Scottish League One Club Avoids Liquidation As Creditors Support CVA
Scottish League One Dunfermline has "avoided liquidation after the company's creditors agreed to support a company voluntary arrangement," according to Jonny Boyle of THE SUN. Fans group Pars United -- which is led by former player Jim Leishman and businessman Bob Garmony -- "will take control of the company's shares after an 'overwhelming' vote in favour of a deal to write down the club's debt." Former Owner Gavin Masterton abstained from the CVA vote, "effectively giving up his claim" to around £8.5M ($13M) owed to him and his companies (THE SUN, 7/30). In Dundee, Craig Smith reported the group is "now expected to take full control of the club and stadium over the next few weeks as the process of exiting administration progresses." BDO administrator Bryan Jackson said, "Obviously this is a great result for the club and for the supporters." There is a 28-day period when creditors can appeal, but Jackson "is hopeful the deal will go through" (THE COURIER, 7/30). The BBC reported the club's shares were sold for £1 ($1.50), while £80,000 ($120,000) will go to preferred creditors, with former players and staff receiving back-dated pay in full. Pars United will assume responsibility for all "footballing debts," which BDO said is "understood not to exceed £170,000" ($259,000) and pay BDO's fees of £100,000 ($150,000) plus VAT. Dunfermline's situation "was complicated by their stadium being owned by a separate company, East End Park Ltd, which is being handled by a different administrator, KPMG." BDO said East End Park Ltd will be "entitled to any residual over and above" the figures they have released, with their main creditor the bank (BBC, 7/30). The Scotland DAILY RECORD reported Dunfermline was issued with a 15-point penalty "after calling in trouble-shooters BDO and were eventually relegated from the First Division last term." Eight players -- including coach Jordan McMillan -- "were made redundant," but Tuesday's news "should spare the club a further 10-point penalty which would have been imposed had they still been in administration when the new League One season kicked-off" (DAILY RECORD, 7/30).