It Is Better To Offer No Excuse Than A Bad One

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It Is Better To Offer No Excuse Than A Bad One

This headline is a quote by George Washington, but it is also friendly advice to Keith Jackson of the Daily Record in response to his ‘exclusive’ today on the reasons Derek McInnes turned down Rangers.

May I begin by drawing people’s attention to two statements by the same organisation on what was essentially the same subject matter:

Aberdeen FC Statement 14th June 2017:

https://www.afc.co.uk/2017/06/14/club-statement-management-team/

“The club can confirm that early this afternoon Sunderland FC agreed to meet all the contractual obligations for both Derek McInnes and Tony Docherty and they have, reluctantly, been granted permission to speak with both of them about the vacant managerial position at Sunderland.

Aberdeen FC will be making no further comment at this moment in time.”

Aberdeen FC Statement 5th December 2017

https://www.afc.co.uk/2017/12/05/club-statement-18/

 

“Aberdeen Football Club has announced this evening that Rangers have contacted the Club asking for permission to speak to Derek McInnes and that permission has been refused.”

 

It is clear from the first statement there are contractual obligations that, when met, mean the club must allow their manager the option of dialogue with interested parties, however reluctant the club may be.

Although money is not mentioned, contractual obligations can only relate to the commitments on either side to terminate the agreement and these are usually financial. In the case of an interested suitor, it would be expected of them to pay this on behalf of the employee.

There is no mention of contractual obligations in the club statement on 5th December, from which one can only infer that Rangers either refused, or were in no position to meet, the financial commitments required. Aberdeen FC therefore exercised their right to refuse permission to speak to McInnes, a position they are perfectly entitled to maintain until such time as Rangers agree to meet all contractual obligations, just as Sunderland did.

The story for the press to pursue is obvious yet Keith Jackson wants to have us believe that the McInnes decision -and ultimately it was his decision – has nothing to do with money. Jackson even suggested that an offer of £1m up-front was on the table in a piece that was published on Wednesday:

In it, Jackson states;

“Dons chairman Stewart Milne made his hardball position clear last night after booting out an official approach from the Ibrox club – and turning down a cheque for £1 million in compensation.”

I’m not entirely sure what Mr Jackson means by an ‘official’ approach, I would have thought ‘formal’ to be more apposite but it’s a moot point in the grand scheme of things. Fact is, Jackson didn’t think long and hard enough about this statement because it contains not one, or two, but three glaring inaccuracies.

  1. Mr Milne did not ‘boot out’ any approach – official, formal or otherwise. If Rangers had met the necessary contractual obligations then Aberdeen FC could not have refused McInnes the opportunity to speak to Rangers – that would have been a breach of contract on the club’s part and McInnes could sue.
  2. Mr Milne is not ’playing hardball’. Playing hardball is about getting what you want. Mr Milne already has what he wants. He doesn’t need to play hardball – it is Rangers who, if they cannot afford the compensation or wish to alter the terms of the compensation, would need to attempt to play hardball. Jackson has this the wrong way around – a common failing when trying to justify a lie and pursue a biased narrative.
  3. I don’t dispute that Rangers offered to pay £1 million in compensation, but I do not believe for one millisecond that it would be paid in a single instalment either by cheque, cash or bank transfer because the audited accounts published last month prove that such a commitment would not be possible. A shortfall of £4m was required in soft loans to see out the current season, with monies required immediately, and a further £3.2m after June 18. Furthermore, these figures did not consider the additional cost of a change of management at the club/holding company/engine room subsidiary/call it what you will.

It’s rather telling that Mr Jackson makes no mention of this £1m cheque in his ‘exclusive’ today. Instead, he offers another inaccuracy. He says’;

“When Milne made it clear he was unwilling to grant the move his blessing – and that McInnes would have to rip up his contract to pursue a return to Ibrox – the ex-Rangers player was boxed into a corner.”

Mr Milne is in no position to grant a move, whether with his blessing or otherwise. There is a binding contract in place and only if contractual obligations are met then – as is glaringly obvious from the Aberdeen Club Statement of 14th June – Mr Milne would have to, albeit reluctantly, allow the manager to speak to the other club, just as he did in the case of Sunderland. He cannot box his manager into a corner. There is no decision for Mr Milne to make if the requisite compensation is agreed to be paid in full to terminate the manager’s contract with Aberdeen FC.

More plausibly, Rangers could box McInnes into a corner. The job is his if he wants it, but he will have to resign his position to take it because Rangers won’t meet the contractual obligations. Once again Jackson has it the wrong way around because he is lying and pursuing a biased narrative.

Any reasonably minded follower of Scottish football knows why McInnes is not going to Rangers. It’s all about the money – or the lack of it – and no amount of lying or high-level fantasy by award winning journalists will alter that prosaic fact.

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Concomitant contributor

Despite over 30 years in exile I'm still as passionate about our national game as I ever was. It breaks my heart to see it being destroyed by those in power - the SFA, the SPFL, the Scottish media and in some cases the clubs.

779 Comments so far

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easyJamboPosted on9:42 pm - Dec 20, 2017


I was looking at some documents on the TRFC website related to the share offer and came across one of interest from 27 March 2017.
https://media.rangers.co.uk/uploads/2017/03/Form-8-OPD-12-September-2016116067237_1.doc

It states that Paul Murray holds 10,000 shares, but also holds 560,000 in a SIPP.  Now it may just be that PM has bought himself a small share in the club from his own funds (£154k at the 27.5p paid for Ashley’s shares).  Alternatively, I guess he could have received the shares in lieu of emoluments as a director. I should add that is pure speculation on my part.

