Rangers may sell players if they go into administration
By Ben James Feb 14, 2012, 10:15 GMT
London - The fall-out from Glasgow Rangers' decision that they intend to go into administration will become clear over the next few days as the playing squad of the Scottish Premier League side are told who will be allowed to leave to cut costs.
Rangers owner and chairman Craig Whyte announced on Monday that the club needs to go into administration to avoid the possibility of liquidation in the face of a potential tax bill that could be as a high as 75 million pounds (118.4 million dollars).
Experts say there is no realistic possibility that the club could fold but Whyte was due to meet with players and staff on Tuesday.
The top players will be considered assets and are likely to stay, but administration is likely to see others sacrificed to save money, experts say.
In a statement on the Rangers website, Whyte said Rangers are 'facing massive financial challenges both in terms of its ongoing financial structure and performance and the potential consequences of the HMRC first tier tax tribunal.'
The potential 75 million-pound tax bill relates to payments paid into 'Employee Benefit Trusts' (EBTs), which began in 2001 and ended before Whyte took over in May last year.
If Rangers do go into administration, the penalty from the league is a 10-point penalty, which would leave them a distance behind Celtic in the title race and effectively end their challenge.
But Whyte said he had known for some time that administration might be the club's only real option.
'Frankly, the case for administration in pure financial terms was compelling but I was acutely aware that such a great institution as Rangers could not be viewed exclusively in financial and business terms,' he said.
'It's a bad day for every Rangers fan; there is no getting away from that. 'We have filed a notice of intention to go into administration and we will do that in the next couple of weeks unless a sensible arrangement can be made with HMRC.
'We have been working very very hard to try to come up with an arrangement to avoid this and so far we have been rejected by HMRC.
'It's a slim possibility that something could be resolved in the next two weeks but I think it's more likely that we will go into administration and come out of it a fitter and stronger business and be in a better position to move forward in football terms.'
The Daily Telegraph said on Tuesday that the 'up to eight current or former Premier League clubs' are facing a similar investigation into their use of EBTs.
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