Now, it wouldn’t be a normal week in Sevcoland without some…err…financial fragility.
It doesn’t help that the Ibrox klanbase still suffers from sugar daddy issues.
They want someone or something to come into their dignified lives and pay the bills.
In the meantime, the lights must stay on!
First, it was more share confetti.
This time, to the tune of £5,344,960.
Football finance expert David Low is calling it straight as always.
For the avoidance of doubt, the more shares that are issued, then the more expensive any takeover will be as, ipso facto, there will be more things to buy to get a controlling stake in the company.
Then, transfer receivables were securitised.
Ouch!
In dealing with Macquarie, the Ibrox entity is now doing business with the “vampire kangaroos” of Thames Water infamy.
A cynic might conclude that this somewhat troubling public data required a PR firefighting effort to be hastily arranged.
This one from the Daily Mail seems to be trying really hard.
Essentially, there is nothing to worry about, as the takeover is almost a done deal, and this is just tidying things up before a new golden age of herrenvolk supremacy.
Here is one dignified chap who clearly isn’t worried.
Kool-Aid duly imbibed.
However, when I sent the Macquarie thing to Rugger Guy, he responded with a simple enough message:
“Liquidity required!”
Consequently, I’m inclined to believe that these recent moves by the Sevco High Command are apropos a cash crisis right now and not connected to any possible regime change in the Blue Room.
Unsurprisingly, the Stenography Corps have signally failed to subject this putative takeover story to anything resembling a robust interrogation.
This is from Alan Morrison on the Huddle Breakdown has a response from English journalist Nick Harris, which is reasoned and evidence-based.
As a subscriber to this excellent service, the content for those of a Hoops persuasion is peerless.
Highly recommended.
Here is Nick’s key observation to Alan:
Given that one motivation for a Rangers takeover, as I wrote, seems to be a potential flip, whether in 3 years or 5 or whatever, a logical assumption has to be that the asset value of the club HAS to grow for that to happen. That will only really happen if Rangers become vaguely competitive again and perhaps even threaten in the coming years to qualify for the Champions League. How do you become competitive? By having better players. How do you get better players? Develop them over years, which will obviously be one aim. But hiring them (better players than now) is quickest, either via buying or loaning, both of which cost money in fees and / or wages. Thus I WOULD expect – if the takeover happens and it remains an if – there to be investment in playing squad. But not “megabucks” money, certainly not tens of millions on players, let alone hundreds of millions. That just isn’t going to happen. Some millions, in the low single-digit millions range? That would be my best guess from what I’ve heard. But as with the tone of the whole piece, there is SO much more we still don’t than we do. And the fact that none of the key players from the 49ers side have said a word on the record, or indeed answered a single one of the questions I’ve put forward … we don’t know.”
There, that’s how it should be done.
Sadly, it appears that the local media in Glasgow didn’t learn anything about their professional failures in 2011 and 2012.
The featured image is a hilarious episode from those times when another American entrepreneur was incubating the idea of buying up the assets of the dead club.
Any due diligence process might think it wise to consult with Mr Miller and his associates.
40 per cent now for a loan could be great business for 100 per cent for the same asset stripping abilities later. Sorry I mean the new dominant asset with title stripping abilities..ahem.
All the signs of a distressed business. I find it hard to believe that any potential buyer having carried out due diligence would then take a submissive approach to buying 51% of a Company’s shares to gain control?
But at least 40? What then in distress to gain total control? Who better than the most invested ahem controlling. Think of it as predicted trading not insider!
I stated in a previous thread a few weeks ago that in the December Share Issue only Club 1872 from the top 10 Investors took the offer up.
They raised around £250k of the £4.8m raised so that led to the question who else did by the shares?
If felt then as I do now that the financial well they have been going to over the past few years has been running dry and now given they are using an external source for no doubt higher interest rate loans to continue financing player acquisitions it would appear they are now desperate need for this supposed takeover to materialise.
It might suggest that the prospective buyers now fully aware of their predicament having gone under the bonnet and are going to get this Brad Pitt show for far less than they seem to think in the MSM
They talk of massive investment without a single acknowledgement of the fact that the current FSR rules mean a 10% reduction in spending when it comes to the Turnover / Expenditure ratio.
“From the end of season 2025/26, a club must ensure that their ‘squad cost ratio’ – the amount they accumulatively spend on transfer fees, wages, player amortisation, agent fees and manager fees – must be equal to or less than 70 percent of their turnover. This season, as UEFA phased in these new benchmarks, this figure was allowed to sit at 80 percent.”
Struggling to keep up with Celtic on 80% spending now heading for 10% less spending power as we gear up for the Summer sales.
How’s that working out for you The Rangers?
Im looking at this from another angle. You take a group of ambitious investors in sport, you show them the player trading model at Celtic,and you tell them if you had a decent scouting department (of which they have experience) you could outperform Celtic. Add in champions league riches then it becomes even more enticing. Whether it happens or not, Celtic need to invest in it’s scouting. The club has proved before that it happy to rest on its laurels .
Does this mean the George Soros takeover is off?
