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Re: Birmingham possibly facing 12 point deduction for breaching FFP restrictions

KG, there is a further points loss for going into administration.

If a company goes into administration, the administrator tries to help it continue trading by reaching a deal with its creditors enabling the company to continue (Company Voluntary Arrangement). If this is not possible, the company may be liquidated - i.e. cease to exist and have all its assets sold off (as happened with Rangers).

The aim is to keep the company (club) going, but it's possible that they will have to sell off assets (including the ground/ training facilities) to pay creditors. Of course, some football clubs have a "brand value" which may attract bargain hunters keen to pick up the name (as also happened with Rangers).

This is why we ended up with Steven Whittaker for a free - the rangers which had employed him had ceased to exist and he refused a new contract with the new Rangers. The same with Naismith, who went to Everton.

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