Either way it doesn’t strike me as a potentially lucrative investment.

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gunnerbPosted on9:49 pm - Dec 20, 2017


SMUGAS
DECEMBER 20, 2017 at 00:48
_________________________

Thanks SMUGAS. I dont know if I would prefer to be creditor or increased shareholder with regard to this company.It looks from the latest at companies house as though the cards will have to be played shortly. All very interesting.

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SmugasPosted on10:09 pm - Dec 20, 2017


Creditor on the understanding you don’t want it back in the meantime would seem to be the best play for now hence the term quasi equity.  

Does anyone know.  Do all the loans need to be converted I.e is it an all or nothing affair?  

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Homunculus

HomunculusPosted on10:25 pm - Dec 20, 2017


The last RIFC PLC AGM suggested that not all of the loans would be converted in one share issue, as did the accounts if I remember correctly.

Indeed I have read that Dave King actually suggested that not all of them would be converted at all and that some of the creditors would leave it as interest free loans rather than converting them to equity. 

I know what I think that indicates with regards the creditors confidence in the PLC. Other people can make up their own minds. 

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Allyjambo

AllyjamboPosted on12:13 am - Dec 21, 2017


Without anything to back up my thoughts, I would imagine that there is no actual contract for any of the lenders to convert their loans into shares. I may be wrong, but I cannot remember it ever being stated that binding agreements exist, merely that the directors intend to convert their loans, and being RRMs, their word is their bond, so to speak.

On the other hand, if they are contractually obliged to convert their loans to shares, then, in the event that it becomes obvious to the board that administration is likely, it might be advantageous for them, both personally, and perhaps to the club, to bring in the administrators before having to convert, to, on the one hand, not lose all their money, and on the other, to be the majority creditors to ensure the safe passage of a CVA!

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John ClarkPosted on2:41 am - Dec 21, 2017


Well, here I am (philanthropist, benefactor and money-launderer20) at 9.30 pm- ish on 21st December. A bit of a problem with my son’s wi-fi provider and some buggering about generally, as one has to do, has delayed me getting on to the blog. 

I’m annoyed to find that I will not be able to attend the Bannatyne judgment! But I expect to read it with some satisfaction.

I think if there had been further discussions between the parties there would have to been some public notice of the fact.

That is, I doubt if Lord Bannatyne is going to report merely that, having heard further submissions   from King’s counsel about Board changes, or King perhaps having sold some or all of his shares, and from the TAB that they are happy now to withdraw their requirement that he make the offer, or any such nonsense.

I think he will have to address the facts as he found them to be as presented at the hearing, and do King: order him to comply by  certain date, and hold him in contempt if he doe not apply with that order.

Anything else is unthinkable, unless those thoughts included the most improbable theories of conspiracy involving the Takeover Panel and the Scottish judiciary.I mean, delay in issuing judgment until word comes that no judgment is after all required because all the parties involved have kissed and made up?

Never!         (surely!? Not in this little country of ours? Unthinkable!)

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Cluster One

Cluster OnePosted on7:22 am - Dec 21, 2017


Dave King take over panel judgement to be released on Friday .
If it’s bad news? will we get a statement from the SFA who said he was fit and proper.Or will they be on holiday.
speaking of holidays. Will the compliance officer be taking a winter break and we will hear nothing from him until 2018

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SmugasPosted on10:15 am - Dec 21, 2017


..of course highlighting this as mere speculation and pure conjecture on my part, but has anyone ever seen Lord Bannatyne and John Clarke in the same room together?

This whole grandweans thing just all seems a bit convenient…21

To be fair they can’t be the same.  Not unless Lord Bannatyne appears tomorrow and in General Melchet stylee calls “and where’s my black hat I’ll be needing that later.”

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SmugasPosted on10:21 am - Dec 21, 2017


And on matters financial.

Given Dave King’s history, given that he is the major shareholder and chairman so would call the shots on admin, given that he is principle lender re any CVA, given that he considers himself to be ‘owed’ £20m off the last lot and given that he is asking you to convert your repayable loan into non refundable shares and he will do likewise…would you really ‘show him yours’ first?

Mexican stand off indeed. 

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Homunculus

HomunculusPosted on10:46 am - Dec 21, 2017


Smugas
December 21, 2017 at 10:21
============================

Ah but it’s New Oasis which owns the shares and has provided the loans, so can Dave King actually decide to provide a further £7m.

Oh wait, he said he could in the audited accounts so he must be able to.

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TrisidiumPosted on11:19 am - Dec 21, 2017


Be surprised if the larger part of the loans is converted to shares.
Control of a structurally insolvent company lies not in virtually worthless shares, but with the major creditors who will retain control when the shareholders are all stiffed.
Going to happen.

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bluPosted on11:22 am - Dec 21, 2017


I seem to recall that part of Dave King’s settlement with the South African Revenue Service was a  requirement that Mr King’s family repatriate business assets held overseas into South Africa. Has anyone any insight into how this sits with NOAL being BVI-based?

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Giovanni

GiovanniPosted on11:45 am - Dec 21, 2017


TRISIDIUM
December 21, 2017 at 11:19
Be surprised if the larger part of the loans is converted to shares.
Control of a structurally insolvent company lies not in virtually worthless shares, but with the major creditors who will retain control when the shareholders are all stiffed.
Going to happen.

———-
Whilst I’m loathe to disagree with Trisidium I cannot see ANY part of the loans being converted for the reason he states but why the allotment of shares announcement?

There has to be something going behind the scenes that I cannot deduce. Have they found a mug, sorry buyer, for the shares and the conversion gives the chose few larger slices of the pot of gold? Doubtful I know.

