Duff & Phelps, administrators to Rangers Football Club Plc, today granted Tennessee businessman Bill Miller preferred-bidder status for the 54-time Scottish champion.
The unconditional bid by Miller, chairman of Ooltewah-based Miller Industries Inc. (MLR:US), for the business and assets of the 140- year-old Glasgow soccer club will secure a return to creditors, Duff & Phelps said today in an e-mailed statement.
“It is a great honor and privilege to have the opportunity to buy Rangers Football Club,” Miller said in a statement published on Rangers’ website. “What Rangers have been put through, particularly in recent months, is a travesty. Under my stewardship, Rangers will be managed with fiscal discipline such that, from now on, Rangers will live within its means.”
Rangers went into administration, a form of bankruptcy, on Feb. 14, owing creditors as much as 134 million pounds ($217 million), including more than 93 million pounds owed to the U.K. authorities in two tax disputes and other unpaid taxes.
Miller’s bid is structured to enter a so-called company voluntary arrangement while the assets and business he is buying are put into a new company. As creditors are dealt with, the assets will be returned to Rangers Football Club, administrators said. The aim is to complete the transaction by the end of the season.
“The bid submitted by Mr. Miller is substantially greater than any other proposal and provides the best return to creditors, a fundamental part of our duties as administrators,” Duff & Phelps said. “The structure provides a stable platform through which new investment can be deployed to ensure that the club thrives again in the future.”
Miller, whose company is the world’s biggest manufacturer of tow trucks, was competing against a group known as the Blue Knights headed by former Rangers director Paul Murray. The Blue Knights’ bid, which had a similar structure, had conditions attached, Duff & Phelps said. Singapore businessman Bill Ng dropped out of the bidding on April 20.
The structure of both bids was the only viable option as a “standalone” CVA would take so long to take effect that the club would not survive, Duff & Phelps said in the statement.
Miller “sees this route as a necessity rather than a choice and in our view this is an entirely workable strategy,” Duff & Phelps said. “Indeed, to ensure the continuing operation of the club beyond the end of May it is in our view a very compelling strategy.”
Liquidation, which would have involved selling off all the club’s assets and returning the proceeds to creditors, was never an option, Duff & Phelps said.
Going into liquidation would have barred Rangers from entering European competition for three years and forced it to start again in the bottom tier of the Scottish Football League.
Supporters, players, staff and anyone with the club at heart had been badly let down by a number of individuals, said Miller, who described Rangers as one of the world’s great sporting institutions.
The team was bought last year by Craig Whyte from David Murray -- who had owned the club for 23 years -- for one pound. Whyte also assumed responsibility for debts of more 20 million pounds owed to Lloyds Banking Group (LLOY) Plc’s HBOS unit and for settling the tax claim by HM Revenue & Customs over the use of offshore trusts to pay players.
Whyte sold three years’ worth of income from the sale of season tickets to the Ticketus agency and used the proceeds to pay off the bank loans.
In an interview in the Glasgow Herald in March, Murray said he had been duped into selling his 85 percent stake in the club to Whyte and he would never have sold to him had he known how the transaction was going to be financed.
The sale was delayed last month when the Scottish Premier League said April 11 it was considering changing the penalties imposed on teams going into administration. A decision, which was due to be made on April 30, has been postponed until May 17.
The Scottish Premier League will continue talks with Miller and his team, it said in a statement on its website today.
On April 23, Whyte, 40, was banned by the ruling Scottish Football Association for life and fined 200,000 pounds. The club was fined 160,000 pounds and banned from buying players over 18 for 12 months.
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