Administration?

[Groo]

A 10 point defecit would not be easily made up, Leeds did well with their 27 points a few years back, but that was League 1.

 

Anyone who thinks a 10 point deduction would be anything but a prelude to a relegation battle is in my mind delutional.

[dustynrg]

A 10 point defecit would not be easily made up, Leeds did well with their 27 points a few years back, but that was League 1.

 

Anyone who thinks a 10 point deduction would be anything but a prelude to a relegation battle is in my mind delutional.

 

Who's saying it would be easily made up? If we go into administration we've got no choice but to bite the bullet.

[Dave]

I'm no financial expert but if he puts us into Admin wouldn't a new owner just be £1 away? Administrators will sell for the best possible price they could get. For example set a date 1 month hence and the highest bidder gets it.

 

Not sure about the outstanding debt, I'd assume player wages would need to be met or a massive point deduction would follow (Lutons 30 points) so a new owner will need to more than cover player wages immediately. Players not paid can literally walk away or the administartor will accept derisory amounts for players (derisory players agreed)

 

Probably all bullshit but if it could be took over I'd take the 10point hit just to get shot of the idiot running the club.

 

The players would all be flogged though and with a timescale like a month we'd not be able to bring any replacements in as it wouldn't be sorted before the close of the transfer window.

 

All the while we're expected to be fielding a team to play week in, week out.

[midds]

Are there any benefits for Ashley personally if he were to put us into administration?   

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

 

Oh. Shit. 

 

 

Breathing a little easier after having a quick word with a mate. 

[Dave]

Are there any benefits for Ashley personally if he were to put us into administration?   

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

 

Oh. Shit. 

 

 

Breathing a little easier after having a quick word with a mate. 

 

Do explain!

[Big Geordie]

We would be left with a team of youngsters (much like Southampton last season) and would then have to rely on out-of-contract players and loan signings. We would barely be able to put a team together, assuming Ashley asset strips first or any potential administrator does it later.

[Groo]

A 10 point defecit would not be easily made up, Leeds did well with their 27 points a few years back, but that was League 1.

 

Anyone who thinks a 10 point deduction would be anything but a prelude to a relegation battle is in my mind delutional.

 

Who's saying it would be easily made up? If we go into administration we've got no choice but to bite the bullet.

 

Agree, its the posters who want admin now to get rid of Ashley my post was for.

 

I'm still praying someone with integrity and at least some knowledge of running a football club rides in on a white horse and saves the club. Then again I'm delusional too.

[Big Geordie]

Groo - Ashley doesn't have to sell though, if this other option is available to him. By selling, he'd be giving the club a chance this season and turning it around. By running it into the ground, he'd all but be twisting the knife one final time.

[Dave]

If he plans on putting us into administration, surely he'd flog the most valuable players first? Makes more sense than letting them go once they're worth pennies.

[CaliMag]

If he plans on putting us into administration, surely he'd flog the most valuable players first? Makes more sense than letting them go once they're worth pennies.

That is what Leeds did.

[Parky]

Important bit in the Mail today...

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great

 

Read more: http://www.dailymail.co.uk/sport/football/article-1202592/Will-Newcastle-follow-Leeds-latest-damned-United.html?ITO=1490#ixzz0MVHJ6NSx

 

[Dave]

No shit Parky, we've been discussing it for the last hour.

[Parky]

No shit Parky, we've been discussing it for the last hour.

 

I've been catnapping and just dipped back in. he he...

[dustynrg]

In some ways, selling the mercenaries (ALL of them) - starting again and perhaps having Shearer in charge and getting some players with heart in, wouldn't be the worst scenario of all time. OK we wouldn't go up this season or even next but we'd be rid of ALL the bastards, the mismatched players, the lying Managing Director and the non speaking owner. We might even enjoy the football.

[Parky]

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

Friday has emerged as being possibly significant simply because it is the end of the month. Ashley has a basic economic calculation: does he make more money from selling the club or from administration?

 

Can anyone explain this to me please?

 

I still don't understand why he'd prefer to take the relative pennies on offer from administration over the £60m offered by Shepherd.

 

I am no expert on British Tax Law, however I knwo that this could easily be done in the States by...

1. NUFC is a seperate entity that has outstanding debts

2. NUFC goes into administration and sells most of its assets in an effort to settle those debts.

3. Fire sale of salable items occurs (like players and properties like SJP, the training ground, parking areas, etc). Not necessarily all salable items would be sold but liabilities (read as players) certainly would be.

4. Debts owed may have legal priority to some institutions over others. Example NUFC owes outstanding debt to BT (hasn't paid bills in months), a loan from a bank and loans from Ashley. Ashley gets paid first by prior agreement in original loan.

5. Ashley takes a loss on the loans

6. Ashely counts this loss against profits form his other holdings and assets - the gov't was going to tax him on his profits from Sports Direct, interest earned, etc - say in the order of 20 million pounds, BUT he claims losses of 100m- therefore pays no taxes. Making his actual loss only 80m

 

Writing off against tax...It was staring us in the face. Just guess we didn't envisage such cruelty (if it happens).