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Allyjambo

AllyjamboPosted on11:48 am - Dec 21, 2017


TrisidiumDecember 21, 2017 at 11:19 
Be surprised if the larger part of the loans is converted to shares.Control of a structurally insolvent company lies not in virtually worthless shares, but with the major creditors who will retain control when the shareholders are all stiffed.Going to happen.
_______________

Should Lord Bannatyne find in favour of the ToP, an interesting wee conundrum might arise if admin does hit, and, as a result, the already low value of shares plummets. Would King then still have to offer 20p per share (I think he almost certainly would) and just how attractive would that price become, even to those with an emotional attachment to the club? After all, any bear who does accept an offer from King would know that his shares are now safely in the hands of a multi-millionaire Real Rangers Man21

Another wee thought just hit me. OUCH01

If some, or all, of the lenders are contractually bound to convert their loans into shares, would an insolvency event get them off the hook?

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Allyjambo

AllyjamboPosted on12:07 pm - Dec 21, 2017


GiovanniDecember 21, 2017 at 11:45 
TRISIDIUMDecember 21, 2017 at 11:19Be surprised if the larger part of the loans is converted to shares.Control of a structurally insolvent company lies not in virtually worthless shares, but with the major creditors who will retain control when the shareholders are all stiffed.Going to happen.———-Whilst I’m loathe to disagree with Trisidium I cannot see ANY part of the loans being converted for the reason he states but why the allotment of shares announcement?There has to be something going behind the scenes that I cannot deduce. Have they found a mug, sorry buyer, for the shares and the conversion gives the chose few larger slices of the pot of gold? Doubtful I know.
_______________________-

Going through the motions, perhaps? Keeping up appearances, even?

The resolution was passed at the AGM and to not progress it might cause genuine questions to be asked that no one in the boardroom wants to answer (or have to avoid) at this time. I suspect that if administration is about to be announced, it will come out of the blue and be a surprise to those most affected. The board will want it to be that way so they can maintain control over events for as long as possible. They will, most likely, want their own financial positions within RIFC plc to be as secure as possible with as much cash in the kitty as they can muster to ensure they get as high a penny in the pound settlement as they can. Having a major money raising event happening in the near future is quite a good way to create an ‘all’s well’ aura around a football club, and give comfort to outside creditors. They will, of course, want to maximise player sale income in January by avoiding any sort of ‘fire sale’ attitude from potential purchasers.

RIFC/TRFC do, after all, have a history of announcements of events that don’t quite come off.

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Homunculus

HomunculusPosted on12:38 pm - Dec 21, 2017


TrisidiumDecember 21, 2017 at 11:19
==============================

That makes sense, however sense is not something we see a lot of from RIFC PLC.

It will be interesting to see what happens when the resolution of allotment of securities is published at Companies House, it seems to be due to happen on Christmas Eve or thereabouts.

It would be really interesting if there was an issue of shares, Club1872 bought a load (brining new money in) and the creditors decided not to take up the option … at this time.

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Homunculus

HomunculusPosted on12:41 pm - Dec 21, 2017


TrisidiumDecember 21, 2017 at 11:19

“… virtually worthless shares …”
====================================

Tying that in to Friday and the Court of Session. Some people might actually be interested in taking 20p each for their virtually worthless shares.

In spit of Dave King’s protestation that it was pointless making the offer as no-one would want to take it up ayway.

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SmugasPosted on1:00 pm - Dec 21, 2017


Homunculus @ 12.38

My thoughts exactly.  The AGM stuff to me made sense to a/ get a hold of 1872’s ‘new’ money with zero repayment clause and b/ to tidy up the balance sheet with a view to a euro licence (listed you will recall as essential to the clumpany’s future well being) which will surely be scrutinised like never before.  It makes no sense for the creditors to do it (unless a billionaire has flown in off the radar offering more per share for their quantum than a simple loan repayment would yield i.e. parity*) and it makes even less sense to allow a situation where the creditors can individually decide whether to do so given the fragility of the underlying company(ies).  Particularly given the reputation of some of the principle creditors.  

* parity insofar as they’d get their money back.  It is not enough to promise growth on their shares in some future dream complete with CL soundtrack if achieving said dream is literally costing you money in the meantime in terms of shareholder calls. RBS being the most recent example to spring to mind.  

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wottpiPosted on1:38 pm - Dec 21, 2017


Before we talk about RIFC doing some jiggery pokery with shares, especially new ones,  can anyone clarify what can and cannot be done without there being a NOMAD or similar in place, being it is a Plc after all.

Last I recall they didn’t have a listing or a NOMAD and there are costs involved with producing a prospectus and the likes, especially when going outside the existing shareholding.

Just a thought!

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Homunculus

HomunculusPosted on3:12 pm - Dec 21, 2017


Wottpi

December 21, 2017 at 13:38
=========================

Given that Resoution 11 passed they can sell them to whoever they want as I understand it. At whatever price the person is willing to pay I suppose.

There is no need for a NOMAD because they don’t trade on AIM and a PLC doesn’t actually have to be listed on a market.

I would however say, with regards the 20p thing, if the shares are currently being bought and sold at about 27p, then surely if a whole new load go into circulation at a lower price then 20p may become a more attractive proposition.

