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Donald, Ashley, cost of hubris laid bare

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Delighted Aberdeen are now free of their “debt servicing burden” after long-term supporters Willie and Elaine Donald proposed to reduce net debt by an astonishing £14.9m.  The club have been able to service their debt but it’s been caught between paying for old overspends and driving ahead with a new stadium to provide for its future.

Aberdeen has a vibrant business and corporate entertainment sector which the club is well-placed to exploit.  In the right environment, specifically, playing a regional league with a new stadium, they could be transformed into a European power, as they were back in the day.

Unfortunately, it’s not all rosy positive financial news for Scottish football clubs.  Rangers International’s statement to the stock market this morning confirmed that Mike Ashley’s £2m loan will not be enough to see the club through to the end of this month.  Ash’ has provided a further £1m, which will take them through to the second week in December – at least!

The statement confirms yet more money will be needed before the end of the year and that the directors have begun a cost cutting exercise.  So where does this leave them?

Living week-to-week is fine if you are within sight of season ticket renewal deadline but that’s six months away.  The funding requirement to get them to that day is likely to be north of £10m, with Ashley now the only wallet in town.

A great deal of analysis is taking place over his commitment to the SFA that he’ll not acquire more than 10% of the club, but this overlooks all the important factors, specifically that owning more share capital is neither necessary nor helpful to Ashley.

Football clubs are a collection of businesses.  There is the football, of course, but there is also a media business (print, online), retail services, brand merchandising, corporate hospitality, there’s advertising space to fill, and with some, there’s a link to a charity, which requires administration.

The charity and football operations cost money but everything else tends to make a profit.  Football clubs are horrible entities to manage.  You have unrealistic competitive pressures, fans who demand conflicting objectives and your performance can be undermined by a defender’s lapse, before you’re scrutinised in public. Only lunatics would apply.

By contrast, corporate retail management is a walk in the park.  Ashley already has a healthy share of Newco’s retail, merchandising and IP rights.  He can and will make money out of them, and no one has been able to tell me why he’d be remotely interested in owning an ounce more than Rangers International.

The funding which will get the club through the rest of the season is likely to cost them all those profitable income streams in perpetuity.  There’s a good chance security will be required over the property assets too.

Newco is pretty much hollowed-out already but the scavenging isn’t finished.  By the time the consequences of all that ‘we will continue to act like a big club’ nonsense of the last two years has comes home to roost, the cost of their hubris will be laid bare to even the most blinkered mind.

All of this was inevitable when Sir David Muray overruled his board’s recommendation and sold out oldco to a liquidation expert.

TIME CHANGE Remember, we’ve got Davie Hay on the blog tomorrow from 9:30 – 11:30.

You can get copies of Caesar & the Assassin, Billy McNeill and Davie Hay’s accounts of managing Celtic from Jock Stein’s departure until the appointment of Liam Brady, signed by both Billy and Davie here.

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  1. Saint Stivs

     

    12:14 on

     

    12 November, 2014

     

    20. Without fans who pay at the turnstile, football is nothing. Sometimes we are inclined to forget that. The only chance of bringing them into stadiums is if they are entertained by what happens on the football field.

     

     

    19. Unlike many other Celts, I cannot claim that Celtic was my first love … but I can say that it will be my last love.

     

     

    18. There is no excuse for a professional footballer not to be 100% fit.

     

     

    17. We all end up yesterday’s men in this business. You’re very quickly forgotten.

     

     

    16. If form was the only factor we would all win the pools every week.

     

     

    15. The secret of being a good manager is to keep the six players who hate you away from the five who are undecided.

     

     

    14. I enjoy being manager here, because I like the people who support us.

     

     

    13. Old Firm supporters went to internationals to cheer three players, boo two, and ignore the rest!

     

     

    12. There’s nothing wrong with losing your temper for the right reasons.

     

     

    11. It’s not religion that’s the problem – it’s the lack of religion!

     

     

    10. I lost some friends when I made the move (to Celtic), but if that’s what matters to them, then they’re not really friends at all.

