Saving £m’s, charging £???

or You Are The Ref ! – The Legal version

It’s Thursday 23rd September and you are called by a client to provide a way out of a sticky situation. The client, a large northern based football team (soccer franchise, anyone?), has only a few weeks to repay its loans before they are called in by their bank.

Currently, the football club is up for sale for a figure reported to be at least £420m and prospective buyers may be in the wings. However if they wait till the banks call the loans in, they could potentially buy the football club for less than the price of its outstanding loans, which are reportedly £280m, a saving it would appear of at least £140m for the buyer.

The dilemma is that if the club debt is called in and the banks technically own the football club, the club could be deemed to be in administration and the rules of the sport appear to determine that the club would be deducted 9 points.

If the points are deducted the football club could find it difficult to retain the services of some of it’s key assets, the players, and could even be staring at relegation and a drop in its revenue, which at the moment can at least service the loans.

Other clubs which have stepped down in the league structure have found the revenue drop coupled with large fixed overheads and player salaries ruinous.  

Should the loans be called in on the 15th October, you have been asked to provide a legal defence, to prevent the application of the sports “administration” rules and prevent the deduction of the 9 points.

1) How do you charge (billing structure) for your advice? (bearing in mind you could find the answer in an hour, three hours or three weeks!)

2) How much do you charge? ( if your advice prevents the 9 point deduction it could head off the spectre of relegation and could protect revenue worth several £10’s of millions of pounds)

Any ideas, then drop a comment in the box below, we’d love to hear how you’d value the legal advice.

Never happen, you say? it might do!

(Ask about Lean Principle #1 if you’re wondering what a legal pricing question is doing on a lean blog. )


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