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dom16

dom16Posted on3:13 pm - Dec 21, 2017


Interesting to note the John James last two blogs are only accessible via a payment and pin method

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SmugasPosted on4:22 pm - Dec 21, 2017


FWIW I still don’t see any advantage to them in ‘eventing.’  Threatening to ‘event.’  Yes for sure. That’ll get all the Christmas coppers rattling in the buckets  since whilst they may look down their nose at a credible challenge for 2nd it would still be a great result for them and give them European access.  Interestingly of course so does 3rd (4th?).  As clubs like Aberdeen know its actually bloody expensive in relative terms being the plucky loser.  But I fear crowd indifference would kick in.  Aberdeen losing 2000 fans by accepting 3rd is no biggie.  Rangers losing 20,000 is a different barrel of kippers.  

The no-event assumption has two core requirements of course.

1/  All parties keep speaking to each other, ignore individual rationality and act instead for the greater good of the club (don’t start) particularly in view of….
2/  Somebody, somewhere has to pony up to keep the loss making bus on the road else it grinds to a halt in the race to the top.  Shouting and screaming and stamping their foot that its all so unfair unless all the other buses are told to stop too is unlikely to get a sympathetic hearing.  Well, not from the fans anyway…. 

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Jingso.JimsiePosted on4:29 pm - Dec 21, 2017


Perhaps I have the wrong end of the stick, but it’s my understanding that whatever RIFC wish to do with regards to their Res.11 undertaking is predicated on the TOP & Lord Bannatyne.

If Lord Bannatyne decides the TOP’s ruling with regard to DCK is enforceable, then the ‘shares’ clock/timetable is turned back to 12 April 2017, the date by which DCK should have bid for the remaining stake in RIFC. Res.11 would be null & void due to changed legal circumstances & it would be as if it was never voted on at the AGM.

If M’Lud decides that the TOP’s findings are unenforceable, then Res.11 applies.

Happy to be corrected if the above is wrong.

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Allyjambo

AllyjamboPosted on4:54 pm - Dec 21, 2017


Jingso.JimsieDecember 21, 2017 at 16:29 
Perhaps I have the wrong end of the stick, but it’s my understanding that whatever RIFC wish to do with regards to their Res.11 undertaking is predicated on the TOP & Lord Bannatyne.If Lord Bannatyne decides the TOP’s ruling with regard to DCK is enforceable, then the ‘shares’ clock/timetable is turned back to 12 April 2017, the date by which DCK should have bid for the remaining stake in RIFC. Res.11 would be null & void due to changed legal circumstances & it would be as if it was never voted on at the AGM.If M’Lud decides that the TOP’s findings are unenforceable, then Res.11 applies.Happy to be corrected if the above is wrong.
___________________

I haven’t seen that mooted anywhere before (other than as speculation, but I’m not saying you are wrong), that the TOP ruling might delay the share issue, but it does make sense to think that such a major requirement stops further shares being issued until such time as the ruling has been complied with. Of course, there may be no genuine intention to go ahead with the share issue, and to blame the ‘Rangers haters’ within the Scottish legal system, would be just fine and dandy for the bears (ignoring, of course, that it’s actually a British Stock Exchange ruling that is causing them all this trouble).

TRFC has ahead of it a month of very little or no income, an expensive squad that has to be paid a month’s salary, and a window in which to try and sell/offload some of those expensive players, while, at the same time, appear to be on the cusp of a few major signings. And yet, the share issue is planned for February. Unless there is a legal impediment (like the TOP ruling) I’d have thought they’d have been full steam ahead with the issue to garner as much as possible, as quickly as possible, to put themselves in the best shape to deal with these problems/opportunities.  

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easyJamboPosted on5:33 pm - Dec 21, 2017


The purpose of the TOP ruling is to protect the company and its other shareholders, while enforcing action on the leader of the Concert Party to comply with their obligations.

My understanding is that a new issue would not be affected, but King would still be required to make an offer for the shares currently owned by parties outside the Concert Party. However if any share issue changes the percentages in a specific way, then it could be that some other party might them be asked to make a share offer for the enlarged share base if they exceed the 30% threshold.

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easyJamboPosted on5:39 pm - Dec 21, 2017


Allyjambo December 21, 2017 at 16:54
TRFC has ahead of it a month of very little or no income, an expensive squad that has to be paid a month’s salary, and a window in which to try and sell/offload some of those expensive players, while, at the same time, appear to be on the cusp of a few major signings.
===========================
Watch for the spin being placed on any outgoing transfers e.g. if Pena was to leave for the same £3m as Rangers reportedly paid for him.  That is not the same as Rangers receiving £3m into their coffers. It is highly likely that £2m of that would go straight to his former club, being the outstanding instalments that Rangers were due in respect of his original transfer.

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theredpillPosted on6:08 pm - Dec 21, 2017


DOM16DECEMBER 21, 2017 at 15:13 5 1 Rate This
Interesting to note the John James last two blogs are only accessible via a payment and pin method
Dom 16
that takes away the temptation to pop in and see what the nutter is ranting about.

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Allyjambo

AllyjamboPosted on6:56 pm - Dec 21, 2017


easyJamboDecember 21, 2017 at 17:39 
Allyjambo December 21, 2017 at 16:54TRFC has ahead of it a month of very little or no income, an expensive squad that has to be paid a month’s salary, and a window in which to try and sell/offload some of those expensive players, while, at the same time, appear to be on the cusp of a few major signings.===========================Watch for the spin being placed on any outgoing transfers e.g. if Pena was to leave for the same £3m as Rangers reportedly paid for him. That is not the same as Rangers receiving £3m into their coffers. It is highly likely that £2m of that would go straight to his former club, being the outstanding instalments that Rangers were due in respect of his original transfer.
_________________________________

£3m for Pena! I take it he’s been turning in five star performances week after week for TRFC! Quite scary if he was to be sold on the reality of the strength of his performances for TRFC. I don’t really know much about how he has performed, but I’d be surprised if a team with TRFC’s results has anyone worth £2m in it, let alone £3m. I’d suggest if he was to be bought on the strength of his TRFC performances, they’d be getting less than £2m, leaving them with the need to make up the balance, somehow.

