They could, of course, sell shares in smaller numbers, retaining control whilst reducing their loss. There must be some folk out there who'd bite?
He'd be replacing loans with equity. His problem is that he could easily get his loans repaid (if there's cash available!) but it's less easy to get money from share capital unless they paid dividends which would be subject to tax. The only reason anybody would want to convert loans into equity would be to comply with some rules (eg. UEFAs). Otherwise there's no advantage for somebody who has all the loans and shares. Usually when there are various shareholders and debtors there has to be some sort of incentive to convert loans to shares - eg. more shares than by a simple calculation of worth with the shares having to be held for a certain time or subject to some shareholder agreement.
Allam will never have to pay capital gains tax on selling Hull City. He would be able to set off any capital losses against any future capital gains of his businesses. As you mentioned earlier, he would only be willing to convert to reduce any penalty imposed by UEFA if there is a financial advantage.
