LNS is currently back in the headlines. It might therefore be a good time to try to set out a timeline describing correspondence we had with the representatives of the authorities over discrepancies and anomalies that appeared to have arisen. None of this is necessarily predicated upon the recent findings of the CoS in the Big Tax Case, but stands on its own.
Back in February 2014 The Scottish Football Monitor wrote to Harper MacLeod, the law firm that the SPL had engaged to gather evidence for the Lord Nimmo Smith (LNS) Commission investigating the full and proper registration of players paid by Rangers Football Club under Employee Benefit Trust (EBT) arrangements.
The initial set-up of the LNS Commission on 5th March 2012 by the SPL (View File) charged LNS with a look at EBTs from 1st July 1998 (when the SPL came into being).
In practice though, the Commission only looked at EBTs from 23 November 2000 onwards.
This change of date was based on the earliest side letter supplied by Duff and Phelps, although Harper MacLeod had requested ALL documentation from 1998 to March 2012 relating to ALL EBTs.
This prompted a series of letters to Harper MacLeod from The Scottish Football Monitor, although Harper MacLeod’s replies failed to address the issues raised.
The passage of time blurs memories but this archive is designed to remind readers of those blogs and correspondence, and the key points contained in them.
It also highlights the apparent inability or unwillingness on the part of the SPL and SFA to engage with us in any meaningful way.
NB: The SFA were informed of our correspondence by Harper MacLeod in October 2014.
It is extremely difficult to be concise in this situation. There are various strands of argument and details seemingly small, but vitally important – however the following is an attempt to make the material accessible and provides links to the relevant files in chronological order (links are in green).
- Item 1: The first SFM letter of 19th February 2014 to Harper MacLeod
- Item 2: The Annexes containing the documents apparently not supplied to Harper Macleod in the spring of 2012 along with other pertinent information about the testimony given to LNS during the Commission.
- Item 3: The SFM response of 29 March 2014 to Harper MacLeod’s reply to the first letter.
- Item 3.1: An SFM analysis of Harper MacLeod’s initial reply attached to response at 3.
- Item 4: An SFM blog of 5th September pointing out how the documents not supplied had a direct impact on the advice given to the SPL Board to accept The Decision of The LNS Commission.
- Item 5: The last letter of 4th October 2014 to Harper MacLeod answering points raised by them (see next) and thanking them for passing our correspondence to the SFA Compliance Officer who has so far deigned not to reply.
- Item 5.1: Harper MacLeod’s actual response to SFM 5th September letter.
- Item 6: An SFM Blog (Inc. a transcript of an interview between Alex Thomson and Stewart Regan).
- Item 6.1: Truncated version of above blog.
- Item 7: A clearer extract of key document from Item 2 Annexes
Having no locus to demand answers from the SPL or the SFA, all we can do is provide information – information that we believe presents a prima facie case that LNS was deeply flawed even before the latest developments in the Tax Case came to light. The challenge for us is this: what can we do about it?
It is clear from the meagre response we have received that the authorities are unwilling to engage with us, so it is fair to assume that further correspondence will be met with the same lack of response.
Are we merely a bunch of obsessed nut-jobs with our own take on the Flat Earth conspiracy? If that is the case, surely a few words of explanation to dispel our doubts would have had traction with the rest of the football public. Indeed the lack of any reply undoubtedly serves as confirmation of our belief that something may be seriously wrong.
The questions have been posed. The SFA appears to think that not answering them is a wise course of action. Given that anecdotal evidence presents a compelling case that the general football public are widely in agreement with us, are there any journalists out there who will take the time to look at what we have observed and what we seek clarification on?
There are undoubtedly inferences to be drawn from the evidence we have, and from the silence of the authorities.
The statement by Celtic on Friday 13th November is certainly a start in the process we wish to begin, but it only mentions the elephant in the room. It gives no clue about how it could be transported to another place.
In the first instance we at SFM seek only explanations, and despite the inferences mentioned earlier, we are still eager to be satisfied that rules were followed and justice done.
Is there really nobody in the MSM who has the courage to seek the answers we seek? I suspect not. What we do in the absence of that courage is important. We are at a crossroads. Either we give up on the game altogether and spend our Saturdays and Sundays doing other things – or we find a way to get these questions out of blog pages and into the mainstream.
We need an alliance of fans of all clubs to do that, and we will be looking to build that alliance. I would urge fans of all clubs to give this material to fan sites of their own clubs.
These are not just words. There can be no movement on this issue unless our reach is extended. SFM alone does not have the clout required to bring the clubs to the table or the MSM to fair and balanced reporting. We need that alliance of fans desperately. We don’t seek leadership of that alliance – but we are happy to provide it if required.
This is not a campaign to have Rangers punished. I understand that Rangers fans (since their club is in the middle of this mess) are reluctant to see us as anything other than a bunch of Rangers haters.
That is unequivocally not the case from the perspective of the moderators of this blog. SFM is committed to justice, and to the integrity of the sport we all love.
Justice is ON THE SIDE of Rangers and their fans – it does not conspire against them. A growing number of Rangers fans are coming round to our way of thinking and our tone must reflect that. This is not a Celtic or Hearts or Aberdeen or anybody else v Rangers issue. This is a fans v corrupt authorities issue.
