The early years of a new business are risky. It doesn’t matter if you have the best product or service, or the potential to rule the world, it’s critically important you don’t run out of cash.
The Rangers Football Club ran at a cash deficit from their first month’s trading. Within six months of starting business they undertook an enormously successful share issue (going public as Rangers International PLC), raising in the region of £22m, but they continued to spend more than they earned. On Saturday, the BBC reported a club source confirmed they were 48 hours from running out of money.
For a moment, put aside who owns Rangers International (RIPLC), sits on its board, owns its retail rights or has security over its assets. In any normal run of business these things are important, but right now, for RIPLC, they are secondary. The most important issue in this company is paying its creditors.
They can either pay their bills, or they can’t. If they could pay their bills, they would have no problems with predator-shareholders and the company could accommodate the aspirations of all stakeholders – including fans.
If the company cannot pay its bills it will not meet the aspirations of any stakeholders. It will either go out of business, or it will attract an investor who is prepared to pay creditors, and in return extract assets or some other compensation.
The pain of Dave King and his legions of cohorts in ‘restoring Rangers’ and preventing Celtic from accumulating 10, 20 or 30-in-a-row is tangible, but there was no easy fix. Rangers International should have been urged by all of these voices to cut costs to match income, pay their bills and ensure that Newco, unlike the original Rangers FC, would never be out of pocket and vulnerable to the most aggressive carpetbagger.
Instead, all we heard about was the Restoration of Rangers, no matter the cost. Living as modest also-rans, paying their bills while hoping to win the odd cup and avoiding an absolute hammering at Celtic Park a couple of times a season, was simply unacceptable when pitted against the alternative – burning cash like there’s no tomorrow and hoping something miraculous would turn up. It was madness.
Mike Ashley has fed the junkie-club a couple of million, which might be enough to see it through Christmas but it’ll need another, larger, hit, before long. Attempts by King or any other wealthy fans to intimidate the Easdales, or Ashley, to capitulate, will fail, again.
The club does not have the money to pay its creditors until season ticket renewal money arrives, but it has more assets, specifically the stadium and Murray Park, which can be sold or secured. In return for this latest loan, Ashley got control of the boardroom. This will allow him and his allies to dictate the terms of the next funding arrangement.
Those wondering how he will increase his shareholding in Rangers International, in conflict with his ownership of Newcastle United, are missing the point. He doesn’t need to own Rangers International, all he needs to do is own the stadium – at an onerous rent, and own the merchandising and image rights.
Like Sir Davie Murray before him, he might even fancy owning the IT provision, travel, stadium advertising and catering (yes, I know that’s already gone) at Ibrox. Murray’s companies used to take close to £4m a year out of Rangers – and they thanked him for the honour.
Much of the above could be outsourced to Newcastle, where all ‘customer contact’ could be administered from. He could even subcontract the manager, coaches, scouts and the guys who puts the cones out from Newcastle. All of which would mean that in the event of a commercial trauma, he holds all the contracts necessary to start afresh.
Ashely doesn’t need to own another ounce of Rangers International, in fact, after he has secured the stadium etc. on a long and glorious lease, he will be pretty much finished with the hollowed-out runt of a club.
Similarly, those who suggest Ashley’s loan is a sign that he will not allow the club to fail are missing the point. If he owns or controls the stadium, IP, client databases, coaches or whatever else, he controls what happens AFTER a liquidation.
Right now Ashley, and his collaborators remaining on the board, have to pay those onerous contracts we heard so much about, while they own less than 50% of the shares. I doubt Ashley has paid onerous terms in his life. Liquidation would allow him and his pals to start afresh, stop paying the last bunch of spivs and keep the money for themselves.
In practically every literary portrayal of hubris, the protagonist has a moment of self-awareness. It as though literature doesn’t work, it’s not credible, without a fleeting moment of clarity. No one, it seems, carries the same stupid world view throughout a complete novel.
Literature has failed to prepare us for the most predicted self-harming on the planet.
Remember to order Caesar & The Assassin, signed by Billy McNeill and David Hay, more here. To confirm a note on Billy’s nickname. While it was acquired from Cesar Romero, Billy prefers “Caesar”, which was how the name was always spelled during his playing days.
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CRC
Looks fairly even, it could depend whose boots KF has on :-)
weefrathetim
21:04 on 27 October, 2014
BT
I take it the club have abandoned the crazy 1300 KO times. Absolute bonkers IMHO. Hope yer well on the recovery path young yin? :-))
Weefra HH praying to Wee Oscar.
…………………………………………………….