     

     

    9. The best place to defend is in the opposition penalty box.

     

     

    8. You go down that pit shaft, a mile underground. You can’t see a thing. The guy next to you, you don’t know who he is. Yet he is the best friend you will ever have.

     

     

    7. We do have the greatest fans in the world but I’ve never seen a fan score a goal.

     

     

    6. Never fall in love with them (players), because they’ll two-time you.

     

     

    5. If you’re good enough, the referee doesn’t matter.

     

     

    4. The most pleasure any manager can get is seeing everyday boys joining the club as youngsters and growing into men and giving themselves a better social standing than they could ever have dreamed of previously.

     

     

    3. We don’t just want to win the European Cup. We want to do it playing good football, to make neutrals glad we won it, pleased to remember how we did it.

     

     

    2. It is up to us, to everyone at Celtic Park, to build up our own legends. We don’t want to live with history, to be compared with legends from the past. We must make new legends.

     

     

    1. Celtic jerseys are not for second best, they don’t shrink to fit inferior players.

  2. i wis allready there for a podium and some bams distracted me,

     

     

    open goal, story of my fitba life, concentrate, concentrate

     

     

    oh look a butterfly, says the big centre back

     

     

    aahhhhh. missed.

  3. GlassTwoThirdsFull on

    Living week-to-week is fine if you are within sight of season ticket renewal deadline but that’s six months away.

     

    —————————————————————————————–

     

    Paul,

     

     

    Have you heard of a company called “Ticketus”? :-)

  4. The Rangers have 3 home gates after Novembers wages get paid.

     

     

    Killie in the Scottish cup (lunchtime KO, on TV? 50-50 Gate money split). Then Cowdenbeath and Livingston………….I imagine they would be oiling the turnstyles in preperation………..if they could afford the oil.

     

     

    I reckon Ashley will be showing them what their contracts will look like post administration in February if they don’t take a ‘voluntary’ pay cut in January.

  5. Joe Filippis Haircut on

    I must admit like many others I cannot understand what Mike Ashley is up to over at Ibrokes he has given them a loan of 3 million pounds which will keep the Rangers solvent until mid December.However,he is likely to have to inject a whole lot more money to keep them going until the end of the season and a the money he is giving them is a loan not a gift he must expect to get paid back at some time in the future it is a strange situation but he must know what he is doing I suppose. H.H.

  6. GlassTwoThirdsFull on

    All of this was inevitable when Sir David Muray overruled his board’s recommendation and sold out oldco to a liquidation expert.

     

    ————————————————————————————-

     

    Problem is Paul that Murray left it in such a mess that no proper investor wanted anywhere near it.

     

    Good article by the way.

  7. ‘Greenpinata

     

     

    PS : I hate Rugby, how can it be right to gain advantage by blootering the ball out of the park ?’

     

     

    ——

     

     

    You don’t, silly!

     

     

    You gain most by keeping the ball off the bad guys. Same as footie!

     

     

    And best not to generalise about the fans. Plenty of officer types and lawyers from Edinburgh and Scotland’s ‘home counties’ but plenty of hard, common men have graced the stage.

     

     

    I give you Jim Telfer. Son of a shepherd in the borders. Eventually a headmaster. And a man to make Alex ferguson seem like a beautician in John Lewis!

     

     

    http://m.youtube.com/watch?v=0pHqw4XZhPE

     

     

    http://m.youtube.com/watch?v=wc3S6iGmUjI

     

     

    Hopefully future tours will be the British, Irish and Scottish Lions!!!

     

     

    HH jamesgang

  8. The football business, and all that armageddon stuff.

     

     

    Usually a rival going bust, disappearing is a good thing for a business.

     

    If your rival had customers that still want products, services, then maybe you can fill the void,

     

    thats what normally happens.

     

     

    In this entertainment sporting sector though. Rivalry, might create a demand for your product , selling seats for the big game. For scottish teams, with no great sponsorship, or tv revenue, it really is about bums on seats.

     

     

    So, why hasnt all those teams now above the new rangers disappeared ? ceased to exist ? collapsed ?

