Tue, 04 Oct 2011 | ADMINISTRATION
The owner of Rangers Football Club has admitted that the company could face administration if it loses a tax tribunal case due to be heard in November.
Craig Whyte has said that "administration is one of the possibilities we have looked at" if they lose the case brought by Her Majesty's Revenue and Customs, for as much as £49 million in back-taxes, interest and penalties.
The businessman has said that they are making plans for a "worst case scenario" and explained that the consequences of a judgement not in their favour would be "pretty obvious".
Whyte took control of the club last May, for a sum of just £1, but taking on bank debt and tax liabilities that were valued at around £18 million. He immediately repaid the £18 million and moved the debt over to Rangers' holding company - his own Liberty Capital Limited. As this made him the largest creditor of the club, Whyte is in control of any administration process.
He was urged last week, by the former chair of the Rangers Supporters' Trust, Stephen Smith, that "everything should be done to avoid administration". Such a move would dock the club of 10 points in the Scottish Premier League. Smith said that even though the club is currently 10 points clear of its nearest rivals, Celtic, it would reflect very badly on the state of Scottish football if the national champions go into administration.
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