We all deserve answers, and hopefully our alliance will compel each individual club to act in the interests of the fans .
I’m disappointed in everyone trying to find ‘bad’ reasons for Dave’s visit to Hampden. After all, the Glum and Blameless Flyer has told you himself it was just a courtesy visit to introduce himself.
Apologies, I’ve been waiting for ages for the SMSM to stop using ‘jetting’ so I could use that description.
I’ll get my boat….
easyJambo 26th November 2015 at 9:26 pm
‘The dates you quote for the Sevco Scotland directors are those when the forms were submitted to Companies House…’
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Yes. In my earlier post at 7.37 ( or 7.57) I used the dates as reported in the press at the time- the dates you mention.
But then I thought I had better check with the Companies House records, in the (badly mistaken?) understanding that Companies House had to ‘officially’ recognise the formal appointment of directors, before they could be regarded as exercising the duties of directors.
Shows you how much I don’t know.
The critical thing is that, before 29th May 2012, there was no ‘company’ of which CG was a director. Just a bunch of guys trying to buy assets on the cheap.
If ,subsequently, the bunch of guys set themselves up as a ‘company’, it would seem to me that they could not backdate their director status to cover their actions as private individuals prior to 29th May.
Whether anything they did after 29th May was done by them as ‘directors’ is debatable..and probably depends on the legitimacy of their ‘director’ capacity.
By Jove, it’s fascinating stuff altogether, quite apart from the fact that it involves a football club.
JC says
“Anyone who does not acknowledge communications sent to him is suspect, in my book. Mr McRae has not even acknowledged let alone replied to my letter to him of one month ago.I therefore have to brand him as something less than a gentleman, who would not be at all welcome in my social environment as exhibiting a serious character deficiency.To what depths might not such a man descend? Or, God save the mark, has he descended so far already that failure to reply to correspondence is the least of his faults?”
……………………………………………………………………………………………………………………
JC perhaps you should take a leaf out of the book of tactics of the old satirical character Henry Root? (William Donaldson’s creation). For those of you who have not heard of him, when trying to engage numerous public figures, often ridiculing their statements and/or views by writing letters with often outlandish questions and sometimes hilarious support, he would usually attach a £5 note to the letter.
The presence of the £5 would often create discomfort in the recipient’s mind especially when accompanied by a suggestion on how they should use the £5 in support of some ridiculous viewpoint or campaign. This almost always resulted in him receiving a reply, usually with the £5 note returned and often having drawn further comment on his suggestions in his satirical letter.
Use your own wonderful writing skills to ask whatever question you want, but include a paragraph at the end of the letter to refer to what should be done with the £5, e.g.
Mr McRae, I appreciate you have found yourself in the middle of one of the greatest cluster****s in the history of British sport and I’m sure you will be bamboozled and perplexed as to finding the solution to this huge problem that is all things Ibrox.
Also, good luck in your efforts to convert the free-thinkers among the throngs of Scottish football fans, to adopt the myth of The Rangers Football Club Ltd being the same club as Rangers Football Club PLC, (now RFC 2012 in liquidation). Obviously you have the unwavering support of the Scottish Sport Media behind you and the flat-earthers among the Ibrox faithful need no convincing.
Furthermore, I have been told that there is a whip-round among the staff at Hampden at the end of each month to raise funds to pay the Electric Bill at Ibrox. Please receive the enclosed crisp new £5 note as my small contribution toward keeping the lights on, God knows they’ve suffered enough.
Actually when I think about it JC, it probably would cost you the fiver as knowing the SFA’s attitude to their pet club(s), he will probably forward the cash as instructed. If so I’ll be happy to reimburse you.
PS I can recommend the book “The Complete Henry Root Letters”, to anyone of a certain age who is not overly PC and can enjoy it for what it is, given the era it represents. One of the few books I’ve read which has actually made me laugh out loud on numerous occasions.
Allegedly ,John C . Mibbes just the business and assets of a football club in liquidation ?
normanbatesmumfc 27th November 2015 at 12:45 am #
‘..perhaps you should take a leaf out of the book of tactics of the old satirical character Henry Root? (William Donaldson’s creation).’
______
I do indeed remember the Henry Root letters.There was a time when I took ‘The Times’!
And I think your own suggested letter is as good as anything Donaldson would have written! If you’ve got a spare fiver, why not bang it off to McCrae?
paddy malarkey 27th November 2015 at 1:00 am
‘.. Allegedly ,John C . Mibbes just the business and assets of a football club in liquidation ?’
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Well spotted, paddy malarkey! And thank you .
Even as I hit the ‘send’ button I felt there was something not quite right!
Excuse me for going a little OT
If on Dec 9th Dave King is found guilty and locked up for ‘X’ amount of days, and that then put him over the minimum amount of days in the UK for tax purposes, would he then be liable for income tax payments to HMRC?
Ah let me argue against myself here.
Charge 6&8 are partially in the period of contract.
I have no idea of where the prosecution will timeline the alleged offence therefore should be at least proportionately covered?
Yes?
Yes. HMRC don’t care why you’re in the UK, just that you are.
Will try and articulate better what I was trying to say yesterday.
