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Dunfermline saved from liquidation as creditors waive debt

Last updated on .From the section Footballcomments196

Dunfermline hope to be celebrating

Dunfermline will soon be in the hands of fans' group Pars United after creditors voted in favour of accepting a company voluntary arrangement.

The Fife club has been in administration since March, with debts of around £10m.

Former owner Gavin Masterton abstained from the CVA vote, giving up his claim on £8m owed to him and his companies.

The £500,000 raised by supporters will pay staff who were made redundant and the administrators' fees.

Pars United are now seeking further backing and hope to add to the 1400 season tickets sold over an uncertain summer.

Former Dunfermline player and manager Jim Leishman - who helped front the supporters' bid - said: "This is a fantastic day.

"Up until yesterday, we were still having meetings discussing what might happen if the CVA did not go through.

"It's through now and there is nothing standing in our way now. Now we have got to make sure we have got sustainability and ensure we can survive going forward."

The club's shares were sold for £1, while £80,000 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 administrators BDO say "are understood not to exceed £170,000" and pay BDO's fees of £100,000 plus VAT.

Dunfermline's situation is complicated by their stadium being owned by a separate company, East End Park Ltd, which is being handled by a different administrator, KPMG.

BDO say East End Park Ltd will be "entitled to any residual over and above" the figures they have released, with their main creditor the bank, while KPMG added: "We will now work closely with Pars United to complete the sale of East End Park."

BDO, led by Bryan Jackson, took over the running of Dunfermline after a winding-up order was served by HM Revenue and Customs for a £134,000 tax bill.

A 15-point penalty resulted in Dunfermline being relegated to Scottish League One via the play-offs.

The club should now avoid a 10-point penalty for the forthcoming season and a £150,000 bond payable to the Scottish Football Association.

Pars United's Bob Garmory said: "We thank each and every creditor who voted for this outcome.

"We know that many have suffered greatly from the financial problems of the football club. We now pay tribute to them. This vote will allow Dunfermline Athletic to begin a rebuilding process under a wide spread of supporter ownership."

There is a 28-day period for creditors to appeal against the decision.

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196 comments

  • Comment posted by lglater, at 20:13 29 Jul 2013

    It's those who are owed money by the club that I feel sorry for. In most cases where a club has gone into administration, many debts are to small local businesses who rely on this money. Dunfermline will come back in another form but many small businesses will likely suffer if they go to the wall.

  • Comment posted by BBC and Jake Humphrey Fan, at 19:38 29 Jul 2013

    Dunfermine should liquidate and get a fresh start, just like Rangers.

  • Comment posted by U15797606, at 19:34 30 Jul 2013

    chris sutton said the creditors just lay down to them

  • Comment posted by Alan, at 20:59 29 Jul 2013

    To offer nothing in the pound is comical. Why on earth would a creditor accept that.

  • Comment posted by U15186106, at 17:35 30 Jul 2013

    A big well done to the supporters for keeping your club and history alive good luck in the future.

  • Comment posted by OddJobLot, at 12:58 30 Jul 2013

    @63 You have a fundamental ignorance of how administration works. Yes they were mismanaged and yes they were unsustainable, but not all businesses get liquidated in such positions.
    As a business going forward, as long as the administrators can demonstrate a sound business footing once debt problems are resolved, the business can be taken out of administration.

  • Comment posted by HamptonCaught, at 10:56 31 Jul 2013

    I'm interested to know when Dunfermline receive the £50k fine for breaking Rule 14 and being 'Subject to an insolvency event' from the SPFL? Only that's what Rangers were fined for entering administration and I'm assuming that in the interests of 'sporting integrity' it would be the same for any team?

  • Comment posted by HeedTheBaw, at 08:42 31 Jul 2013

    @167.
    The team didn't go bust. The club didn't go bust. The holding company did. Suggest you get YOUR facts right.

  • Comment posted by U14747216, at 00:14 31 Jul 2013

    #159
    Decent suggestion, we could also have Craig Whyte Park, the Romanov Terracing, the Dee Marr Stadium and a Mussolini-style statue of Massone outside Livi's ground (or Michael Jackson if they prefer).

  • Comment posted by twsco, at 18:28 30 Jul 2013

    Nice to see BBC comments open on a Scottish news story for once. Good luck to DAFC for the future!

  • Comment posted by U15736505, at 18:23 30 Jul 2013

    Very good news, hope you bounce back this season .

  • Comment posted by U15701068, at 17:56 30 Jul 2013

    Very close call for Dunfermline. It's good
    that they survived and didn't go the same
    way as Gretna, Celtic, Airdrie and Rangers.
    Lets hope Hearts can survive too

  • Comment posted by U14935130, at 17:18 30 Jul 2013

    Glad for the Pars fans. I hope they can get the fans back to East End, looking forward to visiting as a Rangers fan this season. The SPFL1 will be a tough season for them but I am sure they will make it up from the play-offs.

  • Comment posted by U2400038, at 17:04 30 Jul 2013

    As a Hearts supporter I sympathise. So many legendary teams who I remember from the old First Division now in tatters. Rangers and Celtic will always survive but I remember Jock Stein's Hibs beating the mighty Real and that's what we need, more great European days.

  • Comment posted by dh1963, at 16:39 30 Jul 2013

    116: None of your FACTS are agreed by the relevant football authorities, nor by the legal investigation team set up by the old SPL. They all agree it's the same club.
    Just saying FACT doesn't make it any more than your opinion. And going by your user name, its an opinion heavily biased because of what you think of the club concerned.

  • Comment posted by U2685397, at 16:10 30 Jul 2013

    I see that what should have been a discussion about Dunfermline has turned into the usual debate about Rangers' status. We all know that Rangers survived by the skin of their teeth only because of their historic position within the Scottish game. So, by all means be happy about their survival (and, more pertinently, Dunfermline's), but neither club has anything to be proud of in a financial sense.

  • Comment posted by U14258568, at 15:34 30 Jul 2013

    I feel sorry for any clubs competing with Dunfermline this season who have manged their affairs correctly and are now competing with a virtually debt free club. I also feel sorry for those genuine creditors who could ill afford to lose money, but who have gone ahead with the CVA. Will the Pars recognise those creditors in any tangible way?

  • Comment posted by U15804409, at 14:47 30 Jul 2013

    @ 79

    It seems to be a fairly bitter response, hence you use of Sevco also.

    Did they settle all footballing debts?? If not, who didn't get paid for what player.

    I'm just confused why a brand new football club would have any debts to pay.

    Also, if what you say is true about the transfer embargo. Why weren't the SFA reported to UEFA for bribery

    Why do the ECA say they remain founding members?

  • Comment posted by U15432134, at 13:54 30 Jul 2013

    OK, the CVA has been accepted and the club haven't, unlike others, TOTALLY dodged their debt, (There's more detail but basically £80k for the CVA, Preferred bidder assumes reponsibility for the footballing debt (£170k) and preferred bidder provides administrator with £100k to cover their costs), our history is still exactly that - OUR HISTORY.

  • Comment posted by U15410283, at 07:39 30 Jul 2013

    Regulated wage caps migt be a good idea, seeing as a lot of football club boards have no idea about living within their means! Ambition always seems to over-ride financial coomin sense.

    Sad to see any famous old clb in this state. As always, the real suffering is borne by the loyal fans.

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