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Cluster One

Cluster OnePosted on7:09 pm - Dec 21, 2017


ALLYJAMBODECEMBER 21, 2017 at 11:48
Should Lord Bannatyne find in favour of the ToP, an interesting wee conundrum might arise if admin does hit, and, as a result, the already low value of shares plummets. Would King then still have to offer 20p per share
—————-
Two points if i may?
if admin does hit…..would there not be a points deduction for the club? (if i remember correct if the company goes into admin the club will still be deducted….happy to be corrected
if there is a deduction of points that throws a spanner in the works.
A european place (listed you will recall as essential to the clumpany’s future well being) ….that line is not my own,SMUGASDECEMBER 21, 2017 at 13:00…hat tip to smugas for that liine19
—–
Point 2.Would King then still have to offer 20p per share.
would king have the money? he could be all tapped out trying to get the loans to keep the show on the road.
————-
What happens if king is told to make the offer, but king turns around and say’s i don’t have the money,any loans i can get a hold of are being used to keep the lights on.

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Homunculus

HomunculusPosted on7:36 pm - Dec 21, 2017


JINGSO.JIMSIE
DECEMBER 21, 2017 at 16:29
================================

For what it’s worth I see it pretty much the same way as the others who have commented.

Res 11 and the Takeover Panel ruling are separate things.

There is a list of shareholders at the point when King’s concert party bought over 30% of the PLC. King has been told to offer everyone on that list 20p for the shares they had at that time, assuming they still have them. 

Any other issue of shares, and anyone buying  them is an entirely separate matter.

Going back to the 20p offer and the “no one will take it anyway” claim. 

I take this from the RIFC shares page

“Currently 8,500,000 of the Company’s Ordinary Shares (c. 10.4%) are subject to restrictions affecting the right to vote the affected shares, the right to receive payments or distributions in respect of the affected shares and the right to transfer the affected shares. The affected shares are those identified in the attached Shareholder Information.”

Surely if whoever owns these is offered £1.7m for the shares they hold but cannot benefit from they will consider taking it. Assuming the Takeover Panel trumps whatever rule is currently being imposed. 

What about Sandy Easdale, if he is offered just over £1m he might decide to take it. 

There must be several people who would be willing to cut their losses and get out of the loss making business which is £16m in debt and predicting borrowing another £7m. 

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easyJamboPosted on7:45 pm - Dec 21, 2017


A couple of dates for the court diary in the new year.
Thursday 18th January 2018
Starred Motion (2 days) 
A295/16 David Whitehouse v PhilipGormley &c
A & W M Urquhart – Ledingham Chalmers LLP – Scottish Government

Thursday 8th February 2018
Proof (2 days) 
F145/11 Kim Whyte v Craig Whyte – Blacklocks

The Whitehouse action is part of his £9m claim against the Police and the Lord Advocate
The Whyte case may be the establishment of what funds or assets are available for a divorce settlement. (the case has been running since 2011)

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easyJamboPosted on8:05 pm - Dec 21, 2017


Allyjambo December 21, 2017 at 18:56
————————
According to the Transfermarkt website (a fairly reliable source), players were acquired during the summer for the following fees:
Pena £2.7m
Herrera £1.53m
Dorrans £1.35m
Cardoso £1.35m
Morelos £1.08m
Candeias £0.72m
Total £8.73m

If you add agents fees etc., then you won’t be far away from the claimed £10m investment in the playing squad. (more than £7m in payments was outstanding at the end of June 17 according to the accounts)

https://www.transfermarkt.co.uk/rangers-fc/transfers/verein/124/plus/0?saison_id=2017&pos=&detailpos=&w_s=

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Homunculus

HomunculusPosted on8:07 pm - Dec 21, 2017


Yes but have you amortised those values EJ.

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easyJamboPosted on8:31 pm - Dec 21, 2017


Homunculus December 21, 2017 at 20:07
Yes but have you amortised those values EJ.
========================
Just keep an eye on the Cash Flow next year.

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melbournedee

melbournedeePosted on9:06 pm - Dec 21, 2017


HOMUNCULUSDECEMBER 21, 2017 at 20:07
Yes but have you amortised those values EJ.
———————————————————–
Amortisation is a non-cash charge and doesn’t result in any cash flow benefit. From the 2016/17 accounts, the unpaid transfer costs at 30th June totalled £7.8 million.
That means Dave King’s promises to fund the club are less than the outstanding transfer costs and all other activities undertaken by the club will generate a positive cash flow, a proposition that I have great difficulty in believing.

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bordersdonPosted on9:16 pm - Dec 21, 2017


easyJamboDecember 21, 2017 at 20:31 0 0
Rate This
Homunculus December 21, 2017 at 20:07Yes but have you amortised those values EJ.========================Just keep an eye on the Cash Flow next year.
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Aye cash is King or king. They will limp along until season book time (45k of them = circa £18m netto?). With Sevco having that kind of budget, whilst not being able to challenge Celtic, we are back to a duopoly rather than a monopoly. They really are f**ked if they want to be top dogs anytime soon. But the bears don’t want to hear that.

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Homunculus

HomunculusPosted on9:19 pm - Dec 21, 2017


MELBOURNEDEE
DECEMBER 21, 2017 at 21:06
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Sorry, I was of the understanding that the cost of a players registration was amortised over the length of his contract, so that the value of that registration was reduced to zero by the time the contract was ended. On the basis that they could then walk away for nothing and just sign a new contract elsewhere. 

