Two wrongs and a right

Avatar By

Allyjambo 25th January 2016 at 3:07 pm # =========================== I was somewhat …

Comment on Two wrongs and a right by easyJambo.

Allyjambo 25th January 2016 at 3:07 pm #
I was somewhat surprised to see Phil’s latest claim re unsold stock and onerous leases.

If you go back to the terms of the £5M SD loan, then it made specific provision for payment of the onerous leases.–plc–rfc-/rns/-10m-credit-facility—associated-26–rrl-transfer/201501270701132133D/

RRL will declare a dividend of a total of GBP 1,610,000 prior to the Transfer. The Club will use the proceeds of its share of this dividend, inter alia, to repay sums owing to SD in respect of the cessation of onerous leases on unprofitable stores entered into by a previous Rangers management team.

The 2015 Accounts also state:

Other costs incurred
Cost of store closures paid by Rangers Football Club ………………….   (620)

…….and in Note 19 to the accounts – see the attachment which shows that both the unsold stock and onerous leases were paid off in the last financial year, leaving a zero balance on the provisions as at 30 June 2015.


easyJambo Also Commented

Two wrongs and a right
John Clark 22nd January 2016 at 8:16 pm #
tykebhoy 22nd January 2016 at 8:39 pm #
What have these two Scottish Cup ties got in common?

30 Nov 2013 SC Cup Albion Rovers 1-0 Motherwell
17 March 2014 SC Cup Albion Rovers 0-2 Rangers

Well neither was played at Cliftonhill. They were both played at New Douglas Park.
What is the nearest registered ground to Cliftonhill?  I make it the Excelsior Stadium in Airdrie at 2.36 miles away, while New Douglas Park on the other hand is 7.03 miles away.

SFA discretion indeed.

Two wrongs and a right
One final snippet from the RF accounts is the £7,800 paid to Level5 for media and PR services.
It was probably good value for money given the free advertising and exposure they received from the Record and Herald groups.

Two wrongs and a right
Further to the RF accounts, the amount of cash in hand may well be less than the £675K that Wottpi estimates.  The share purchases that RF concluded after their year end involved two major outgoings, the first of 586K @ 27.731p and the second for 250K at 27.5p. Together these would have cost in excess of £230K.

However, RF’s membership only really ramped up around January 2015, so the bulk of their income has only accrued since then, which would mean the that monthly income will be higher than the estimated £50K. 

Recent Comments by easyJambo

It Is Better To Offer No Excuse Than A Bad One
Allyjambo January 2, 2018 at 14:38
My one overriding memory of the Ibrox disaster was that of the five schoolkids aged between 13 and 15, all from the village of Markinch in Fife, who lost their lives.  I lived just a few miles away and was only 15 myself, at the time.

I remember those losses having a huge impact on the local Fife schools and communities.   

It Is Better To Offer No Excuse Than A Bad One
HOMUNCULUS DECEMBER 28, 2017 at 15:38
It doesn’t matter if it is paid to a trust or your aunt Agatha, you still have to pay the tax. I have no idea why they use the name Agatha, but they do. 
“Aunt Agatha” was used by the RFC QC Andrew Thornhill during the appeals process when discussing the redirection of earnings to a third party.

On a separate point about the share price.  The sale of Ashley’s shares to Club 1872 and Julian Wolhardt was used by King’s QC at the CoS, as an example of shares trading above the 20p price.

The TOP’s QC, however, countered that by claiming that Ashley wasn’t interested in the share price, but was insistent that he received £2m for his shares. To that end, it was pointed out that the price per share paid wasn’t 27p, 27.5p or 28p, but something to the second or third decimal place that ensured that the sum received was not £1,999,999 but a fraction over the £2m figure.  I can’t recall the exact fraction used, but the counter argument put forward seemed entirely plausible.

It Is Better To Offer No Excuse Than A Bad One
Homunculus December 27, 2017 at 22:39
EASYJAMBO DECEMBER 27, 2017 at 22:32
Is there a way of calculating how the issue of new shares reduces the value of the existing ones, or is it not as simple as that. I don’t imagine for a second it is. 
I cannot believe that the sale of new shares does not effect the value of those held by existing shareholders. That would surely be market capitalisation gone mad. 
It’s not as simple as the share price being reduced inversely proportionate to the number of additional shares issued.

The capital value (no of shares x share price) of the club is presently around £16m at 20p a share (80m x 20p), but given that the club also has £16m of debts, you could argue that a debt free club would be worth £32m (or 40p a share).

The value of the shares going forward would depend of the amount of debt written off and the number of shares issued in order to achieve that. e.g. if they double the number of shares to 160m in exchange for writing off half the debt.  The capital value of the club might go up to £24m, as it only has £8m debt, but the value of each shares would probably fall to 15p. (160m x 15p = £24m)

If however, they manage to double the share numbers, write off half the debt, but also raise £4m in new money, then the capital value of the club should go up by £4m (the new money). So you could see the capital value rise to £28m, but still with £8m debt. The share price might then be 17.5p (160m x 17.5p = £28m)

I hope that makes sense. It does to me, but the nuances of share numbers, to debt, to capital raised can easily be lost, if you don’t have an appreciation of where they are at just now, and where they might end up.

It Is Better To Offer No Excuse Than A Bad One
shug December 27, 2017 at 22:05
Great hard fought match tonight.
Sadly, that was two hours of my life I won’t get back.  There was nothing great about it and it was more of a borefest akin to many derbies of yesteryear.  Tom English described it perfectly as “Thud and Blunder”

It Is Better To Offer No Excuse Than A Bad One
Homunculus December 27, 2017 at 18:21
I take it all that has happened is that they passed the resolution allowing them to issue new shares. Those new shares have now been created.
This is them simply notifying Companies House that they have done that, Companies House records show how many shares have been issued.
That has to be done before they can actually sell them to anyone.
Purely a procedural matter I would have though. 
It’s not got as far as creating the shares. It’s merely confirmation that the Board has the authority to issue shares up to the specified limit.  That authority expires on the date of the next AGM.

The allotment of up to a nominal value of £1,086,376.01, means that new shares equivalent to 1.333 times those currently available can now be issued.  I’m sure that there will be a good reason for the number of new shares being set at that specific level, but I can’t think of one. 

About the author