How would a CVA work?

[Stefanovitch 0]

The whole process is quite confusing I find.

 

For example, if someone bids £11m for the club what does this £11m get them? Does the £11m secure the club and assets or does the £11m secure the club, assets and fund a CVA?

 

If the big tax case goes against us and is included in a CVA do the creditors get less or does more have to be added to the pot?

 

I ask because some compare a CVA to a trust deed where the trust deed is repaid over an agreed period (e.g. 3 years). The difference with a CVA is there would be an £11m up front payment.

 

Does the club emerge from an agreed CVA and exit administration debt free or do we exit administration with a repayment plan which requires more than the initial £11m.

[CumbernauldGers 0]

Good post, i'm like you in the dark over this stuff and would be good if somebody could give a run down on how a cva would work?

[Bluedell 5,348]

The CVA is an agreement between the club and the creditors. The club will get the cash from one of the bidders and then reach agreement with the creditors to repay a proportion of the cash, either immediately or over a period of time. Presumably in our case it will be immediately. The bidders in return for the cash will either get the shares of the club or the assets of the club depending on what sort of agreement is reached and with who.

 

My guess will be that we would emerge from administration still owing Ticketus (based on TBK proposal) and perhaps some of the football debt, although this MAY be dealt with by the payment from the bidder, but the rest of the debt would have disappeared.

 

If BTC goes against us the HMRC are owed more and would therefore get a bigger proportion of the cash received from the bidder.

[Stefanovitch 0]

So we could emerge from administration owing £10m (or threreabouts) to Ticketus, repayable over 9 years at 0% interest (if the last deal stands), £800k to Hearts and £1m to Rapid Vienna, £200k to Palermo, Orebro £150k + £350k to Arsenal & Chelsea.

 

That doesn't seem such a terrible situation IF a CVA is agreed.

[Stefanovitch 0]

Does anyone know the answer regarding a CVA?

[Zappa 0]

Does anyone know the answer regarding a CVA?

 

Answer to which question?

[Stefanovitch 0]

Answer to which question?

 

Does £10m get you a debt free club and all it's assets or would a CVA be repaid over a number of years?

[Zappa 0]

Does £10m get you a debt free club and all it's assets or would a CVA be repaid over a number of years?

 

That would depend on various things related to who the buyer is. For example, The Blue Knights proposal would most likely mean that the club is not debt free because they are planning to borrow money from Ticketus as well as sign an agreement with Ticketus to pay back a certain proportion of the money Ticketus gave to Craig Whyte.

 

The Bill Miller proposal is completely different in terms of how he intends dealing with Ticketus. Essentially it looks as though Miller wants to rip up the Ticketus deal and tell them to GTF. It seems to me that Miller's proposal would probably leave the club debt free.

 

That's my take on it mate, but I could be wrong of course.

[Shane 0]

That would depend on various things related to who the buyer is. For example, The Blue Knights proposal would most likely mean that the club is not debt free because they are planning to borrow money from Ticketus as well as sign an agreement with Ticketus to pay back a certain proportion of the money Ticketus gave to Craig Whyte.

 

The Bill Miller proposal is completely different in terms of how he intends dealing with Ticketus. Essentially it looks as though Miller wants to rip up the Ticketus deal and tell them to GTF. It seems to me that Miller's proposal would probably leave the club debt free.

 

That's my take on it mate, but I could be wrong of course.

 

Looks right to me. Plus Miller can pursue Whyte and others for assets stripped from the club, which includes hauling directors and company managers up in court to testify about their knowledge of events under oath, not in the media. Some of the people behind microphones now might have a slightly different story to tell under those circumstances.

[bigy 0]

Looks right to me. Plus Miller can pursue Whyte and others for assets stripped from the club, which includes hauling directors and company managers up in court to testify about their knowledge of events under oath, not in the media. Some of the people behind microphones now might have a slightly different story to tell under those circumstances.

 

How so? If Miller creates a newco, which he is planning to do, how does that newco have any comeback to the owner of an old, non existent, business?

 

The other thing I don't understand is that D&P are charged with acting in the best interests of all creditors. If Bill Miller is putting up £11.25m, but that has to be split between Ticketus and HMRC, how can that possibly be better than TBK putting up even half that to HMRC with Ticketus out of the pot?