Diogenes wrote:It doesn't matter how much the SMC owes Allam because he will never get it if the SMC has no assets; nobody else would be liable to pay it. In fact if it is loaded with debt nobody would buy it anyway. If the council terminates the head lease that would be the end of the SMC and its creditors including Allam would lose their money. That may include money paid to the SMC by City and FC for rent etc.
I've been pondering this scenario:
Allam wants to sell City. It's a difficult market and few are interested and the SMC is a further ball and chain which future buyers don't want. He can't spell City without the SMC as he would be left holding that putrid baby - the SMC is completely unattractive as a lone company.
He has to get rid of the SMC whilst retaining what he's owed from it (anything between £4-£6M if estimates are correct). He offers to sell it to the council for a pound. Refused.
So he creates a situation where the council are forced to intervene. I think he hoped the council would step in and take over the SMC debt and all. I don't think he's expecting they can terminate the lease - he seems from the letters we've seen to believe he has adhered to the terms and is legally compliant. We all know his pig-headedness and self belief even when confronted with all evidence to the contrary. He probable has top-class lawyers who he believes can make this stick.
It's up to the council to prove a breach. If he can get away with it the council cannot terminate the lease and cast him adrift owing himself money. But they would be pressured by the furore to seize ownership, thus undertaking the debt too. Allam is remains a massive creditor in this situation and it's a win-win for him.
It's a crazy bet, but is this the way he's thinking? Like Mrs B, I can't see what his strategy is in all this if not something along these lines.