Is that not how it works. 

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Homunculus

HomunculusPosted on9:23 pm - Dec 21, 2017


BORDERSDON
DECEMBER 21, 2017 at 21:16
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If it’s a duopoly it’s Celtic and Aberdeen. 

First and second in every competition last year (with Rangers playing in all of them).

First and second in the league just now. 

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StevieBC

StevieBCPosted on9:27 pm - Dec 21, 2017


Amortized…and I would suggest that since signing for TRFC these player acquisitions have been severely impaired.

Don’t know how to value mince on a B/S though.  15

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Homunculus

HomunculusPosted on9:43 pm - Dec 21, 2017


STEVIEBC
DECEMBER 21, 2017 at 21:27
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I’m happy to go with the FT spelling and definition.

“The practice of reducing the value of assets to reflect their reduced worth over time. The term means the same as depreciation, though in practice amortisation tends to be used for the write-off of intangible assets, such as goodwill, while either term is used for the write-off of fixed capital.

Amortising an asset effectively transfers its value, or the part that is being written off, from the balance sheet to the profit and loss account, where it reduces taxable income. Depending on the relevant accounting standards, an intangible asset can be written off over time or all at once. Amortisation can also refer to the reduction of debt, either through periodic payments of principal and interest, or through use of a sinking fund.”

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easyJamboPosted on10:15 pm - Dec 21, 2017


Homunculus December 21, 2017 at 21:43
======================
You are right about how amorisation works.  The asset values of intangible assets purchased (transfer and agents fees paid for player registrations) are written down over the period of the contract.  However, the amortisation doesn’t reflect the cash changing hands.

Few £milllion transfer fees are paid in a single instalment these days.  The registration has been acquired (now an intangible asset at full value – to be amortised over the period of the contract length), but the cash flow will only reflect the actual amount handed over during each financial year.

Rangers intangible assets increased by £10.33m (p.44) in the last accounts, but the cash flow used in acquiring those assets was only £4.3m (p.28)  (leaving a difference of £6m still to be funded)

Taking other ins and outs into consideration leaves payables for player registrations at £7.8m (p.48), as Melbournedee points out.

That £7.8m is the likeliest reason for the forecast funding shortfall over the next two years.

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Homunculus

HomunculusPosted on10:18 pm - Dec 21, 2017


EASYJAMBO
DECEMBER 21, 2017 at 22:15
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Thanks, that makes absolute sense.

They have included the full value of the asset, even though they haven’t actually paid for it yet.

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easyJamboPosted on10:31 pm - Dec 21, 2017


Homunculus December 21, 2017 at 22:18
EASYJAMBO DECEMBER 21, 2017 at 22:15
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Thanks, that makes absolute sense.
They have included the full value of the asset, even though they haven’t actually paid for it yet.
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Yes – that’s my understanding.  Normally is you teaching me, but I’m pleased to return the favour.

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tony

tonyPosted on10:34 pm - Dec 21, 2017


HOMUNCULUS
They have included the full value of the asset, even though they haven’t actually paid for it yet.
sounds like a south african wine cellar

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Bogs DolloxPosted on11:00 pm - Dec 21, 2017


TONYDECEMBER 21, 2017 at 22:34
HOMUNCULUSThey have included the full value of the asset, even though they haven’t actually paid for it yet.sounds like a south african wine cellar
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But of course the amount of transfer fee outstanding at the balance sheet date is included as a debt. There’s no funny business going on it’ normal accounting practice.

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Homunculus

HomunculusPosted on11:02 pm - Dec 21, 2017


EASYJAMBO
DECEMBER 21, 2017 at 22:31

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LOL, I think not, but thanks for saying it anyway. 

In other considerations, I believe tomorrows decision from the Court of Session is going to be huge for the new club. I don’t think their support realise just how big it might be. 

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Homunculus

HomunculusPosted on11:08 pm - Dec 21, 2017


BOGS DOLLOX
DECEMBER 21, 2017 at 23:00
But of course the amount of transfer fee outstanding at the balance sheet date is included as a debt. There’s no funny business going on it’ normal accounting practice.
===========================================

I don’t think anyone was suggesting otherwise.

I really was having a laugh with EJ re amortising the value of players’ registrations bought a few months ago. 

I honestly didn’t think anyone would take it as a serious criticism of him, or RIFC PLC’s accounting policies.

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tony

tonyPosted on11:19 pm - Dec 21, 2017


BOGS DOLLOX
just having a laugh mate 04

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fishnish

fishnishPosted on11:49 pm - Dec 21, 2017


DOM16DECEMBER 21, 2017 at 15:13 11 2 Rate This
Interesting to note the John James last two blogs are only accessible via a payment and pin method.
………………………………….
Good.
Missing it already – the recent times in which I’ve wandered back there for a free keek, I’ve been concerned for his mental strength.  Like a hand-knitted geeg, hurtling close to the earth with wobbling wheels predestined to hurtle off, crashing and not burning…

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HopeforthefuturePosted on6:18 am - Dec 22, 2017


Fishnish
i’ve given up on JJ, I had a look at my donations to date and can’t see value in it. Plus it’s too much hassle, send me a code, make a card payment, make a token payment, bah!

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Cluster One

Cluster OnePosted on7:05 am - Dec 22, 2017


HOMUNCULUSDECEMBER 21, 2017 at 23:02
In other considerations, I believe tomorrows decision from the Court of Session is going to be huge for the new club. I don’t think their support realise just how big it might be.
————–
I believe the SMSM have played there part AGAIN in keeping the ibrox fans missinformed

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Homunculus

HomunculusPosted on9:19 am - Dec 22, 2017


Cluster One
December 22, 2017 at 07:05
==============================

I agree.

