Sale of Southend United to Justin Rees and his consortium

[Paddypel]

I think as @TrevorFitzpatrickHattrick mentions, he is using it as his last bastion. We know he enjoys brinkmanship and he’s using as his ejection button and IMO is his only real negotiation tactic, in his pursuit of a sweeter deal from Justin or whoever else he is sweet talking. He doesn’t care about the club. Yes it makes his life easier to have it alive but that’s no reason to help it in his eyes.

But then doesn't he lose the bargaining power in regards to the sale terms ?

 

[Holy Joe]

But then doesn't he lose the bargaining power in regards to the sale terms ?

Not really he's selling the club for a pound - no one is negotiating on that. Roots Hall won't be part of adminstration as it's not owned by the club

 

[kentblues]

But then doesn't he lose the bargaining power in regards to the sale terms ?

He as owner and only charge holder is the only person who can seek administration. To do so without having some sort of "pre-pack" arrangement to present to the administrator would be stupidity. Any sale out of administration needs to be pretty much immediate as the the administrator will not fund the running of an insolvent business for any period IMHO.

 

[5ufc]

Can someone confirm will it be in RM interest to let us go into administration over a sale? Thanks

 

[Shrimpergonzo]

As the council are getting a chuck of them I can't see them say no.

It may be taken out of their hands though - I believe the original application was called in by the Secretary of State.

 

[kentblues]

Can someone confirm will it be in RM interest to let us go into administration over a sale? Thanks

No-one knows. Because a) no-one knows what hw has been offered b) no-one knows how much he owes against RH c) no-one knows what he would get for RH and club if club was sold out of administration.

 

[West Stand]

No.

If we enter administration, then we need to exit it before the AGM next June. If we haven't exited administration by then, then yes demotion is a possibility. That is my interpretation anyway. Minus 10 points is nailed on however.

It’s far far more complex than that.

You are right that 10 point minus is almost a given.


Between now and the Next AGM if Administration happens then all Football Creditors have to be paid in full and what’s called a Creditor Compromise has to be agreed too

That Compromise agreement will require a set % dividend to be paid to unsecured creditors. The EFL requires that dividend to be 25p in the £ if paid over 2 years and 33% if it’s over 3 years.
It that agreement isn’t in place at then there is an automatic relegation

 

[West Stand]

Could someone shed some light on what RM would gain by putting the club into admin please ? written off debt but then surely an administrator would be appointed ?

At this very late stage it may well be the only way to give SUFC in its current guise the chance to survive but will expose him and the other directors to investigation as to their actions and based on those investigations there could be an order made making them liable for some of the debts

 

[West Stand]

He as owner and only charge holder is the only person who can seek administration. To do so without having some sort of "pre-pack" arrangement to present to the administrator would be stupidity. Any sale out of administration needs to be pretty much immediate as the the administrator will not fund the running of an insolvent business for any period IMHO.

I think you are right re running the club but the clock is ticking ever faster and the setting up of and agreeing a pre pack is quite a process

The steps involved in a pre-pack administration​

1. A company is under pressure from creditors and is threatened with receivership or liquidation.

2. A firm of licensed insolvency practitioners is contacted to discuss the situation. They perform a business assessment and provide a range of possible options.

3. If pre-pack administration is decided upon, the insolvency practitioner values the company's assets and prepares a Statement of Affairs.

4. If business assets are to be sold to an existing company, steps will be taken to ensure the buyer has the necessary funds. This includes the provision of management accounts and other information to the insolvency practitioner.

5. If the intention is to sell the assets to a new company, or ‘newco,’ cash flow, profit and loss, and balance sheet forecasts should be provided to demonstrate the viability of the new company, and their ability to purchase the assets. Assistance to buy in the form of asset-based lending may be available.

6. The company is placed into administration, suspending all legal actions against them, and assets are sold immediately.

7. The administrator organises a creditors’ meeting during which an explanation and justification for going down the route of pre pack administration is provided.

8. The IP repays creditors pro-rata, with funds received from the liquidated assets.

 

[Mad Cyril]

arrrrrrgggghhhhhhhhhhhhhhhhhh

Ron not accepting the offer #Shocked

That is his perogative.

 

[discord]

He as owner and only charge holder is the only person who can seek administration. To do so without having some sort of "pre-pack" arrangement to present to the administrator would be stupidity. Any sale out of administration needs to be pretty much immediate as the the administrator will not fund the running of an insolvent business for any period IMHO.