Weefra, I’ve read similar criticisms from other fans on here but I love the 1 pm Sunday KOs. I. Generally return my grandson home on Sunday evenings. It’s a long drive and it means with the earlier kick off I can get home, have a rest and eat my dinner before I set out. I wonder if there are others who like the 1 pm kick off.
According to the bbc a man has been reported to the police for leaking documents online last year re sevco.l.P.
Are we about to find out the identity of charlotte fakes?
Jamesgang
What a discerning, welcome addition you’ve been to CQN.
If only the rest shared your intelligence, respectful nature and charisma.
OweYouAFiverCSC
Mighty Tim
I must have missed it, wits the story with yer lhaddie?
Weefra HH praying to Wee Oscar.
praecepta – Thank you.. but please don’t give him any more ideas!! I will get my own back on the pair of them.. they are loving this!
quantum
23:00 on 27 October, 2014
That’s what crossed my mind as well
the spirit of arthur lee,
Brammer, I explained to my daughter that Ht and Minx are a couple and it was minxs birthday yesterday, I had to pick her off the floor when I showed her that ;)
brnobhoy
My son’s that daft that he’d be chewing the nerf bullets!
HT. Debt passes on death. And I’m still in minx’s dead meat bad books!
SavedYouAfiverCSC!
HH jamesgang
tosb
I’ve no doubt some supporters do prefer the earlier KO. I have no issues with them or yourself whatsoever. One man’s meat and all that. It doesn’t suit me as I have a disabled wife who takes a bit of getting started in the morning. So we both have to get up earlier, which doesn’t always suit her, to allow me to run about like a maddie to get everything done before heading off to the game. That’s my only beef kiddo. :-))) If this is going to be the norm for next season, I may have to consider whether or not to renew my ST. Och, talking sh@te here, of course I’ll renew. Hahaha.
Weefra HH praying to Wee Oscar.
I have seen lots about an iron as a gift
Really you need to buy a Bosh steam one
Irons a shirt in about 2 minutes
Jeans even faster
So why are you all complaining?
My lawyer says I have a chance to see
My kids twice a year ………..
Brnobhoy
brnobhoy
Ha that made me laugh! :-)
The exiled Tim
http://mobile.newsnow.co.uk/A/740757199?-10583:834:t
Might clear those negative thoughts away
minx1888 –
Had to speed read the blog today but just wanted to add my congratulations on you Iron Wedding Anniversary. I think the next one is Leather – so looking forward to see what kinds of gifts you two exchange… :-)
Mighty Tim
Prayers, thoughts and justice for your lad
HH
CRC
Just watched Ronny on the news, felt for him, you can see the stress on his face, let’s hope it works for him and Celtic.
Tomorrow is going to be interesting in work, a squad of yanks over to make an announcement tomorrow, although it’s a hun infested workplace, it pays the bills.
Bedtime for me and that Caesar the cat is getting papped downstairs, up at four to let him out last night…grrr.
Ok ghuys, the ole ipad needs charging as does my ole energy izms. So I will bid you all a big…….
Night Night Timland.
Weefra HH praying to Wee Oscar.
Night Weefra
HH jamesgang
Too much irony makes you rusty.
H.H Mick
Sipsini
I agree, after watching Ronny being interviewed earlier I thought he’d aged in the time that he’s been here
I still have real reservations about his abilities but as much for him as us, I hope he becomes a huge success.
Hamiltontim
That’s a good thing
I have lurked for 10 years, posted very rarely
But read every day
Love this blog , and still makes me realise why I am
A Tim,
It’s a hard life at time but Celtic brings it back to who I am
Brnobhoy
jamesgang
Cheers kiddo. :-))
Weefra HH praying to Wee Oscar.
Night wee man. :-)
The following detailed research by STV’s Grant Russell is I think worth posting in full with respect to SFA and UEFA rules regarding Ashley.
After a few tweets discussing it tonight it might mean that if TRFC and Newcastle United were to qualify on sporting merit for say the Europa Cup, one club might have to step down. (that should go down well)
The increasing moral hazard that short term thinking brings to our game is more likely to kill it long term more certainly than any of TRFC’s growing pains.
http://sport.stv.tv/football/clubs/rangers/297189-can-mike-ashley-own-newcastle-united-and-rangers/
” With Rangers having informed the stock exchange they have accepted an emergency loan from Mike Ashley, further questions have been raised about his increasing influence at Ibrox.
Some are suggesting the Newcastle United owner’s £2m injection, which is secured against club properties Edmiston House and the Albion car park, could even be a precursor to the businessman bidding for outright control of the club’s shares.
