1) The club (Cardiff City FC (Holdings) Ltd) was approx £30m in debt at 31.05.04. This debt will now have risen significantly. I don't think we know who owes the debt at this point: is it Cardiff City (Holdings) FC or Rudgwick? Given Sam owns 82.5% of CCFC Holdings anyway he is the de facto owner so does it make any difference? Which bank owns the debt?
2)We have bought players at high prices and paid silly wages. We have bought some players we don't need, eg another goalkeeper. We have failed to deliver a business plan for the stadium. We still (?) have not paid February's wages.
3) Should the club go into administration, the shareholders, including Sam Hammam's Rudgwick, will effectively get nothing. There are nearly 600 shareholders. Sam owns about 82.5%, other directors more, small shareholders like myself a tiny amount together, probably barely 1% between us. Most of us small shareholders of course simply put a bit of money in through the Bluebirds 2000 offer and never expected to get it back anyway. (I have 600 shares out of the overall 22,500,000, for example).
4) Would Sam benefit from administration now to reduce the debt? That's not clear to me, unless Rudgwick got something back directly, for example, the paying out of its loan. Arguably though, surely it is in Sam's interest to avoid administration, with the hope of getting more back through player sales later.
5) Administrators will have a responsibility to try to maintain us as a going concern and try to find a buyer.
6) We will lose ten points whether we go into administration now or in the summer. If in the summer, we lose the points next season.
7) If we went into admin, presumably every asset, including the lease on the ground, would be up for sale. Could an individual existing director make a bid for the Club (Company) at that point to buy it out of administration? Not sure what the law says on this. (There might be different rules for directors, or for directors with controlling interests. Clearly, Company law would not want a bunch of directors running a company into administration then the same lot picking it up from the administrator for a song) If it's not ruled out in principle, you could form a Newco (new company) with others.
8) That Newco would presumably be able to sign new contracts with players who were left. Presumably that Newco could involve supporters in ownership, possibly through a Trust. Newco would have to plan on the basis of say 10,000 a game crowds, investment by fans, including some 'serious money' fans, and the need to negotiate access to a ground, eg the Millennium Stadium, or a further lease on Ninian Park, paid for from the gate, advertising, TV rights, programme sales etc.It would have to start small, and cheap - youth, Bosman players etc.
9) What would the position be if the club were liquidated? A new club would have to be formed. Would it retain the position of the existing Cardiff City in the Championship?
My current take (this might change depending on available info) is that avoiding administration is probably still the priority if the club can be kept going till the end of the season. That may mean selling off players, hopefully the older/less promising ones (we all know who we would prefer to see go), and/or taking in more investment, assuming it is available, from other investors such as Mr Isaac. Selling players would of course be a dreadful prospect. I certainly don't want to see players go. The thought was there all through Saturday's game that this might be the last time we saw this bunch of players together. But if more players had to be sold, then we know at least one who would generate more income if Premiership Clubs were allowed to bid for him. Therefore the club would get more money from the sale of players in the summer, rather than a fire-sale now.
But is that a feasible long-term solution? Doesn't it depend on further borrowing, possibly against a stadium plan? Will anyone really buy the new stadium dream now? That would seem unlikely.
On the other hand, of course, there is no guarantee to eg Mr Isaac that he would be doing anything other than pouring his money into a hole in the ground, whereas if he bought the club out of administration, he would have a chance of doing something meaningful with the money he was investing, with more control. Planning permission for a development would of course be an asset. (This is the opposite of what Wales on Sunday is suggesting was his position, but who knows?) Some I suppose might feel that administration, losing ten points, and being relegated, but bought out of admin by a new owner, with the possibility of a season in which the club did well in League 1, thus encouraging people to watch, might be worth it. And perhaps we might actually manage to hold onto more of the players we would want to keep - or would they have been sold in administration?
The trouble is, we still don't have enough information. Much of what I am saying here is speculative. I think also we as fans need some top-notch accountancy/corporate legal advice.
But with or without more information, all the routes forward look dismal.
