Meeting Gerald Krasner – Tuesday 1^st September 2020

I had a telephone meeting with Administrator Gerald Krasnor on Tuesday evening where there was an opportunity to put forward questions raised by supporters over recent events at the club. The call lasted 33 minutes.

Quite a large amount of the conversation was ‘off the record’ or ‘unable to comment on’ so I cannot report that back, but below is a fair summary of what he answered on the record.

We started with perhaps the most burning issue which is a rumour circulating about the possibility of former Port Vale owner, Norman Smurthwaite, being one of the active bidders.

Norman Smurthwaite, I was administrator at Port Vale 6/7 years ago, but I wasn’t the lead administrator, my partner dealt with Mr Smurthwaite as he lived in Stoke, I never dealt with nor met Mr Smurthwaite.

That doesn’t make me not responsible for the sale as we’re all responsible for everything, but I want to make it clear that, number one: I’ve never met the guy, until recently, and number two: I didn’t do the sale to him.

He’s made himself public, which is a silly thing to do. I’m rough but at least I will try to communicate, he’s boss and everyone has to do as he says.

I am obliged, by law to take the best offer.

Player Sales

We have sold players for £7.4m, the first £1.8m of that is covered by the Weir, Gelhardt and Devine sales, all that money was used to pay the wages because when we walked in on 1^st July the wages hadn’t been paid for June and July (would have to be found), we also were allowed to get that money because we sold to Premier League and not EFL clubs, although we have paid the players wages, we haven’t paid the PAYE on it, the wages net were £1m now we have a big PAYE bill to find and it is a loss in administration.

So you’ve got to knock off £1.7m of the transfer income of monies that goes to Football creditors as you can’t use the same money twice. We’re down now to £5.7m of ‘proper’ football sales to use for the Football Creditors. So we are still £700K short.

There’s one more player we’re going to sell to bridge that gap, probably Kipre, everybody knew what we had to do.

Let’s just say then that the money from the footballers have paid net wages and football creditors in round terms, the football creditors will be totally paid off once we get all the money in, if not today or tomorrow, then within a week they will be.

Now the other problem we’ve got is a number of the players that remain have contacted us and said that they don’t want to play League 1 football next season. But nobody wants them and we’re not going to be pressurised, but we’ve had to deal with this as we’ve had to get the wage bill down to £2.5m (salary cap), nobody seems to remember that the wage bill was over £12m. That was just footballers, don’t forget about all the other wages.

That deals with the player sales.

I’m still talking to a number of bidders, no one has disappeared, in fact someone has come along interested but they’ve not dropped their formal offer in yet. Once someone puts an acceptable offer in, we can move very quickly.

I’m still talking to the Americans, they’ve been emailed today, their problem is they’re on different time scales and we can’t answer their emails a minute after we get them, but we’re talking to other people not just concentrating on one. So no matter what the fans are telling me, “I’ve got to give it away to Ganaye” that will not happen, and why won’t it happen? We have to pay at the moment, on top of the Football Creditors, £1.3m to the non Footballing creditors or take a 15 point penalty.

We have to pay the losses in the administration (PAYE + other) which by the end of September will be £3m, and we have to pay the costs – the EFL costs (the appeal), our costs, the legal costs – and that is a figure just over £2m, now as of today I have still not been paid a penny.

We had to do the appeal, we had a marvellous offer if we stayed in the Championship, in excess of £10m, the cost hasn’t come in at half a million, but there is no change out of £300K, though you can see why we had to appeal.

I’ve got to pay £1.3m to the other creditors to stop the penalty next season, HRMC are more than 50%, but there are other creditors, if we don’t pay 25p in the £ by the end of next season, we’ve got three years to pay 35p in the £, but that adds another half a million to the bill.

Now what I am looking at as a last resort is the buyers can be paying all this, but if I say to the buyers that you’ve got to pay £6.4m no one would touch it, which is why we have gone down the strategy we have gone. But I’m looking at saying ‘Right we’ll drop the price by £1.3m but we’re not paying the creditors that’s your problem within the next year’ so it gives them a bit of leeway on cash, but I don’t think the EFL will be very happy with that.

If the debt isn’t cleared there is the 15 point penalty and I want to give the new owners a clean start.

So the bidders are still there but trying to get them to understand what we are doing…

I value the Stadium at £3m, I value Christopher Park at half a million and Sharpey’s at half a million, so that’s the £4 million. Plus add-ons

Now we’re not looking to make a profit, we’re looking to get paid and walk away and let the new owners take it forward, this has been a very difficult job, more difficult than the Leeds one which was £100s of millions, we had six weeks to prepare for Leeds, no time to prepare for this.

The Supporters Club have raised approaching a million pounds, that is real money. You’ve got to get together all of you. Got to look at all alternatives.

Tell the fans to stop WhatsApping me because I’m not answering them anymore.

Meeting with EFL today (Wednesday) regarding starting the season, no announcement until decision made.

I don’t care who buys the club but they have to pay the right price.

If a deal is agreed in outline it can be done in a week.

At the moment the Academy is self sufficient with the money from the Football Laegue, whether it will be in the future or it’s something that the new owners want to keep, is up to them.

By, Barry Worthington