Regardless of of dates of incorporation and appointment of directors, I would expect Green and his lawyers to argue that any activities that predate Sevco were just negotiations that led to its birth and as such should be indemnified by the Company to whose birth it relates.
His is alleged criminal activity directly relates to the establishment of Newco Rangers (TRFC/RIFC), the acquisition of assets by it, and its subsequent public offering. There are some additional charges in relation to him enriching himself along the way but substantially it is all about the creation of Sevco.
I remember being astonished when the decision of the SFA Judicial panel, headed up by Lord Carloway – to hand a 12 month transfer ban to Rangers – went to the Court of Session because Rangers wouldn’t accept the ruling. At the time I thought it a very soft punishment, in some ways meaningless it only really meant they couldn’t do any business in the next January transfer window.
But, Lord Glennie at the Court of Session concluded that only the specific punishments laid down in the SFA’s rulebook for the charges Rangers faced – namely a fine, expulsion from the Scottish Cup or suspension or termination of membership – could be applied to the club.
I can’t be bothered to go and find the rule but I’m almost certain the wriggle room was there in the rule. After the specified punishments, the line, ‘or any other punishment as we see fit’ type of thing.
If Lord Glennie was correct, why have the SFA (& SPFL) not addressed these discretionary aspects to their rules? In other words only carefully thought out SPECIFED rules, no get outs for the authorities when dealing with a certain club.
After 5 years of feeling a great sense of injustice I have got to the point where I honestly don’t have a clue how the courts will adjudicate on the forthcoming cases, as I said yesterday they – the legal eagles – often see things differently from us.
My worst case scenario is that Rangers, the SFA & DCK win everything and MA loses everything. Hopefuly that will not happen. The only real hope I still have is that despite the outcomes, a lot of people will be exposed for all their grubby goings on.
Re your worst scenario.
To quote a politician of not so long ago “there is no money” or words to that effect.
Note was left by Liam Byrne at the Treasury after Labour lost the 2010 election. It read:
Of course when I say the grubby goings on will be exposed, we already know most of it. But I think there is more to come. And once all this comes out in an open court, the Scottish media will be reluctantly forced to report on it. Humble pie time.
Excuse me for going a little OTIf on Dec 9th Dave King is found guilty and locked up for ‘X’ amount of days, and that then put him over the minimum amount of days in the UK for tax purposes, would he then be liable for income tax payments to HMRC?
————————————————————————————
Can he not just get TUPED to a SA jail?
@JC, various posts.
I agree that between his first involvement and May 2012 Charles Green “represented a consortium” that entered into negotiations, firstly to acquire the former Rangers Plc, and latterly its business and assets.
It is not unusual that the consortium didn’t have a legal entity until the negotiations were sufficiently advanced as to require documents to be drawn up, after all it is literally a 5 minute job for your lawyer to repurpose one of their off the shelf companies.
The consortium, through the subsequent allotment of shares to the initial investors, essentially became Newco Rangers.
As I said previously, if I was in Green’s shoes I would be arguing that the representing of a consortium through to becoming the legal entity that acquired the business and assets was just the natural evolution of the transaction.
An example of this in practice is the tax treatment of pre-incorporation costs i.e. where your company reimburses you for expenses incurred prior to the company being formed. An individual can claim back legitimate formation and other pre-incorporation costs of a company e.g. professional fees, for a period of up to 7 years prior to the company being incorporated.
Would also add that had I been in Green’s shoes I would probably have made sure the indemnity explicitly covered me back to the opening of negotiations.
Getting sceptical of Warburton’s city trader credentials given that he obviously can’t count.
So that’s P14 W12 D2 L1
What a change of wind direction that will be from past dealings,before we had documents blown away in the wind and landing in big shredders and now Charles and co will have been out with their litter packers and suddenly there will be more paper than a rain forest can produce,amazing change of wind direction that will be.
From the Rangers AGM currently underway
Alasdair Lamont @BBCAlLamont 21s21 seconds agoDK – Last night, board made decision to reverse position on SD loan. We will endeavour to repay loan as long as we can raise money.
Grant Russell @STVGrant 44s44 seconds agoKing: Board has reversed previous decision over SD loan. We have decided now to repay the loan. We now have funds to do so.
Grant Russell @STVGrant 44s44 seconds ago Hugely significant line from King. Rangers will repay Sports Direct’s £5m loan. King says group of investors will provide the funds.
Alasdair Lamont @BBCAlLamont 1m1 minute ago DK – Took me one hour this morning to raise the £5m from major shareholders. Will advise SD we will be repaying that loan.
Grant Russell @STVGrant · 1m1 minute ago
Members of the “three bears” mentioned as being among those who will provide funds to repay Sports Direct. And King.
Cool. So another 4.8 minutes work and that’ll be the LNS fine paid as well.
Unfortunate tweet from Grant Russell above.
I’m assuming (always dangerous) that he is inferring that the 3bs will put in to repay money due to Ashley, as will King.
That’s not what it says though!
Per Grant Russell. Decision to to repay made at board meeting last night.
One hour to “raise the commitment to fund”.
Will be interesting to see whether “commitment to fund” turns into actually fund.
