Date:Tuesday March 9 2010
Last Saturday before the Birmingham cup game a group of fans representatives including myself were invited to meet UHY Hacker Young's staff in the Fratton Park boardroom.
The meeting was informative and is seen of the first of a series of sessions to take place before coming home games. We learnt nothing earth shattering but had some key questions answered.
To date UHY have far from completed their look at the figures and would tell us nothing until thay have, which is fully understanderable. But the minutes below make a very interesting read and special thanks go to Brendan Bone who made the notes which have now been agreed by all parties.
Thanks also go to Jo Collins from the Pompey trust who has experience of Insolvency matters and kept the rest of us (all men) on our best behaviour.
Minutes of Meeting between Pompey fans and Representatives of UHY Hacker Young (Administrators of Portsmouth Football Club)
Present: Colin Farmery (PVA), Scott MacLachlan (London Supporters Club), Jo Collins (Pompey Supporters Trust), Dave Taylor (Vital Pompey), Nigel Tressider (Pompey Supporters Club-Central Branch), Barry Dewing (Portsmouth Independent Supporters Club), Alan Taylor (Supporters Advisory Panel), Reece Percival (Pompey Anoraks), Mick Bleach (Chichester Supporters Club), Ken Malley (Football Supporters Federation) Mike Hall (Pompey Fans Online), Bill Gillon (Pompey Online) and Brendon Bone (SOS Pompey/True Blue Army.com) Michael Kiely (Associate Partner - UHY), Terri Mulgrew (Senior Insolvency Administrator - UHY), Johnny Moore (Fans Liaison Manager - PFC) and Lucius Peart (Operations Manager - PFC)
Meeting commenced - Saturday 6th March 10.00am
MK - Mike opened the meeting by introducing himself and stating that he was looking to open dialogue with fans representatives and he hoped this would be the first of many meetings. The result being the administration process was as open and transparent as possible, however, he did stress that they were in the very early stages and as such it would be impossible for him to divulge any specific information regarding actual financial findings at this time.
It was decided in the early stages for Reece Percival to put forward a number of questions that had been pre-agreed, and then once these had been asked, questions would come from other people around the table.
RP - What is the size of Portsmouth FC's current debt?
MK - Rough ball park figures at present, those are HMRC - £10m, Alexandre (Sasha) Gaydamak - £30m, Balran Chainrai - £15m (Owed to Portpin) and Unsecured debt £4mplus others - in total between £70-80m.
MH - Regarding Balran Chainrai debt, if he has taken 90% of the shares of PFC, surely this must be a substantial amount of money, and therefore how do we owe him £15m?
MK - BC put £15m into the club, and this has been used for month to month running costs, paying wages and a part payment to the HMRC. However as PFC has the debts it does, the shares are worth virtually nothing due to the huge financial deficit on the books.
AT - When Sulaiman Al Fahim came in and spoke to the fans in October, he said he was looking to raise £50 million, after doing due diligence. £15m would go to Paul Hart for players and the other £35 million would cover the debts of the club. If the debts were £35m in October, how are they £60-£70m 4 months later?
MK - Said it was very difficult to actually comment on the level of debt at present. They have spent the first week have meetings with various parties, and ensuring boththe FA Cup and League game against Birmingham to go ahead, however, by the time of the next meeting, they will have a much clearer idea.
RP - Does BC actually own 90% of Portsmouth FC?
MK - BC effectively owns Falcondrone so therefore by default owns 90% of Portsmouth FC.
RP - Have you found any irregularities in the accounts of Portsmouth FC as yet?
MK - As yet haven't looked at the full accounts, but will have more financial information at the next meeting.
RP - What is Plan B if we lose the High Court case against the HMRC?
MK - The Joint Administrators are not unduly concerned, however if necessary a directors application for an administration order would be made. They are confident that they will have all paperwork in place that the High Court have requested to prove that BC lent the money to Portsmouth FC rather than Falcondrone and therefore has the right to put Portsmouth FC into administration.
RP - Are we still owed transfer revenue and do we still owe other clubs transfer revenue?
MK - We are owed a minimal amount, somewhere around £0.5m however we still owe other clubs around £8m
SM - Is it too early to know where all the transfer revenue from other clubs into Portsmouth FC has gone?
MK - Most of the transfer fees have gone on everyday running costs, mainly wages with the total wage bill for all staff at the club around £4 million per month. LP interjected that despite fees being quoted in the press, the actually amount coming in to Portsmouth FC is nowhere near that amount.
RP - Have loans been secured on the club against future revenue ie Parachute Payments or Season Ticket money?
MK - Honest answer is that he doesn't know at present, but is looking at it as we speak.
RP - Have the Premier League been approached regarding early advance of the Parachute Payments in order the advance/achieve the CVA?
MK - The Joint Administrator have spoken to the Premier League regarding this, however the PL will not discuss this matter until the matter with HMRC are concluded.
RP - Due to everything that has happened this season, the feeling amongst the fans is dismay and distrust, how do you intend to regain the supporters trust?
MK - Advised that they have received lots of messages of support from supporters, and believe in the way they are working and what they are doing.
