Leading Horses to Water

Quote: Slugger McBatt "Without wanting to appear as a Ted-lover, and struggling to get my head round the technicalities, is the gist of what's happened this

If there are wrongdoings, then whatever form the insolvency takes the insolvency practitioner appointed - be it Administrator or Liquidator - is an officer of the Court. And ALWAYS has to ask creditors if they have any information that may assist him in assessing the conduct of the directors, in respect of which he has a statutory responsibility to enquire and if necessary act. The directors may seek to appoint a liquidator, but it is the creditors who decide who the liquidator is to be - provided they get off their s and act responsibly. The key is for the creditors to make sure THEIR man gets appointed, not some pal of the directors. Then a liquidation committee of creditors may be formed. The trouble is, a liquidator has sod all funds, so if the creditors want him to go after the directors then they have to fund it. To an extent, the same applies in Administration.

Sorry, that is quick and abbreviated - its a wide subject, and I doubt you'd want me to bore you any more with it.

And the way it could look to an unconnected third party MIGHT be:

1. Property speculator buys club because he sees development value in the ground.
2. Property speculator forms offshore vehicle to buy the ground off the club, at a fair "existing use" value and probably at some premium to that, recognising that at that stage there is no planning permission so the fair market value is hard to determine.
3. Offshore vehicle borrows most of necessary funding from Irish Bank, secured by mortgage on the ground
4. Offshore vehicle seemingly pays only part of the purchase price to the club. Unclear why not all.
5. Club then uses some of/most of/all of (unclear) the part-consideration to repay loans due to directors. (note that this would probably only be illegal if, at that point, the business was insolvent - then it would be a "fraudulent preference". But this transaction is surely bound to attract the interest of the Administrator or Liquidator.
6. Offshore vehicle obtains planning permission. Value of property now probably much higher than previously. How that value compares to what it paid the club...well that would be another area likely to interest the Administrator.
7. Property market goes belly-up, and short-term development options limited.
8. Club does not make the progress it hoped for in securing new ground, so is stuck in old dilapidated ground that offshore vehicle will of course spend no money on as such would be of no benefit to it.
9. Offshore vehicle stuck with paying interest on loan it took out to buy ground, rather than securing quick sale as it had envisaged. Offshore vehicle starts to get in the poo. (The administrator would likely be VERY interested in understanding what happened to the rest of the consideration, if it was not all paid, since if the offshore vehicle borrowed most of the value of the property and then did NOT pay it all over to the club, who DID it pay it to? Since this would prevent there being enough equity in the property to allow the interest to be rolled up.)
10. Remember it was an Irish bank? They who destroyed the Irish economy by reckless lending to poor credit risks? QED? And they will likely want their money back, or the mortgaged property sold at best value to at least get a half-decent recovery. And such a sale will have to be for development if that is the case.
11. Offshore vehicle goes bust.
12. Club owner goes bust. Unclear why, especially as he had his loan to the club repaid a while back.
13. Club, stuck between a rock and a hard place with no assets, soon to have no ground and seemingly owed a slug of money for sale of its ground from a company that has gone bust, and having seemingly had to use tax monies never its own to pay the bills, proceeds to go bust itself.

And, then again, it might not. The above is a view you might form from what is in that article and what you read on here and elsewhere. I do not know what REALLY happened.

But someone does.

And, I suggest, that someone should now be totally open and honest about what really happened.

Unless, of course, that would not be in their personal interest?