This presumably means that one £5million loan is being replaced by another and the existing cash requirement which needs to be met by soft loans, also from 3B, still exists?
Now why would anyone who doesn’t give a monkeys about his personal image, has spare change more than the numbers we’re talking about, and, say, a 75% profit share on use of all image rights shove in 7.5m (especially if he got a discount of, say, 5m) to keep the lights on and sell lots of tops?
Why would someone do that. Think brain, think god dammit!!!
Reading between the lines of DK’s response to a question on trademarks reverting to Rangers, I’m pretty certain that the loan will not be repaid in a single lump sum. .
Grant Russell @STVGrant 8m8 minutes ago King confirms Sports Direct securities will revert to Rangers if SD are paid back in full.
That suggests to me that they will attempt to pay it back over an extended period. If I recall the terms of the loan correctly from the AIM statement, the additional shareholding will be transferred back in proportion to the loan repayments; e.g. for each £1M they will get 5% back, and the dividend share will also change in line with this.
Fairy stories again from King
Grant Russell @STVGrant 9s9 seconds agoKing: Those providing soft loans are doing so as equity substitute. Not really a loan. They won’t be repaid. They will be converted.
Grant Russell @STVGrant 1m1 minute agoKing: Once SD loan paid off, Rangers will have no debt.
Grant Russell @STVGrant 1m1 minute agoKing: Once SD loan paid off, we will be one of strongest clubs in world with regards to financial position.
Whilst not a great fan of the DR, I’m enjoying the rather tongue-in-cheek reporting of the AGM by Euan (Lex) McLean.
On second thoughts; perhaps the meeting is actually that surreal & McLean is reporting verbatim!
Albeit there remains an impediment to this happening.
Notwithstanding that the loan is being paid off using a loan, this is patently not true
Glib, shameless.
Because loans that aren’t repayable has worked well for them in the very recent past.
So, according to King, all the amounts advanced to the Club by the board and himself have to be classified as loans, but they will never have to be paid back!
I think I have heard this description used in a previous series of financial transactions embarked upon by Oldco.
Will they never learn?
Again though you can see the model laid absolutely bare (no pun intended). They simply have to get to top two of premiership first and then, and only then, will they work out if they can do so and stay there profitably and sustainably.
What could possibly go wrong?
And, to continue the above, to answer my own question, here’s what could go wrong.
1/ Well they could go bust again! So what….. Immortal etc etc
2/ Id be very interested in a straw pole round the SPFL Premiership clubs in particular. How many have an issue with this “chuck yet more money at it” approach? Indeed, as I suspect, how many welcome it – the money that is? And finally, how many have footballing issues with it?
I suspect the answer is precious few, if any in fact!
Thanks are due to Grant at STV and others for their reporting of the event.
I think we have seen a well controlled, coordinated and pre-agreed meeting that avoided the very real possibilities of internecine warfare and even meltdown.
Credit for that is due to the guys at the helm but it was all done without providing any business answers or real insights into where they really are and how they plan to climb out in a sustainable way.
Rhetoric is cheap.
As of today we have had a public insight into what we have been led to believe is a very confident board whose real troubles and the causers thereof are in the past.
The key word to me is confidence which in turn says minimal risk.
Unfortunately for them the real world is intruding as I write this.
Numbers have to make sense and sooner or later be long term neutral / positive.
Cash is king in all businesses apart from Rangers where King has no cash.
zerotolerance1903 27th November 2015 at 9:42 am
‘.. if I was in Green’s shoes I would be arguing that the representing of a consortium through to becoming the legal entity that acquired the business and assets was just the natural evolution of the transaction. …….. had I been in Green’s shoes I would probably have made sure the indemnity explicitly covered me back to the opening of negotiations.’
_______
I defer to your deeper knowledge of these things.
I wonder why CG did not,shrewd and cunning chap that he is,did not get himself explicitly covered to the earliest date of involvement. Maybe he tried , and could end up only with t a ‘compromise’ agreement?
So the AGM is over, not so much Penny Arcade as
https://www.youtube.com/watch?v=jGUW0uAwDyw
So, Dave King meets Neil Doncaster and within 24 hours the RIFC board reverse their position on repaying a £5 millon loan to Mike Ashley.
Two conjectures:
1. The SFA must really want Mike Ashley away from everything.
2. They have a certain amount of leverage with Dave King.
Jake
More likely is the realisation that Ashley is quite capable of running up legal costs for RIFC in excess of £5million, and RIFC would still owe him £5Million at the end of it.
Ashley is in a win/win position.
Given the nature of the Sports Direct deal, Rangers would, effectively, be paying for both sides legal costs anyway
However, I would make a healthy wager that whether Ranger’s repay the loan or not, Ashley’s war on King will continue, mainly because King is too stupid to cease and desist from winding Ashley up. As King’s comments today about “SD working to an agenda” demonstrate.
3. They’re paying for it.
Sorry couldn’t resist.
If the wheels where already in motion to repay the loan,why not announce this a few days ago,even a wee leak to the munch bunch,the AGM today could then have been all cuddles and Xmas gifts ,unless,that is,someone might have had time to further question the set up of the loan,now we wouldn’t want that ,would we,but we will know soon enough,is Dave on the PM flight to London per chance en route to his wine cellar.