[dcmk]

If the club defaulted on payments would the creditors enforce this administration?  I have no idea how the process works admittedly.

[Parky]

If the club defaulted on payments would the creditors enforce this administration?  I have no idea how the process works admittedly.

 

Barclays would be the first I guess.

[Dave]

In some ways, selling the mercenaries (ALL of them) - starting again and perhaps having Shearer in charge and getting some players with heart in, wouldn't be the worst scenario of all time. OK we wouldn't go up this season or even next but we'd be rid of ALL the bastards, the mismatched players, the lying Managing Director and the non speaking owner. We might even enjoy the football.

 

I know this is clichéd but I'm pretty sure Leeds fans will have thought something similar at the time.

[CaliMag]

In some ways, selling the mercenaries (ALL of them) - starting again and perhaps having Shearer in charge and getting some players with heart in, wouldn't be the worst scenario of all time. OK we wouldn't go up this season or even next but we'd be rid of ALL the bastards, the mismatched players, the lying Managing Director and the non speaking owner. We might even enjoy the football.

If the timing and the paperwork is not done exactly right it would mean starting the season with just the academy and no window to get replacement players in. We would get battered EVERY game... not very enjoyable.

[Kasper]

Important bit in the Mail today...

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great

 

Read more: http://www.dailymail.co.uk/sport/football/article-1202592/Will-Newcastle-follow-Leeds-latest-damned-United.html?ITO=1490#ixzz0MVHJ6NSx

 

 

How do you do that highlighting?

[midds]

Are there any benefits for Ashley personally if he were to put us into administration?   

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

 

Oh. Shit. 

 

 

Breathing a little easier after having a quick word with a mate. 

 

Do explain!

 

In simple terms, he couldn't set the capital loss on the sale of his 100% stake in NUFC against trading profits of his other companies like Sports Direct.

 

The only time the capital loss on the sale of NUFC would be of any use to him is if he were to sell loads of his other investments at a massive profit, which is unlikely given the recent performance of Sports Direct etc.

[Parky]

Are there any benefits for Ashley personally if he were to put us into administration?   

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

 

Oh. Shit. 

 

 

Breathing a little easier after having a quick word with a mate. 

 

Do explain!

 

In simple terms, he couldn't set the capital loss on the sale of his 100% stake in NUFC against trading profits of his other companies like Sports Direct.

 

The only time the capital loss on the sale of NUFC would be of any use to him is if he were to sell loads of his other investments at a massive profit, which is unlikely given the recent performance of Sports Direct etc.

 

But....What if he liquidated it??

[midds]

Are there any benefits for Ashley personally if he were to put us into administration?   

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

 

Oh. Shit. 

 

 

Breathing a little easier after having a quick word with a mate. 

 

Do explain!

 

In simple terms, he couldn't set the capital loss on the sale of his 100% stake in NUFC against trading profits of his other companies like Sports Direct.

 

The only time the capital loss on the sale of NUFC would be of any use to him is if he were to sell loads of his other investments at a massive profit, which is unlikely given the recent performance of Sports Direct etc.

 

But....What if he liquidated it??

 

No idea! 

 

I'll ask him.

[Parky]

Are there any benefits for Ashley personally if he were to put us into administration?   

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

 

Oh. Shit. 

 

 

Breathing a little easier after having a quick word with a mate. 

 

Do explain!

 

In simple terms, he couldn't set the capital loss on the sale of his 100% stake in NUFC against trading profits of his other companies like Sports Direct.

 

The only time the capital loss on the sale of NUFC would be of any use to him is if he were to sell loads of his other investments at a massive profit, which is unlikely given the recent performance of Sports Direct etc.

 

But....What if he liquidated it??

 

No idea! 

 

I'll ask him.

 

Cheers.

 

...and I'm pretty sure tax losses can be carried over. I'll check.

[CaliMag]

Are there any benefits for Ashley personally if he were to put us into administration?   

 

As Ashley would be the major creditor, administration would seem an odd move financially. But Ashley could probably take his losses at Newcastle, which would be close to £250m, and set them against profit at his other companies, such as Sports Direct. Ashley’s tax liability would then be reduced and his loss not so great.

 

 

Oh. s***. 

 

 

Breathing a little easier after having a quick word with a mate. 

 

Do explain!

 

In simple terms, he couldn't set the capital loss on the sale of his 100% stake in NUFC against trading profits of his other companies like Sports Direct.

 

The only time the capital loss on the sale of NUFC would be of any use to him is if he were to sell loads of his other investments at a massive profit, which is unlikely given the recent performance of Sports Direct etc.

 

Since Sports Direct is now a public company (he owns just over 50%) his only income from it comes in the form of dividends (which he shares with all share holders). That being the case, if he files his income taxes as a person rather than a company isn't his right to say "I made loads of money here and I lost even more over there. So I owe no taxes."?