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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james gang
“Aff oot. To a concert. Not paolo. Respiratory patients.”
A concert for or by respiratory patients?
Comments section closed on DR’s Ashley crisis loan story.
Hmmm CSC
Well is it Snyde for the pain, or shortbread for the illusion?
Anyone attending the Astra Giurgiu will find Bucharest to be a fascinating place. From Ceausescu era endless gray concrete structures, to small pockets of the old city that survived.
The metro is a great way to get around. Can’t remember if it stretched that far south, to where Giurgiu is situated a small distance outside Bucharest. Well worth finding out though.
One caution I would strongly emphasize is to watch out for your personal belongings, particularly what’s in your pockets. Small gangs of Romanies operate at public locations: train stations, bus stops, busy street corners etc. You will find yourself without your wallet and anything else on your person quick as a flash.
Sftb
By not for…..
Signing’s really good for lings. Even damaged ones.
HH jamesgang
“Signing’s really good for lings. Even damaged ones. ”
Wot? No dancing?
How about playing the Tuba?
thomthethim
We appear to have a mobile phone problem.
I am now getting repeat messages from you of the same text and it still won’t send my replies.
Living_in_the Love
Excellent – ( sounds grim though )
Romanies in the gloamin with St Patricks Fenian Bands.
MNCelt
It’s true that Man City could put a ‘lucrative’ contract in front of him right now, but he’s in the same position as all players in their final year – they have the imperative, not the club, assuming there’s an offer there at all.
In any event, if City wanted him, they’d have tied him up before now. He’s on loan to us because they don’t want him, either the player, or his wage cost. His illness set back his development, and he’s not performing at the standard they look for in a player at 22 years old.
Denayer though is a different situation, with City looking at the loan as a player development opportunity. They’ll assess him at the end of the season, and if they like what they see, he’ll be offered a new deal, failing which he will be in Guidetti’s situation this time next year.
winning captains
17:44 on 27 October, 2014
Another snippet from Caesar & The Assassin for you to enjoy.
I always liked Tom McAdam…
Used to watch Tom McAdam at Dumbarton. He was a good centre forward but ended up a much better centre half.
Prediction:
The remaining diehard Servco supporters will be gritting their teeth and heading to MASS next season…
… (Mike Ashley Sports Stadium).
Don’t you just love Karma?
;o)
Mike’s just dropped the bombshell that his sister Laura
is going to re-do the Blue Room,
…………she has something mauve in mind apparently,
and THAT bike has to go.
Good evening friends.
Pity about the Paolo gig being cancelled but hopefully rearranged soon and perhaps for a Friday or Saturday night. I’ll not be the designated driver then ;-)
Sorry couldn’t resist BFDJ
Jason Denayer at 19 and no Man City debut helps explain why John Guidetti is surplus at Man City, they are on a different football planet.
For Guidetti see Samaras CSC
This will be fun,BFSDJ ready to unpack the Sevco /Ashley deal,answers to include
‘I don’t know’
‘I’ve never met the man’
‘I don’t know’
‘I’m not sure’
‘Thats a question for the PLC’
‘He’s better than Craig Whyte’
‘I don’t know’
‘I’m not privy to that information’
‘I will back anyone who gives me a testimonial’
‘I don’t know’
I am now just totally baffled with the Sevco situation.
Just cannot see what’s in it for Ashley.
Hope he us just the latest in a long list of Spivs out to fleece them.
Hopefully , this will finish them off once and for all.
Have my doubts though
Jobo
Pity about the show – I’m not surprised his ole tonsils went, the shouting he does in the middle Charlie Chaplin’s speech.
bournesouprecipe. I hope what you say plays into our hands and we can eventually sign both . H.H.
burghbhoy
18:13 on 27 October, 2014
I am now just totally baffled with the Sevco situation.
Just cannot see what’s in it for Ashley.
Hope he us just the latest in a long list of Spivs out to fleece them.