Let’s paint a potential scenario, and not an outlandish one. The Court of Session orders Dave King to make the offer, as instructed by the Takeover Panel. He fails to make that offer and is banned from being a director in the UK for 5 years, and is given the “cold shoulder”.

So he no longer sits on the board of RIFC PLC.

Does he then go through with agreeing to convert the NOAL loans to equity and does he agree to NOAL providing a further £7m, presumably also to be converted to equity. That’s something like £15m* (if memory serves) which is now worthless shares, in a loss making business, which he has no control over.

I’m not sure he would be that gracious.

How does the business then trade, it has to get the money from somewhere.

Pure conjecture on my part, however as I said I don’t think it is that outlandish. Indeed if he is found to be in contempt of Court then the situation could be meven worse for him.

(*I’m basing that on £2m to buy in, £6m in existing loans and a furrthr £7m which he has promised )

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wottpiPosted on9:43 am - Dec 22, 2017


Do we know if anyone (bloggers or SMSM) is going to be at the CoS today for the judgement?

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wottpiPosted on10:27 am - Dec 22, 2017


While checking some twitter feeds to see if anyone was covering the CoS today I noted a link in Chris McLaughlin’s to the twitter feed of the Hoops girl who was hit in the face with the ball at the Partick game.

Refreshing to see the girl is not making a big deal of the incident and telling people who seem to be stirring it to calm down.

Seen some coverage elsewhere that seemed to be full of  faux outrage and questioning when apologies would be issued etc. IMHO that is one of the problems with social media these days – people trying to find offense in matters that don’t necessarily concern them directly.

While Fraser’s actions were petulant, foolish and are not to be condoned the Firhill club, player and the girl have handled it all in a timely manner, on a personal level with a degree of common sense and dignity.

Sorted.

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easyJamboPosted on10:33 am - Dec 22, 2017


wottpi December 22, 2017 at 09:43
Do we know if anyone (bloggers or SMSM) is going to be at the CoS today for the judgement?
=======================
There is no requirement for counsel to be in attendance. I therefore don’t believe that there will be a formal statement in a court room to hear.  The judgement will simply be recorded and published on the court’s website, probably at noon.

Both parties will already have been informed of the decision and no doubt, King or Traynor, will be preparing a statement as we speak, whatever decision Lord Bannatyne has made.

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wottpiPosted on10:41 am - Dec 22, 2017


EASYJAMBODECEMBER 22, 2017 at 10:33

Thought that may be the case but was wondering if someone would be trying to get ahead of the game.

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easyJamboPosted on10:47 am - Dec 22, 2017


Daily Record Rangers‏ @DR_Rangers 2m2 minutes ago
BREAKING: Rangers owner Dave King loses £11m court case as judge rules in favour of Takeover Panel http://bit.ly/2kXos5O

Rangers owner Dave King this morning suffered a crushing blow as a top judge ruled he must make an £11 million shares offer.

The decision at the Court of Session potentially plunges the Rangers owner into a major cash crisis as King’s lawyer previously told Lord Bannatyne the entrepreneur was “penniless”.

King, who has faced turbulent conflict with tax authorities in South Africa, argued that King’s money was tied up in onshore and offshore trusts but they were in the name of his family and he didn’t have control of them.

But Lord Bannatyne’s ruling favours the view of The Takeover panel, who argued that he controlled the cash and was legally bound to offer to buy out other Rangers shareholders at 20p a share – amounting to £11 million.

King’s advocate, Lord Davidson of Glen Clova QC, earlier told the court: “Mr King is penniless. Any order wouldn’t secure compliance. It won’t. It is pointless.”

He also recommended judge Lord Bannatyne dismiss the order because the shares were currently worth 27p.

The hearing at the Court of Session in Edinburgh was told King didn’t know he’d be legally required to fund the £11million share purchase as part of his takeover.

But Advocate James McNeill QC, acting for the Takeover Panel, rubbished the suggestion he was unaware of the 2006 Companies Act provisions.

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valentinesclown

valentinesclownPosted on11:14 am - Dec 22, 2017


Oh dear the smsm will be working harder than Santa’s elves trying to make this news from verdict of TAB sound as good news for the bears in Govan.

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Allyjambo

AllyjamboPosted on11:23 am - Dec 22, 2017


Assuming the decision goes against King, the question is obviously, ‘what happens next?’

One thing that the TOP will have to take into account is the effect on existing, innocent, shareholders, so a balance will have to be met to ensure it is only King who is disadvantaged. I wonder if King, perhaps backed by the board (although they might not be in the TOP’s good books), will appeal to the panel, on behalf of the shareholders, on the grounds that the cold shoulder could result in the demise of the club, disadvantaging the small shareholders whom the panel is actually trying to protect. I’m not thinking in terms of their beloved football club, more in terms of ordinary shareholders in an ordinary company illegitimately taken over by a concert party. As painted in Homunculus excellent potential scenario, the cold shoulder has much greater effect on the company because King has made those loans, and the company is only continuing to trade on the strength of his promised future loans.

A bit of a dilemma for the Takeover Panel, I’d suggest, and maybe what King’s counsel was hoping for in his impoverished King defence! Basically telling the judge, and the panel, that too draconian a punishment might result in the end of the company. 

As for today’s announcement, I’ll be surprised if it’s anything more than to state the court has upheld the TOP’s right to order King to comply with whatever they, the panel, see fit (or to reduce their powers), and it could be into the New Year before we know the effect on King and RIFC/TRFC.