     

     

    well simple really, they managed their business and took advantage off the void. that little business maxim still applies.

     

     

    Everyone that was in the SPL without Rangers earned more prize money than before.

     

    Some enjoyed european entry, because there was an open slot. And more importantly most are having more bums on seats, their old fans return as competiton and rivalry emerge. How many teams have won a cup in the last wee while. Thats good.

     

     

    United, Aberdeen Inverness, Ross County, Saint Mirren, all in healthier financials.

     

     

    Even Killie almost there

     

     

    Motherwell being the poor relation.

     

     

    Hearts, whisper it, the same club, never dies, looking in rude health, the benjemin button of the league.

     

     

    The lower league teams, been a wee while since an insolvency event, in fact again, they all manage their businesses , some have boom times, because a new team has been admitted to the league, and enjoy the novelty factor of a big support.

     

     

    Rangers dying, its the best thing to happen FOR ALL OF scottish football since March 1965.

  9. Salzburg Tickets arrived today. Looking forward to my pilgrimage. As I’m ageing trips are reducing, so each one is to be savoured. North Stand Lower this time.

  10. GlassTwoThirdsFull on

    Joe Filippis Haircut 12:43

     

    he must expect to get paid back at some time in the future it is a strange situation but he must know what he is doing I suppose.

     

    ——————————————————————————-

     

    Two possibilities. Either Paul’s point re the property or a massive warchest to get promoted, win the Premiership, get through the CL qualifiers and into the CL group stages.

     

    I know which I find most likely!

  11. BOBBY MURDOCH'S CURLED-UP WINKLEPICKERS on

    SAINTSTIVS

     

     

    I wasn’t having a pop,mate. I knew who uttered the words originally.

     

     

    You,and many like us,could have come out with many similar comments. Sadly,I doubt our current board would.

     

     

    As I said,your post deserves to be displayed at the top of every page. Nailed it.

     

     

    Good man.

  12. Joe Filippis Haircut on

    corkceltic.It would be great if we could fill the ground for that match and get right behind the Bhoys.I think it should be a great game .H.H.

  13. Sad news. Actor Warren Clark has passed away aged 67.

     

     

    I remember him most fondly as the bluff Yorkshire millowner in Blackadder 3 who said ” I’ll take me trousers off and by thunder, me trousers will fall down”

     

     

    A sad loss

     

     

    HH

  14. My take on the Ashley/Huns thing is once he punts Newcastle he will plough millions into ibrokes making it the best stadium in Europe, get a top class manager and spend a fortune in the team buying top class players from around the world to help Lewis McLeod win rangers the champions league.

     

     

    Theycanonlydream csc

  15. Paul

     

     

    I’m not 100% convinced your concern for them is sincere.

     

     

    Just saying like…..

     

     

    P67LordHubrisCSC

     

     

    HH jamesgang

  16. BOBBY MURDOCH’S CURLED-UP WINKLEPICKERS

     

    12:50 on

     

    12 November, 2014

     

    SAINTSTIVS

     

     

    I wasn’t having a pop,mate.

     

     

    I know bud, i just thought you were gently yanking my leg for a wee laugh, I know no malice,

     

     

    that CATMAN dude, now thats a centre half carthorse of a different colour (i went all kojo there for a minute)

  17. Joe Filippis Haircut on

    GlassTwoThirdsFull. I suppose only time will tell but it wont be good news for The Rangers fans of that I feel sure.H.H.

  18. But, but… Financial expert Craig Paterson said the Gers bizniz wis a ‘global juggernaut’, oan the telly! Ah heard um! Whit’s goin’ on! It’s that yin Whyte’s fault!

  19. Davidopoulos

     

     

     

    12:08 on 12 November, 2014

     

     

     

    Re Fleetwood Mac…

     

     

    I saw Peter Green play the Hop Farm festival a few years ago. He could still play but couldn’t speak to the audience and lyrics were jumbled. It really is sad what happened to him and Kerwin.

