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Sir David Murray ‘hugely disappointed’ by Rangers administration

• Former owner issues veiled criticism of Craig Whyte
• HMRC action was triggered by VAT and PAYE bill

Sir David Murray, the former owner of Rangers, has expressed surprise after the club’s slide into administration was confirmed, with the Scottish Premier League deducting the club 10 points.

Rangers lodged documents at Edinburgh’s court of session on Monday, confirming their intention to appoint an administrator. Amid dramatic scenes at the same court 24 hours later, Her Majesty’s Revenue and Customs challenged the attempt by the Rangers owner, Craig Whyte, to make that appointment. The judge gave Whyte a two-hour deadline in which to confirm administration, which was duly met and approved by HMRC.

Murray said: “Words cannot express how hugely disappointed I am with news of the appointment of administrators to Rangers. The timing of the appointment of administrators is especially surprising given two facts. Firstly, there has been no decision, and there is no present indication as to the timing of a decision, from the first-tier tax tribunal concerning the potential claim from HMRC of £36.5m excluding interest and penalties. Secondly, legal opinion on the strength of the club’s case remains favourable.”

Murray, who sold Rangers to Whyte for £1 last May, has been subject to criticism over the club’s predicament. Rangers have been embroiled in a multimillion-pound battle with HMRC relating to employee benefit trust payments to players during Murray’s tenure. Whyte has consistently claimed that matter was key to Rangers’ off-field troubles when questions have been raised about his stewardship.

It was, in fact, confirmed that a £9m bill due by Rangers in VAT and PAYE had triggered the revenue’s actions on Tuesday. Whyte said: “Due to its cost structure, the club has been loss-making for many months. This situation has resulted in increasing liabilities and the club has been in discussion with HMRC regarding these liabilities. These liabilities, combined with the threat of the outcome of the first-tier tax tribunal, left the club no option but to formally restructure its financial affairs.”

Murray’s veiled criticism of Whyte is pertinent given it was understood to be a condition of the pair’s sale/purchase agreement for Rangers that neither party would publicly speak out about the other. Murray confirmed he had more recently looked for assurances from Whyte about Rangers’ position.

Murray added: “Following a protracted sale process over a three-year period, Murray International Holdings Limited (MIH) ultimately sold its 85% controlling shareholding in the club to Wavetower Limited (now renamed The Rangers FC Group Limited), a company wholly owned by Craig Whyte, in good faith on 6 May, 2011.

“In addition, the share purchase agreement (SPA) imposed a number of obligations on Wavetower. These included the retention of £9.5m on behalf of the club for investment in the playing squad, expenditure on the infrastructure of the stadium and settlement of an agreed tax liability, together with the availability of working capital to fund the club’s operations.

“The shareholder’s circular issued by Wavetower on 3 June 2011 confirmed these undertakings. Contrary to recent press speculation, there is no legal mechanism in the SPA for MIH to reacquire the club. MIH wrote to Wavetower on 25 August 2011 seeking confirmation that its various obligations were being complied with. A confirmatory assurance was eventually obtained on 3 January 2012.” A recent request for further clarification had gone unanswered.

“Following recent speculation concerning the financing and security arrangements put in place by Wavetower, a request was issued seeking further clarity. At the time of this announcement, no response has been forthcoming.”

Whyte held a meeting with Rangers’ squad before their Tuesday training session. During those talks the owner sought to explain why administration is an appropriate course of action rather than point out direct ramifications. Yet, at that stage, Whyte is believed not to have signalled it would be as immediate as became the reality. Worried players pressed the owner on the likelihood of them receiving their full salaries when due at the end of this month.

The London-based Duff & Phelps have been confirmed as Rangers’ administrators. A partner in that firm – David Grier – was photographed in Whyte’s company at Rangers’ first home game post-takeover nine months ago.

The SPL immediately confirmed Rangers had been deducted 10 points, leaving them 14 points adrift of Celtic and effectively forcing them to concede the championship. The SPL said: “As Rangers is subject to an insolvency event, a 10-point deduction has been applied to its total points in the league championship for the current season. In addition, Rangers is subject to restrictions on the registration of players with the SPL whilst in administration. We are seeking an early meeting with the administrators.” © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds