Clean slate for Livingston as debt wiped out

Sep 24 2009 by Eric MacKinnon, West Lothian Courier

LIVINGSTON are a club reborn after interim manager Donald McGruther rubber stamped a deal this week which will give the club a fresh start by wiping out its £2million debt.

The decision was made at a creditors meeting last Thursday but the day was not without incident as former chairman Angelo Massone and Tomasso Angelini, who was the club’s football consultant, rejected the proposals despite warnings from the administrator that the consequences could be the demise of the club.

The Lions looked to be on the brink of liquidation after racking up debts of over £2million until McGruther, from administrators Mazars, finally wrestled control of the club from the Italian and sold it on to a new consortium in July.

Massone was back at Almondvale for the creditors meeting where he was looking to recoup £467,337.

That figure was thrown out by McGruther, who instead approved a figure of almost £280,000, with various other claims disallowed and rejected.

A separate claim from Angelini for £300,000 was also dismissed, with McGruther casting doubt on the role he had played at the club over the past year.

And with other creditors, including HMRC and landlords West Lothian Council, voting to accept the deal for around five pence for every pound owed, it means Massone had to settle for just less than £14,000.

McGruther said: “The position Livingston is left in after this meeting is the club have no debt as the creditors will vote away their debt in return for a dividend from me.

“This is a fresh start for the club and this meeting is all about relieving the club of it’s debt.”

McGruther explained there were considerable votes in favour of a resolution and asked whether there were any objections to the proposal — prompting both Massone and Angelini to raise their hands.

McGruther warned the pair that if these proposals failed it would mean the demise of the West Lothian club.

He continued: “On the basis of Mr Massone’s past comments and promises on the commitment to Livingston FC and to Scottish football, I’m disappointed at the decision to vote against it.

“All other creditors are in favour of accepting the proposal, except one who is outwith the room today.

“So with £1.265million of claims accepting the proposals and approximately £287,000 against. On the basis of a 75 per cent majority, the proposal to enter into a voluntary arrangement, solely with objective of collecting the cash and distributing the available dividend to creditors, has been approved.”

Loss

It also emerged that the SFL’s decision to dump the club into the Third Division has cost creditors in excess of £100,000.

“The former directors failed to appreciate the position the club was in and the extent of the debt which is frankly enormous,” revealed McGruther.

“The total assets of the club on a break-up value by an auctioneer was under £30,000. It is that which has been sold to the incoming consortium, with payments to the creditors amounting to £225,000.

“It would have been £335,000 had the club retained their First Division membership, so relegating the club has made a huge difference.

“There has also been a figure of £400,000 already invested by the incoming consortium which has already been spent on paying off the footballing debts in principle, like player salaries, staff salaries, which was insisted on by the league to retain membership and sort out the problems of the past.

“It is hard to understand why Massone voted against the proposal when he knew he was going to lose.

“But he still went ahead with his claims against the interests of the club.”

Livingston chief executive Ged Nixon welcomed the decision, admitting it was time for everyone involved with the club top start looking forward again and put the past behind them.

He said: “The CVA has been approved by the administrator and a line in the sand has now been drawn and the club can now move on and start afresh but this can never be allowed to happen again.

“It is financial carnage which has happened here, with mind-boggling figures.”