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Allyjambo

AllyjamboPosted on11:25 am - Dec 22, 2017


Well, Easyjambo just made my last post a waste of time18 So much for a 12.00 announcement!

Anyway, let the fun commence04

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Allyjambo

AllyjamboPosted on11:28 am - Dec 22, 2017


valentinesclownDecember 22, 2017 at 11:14 
Oh dear the smsm will be working harder than Santa’s elves trying to make this news from verdict of TAB sound as good news for the bears in Govan.
________________

And they’ve just pointed out to the bears that the man who has promised a further £7.2m in loans, to keep the lights on for the next season and a half, claimed to have no money in court. (I know we all knew this, but I think most bears didn’t quite catch it before)

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Homunculus

HomunculusPosted on11:44 am - Dec 22, 2017


Allyjambo
December 22, 2017 at 11:23
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I fear that failing to comply with a Court of Session order may lead to more serious consequences than “the cold shoulder”.

I assume that the Court will have put a timescale on him doing it, that should become clearer if / when the full ruling is published.

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easyJamboPosted on12:05 pm - Dec 22, 2017


Full Judgement
https://www.scotcourts.gov.uk/docs/default-source/cos-general-docs/pdf-docs-for-opinions/2017csoh156.pdf?sfvrsn=0

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wottpiPosted on12:28 pm - Dec 22, 2017


Statement O’clock but on another matter.

ClydeSSB tweeting Murty appointed until end of the season.

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easyJamboPosted on12:29 pm - Dec 22, 2017


Rangers in full deflect mode.

1. Murty confirmed as manager until the end of the season
2. Declan John signed on a 3.5 year contract

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upthehoopsPosted on12:32 pm - Dec 22, 2017


As soon as King loses the court case with the TOP, the usual media cheerleaders are out shouting about Graham Murty being appointed Manager until the end of the season, and Declan John signing a permanent deal.  Yes, Ibrox is simply good news central these days!

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Billy BoycePosted on12:53 pm - Dec 22, 2017


Does impecuniosity trump concomitant?

” Given the circumstances put forward by the respondent in support of his supposed impecuniosity they are of no significance. His impecuniosity is entirely self-generated….the Trusts have been willing to provide money for the purchase of Rangers shares when the respondent wished them to do so. Now, suddenly, when the respondent does not wish to comply with the terms of Rule 9 the Trusts no longer are willing to provide any money. “

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easyJamboPosted on12:56 pm - Dec 22, 2017


Reading from the judgement, the TAB ruling was for an offer document to be prepared within 28 days and the formal offer to be made within a further 28 days. 

I would also expect those time scales to apply to the CoS judgement, so King would be required to publish an offer document by 19 January 2018 and make the actual offer by 16 February, if the time scales are imposed rigidly. 

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borderman67Posted on1:01 pm - Dec 22, 2017


Cant. Stop. Laughing. 12

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wottpiPosted on1:01 pm - Dec 22, 2017


EASYJAMBO
DECEMBER 22, 2017 at 12:56

Lets just call it 14 February for old times sake and serendipity. 21

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Allyjambo

AllyjamboPosted on1:11 pm - Dec 22, 2017


Decision [130] For the above reasons in respect of the first issue I find in favour of the respondent, however, in respect to the second issue, I find in favour of the panel and grant the order sought. I reserve all questions of expenses

Could this be a door left open for an appeal?

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Homunculus

HomunculusPosted on1:16 pm - Dec 22, 2017


EasyJambo
December 22, 2017 at 12:29

Rangers in full deflect mode.

1. Murty confirmed as manager until the end of the season

2. Declan John signed on a 3.5 year contract
=====================================

They must know how bad it is, the simulaneous release of two squirrels, it’s unprecedented.

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Homunculus

HomunculusPosted on1:21 pm - Dec 22, 2017


EasyJambo
December 22, 2017 at 12:56
=======================

That makes sense.

All that has really changed is that if he doesn’t do it now then he is defying the Court of Session rather than the Takeover Panel.

Does anyone else think Mr King may have made his last visit to Ibrox … or Scotland.

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melbournedee

melbournedeePosted on1:26 pm - Dec 22, 2017


ALLYJAMBODECEMBER 22, 2017 at 13:11
Decision [130] For the above reasons in respect of the first issue I find in favour of the respondent, however, in respect to the second issue, I find in favour of the panel and grant the order sought. I reserve all questions of expenses
Could this be a door left open for an appeal?
—————————————————————————————————————
AJ,

The 2 issues considered by the court were:

1) What, on a proper construction of section 995 of the Act, is the ambit of the court’s discretion?

2) If the court has discretion to refuse the order, should the court in the exercise of that discretion refuse the order sought?

Issue 1 – The court agreed that it did have discretion.
Issue 2 – The court decided that it shouldn’t refuse the order an so the order is granted.

No wiggle room – DCK is stuffed

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easyJamboPosted on1:30 pm - Dec 22, 2017


Allyjambo December 22, 2017 at 13:11
Decision [130] For the above reasons in respect of the first issue I find in favour of the respondent, however, in respect to the second issue, I find in favour of the panel and grant the order sought. I reserve all questions of expenses
Could this be a door left open for an appeal?
====================
The “first issue” was the scope of the discretion the court had to make an order.  The TOP argued that the court only had limited discretion to determine the nature of the compliance order.  King’s QC argued that the court had the discretion whether or not to make an order at all.

Lord Bannatyne agreed with King’s QC that he had the discretion whether or not to make an order, therefore found in favour of King on that point.

However, in using that discretion, he still chose to make the order in favour of the TOP anyway.

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