Hopefully , this will finish them off once and for all.
Have my doubts though
Listen to Snyde, keech and BFDJ will sort it for you. Trust me every word is true
Burghbhoy
You’ll recognise the voice as in: ‘explaining debt to a hun!’
http://youtu.be/CkMmECn3xU8
City, like the other megarich clubs, are compelled to buy and play established stars – spending obscene amounts of money in the process. The chance of any fringe players making it must be approaching zero. A 20-year-old would need to be world class to have any chance.
Not sure why any youngster would sign for them unless making good money is a priority over playing regular football. better to go to Crystal Palace etc. and build up your reputation.
Same question can, of course, be asked as to why Scottish youngsters sign for Celtic when they have next to no chance of breaking into the first team. Better to play for Hamilton, Kilmarnock etc. and get experience and be seen than to be hidden away playing reserve football (or whatever it’s called these days).
Ally’s stayin’
;)
Don’t have nightmares.
Man city bought a centre back from porto for 32m.Mangala
I watched him on Saturday and wasn’t that impressed
bournesouprecipe
18:00 on
27 October, 2014
Living_in_the Love
Excellent – ( sounds grim though )
Romanies in the gloamin with St Patricks Fenian Bands.
==================================================================
And when the music stops?
Pray tell.
macjay1 for neil lennon
18:27 on 27 October, 2014
bournesouprecipe
18:00 on
27 October, 2014
Living_in_the Love
Excellent – ( sounds grim though )
Romanies in the gloamin with St Patricks Fenian Bands.
==================================================================
And when the music stops?
Pray tell.
——–
If you don’t have a seat, you’re out.
H
Musical Fenians?
thomthethim
no text messages here either.
Brilliant from Ronny there. Said he would rather watch TV than go to Ibrox. Asked if he wanted to meet them and said he wanted to win the comp. Also spoke very well about Guidetti.
living_in_the_love_of_the_commons_people
Just a wee funny that happened today in the work…
There’s a young Romanian started a few weeks ago, he constantly wears green :)
The huns, of there is many don’t like this.
As he past my section a hun “cubby” shouted over to us what is Romanian for b*****d?
Quick as a flash my wee tim mate replies… ” cubby”.
sipsini
Is that fat Tubby and Chubbys brother Cubby
Delighted to see Ronny go with 2 up front yesterday. At Celtic park in the SPFL we should go with that every time.
Would be a very happy man if we sign Guidetti, the super Swede just what we need, walking in Guidetti wonderland
Not being presumptious, but what is the venue for the league cup final? Is Hamden still out of action?
Guidetti is a gallus front man who does what it says on the tin; he shoots, he scores. What’s not to like? Get him signed up PL and earn your corn!
Hamiltontim
23:18 on
26 October, 2014
Finally in bed after an extremely busy and exhausting trip down to celebrate my mammie’s 65th birthday in Worcester.
It’s late but there’s still approximately 42 left of another special lady’s birthday.
Happy Birthday Minx1888, definitely the best kisser on CQN :-)
——————————————————————-
Aye …so she is :O)
Yep
I’ll testify to that also:o)
leftclicktic,
HaHa, I doubt it, not a pick on him, he tried to be a smart a**e, but my wee mate is as quick as lightning…
He’s from Hamilton, right good tim, keep pestering him to post on here, prefares to just lurk now and again.
In fact the wee s**t stuck me in with the hun management….
The yanks were over a couple of years ago and we got taken up in groups to see their plans for the company.
The wee man comes back down and says…hope you don’t mind but I had to put our hun management in their place.
They were telling the yanks how they got thrown the league and started from the bottom, the crowds are record breaking, in other words the watp pish.
Hearing this, the wee man voiced up…yer gone bust again.
The reply: so where do you get your information?
The wee s**t said me ;)
And I obviosly get it from here :)
Think it’s really obvious why Ashley has bought The Rangers.