I wonder what Big Mike will put this sudden windfall towards,any guesses anyone.
Since it was Rangers International Football Club’s AGM- the company that owns the company that owns the club that plays in the SPFL,-Mr King is probably correct in saying that RIFC will be one of the strongest(only ?) clubs in the world that own a company that own a football club . As for TRFC though, how much debt do they have to the parent company ?
I think the fact it wasn’t a keef eksclushive this morning would back up that the loan repayment was a last minute decision, I’m guessing prefaced by the Green non legal fees deal.
Convenient timing.
highfibre 27th November 2015 at 12:26 pm
‘…draw your own conclusions about whether any other cosy five way agreements may have been made..’
_________
This is always the worry.
The Board of the SPFL allowed themselves , for whatever reason(s) , to betray us all by jettisoning all idea of truthful, honest, governance in a frantic, panic-stricken ‘save Rangers at all costs’ move, transmuted into a ‘save the new club at any and all costs.
The ‘courtesy call’ to Hampden is likely to have involved the Board in some dirty wee bit of business, perhaps little assurances, little words of comfort, that if Warburton fails to earn a place in the Premiership, arrangements will be made to circumvent the consequences.
With men who are already branded as unprincipled and partisan in thedischarge of their governance duties , dealing with other such, we must expect the worst.
Was there any mention of Mr McCrae or Mr Regan having been ‘courteously’ called on by King?
Was just re-reading some of the opening blog item 6, Auldheid’s transcript of the interview between Alex Thomson and Stewart Regan. Why can’t any Scottish journalist ask questions like AT does? A real shame. I loved this snippet:
“AT Forgive me that sounds absolutely incredible this is the biggest club in Scotland which has been brought to its knees by a whole range of fiscal mismanagement, it is all on the record and proven. A new man comes in claiming all kinds of things, just like the previous man, and the SFA did not check or do any due diligence whatsoever.
SR That is part of the process of governing football, we
AT That’s, that’s NOT governing football that’s the exact opposite to governing football that’s running away from governing football.”
highfibre 27th November 2015 at 12:26 pm
”…TRFC should not be paying Charlie’s legal bills for exactly the same reason they should not have any titles stripped…’
____
Just to absolutely clear, I don’t think there is any talk about stripping TRFC of titles-only of their claim to be the same entity as RFC(IL)!
No, the couple of league titles they’ve got, they ‘earned’.
It is the ‘dead’ beast, RFC(IL), which has to have its record corrected by the removal of any and all titles and honours dishonourably ‘won’ by the serial fielding of ineligible players over many years, in a carefully calculated cheating operation masterminded by a knight of the realm.
I’ve just had a listen to the STV interview with King following the AGM.
http://news.stv.tv/west-central/1333962-dave-king-says-repayment-of-5m-sport-direct-loan-right-thing-to-do/
Contrary to my expectations, the full £5M appears to be available now, with King, Park, Letham, Taylor, Murray and Bennett providing the cash.
I don’t suppose we will get a breakdown of who is providing what.
So we have gone from £50 million to £30 million to a commitment to fund (a beautifully meaningless phrase) obtaining a loan of OPM to pay off another loan which has been used to pay for flights legal fees and other costs which if things had been run properly would never have been needed. This other commitment to fund will be processed through the ethereal prestidigation machine to become neither loan nor equity but some other thing inside the cloud of unknowing.
THere will be those who will “pure lap it up by the way we are the people and owe naebody”
This has optical illusions of which MC Escher would be very very proud.
The HIbs have a sacred duty to derail this smoke wrapped DDR quality machine.
So after all the bluster they are going to pay up. However the timescale is unclear. So we know that the club posts losses each year and in posting those losses ‘free money’ has been gobbled up This calander year it was £5m from MA and circa £4.5m from the 3Bears and King Given the required £2.5m to see the season out there is no indication of where the circa £14m will come from to see them break even by the next accounts and move into season 2016/17 on a sustainable footing.
Still a financial basket case where the fans are going to be asked year on year for considerable sums of monies over and above ticket and retail sales
No obvious change from the previous failed model
Any indication of the terms of conversion of the loans into shares ,eg 2 votes per share like MA has in retail , and if the same option is available to other lenders , like MA ? Or the price per share conversion rate ?
It’s hard to know where to start with today’s AGM. The only thing that is clear to me is the vice like grip Rangers still has on the Scottish media. The unquestioning reporting is bordering on that we could expect surrounding a Royal Wedding. Even by their own standards of deferring to the ‘royalty’ in the Ibrox Boardroom, the media has surpassed itself.
Let us assume that all of the debt to major shareholders as reported in the accounts remains outstanding, as I recall that was around £3.75m. That is all to be converted to equity.
Let us assume that a further £5m is to be raised from the same people, again to be converted to equity.
Let us assume that Ashley does not object to dis-application of pre-emption rights (he may not if he is guaranteed his £5m, that may be one of the conditions under which he does not contest them).
That would mean the first £8.75m of any rights issue would go to the major shareholders. i.e. they get that amount in shares but no money actually goes to the club. They have already paid for them. They are simply getting their money back but as equity rather than as cash.