As a general rule, an individual requires the consent of the Scottish FA to have any significant shareholding or involvement in the running of the club if they already have such interests in any other football club in the world.
Ashley already holds just under nine per cent of the shares of Rangers. Such a shareholding has already required the prior consent of the Scottish FA’s board, as it breaches a three per cent threshold.
Similarly, any attempts to increase that stake would again require approval.
Boardroom power
In the immediate term, there are questions over the influence Ashley could wield as a result of his cash loan.
With chief executive Graham Wallace and financial director Phillip Nash having quit the club’s board, it is said two of Ashley’s men – Derek Llambias and Stephen Mucklow – will be installed.
In plain sight, that would represent two of the five members of the board, assuming Wallace’s removal, being associates of Ashley.
Scottish FA regulations state “no person…through an associate… may have any power whatsoever to influence the management or administration of another club”.
It’s unclear whether that rule extends to having two votes at the boardroom table, or whether it applies only if a majority of votes were held. Assuming the latter, it wouldn’t appear a Scottish FA regulation was being potentially breached, nor would their consent be required.
Nevertheless, it has been reported the governing body will write to Ashley asking him to clarify his position and intent going forward. They will also take guidance from the announcement to the stock exchange.
Taking share control
If Ashley, as is being reported, sought outright control of Rangers, for example a 51 per cent shareholding, the picture would be clearer.
The businessman currently has an agreement with the Scottish FA not to exceed a 10 per cent shareholding in the Ibrox side. In order to increase that stake, permission from the governing body would be required.
While there is arguably a case to be heard for a non-majority shareholding to be purchased, taking a majority would mean Ashley would be their owner, and have full power over all of their decisions.
The Scottish FA has the discretion if it sees fit to allow that to happen. The rules are not inflexible. They state such a controlling interest is not allowed “except with the prior written consent of the board”.
Clearly if they so wish, the governing body could block Ashley from taking any more shares in Rangers, and they could block him taking outright control. Similarly, they can also allow it to happen and allow him to own both Newcastle United and Rangers.
As a third option, the Scottish FA could allow more shares to be bought but only if Ashley can prove he has disposed of his interests in Newcastle United. That has already been raised as a possibility in the future, but the man himself has said that is unlikely to happen until “at least” 2016.
From the perspective of the Scottish FA’s rules, the key line is the “power whatsoever to influence the management or administration of another club”. It is down to them to determine at which point that is occurring.
Foreign interests
As far as the English Premier League are concerned, their rules do not forbid Ashley from having any form of influence on a club outside of England.
The Football League, which operates the second-tier Championship competition down to the fourth-tier League Two, have far more stringent rules.
Their regulations state consent is required if an owner of an English club has the power to influence affairs at a Scottish team, or has any shares in them.
There is one other pertinent point which will interest Rangers supporters.
An “interest” as per Football League rules extends to having “lent to… or guaranteed the debts or obligations of that Club (or any other arrangement of substantially similar effect) otherwise than in the ordinary course of banking.”
All that said, it is important to note that these regulations, as is the case with the Scottish FA’s, do not expressly forbid the interest taking place. Instead, it is at the behest of the bodies’ respective boards to determine whether they should be permitted.
UEFA are the governing body for European football but their regulations would only come into play at Rangers if, in the future, both they and Newcastle United both qualified for either the Champions League or Europa League. They are not required to both be playing in the same competition at the same time.
The rules here are clear and not flexible through the consent of any UEFA board.
If Ashley was thought to be in control of the majority of shareholders’ voting rights, held the ability to appoint a majority of board members, or was “able to exercise by any means a decisive influence in the decision-making of the club”, UEFA would block both teams being able to take part.
They don’t, however, kick both teams out of competition. Instead, one gets to keep their place. How they do determine which one? There is a pecking order.
First, if the clubs were in separate UEFA competitions, the team taking part in the Champions League would be the one to keep their spot.
If both were in the same competition, Rangers would lose their spot as England is ranked much higher than Scotland on UEFA’s “access list” for competitions. Scotland wouldn’t lose a European participant. Instead, Rangers would be replaced accordingly.
Can Mike Ashley influence or own both clubs?
Only the Scottish FA can ultimately decide whether they deem it appropriate for Mike Ashley to have a hand in both Newcastle United and Rangers, if indeed that is his goal.
In English terms, the picture is only complicated if Newcastle United are relegated out of the Premier League.
In UEFA terms, it’s only an issue if both qualify for European competition at the same time. And even then, the rules do not forbid one of the two clubs being able to take up a place.
The onus then will fall on in the positions of power at Hampden. If a proposal from Mike Ashley arrives on their desks under which he proposes strengthening his grip on affairs at Ibrox, it is their call to make.
Given the currently unofficial claims about the precarious nature of the club’s finances without an Ashley intervention, albeit in the context of various other suitors being on the scene, the Scottish FA may soon hold the future of Rangers in their hands
ht
:-))
Weefra HH praying to Wee Oscar.
theoriginalsadiesbhoy
22:59 on 27 October, 2014
weefrathetim
21:04 on 27 October, 2014
BT
I take it the club have abandoned the crazy 1300 KO times. Absolute bonkers IMHO. Hope yer well on the recovery path young yin? :-))
Weefra HH praying to Wee Oscar.
…………………………………………………….
Weefra, I’ve read similar criticisms from other fans on here but I love the 1 pm Sunday KOs. I. Generally return my grandson home on Sunday evenings. It’s a long drive and it means with the earlier kick off I can get home, have a rest and eat my dinner before I set out. I wonder if there are others who like the 1 pm kick off.
—————————–
Yup – definitely suits me and Wee BGFC. He hates coming home late on a Sunday from the game then having to get ready for school the next morning – signals the end of the weekend :-)
With an earlier kick-off he can play fitba, and talk mince to me for a couple of hours more, before the inevitable and depressing Sunday evening bath-time :-(
Appreciate it is something that will have a bad impact on some people because of personal circumstance; I do think, though, that Celtic have done this with the best of intentions to help people who have to travel a distance back home after the game on a Sunday (albeit they introduced it in a clumsy way).
HH
BGFC
Thanks again bhoys and ghirls for the good wishes for Sean.
Weefra Sean got arrested in march at the caley thistle game for allegedly singing an offensive song. The police later released him without charge however the procurator fiscal later charged him. He was originally banned from going to any game by Celtic but a certain friend of yours and mine arranged a meeting with the guy at Celtic. He and Sean had the meeting and the ban was immediately lifted. Now even though they have no video evidence and only the word of 2 coppers standing 70 yards or more away looking into a crowd of thousands they claim to have heard Sean sing said offensive song as wait for it no one else was singing at this time and the ICT fans more than 100 yards away were offended. Strangely enough no one from the ICT made a complaint no one from the thousands of Celtic fans made a complaint but these 2 focus cops heard him and new that people were offended. They also must be great lip readers.
HH
KTF
UTLR
Sips & HT…
Thought RD looked well, alert and robust actually.
Seems to me a confident and intelligent guy.
We all continue to wonder how good a football manager he is!
Peter L
was given £3,000 pound today.
was he worth that 5 hour shift ?
Mighty Tim
I pray your son gets justice.
And I hope that focus get the GIRUY ridicule they so richly deserve.
Good night.
HH jamesgang
weefrathetim
23:09 on 27 October, 2014
tosb
I’ve no doubt some supporters do prefer the earlier KO. I have no issues with them or yourself whatsoever. One man’s meat and all that. It doesn’t suit me as I have a disabled wife who takes a bit of getting started in the morning. So we both have to get up earlier, which doesn’t always suit her, to allow me to run about like a maddie to get everything done before heading off to the game. That’s my only beef kiddo. :-))) If this is going to be the norm for next season, I may have to consider whether or not to renew my ST. Och, talking sh@te here, of course I’ll renew. Hahaha.
Weefra HH praying to Wee Oscar.
…………………………..
Weefra, I wouldn’t want you not to renew your season ticket. I’d rather Celtic moved the games to a 3 pm KO than that. Perhaps a 2 pm would be a better compromise for everyone.
mightytim
Cot time for me now, but shocked. Will discuss this further tomorrow if that’s ok. Sickening. KTF.
Weefra HH praying to Wee Oscar.
tosb
Talk tomorrow, ok. Cot. :-))
Weefra HH praying to Wee Oscar.
Thanks bhoys. Long shift tomorrow will be on and off sporadically through the day. Will then be on from about 10.30th weefra.
HH
KTF
UTLR
MT
Head up son.
UTLR.
God save Iron says the Argos,
especially in Cumbernauld,
for on the ironing board we dry,
from Moriarty’s we will fly,
HT and Minx to Paradise…
TBM
Hamiltontim…. Many Thanks for responding to Pedro’s request for info for Saturday’s Food bank collection. Yer a Good Man ye are.!!
TBM
I’d prefer Calton to Moriary’s :-)
Andy53
You’re welcome, still waiting to find out if I’m helping on Saturday.
Night all God Bless.