Rangers takeover: Three bidders remain in the running to buy Rangers

Paul Murray’s Blue Knights consortium, an American bid and one from Singapore are the three which remain.

All four offers were submitted on Wednesday, administrators Duff & Phelps’ deadline for “best and final bids” for the Scottish champions.

After scrutinising the content of those bids, Duff & Phelps were able not only to reject the German offer as insufficient, but also to express increasing optimism that the club could come out of administration via a Company Voluntary Arrangement (CVA).

That was despite the fact that, in a statement to creditors posted on the Rangers website, Duff & Phelps said that the club’s debt could go as high as £134 million in the event of the so-called big tax case going against them.

Duff & Phelps must believe that the remaining bidders have laid down feasible plans for dealing with that sum, as to agree a CVA, a prospective new buyer must win the consent of at least 75 per cent of the creditors.

“Following the outcome of the bidding process, I can confirm today that we will be considering further three of the four bids submitted yesterday,” joint administrator David Whitehouse said. “We have had a number of discussions with the interested parties today and have stressed the benefits to them of engaging openly with the club’s fanbase.

“We can now see light at the end of the tunnel, whereby the club can exit from administration and focus upon success on the pitch. While we cannot be precise on time scale, exit from administration does look achievable by the end of the season. We also hope to announce next week acceptance of one bid, which would then be subject to a period of due diligence and exclusivity. Most importantly, following the bidding process, we believe that the most likely exit from administration will be the successful implementation of a CVA.

“This is an extremely complicated case, not least because of the requirements to meet insolvency legislation, the rules of the various football authorities and the contractual requirements of key business partners of the club. It is, however, appropriate that we once again set out our position in relation to the manner in which we are seeking to achieve an exit from administration.

“The first objective of administration is to achieve the survival of the company as a going concern. In relation to the football club this can only be achieved via the exit from administration through a CVA. A CVA is a process by which creditors are presented with a proposal to deal with the legacy debts of the company.

“Creditors in turn vote upon those proposals and therefore there is a requirement for a CVA to meet the commercial needs of creditors. It is therefore essential that any CVA proposal is commercially acceptable to the general body of creditors. The ability of the company to exit through a CVA process is, therefore, dependent in part, on the level of offers submitted for the business and is in the gift of the potential purchasers to deliver. As stated, we believe this can be achieved.”

Of the three remaining bidders, Murray has come out explicitly in favour of a CVA and completely opposed to the club being liquidated then reinvented as a new company. A source related to the Singaporean bid has said that they too want to pursue the CVA route and are opposed to liquidation.

The American bidders have yet to explain their strategy. The only related comment has come from Club 9 of Chicago, the company which was involved in initial talks to form the American consortium, but which has since dropped out.

Earlier this week, Club 9 said that, contrary to speculation, it was opposed to liquidation. However, the company did not explain whether the remaining elements of the consortium shared that view.

Whitehouse explained that he and colleague Paul Clark had discussed alternatives to a CVA with bidders – including liquidation. “While such an arrangement is not desirable in so far as it would change the corporate entity and would leave the club facing European and domestic football penalties, it nevertheless could provide a platform to enable new and substantial investment to be made, which would in turn achieve the long term stability and viability of the business,” he said. “As administrators, we would be in breach of our statutory duties if we rejected out of hand any legitimate proposal that asserted to secure the future of the club. This solution is not our primary objective nor our preferred option. However, we would ask fans to understand that delivery of a CVA can only be achieved if purchasers are prepared to offer enough to provide a return to creditors at a commercially acceptable level.”

After seeing their club stay in administration for almost two months, those fans probably understand that only too well.

Nonetheless, they remain implacably opposed to the liquidation route. Besides the fact that two of the remaining three bidders appear to favour a CVA, those fans can take further solace from the potential role of Brian Kennedy.

The Scot, who owns Sale Sharks rugby club, has called himself a reluctant bidder for Rangers, but has said he would be far more reluctant for the club to be liquidated.

He is standing by ready to table a bid if the Blue Knights’ offer, and any other which proposes a CVA, is rejected by the administrators.