Let us assume that 40m shares are issued to them at 25p each. I don’t actually have the figures from the resolutions so I’m just making this up to illustrate things. That raises £10m (excl any fees). It’s difficult to see how they could make it much different from that figure. If it’s less they simply raise less (notional) money in the rights issue.
So we have c £1.25m going to the club. The rest already being spent.
However they have already stated they need £2.5m to see them to the end of the season. I think that is conservative (I think it is really until the next season tickets can be sold) but if we take it on face value they require a minimum of £1.25m just to do that.
Is this money to be supplied by RST, the CIC, some combination of supporters groups. Is it simply more borrowing or is it a gift. Are the supporters simply covering this shortfall, do they really understand that is what is happening.
It is still a loss making business, it still has no reasonable line of credit, there are still no signs of meaningful recovery. There is nothing to suggest that things going into the future are any better than they were in the past. Indeed they have almost certainly now cut off one of the few sources of “investment” (read borrowing) available to them (SD / Ashley).
In addition the Rangers Retail joint venture is still in place, as far as we are aware the rolling 7 year deal is still part of that. They are still losing most of their merchandising income to SD, money they desperately need. Money they won’t get for years.
How anyone can paint this picture as anything other than dire straits is beyond me. Smoke and mirrors, that is all we are witnessing just now.
I have to admit that I have been rather surprised by various of Dave King’s comments today.
And then I remembered that a South African judge said that we should not believe anything he says without independent evidence to corroborate it.
Been a ‘good news’ couple of days for the bears, Green beaten in court and the announcement that enough money is pouring in to repay the MA loan. And as far as we know, no awkward moments at the AGM.
A few questions might remain though (OK there’s still quite a lot to be asked by some bewigged gents in various courts).
Questions like, is getting his £5m back all that MA wants from over a year of effort by him and his men, with no end of public bickering, if bad mouthing met by silence can be termed ‘bickering’? I don’t know, but I’d imagine MA wanted quite a bit more than merely receiving his £5m back after it had been used to keep the lights on at a football club he has no interest in other than as a money making vehicle. I am of the opinion that he’s always had his sights set on gaining complete ownership of the IP, and the repayment of his loan will leave him back at square one, still with his great RRL deal, but nothing much more than a few low valued shares in a football club.
There has, of course, been some doubt on whether, or when, MA could call in his loan as, as far as we are aware, there was no set repayment date within the loan agreement. Well today maybe that has changed, for at the AGM the RIFC/TRFC directors have acknowledged it needs to be repaid and I just wonder if MA will now turn round and demand instant repayment, in the hope, or anticipation, that the money isn’t instantly (within, say, three weeks) available, pushing the club into administration and triggering his right to take ownership of RRL and the club’s IP!
There’s another question (or two); do the directors of RIFC/TRFC believe that there is absolutely no chance of the club losing all it’s major assets as a result of the criminal case currently waiting to start in the High Court? Or, are they so rich that they can commit further millions when there is a chance that the ‘club’ might end up without some/all it’s major assets?
Any word on the resolutions over pre-emption rights? If they don’t get that, how can the loans be turned into shares? And even if they can have a fresh, unrestricted, share issue, that’s something like £8m+ of the potential uptake (from the world’s most committed RRMs) already gone!
As ever, with TRFC, and particularly Dave King, we will all have to wait to see if the announced ‘over-investment’ ever comes to pass!
Still, there was probably much more revealed at the AGM than I have so far read, so maybe they have got it all sorted out and Big Mike will no longer feature in Scottish football conversations! Bye, Mike, it was nice knowing you
Allyjambo 27th November 2015 at 3:09 pm
Any word on the resolutions over pre-emption rights?
——————————————————————————————-
I have been looking for the res votes myself. However I think it is fair to say that even if passed, nothing will be paid back for at least 21 days, as Ashley has the right to appeal/block any share conversion.
Would any of our learned chaps advise, that if Ashley agrees to a share conversion, will he see his percentage cut?
If so, why would he agree to it? …….It appears more a tactical move than anything else.
Allyjambo 27th November 2015 at 3:09 pm #
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I’m more interested as to the reason for the sudden volte face with regard to repaying the loan.
Has Mike Ashley pressed the nuclear button on the eve of the AGM, by demanding the repayment of his £5M, backed up with a petition for an insolvency order if it was not paid within seven days?
That is the sort of action that might have forced King and his backers to act with such a sudden change of heart and a whip round provided the necessary funds to prevent a melt down. The backers will, by the end of the season, have an unsecured exposure to £11.25M (£3.75M, £2.5M and £5M) in loans, although I guess they could now use the previously encumbered properties as some measure of collateral.
I’m being cynical here,but is the meeting (sorry social call) at Hampden yesterday completely unconnected with King’s amazing about turn, just a few hours later, on the principle of repaying Ashley?
STVGrant is adamant on twitter that according to King the £5m is now safely in the bank. Is that even possible? The Board decided to repay on Thursday night, an hour was spent contacting the Real Rangers Men, and next morning £5m is in the bank? From several sources? That is certainly very efficient, if true, but how about all that messy money laundering stuff us mere mortals have to comply with when transferring any significant sums of money? Amazing, the ways of billionaires. But I just don’t believe it.
