as I understand it its something like this...Apologies long post from memory

ME bought 87.5% of scum for a pittance and seperately bought the debt owed to Aviva of £35m for about £10m. Thus he owned both the football club and its debts.

He didn't do a deal with the creditors to wipe out the debts but became the new creditor. The debt was placed with another subsidiary of the ME group who charged scum full interest on the debt and any outstanding interest (like a credit card where only the minimum repayment was made).

All payments made by scum either cleared some of the interest or were made by other loans by ME companies - this had the benefit of offseting corporation tax as scum could get a credit for the loss and the profit of the other company is reduced and less tax paid by the ME group.

With scum in the Championship or higher (ha ha) their is less FFP rules in place which means that the debts can remain in place but no doubt both the EFL and the taxman were getting itchy over the accrued debt of over 100m (which had only cost ME 10m plus whatever added to scum - say 10 years at 2m a year - £30m total cost).

When the sale happened once again there were two purchases - the football club for 35p a share and the debt which ME accepted that he would write off (giving him a tax credit) in exchange for £30m cash - roughly break even with a corporation tax credit for the ME group.

plus if pigs start flying and the yanks get scum promoted to the premier league he has retained a small investment to flog off for a profit later...

Please feel free to shoot me down here - I've done this from memory and couldn't be arsed to check any facts!

Posted By: Ruttles, Jul 1, 17:32:33