RP - How can you assure us that you are acting independent?
MK - The Joint Administrators have had no previous dealings with Balram Chainrai until 2 weeks ago, when the Joint Administrator received a call whilst on a skiing holiday about this matter. They are acting in the best interest of the club, and are completely independent from BC and Portpin.
KM - Asked what assurances are there for the staff and their futures.
MK - All staff have been met with once already, and will be spoken to again early next week. There will be redundancies and these will be confirmed next week, however no details will be made available until relevant staff are spoken to.
MH - How can redundancies proceed if we are now actually in administration?
MK - Things will become clearer from the HMRC and Portsmouth FC on Monday and then administration process will proceed in earnest.
BD - How has this situation happened?
MK - Simple answer is that expenditure at Portsmouth FC has been way in excess of income. Actual answers/reasons will come in future weeks/meetings.
BG - Why is Mark Jacob still at Portsmouth FC?
MK - Mark Jacob is not on the payroll of Portsmouth FC. However it is believed his experience can add value to the administration process, although he is effectively doing that for free and not with Portsmouth FC's money.
AT - News has emerged this week of 12 prospective buyers, is there any truth in this?
MK - They have indeed been contacted by many interested parties, however, as yet none have provided proof of funding. On Tuesday 9th March they will be an advertisement in the Financial Times inviting interested parties to make formal offers.
MH - Will a forensic examination of Portsmouth FC's accounts still happen even if a buyer is found.
MK - Yes, definitely.
BB - It is obvious that sooner or later Season Tickets are due for renewal, how would this revenue be protected for the fans?
MK - All revenue generated from Season Tickets would be placed in a separate account, so if next season didn't happen, people will get their money back. Season Ticket details will be looked at shortly.
CF - Are we actually in administration and if so when will the 9 points be deducted by the Premier League?
MK - The administration process should be confirmed next week, however, the administrator has had several conversations with the PL, and the 9 points deductionis to be discussed further.
SM - What is Peter Storrie's role now at the club?
MK - Believes that with his knowledge of the game, he adds value and can be of assistance.
DT - Have we asked the Premier League about selling players?
MK - We have but no definitive reply as yet. FIFA said we could but could only sell to other PL clubs, but PL owners have so far vetoed it.
JC - On basis of looking for perspective owners, is it being sold as a whole club including Fratton Park and including a possibility of supporters owning part of the club.
MK - The club would be sold as a whole, including Fratton Park , and there would be no rental agreement from BC to lease the ground back. On the subject of supporter ownership, the administrators are not stipulating this, it would be up to whoever ends up owning the club.
CF - Would any deal to buy the club include the surrounding land owned by Alexandre Gaydamak?
MK - The administrators have had discussions with SG, and are hopeful of including his land in any perspective deal for the club.
AT - Is there proof that we actually owe money to Alexandre Gaydamak?
MK - Has seen evidence to prove the amount we owe Alexandre Gaydamak is correct.
MH - How quick can a CVA be achieved?
MK - 6 weeks would be the minimum
BB - Have UHY Hacker Young as a company ever dealt with Balran Chainrai or Portpin before?
MK - No, never.
RP - At what point to we cease to become a Premier League club and become a Championship club after possible relegation?
MK - Don't know as yet.
RP - How much does administration actually cost and who is paying for it?
MK - The Joint Administrators work on a time/cost basis so it is impossible to put a figure on it, however, the fees for administration would come from the sale proceeds.
MB - We have a lot of players still on large sums of money, can their wages/contracts be decreased?
MK - Their wages cannot be decreased, however, there is the possibility of deferral on wages until a sale is agreed, but this hasn't been discussed as yet. However, if the players were not paid, their contracts could be cancelled and this could have a detrimental effect on the value of the club.
KM - Will loan players be staying?
MK - Yes they will all be staying, as they are presently contracted to the club.
JC - Has the clock started ticking yet with regard the CVA?
MK - Not yet, the Administrators have 8 weeks to send their proposals to creditors and the meeting of creditors must be convened within 10 weeks of their appointment. It is likely that the CVA proposals will not be prepared until a new buyer is found.
JC - Have the administrators met with the PFA regarding any deferral of player wages?
MK - Yes they have met with the PFA but no news as yet.
JC - Has dealt with administrators previously, and as the Administrator is now the top man at the club, with all staff reporting to you, is there any legislation that can be used should anyone refuse to disclose vital information to the administration process?
MK - The Insolvency Act provides the Administrators with powers for information to be provided to them where it is not readily forthcoming..
RP - Has MK got an opinion on where the money has gone?
MK - No opinion as yet, however the Administrators will do everything in their power to get to the bottom if it.
TM - Reiterated that they want to have regular meetings with fans to keep them up to date on what is happening, and that there will be another meeting before the Hull game in 2 weeks time.
When asked what message the Administrator wanted to get over to the fans, MK replied be positive and keep supporting our team by buying tickets and filling the ground.
Next meeting Saturday 20th March at noon.
WOW a long read but let us know your thoughts below.
Date:Tuesday March 9 2010
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