The Scotsman is reporting that Rangers is to become a Living Wage Employer.
http://www.scotsman.com/sport/football/teams/rangers/rangers-to-become-living-wage-employer-reports-1-3960699
Has Level5 been fully re-engaged? I’ll wait for more official confirmation, but if they do go ahead then well done to them, although I can’t dismiss the thought that it is being done more for PR or one-upmanship reasons, than through a conscious thought process that it is the right thing to do.
There is a freeview Rangers TV interview with King, where he confirms the Living Wage decision and speaks at some length about the £5M repayment.
http://rangers.co.uk/news/rangers-tv/video-chairman-interview/
Grant Russell @STVGrant King: Once SD loan paid off, we will be one of strongest clubs in world with regards to financial position.
11:05 AM – 27 Nov 2015
Good God what do you say?
Why was this incredulous statement not challenged by honest intelligent bears in the room?
There’s none so blind……..
If they needed 2.5 Million to see out the season only a few weeks ago why are they suddenly “one of strongest clubs in world with regards to financial position”?
Anybody?
Hello Media?
Both King and the interviewer repeat ,it’s great to have had 12 wins & a draw,hmmmm,what else did they dance around,lots.
Oh Dave, and you were doing so well too. He has a very unfortunate turn of phrase does the GASL!
“I previously felt that loan was something the club was entitled to and shouldn’t be repaid.”
easyJambo 27th November 2015 at 3:47 pm #
===========================
From STV “While Rangers have not signed up to the scheme, they will pay their employees the same rate.”
And then there is this:
“Grant Russell @STVGrant King says he hopes Ashley treats the repayment as an oak tree, rather than an olive branch.”
I would suggest not so much an oak tree analogy was appropriate but a little acorn, after all:
“An individual suggested creating a fat effigy of Ashley, to establish whether voodoo worked. There was praise for removing the ‘rats‘ from the boardroom. As this includes Mr Llambias and Mr Leach, it will do little to assuage the concerns of Mr Ashley.”
Nope
The name of the game is still who gets the blame for Administration/Liquidation
With CG gone for the short term at least, the candidates are DCK and MA
……………………
No loan can be converted into equity if no new shares can be issued
If MA objects to dilution he can delay any issue of new shares for as long as he can sustain a court challenge. This could be spun out for months
Meanwhile
The money to survive and pay back MA his £5m can only be provided on a promise of conversion into equity “at some future date”.
These soft unsecured loans are at serious risk in the event of insolvency
,,,,,,,,,,,,,,,,,,,,,,
IMO
The intention seems to be to put MA in the position of blocking repayment of his £5m loan by delaying or preventing the share issue
Why?
It’s sticking out like a sore thumb
They want to formally advise MA that repayment of his loan is dependent on him approving the share issue. But they won’t pay him his £5m before the share issue takes place
If MA says yes he gets diluted and MAY still not get repaid his £5m
If MA say no the Board put the business into Administration/Liquidation and blame MA for blocking “fundraising” when in reality the actual cash inflow would have been peanuts anyway
easyJambo 27th November 2015 at 3:47 pm #The Scotsman is reporting that Rangers is to become a Living Wage Employer.
==================================================
Via EBTs ?
GoosyGoosy 27th November 2015 at 5:40 pm
Ditto that.
GoosyGoosy 27th November 2015 at 5:40 pm #
Interesting point but I doubt very much if Mike Ashley could give a Fig if he was blamed for Putting Rangers 2012 into Admin or Liquidation. Why would he care
Fit and proper.
I have previously suggested that the SFA were always going to have problems wrt Dave Kings fit and proper status and had drawn attention to the EFLs travails with Massimo Cellino.
At the time I was of the opinion that the whole fit and proper test was largely a waste of time.
Here’s a wee update from down south on how things are going at Elland Road, from the excellent David Conn, which further reinforces my view that it really is a rather pointless test.
http://www.theguardian.com/football/2015/nov/26/massimo-cellino-leeds-united-two-bans
Goosy, in the televised interview, King is saying that he has the money available immediately, and that as soon as the legal work regarding the release of the securities is complete, the £5m will be repaid. No mention of the £5m loan being contingent on a share issue. Now that’s from King’s own lips, so I think I’ll wait to hear what Ashley has to say on the matter.
I did think that King dodged a very good question as to whether Ashley could block repayment. King looked even shiftier than usual at that point.
Initial impressions of the TRFC AGM is that it was well run and non- controversial.
I suppose that is progress, certainly when compared to the previous gazebo shambles events.
And the AGM – IMO – has served its purpose: it’s bought King a bit more time.
And the living wage ‘commitment’ ?
Well King can say anything but I would wait to see the detail and any qualifying criteria for employees.
…but TRFC has played this one well.
Show (well indicate) the club can afford to pay the living wage – and embarrass your main competitor at the same time.
Quality bit of deflection there to distract the SMSM.
I do hope King follows through for the employees – but it smacks of Green in his pomp, making bold statements to appease stakeholders and without consideration for the consequences.