     

     

    Don’t do drugs kids…

     

    ——————————————————————

     

    I saw Bob Dylan and Van Morrison at the Hop Farm a few years ago and they were exactly the same. Maybe it’s the ale rather than the drugs? :-)))

  20. Paul67 :

     

     

    “By the time the consequences of all that ‘we will continue to act like a big club’ nonsense of the last two years has comes home to roost, the cost of their hubris will be laid bare to even the most blinkered mind.”

     

     

    You’d think, eh? And yet…! :-)))

  21. Sandman

     

    12:56 on

     

    12 November, 2014

     

    But, but… Financial expert Craig Paterson said the Gers bizniz wis a ‘global juggernaut’, oan the telly! Ah heard um! Whit’s goin’ on! It’s that yin Whyte’s fault!

     

     

     

    have you never watched alaska ice truckers.

     

     

    they need to get across the ice lake road before saint hugo day, and the start fo spring.

  22. The thing you have to remember is that evey single ‘bad’ thing that happened to Rangers was self inflicted. Likewise everything that has put Sevco in the mire has been done by themselves. It’s bizarre to think on that.

     

     

    Its like they sat down and said ‘we are losing £1m a month and will eventually run out of money and go into admin, but if we stop spending people will think we are a wee club, so we keep on spending, agreed?’

  23. NatKnow

     

     

    12:57 on 12 November, 2014

     

     

    Davidopoulos

     

     

    12:08 on 12 November, 2014

     

     

    Re Fleetwood Mac…

     

     

    I saw Peter Green play the Hop Farm festival a few years ago. He could still play but couldn’t speak to the audience and lyrics were jumbled. It really is sad what happened to him and Kerwin.

     

     

    Don’t do drugs kids…

     

    ——————————————————————

     

    I saw Bob Dylan and Van Morrison at the Hop Farm a few years ago and they were exactly the same. Maybe it’s the ale rather than the drugs? :-)))

     

    ——————————————————

     

     

    Indeed! That was the same one. Van Morrison walked on, played averagely, walked off. Or was I just listening averagely?

     

     

    Good wee festival that though…

  24. NatKnow

     

     

    My bro and sis in law live in Bonaly Wester.

     

     

    You anywhere near?

     

     

    Sis in law also works at the local dentist.

  25. IMO Ashley will be the new ticktus,he has got the hun fans paying for the loan he gave them everytime they buy merchandise now he has given them another loan which as he has implmented a credit paying facility means that next season when they buy seasen tickets mike gets paid back from the hunspockets….THEREFORE….the hun fans keep the club/company going and mike pockets the profits…NO?

  26. MA

     

     

    Maybe he is asset stripping, lending enough money to ensure secured loan claims over every asset, then he can take ownership and leaseback Ibrox, Murray park, the manky car park, Edminston House to ‘Rangers’ when they can’t afford to pay him back, whilst still owning all other assets, retail, and intellectual property.

     

     

    I’d say this is far more likely than any ‘war chest ‘ scenario. All he has to do is sit tight whilst the boycott rumbles on, and ‘Rangers’ will need his loans.

     

     

    Sounds pretty lucrative in the long term. So in summary, to Ashley, it is more profitable for the club to be losing money – just enough for them to become totally beholden to him. Then he will probably run the club on Newcastle lines, ie spend what you can afford.

  27. arranmore

     

    13:00 on

     

    12 November, 2014

     

    The thing you have to remember is that evey single ‘bad’ thing that happened to Rangers was self inflicted. Likewise everything that has put Sevco in the mire has been done by themselves. It’s bizarre to think on that.

     

     

    Its like they sat down and said ‘we are losing £1m a month and will eventually run out of money and go into admin, but if we stop spending people will think we are a wee club, so we keep on spending, agreed?’

     

     

    —————

     

     

    or maybe they said

     

    “we need to pay our bonuses up faster, before the money runs out”

     

     

    like i do when i am on red in the car and looking for a petrol station.

  28. Warren Clarke RIP .

     

     

    Manchester city supporter .

     

     

    A very good actor —————Red Riding / Bleak House / Firefox/ Clockwork Orange / Oh Lucky Man/ The Jewel in The Crown etc . Great shift as Mr Bott in Just William.

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