentless, and arguably illegal.

[Matthew Le God]

I hope the players' union are on to this. The pressure the high earners are under now is relentless, and arguably illegal.

 

Under which law?

[Verbal]

Under which law?

 

Oh god (!). It's you.

[Torres]

In fact, this whole crappy CVA could be a face-saving exercise for PKF and an additional bit of leverage for Chinny when it (perhaps inevitably and inevitably by design) fails.

 

PKF walk away and say "We tried our best, we proposed a CVA but the creditors rejected it against our recommendations" and have their reputation within the industry intact. Of course, they also get paid.

 

Chinny can turn to the people and, more importantly the council, of Portsmouth and say "I tried to save your club when nobody else did. I offered to pay the small creditors in full. I offered to pay the charities in full. I did everything I could, but those nasty people at HMRC/Baker Tilley stopped me. Now can I have planning permission to build flats on Fratton Park, pretty please?"

Edited 8 June, 2012 by Torres

[Chez]

Under which law?

constructive dismissal

[angelman]

2p!! If I was offered 2p I would tell them to keep it!

[tony13579]

Could the PST now create a rival CVA proposal and offer 3p in the £ ????

[andysstuff]

Could the PST now create a rival CVA proposal and offer 3p in the £ ????

 

 

thay are apparently to release a statement at 3.00pm

[Chez]

Can't the Trust top that £500,000 offer?

[Chez]

2p!! If I was offered 2p I would tell them to keep it!

 

Imagine if you were owed £100,000 before the first admin and had now just been offered the grand total of £400. I think you'd come up with a place they could shove their £400.

[pedg]

Can't the Trust top that £500,000 offer?

 

I am not sure we have a handle on the total cost of the current offer as it included paying football creditors in full (does that include the wages that have been forgone?, one suspects not) and the charities as well as the 500k for everyone else.

[derry]

Maybe HMRC should buy it, liquidate it and cover the cost with the tax that the players contracts would generate. They would also save themselves further losses when the whole thing goes tits up further down the line.

[pedg]

of course another option is that this is something of an opening bid from chainrai and that he is prepared to pay more but wants to see what the trust intends to do. If the trust offer 3p and then he comes back and offers 4p what chance the trust coming back with a higher option?

[trousers]

I hope the players' union are on to this. The pressure the high earners are under now is relentless, and arguably illegal.

 

I'm no union man (said the official spokesman from the "The Pope is a Catholic" campaign headquarters....) but I agree with this wholeheartly. Once again, in any other walk of life this employee moral blackmail would be stamped upon relentlessly, but, in the fantasy world of football it's seemingly deemed to be acceptable behaviour....