West Ham Fan 27th November 2015 at 5:49 pm #GoosyGoosy 27th November 2015 at 5:40 pm #Interesting point but I doubt very much if Mike Ashley could give a Fig if he was blamed for Putting Rangers 2012 into Admin or Liquidation. Why would he care
,,,,,,,,,,,,,,,,,,,,,
I agree
MA has a long track record of ignoring his public personna
So normally he wouldn`t care if he got blamed for Admin or Liquidation
But thats not the issue here
IMO
Both sides want Admin/Liquidation but only MA has an interest beyond the Admin/Liquidation announcement
DCK & the 3Bs want Admin/liquidation to shed the current trading debt (probably including the next HMRC payment) and get out of this mess without puttiing in any more money
MA wants Admin/Liquidation to enable his surrogate Sarver (Ashley) to take over with MA pulling strings from the sidelines and the offshore Spivs vanquished at the same time
If there is a credible reason for blaming MA for engineering the insolvency this goal becomes more difficult
All this confrontation talk re MA is simply an attempt to get him to pull the plug
King said Rangers are recovering from “all manner of malicious attacks” but are now irreversibly on the road to recovery.
“It was our collective belief that kept Rangers alive despite the crimes, the punishment, the abuse, the lies and sometimes the hatred the club has endured,” he added.
“No club has been made to suffer as this one has.”
They really do live in endless victimhood. Never doing wrong.
Shameless.
Well now that the AGM has come and gone and Ashley is about to get his money back will he exit stage left?
I don’t know whether he thinks it is actually worth it or will he be willing to spend ‘X’ amount to get less than ‘X’ back. That’s not good business unless of course it isn’t business any longer!!
While everyone has been discussing the voting at the AGM and whether the board would achieve the 75% mark to allocate the new shares, what about MASH?
Could MASH call an EGM prior to the repayment of the “holistic loan”, and vote to sell ‘The Rangers’ IP and properties to a third party for a small fee?
As MASH currently owns 49%, whose votes double on financial matters, plus another 25% as part of the loan agreement this deal could go through leaving the properties and the IP’s belonging to another company. Now this company may be owned by Mr Llambias or another respectable chap. Would this even be feasible?
I was also particularly intrigued by the fact that “within an hour” Dave had raised £5M. This begs the question of where were these ‘investors’ last January?
Or, which may be more important, what have they been promised in return for the £5M?
Where has this money materialised from?
Has it really come from the three bears?
Has it come from the city? I doubt it as they have been burned by this fire before.
While ‘The Rangers’ do not need to comment any further on this issue I’m sure MASH will make an announcement when the loan is repaid. Having said that I’m sure there will be a procession, and a committee to welcome back the properties and the badges………… with full media coverage of course!!!!
So in the blink of an eye King, Park, Letham, Taylor, Murray and Bennett, Rangers men strong and true, can rustle up £5m to see off MAs loan. (Yes I know we don’t know whose pockets are the deepest!)
Yet no one is asking why these same folks, with the addition of the likes of Jim McColl and Brian Kennedy (who I felt was always wary of Duff & Duffer as the preferred bidder saga went on) didn’t step up to the plate when required with £6m to buy the club and another £1m set aside to legally challenge to asset sale process if required to get things into the hands of the right people.
If they has stepped up at that time and got the fans fighting fund cash and other supporters behind them, what a different place they would be in now. Maybe they would have been in a similar position to Hearts in terms of moving forward in a sustainable manner with a healthy mixture of high worth individuals and fans actively running their club. A major opportunity lost.
The decision to pay of Ashley is one of the more sensible things this current board have done.
While it shows MA they were full of bluster, backed down and they are unlikely to challenge his water tight contracts, it is correct that a clubs assets remain in the control of the board of the Ltd or PLC.
I doubt we have seen the last of MA as I believe he has a hard on for seeing King punted but it may just be he will be happy taking what he can from the retail deal.
Wouldn’t be surprised if the board call off the attack hounds and fans are suddenly encouraged to go on a spending spree for club merchandise before Xmas.
Couple of observations;
1) AGM’s
Mibbees one to consider as a longer term objective for SFM – but should we aim to acquire 1 ordinary share for each of the 42 senior clubs – to facilitate entry to any AGM / EGM in future?
(Agreed, that as the majority of clubs are privately held obtaining a share might take a while but if SFM is to represent Scottish football there should access to the clubs to ask questions, if necessary.)
Just a suggestion.
2) Pro actively trying to engage the SFA & SPFL.
Well individually a lot of us have contacted both organisations and typically got no response.
Should SFM contact either body when it deems fit, to ask pertinent questions on behalf of x thousand fans?
For example: a registered letter is sent to Doncaster asking him to confirm – or otherwise – that King’s visit to Hampden was purely a ‘courtesy’ call as he told the media.
I guess the SPFL will ignore the letter or maybe agree with King.
But the letter sent and any response could be publicly available on the SFM site.
Maybe a few years down the line it transpires what King’s visit was really about and there is proof that the SPFL was not transparent – again.
If the SFA and SPFL are receiving these info requests it reinforces the message that Scottish fans are onto them – and not swallowing the mince from the SMSM.
Maybe regular formal SFM requests for clarifiucation / transparency could help/force the SFA and SPFL change their behaviour?
Mibbees aye / mibbees naw?