Rangers liquidators in talks over potential Inverness Caley Thistle administration amid redundancy concerns
Inverness Caley Thistle Football Club. Picture: James Mackenzie.Inverness Caley Thistle Football Club. Picture: James Mackenzie.
EXCLUSIVE: Inverness Caledonian Thistle FC has launched talks about potentially entering administration with the same company that handled the liquidation of Rangers.
Internal documents seen by The Inverness Courier reveal that initial contact has been made with large accountancy firm BDO which, as well as dealing with Rangers, also were the administrators for Hearts and Dunfermline.
Previously, Alan Savage promised on August 13 to maintain the club for a period of three to six months as he sought to find a potential buyer by propping it up having taken control of running the club day-to-day.
But now – exactly seven weeks on from that announcement – it appears his efforts to rescue the club have come to an end in what is a devastating blow for Caley Thistle.
Right now the club is in the pre-administration phase but if it does appoint BDO as the administrator that would trigger a number of immediate actions including a points deduction and redundancies.
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The document from BDO titled “Operation Kessock” is dated as Friday, September 27.
It outlines “Indicative Administration & Company Voluntary Arrangement (“CVA”) Timeline” – that is a method to rescue a company/club in deep debt by reaching agreement with creditors about repayment of all or part of its debts.
But it comes with a heavy price both on and off the field. If an administrator is appointed it would mean “immediate redundancies” not just of staff but potentially players too.
The SPFL would deduct 15 points this season and five points next season as well as placing the club licence under review – if Caley Thistle loses its licence then it would not be permitted to compete in professional football.
BDO projects three phases ranging from one to 12 weeks though it can be reasonably assumed that this is subject to change depending on what is discovered and what obligations need to be met.
The first phase is the pre-planning stage due to last between one and two weeks – this is approximately where the club is headed to at the moment.
It involves reviewing cash flow projections, agreeing a reduction in costs and liaising with football authorities like the Players Football Association (PFA). That is seen as “critical” because player redundancies are on the table so PFA support will be “vital to ensure fixtures can be completed”.
Then it would be a matter of preparing the administration cash flow forecasts to ensure funding requirements can be met to cover any trading shortfall and the costs of the administration.
A media communication strategy would need to be agreed and sales memorandum and non-disclosure agreements would be drafted as well as consideration of whether the Financial Conduct Authority (‘FCA’) needs to be notified prior to appointment.
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Stage two would likely last from weeks three to eight and would see appointment of administrators leading to “immediate redundancies” and work to find a buyer starting in earnest.
There would be engagement with interested parties and then, to verify if any bids were viable, a data room would be set-up with the co-ordination of any due diligence work and ongoing dialogue with relevant authorities.
The closing date for bids would be issued and then a preferred bidder would be appointed followed by approval from football authorities that they are “fit and proper” to own a club.
The period of time for this to take place could also be extended depending on the interested parties. Finally a draft sale and purchase contract would be agreed and draft proposals to repay creditors.
The repayment proposals would be finalised with a meeting of creditors and shareholders and if approved then the company/club would exit administration.
Alan Savage, Caley Thistle and BDO have all been approached for comment.
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