David Low spoke to SFM today about the latest focus on Rangers Oldco, but thinks that Dave King’s words about Oldco being the real Rangers matters less to King than the increasingly improving health of the Oldco, now in liquidation.
In the last week it has emerged that HMRC may have lost their appeal against the improper use of EBTs, and that coupled with Dave King’s £20m claim being thrown out, has reduced liabilities so dramatically that Oldco could be solvent – especially if the asset sale from Oldco to Sevco Scotland is overturned as a consequence of current criminal proceedings involving all parties to that sale.
Low says that Rangers cannot possibly raise public investment for Newco whilst that uncertainty surrounding the assets is resolved.
“Nobody will put money into a business whose main assets are under dispute, and if they tried to raise funds in a prospectus, they would have to declare that nature of the dispute”
But the single most important aspect of the new developments?
“Everything depends on the criminal case outcome” says Low, who also observed that King is not alone in his repositioning with respect to Oldco.
The Worthington Group, of which Craig Whyte is a former director, have recently sprung to life and filed three years of returns. They have also made a claim to Rangers’ liquidators, BDO, that they hold a floating charge over the assets (currently around £20m net in cash) held in the current creditors’ pot.
“They also just appointed a new corporate director, Liberty Corporate – a name associated with Whyte”.
Low thinks that criminal proceedings and litigation could drag on for a number of years until the uncertainty over asset ownership is resolved. He thinks that this will critically impair Newco’s ability to raise funds for that period of time, but that improvements on the field will take the pressure of King in the meantime.
“At the end of the day, fans are only interested in what happens on the field.” says Low; “Rangers have a good manager, they are playing well and winning consistently. The fans will be happy with that”
Is it possible that TRFC have not repaid Mike Ashley because potentially there may not be any assets in Ashley’s ownership? In any case, even for Rangers to limp on with soft loans (which he says are the only funding options available), they need to try to put an end to the factional disputes which continue to plague the company.
“Peace needs to break out. There is no consensus, nobody is in control, so there is no way forward at boardroom level”
“The directors find themselves in the situation where they either continue to drip feed the club out of their own pockets, or face the alternative which is far more unpleasant.”
Curiously, Low gives the SFA a pass on their handling of the situation, and feels they were in an impossible position. That is not something that fits in with our consensus on SFM, and in fact the next blog, which will be published later this week, focuses on one of the SFA’s many dysfunctional episodes – their inability to scrupulously apply the rules and carry out their obligation to UEFA.