Simon Jordan proved he has no pre-pack to present on talk sport. Ron just wants someone to pay his bill at the end of the day.

 

[GBJ]

At this very late stage it may well be the only way to give SUFC in its current guise the chance to survive but will expose him and the other directors to investigation as to their actions and based on those investigations there could be an order made making them liable for some of the debts

On the face of it, I feel that would be a good thing as it may factually expose the horrendous way we’ve been run for years. What’s the downside to an investigation though? I assume there’s something?

 

[West Stand]

He currently has a loss-making business on his hands. He’s not willing or able to put more money in to cover those losses. He’s put it up for sale for £1 but its historic debts make it an unattractive proposition. If he can’t sell his next best option is to go for administration and make it the administrators’ problem. Failing that it’s going bust and he could be prosecuted for wrongful trading.

That could happen for any Insovency Event save a CVA so Admistration won’t restrict scrutiny

Also the £1 sell is key because the only issues then would be around settlement of debt , RH / Training Ground be it the value or sums they are expecting RM to pay.

 

[kentblues]

I think you are right re running the club but the clock is ticking ever faster

With JR's references to administration I do wonder whether this option has been discussed as a potential scenario? JR may not want it but if they can't offer sufficient £££, and that the sale effectively requires Ron to find money rather than receive it (due to satisfying maybe very significant debt on RH for example) then this may have been presented as a plan B. Who knows. The proposition would need to be presented to the court, and a "pre-pack" sale to JR & co would need the courts go ahead.

If creditors get 25%-33% then probably that is looking after the creditors sufficiently verses liquidation. Unfortunately whilst I have been involved in these things as a supplier and buying companies out of administration, I am not knowledgable enough to know exactly how this could work.

As a supplier & creditor I have been on the end of "pre-packs", particularly with customers in the print industry. Fun. Not..

 

[Shrimper]

Fully expecting Ron's statement to make no sense

 

[West Stand]

With JR's references to administration I do wonder whether this option has been discussed as a potential scenario? JR may not want it but if they can't offer sufficient £££, and that the sale effectively requires Ron to find money rather than receive it (due to satisfying maybe very significant debt on RH for example) then this may have been presented as a plan B. Who knows. The proposition would need to be presented to the court, and a "pre-pack" sale to JR & co would need the courts go ahead.

If creditors get 25%-33% then probably that is looking after the creditors sufficiently verses liquidation. Unfortunately whilst I have been involved in these things as a supplier and buying companies out of administration, I am not knowledgable enough to know exactly how this could work.

As a supplier & creditor I have been on the end of "pre-packs", particularly with customers in the print industry. Fun. Not..

I suspect this is new territory for many and I think you are right about the expectation that RM stumps up and / or maybe even waves his right to a dividend .

 

[Fitz]

The best and most coherent statement I have seen from any of the prospective buyers over the last few months. So in the short term we will be going into administration, with a further points deduction and real prospect of National League South. But longer term this gives me great cause for optimism and I very much like the way they are trying to structure the deal. They should be able to do a deal with the administrator I would have thought, it will just be whether Ron let's go of the property assets.

 

[bluesfansince1952]

It’s amazing how some people are just totally immune to the perspectives of the rest of humanity, no matter what. He’s up there with Pol Pot in terms of reasonableness and compassion for others.

We need a sense of proportion here.

Somewhat inappropriate and OTT don't you think? Knowing someone who lost all of her extended family ie parents brothers sisters aunts uncles and cousins as a result of the 'cleansing' carried out by the Khmer Rouge I find it difficult to see how anyone would compare that with the actions of a football club owner.

Sad as we all might feel should Southend fold it is hardly a human catastrophe.

 

[gatecrasher]

Ron's like a man who was certain it was going to land on red in a casino and kept betting and betting on it and lost it all and is now asking the casino to pay him back.

Ron, you have no doubt lost money on this I also would expect you to look to cover your losses as much as you can, fact of the matter is your busted flush. The deal to allow him to keep fantasy farm and build on it would mean he can recoup his losses and probably make a few million, the big 50m plus pot is gone. Take what little self respect you have left and leave us with a club still left in tact albeit sent to within a whisker of its ruin.

 

[THE SEVENTIES NORTH BANK]

Fully expecting Ron's statement to make no sense

He'll just say that the two offers were nowhere near enough. So blaming the potential buyer.