Whilst we’re on financials, have they ever paid a fee for Connor Barron yet?
Also, does anyone know how many issued shares they actually have over there now?
They’re now over the half billion mark!!
532,223,088 and counting…
So, at 20p a share, that would give them a valuation of £106,444,615.
To say that’s stretching things a bit would be an understatement.
@Morto Only a complete numpty would pay them 20p a pop for what are diluted equity confetti.
An in depth look into their books will reveal a loss making business which has been surviving on internal investment for the best part of 9 years.
The guys who have stumped up the ten bobs for the meter are the very same guys who chucked their private fortunes at it believing it was going to swell their pension pot.
Dave King for example has been treading water for a while now and watched his own holdings lose value as equity swap after equity swap diluted his shareholding.
He’s lost over 1% in over a year.
The best example of just how bad it has been is the case of Club 1872 whom in 2016 had a shareholding of just over 7 million shares which gave them 5% of the overall share holding.
Skip forward to this year and they have accumulated just under 23.5 million shares to retain that same 5% they had in 2016.
That’s an increase of around 235% in shares to effectively stand still.
Who in their right mind is giving them 20p a pop knowing this?
What is the true value?
Nobody knows.
20p per share would mean a helluva lot of the guys who’ve been keeping the lights on, taking a big hit, if previous issue statements were accurate. Many, maybe even most, touted a price of 25p. That’s a twenty percent hit!
Of course if your washing machine has broken down, you might think 80p in the pound is worth it!!
I dont know how much they paid to acquire Leeds, but it could be a good buy. One club City so no divided support, relatively large existing ground, with plenty of land around the ground to expand as makes sense. Great history and a fanbase desperate for a return to the glory days of the past. If they can get promoted this season, and stay up next season they could use it as a starter point to become a PL constant, a bit like Forest have done over the past couple of years. Only issue is with the sales to balance the books in the last 2 summers, all the stars have been sold off and replaced, so if they’re to stay up next season it will probably require 150M of new players to be signed in the summer. But.. if they can manage it and expand thereafter they could get a x10+ return on their investment within a decade.
Rangers have some of the same in the relatively large existing ground and a desperate fanbase. But they’re not in a one club city, and they’ve little room for ground expansion. I also cannot see a x10+ return on investment within a decade given the financials of the SPL. So why would they invest anything near the level that they will into Leeds? So the idea that Leeds would be their feeder club is pretty ridiculous.
Also pretty ridiculous seems to be the hope that because Red Bull are involved in Leeds to a degree, that they’ll be in Rangers as well and feed them all these great players for recruitment. Except that makes no sense either, they’ll recruit the best players that they scout for themselves, possibly recommend or sell the lesser ones to Leeds, or use them as a feeder club of sorts. They’re not a charity, and there’s not that many great players that they’re scouting that they can afford to just pass the info on to other clubs that they have a small interest in.
If a fakeover erm takeover was imminent then surely the latest confetti share issue is essential to keep the lights on until then.
If the takeover is a bust, I expect that klub is likewise. HH
What is most telling, is that the RIFC CEO has not said one word
during all this media hype. If there was genuine interest he would be
expected to at least confirm that ‘interested parties are in discussions’.
He has a duty to keep ALL shareholders informed – unless it’s being ‘misreported’?
When Mr Miller withdrew his interest, some wag on RTC posted “See you later, incubator!
Expect the 49rs people to be thorough regarding due diligence. That’s where their intentions will be tested regarding a move for the new Glasgow club.
Apart from the article highlighted by our friend at the Huddle, all we have seen is the usual moonbeam speculation from the follow follow boys and their friends in the
so called mainstream scottpish media.
Expect heaps more fantasy reporting from them in the days, weeks, and months ahead as they work themselves into a 49rs frenzy.
Imagine the meltdown if it doesn’t happen 😂😂😂
I’m not a financial person, but I understand income has to be greater than expenditure; and I realise reversing this has been a game plan for Oldco and Sevco for time immemorial.
However, how can they invest in the squad if income has to comply with financial fair play requirements?
They can share players with Leeds.
“Well Known Member”….sounds about right
I’ve never thought that this deal would happen! It’s looked to me from the outset as an ST sales pitch! Jam tomorrow!! Pie in the sky!!!
Now, if I’m completely off the mark and something is afoot – I’m reading about due diligence taking place – what the feck difference will it make to anything??
The new UEFA 70% rule leaves them hamstrung!! They MUST reduce their existing wage bill !! They can only do that by sourcing players prepared to play for less money than the guys presently there. This equates to either hiring inferior players to those presently on the books, or very young players desperate for a break. Either way it weakens them!
Another wee point. It’s unlikely that Sevco’s TURNOVER this season will be 70% of Celtic’s!!
or if Leeds go up and spend £70 million on players Rangers could get some of the Leeds players on Loan with favourable terms and conditions without affecting Rangers FFP too much.
If Leeds go up, all attention will be on Leeds staying up.
What’s the chance that the monies raised was to pay the first tranche of the Clement and staff pay off?
A (probably) soon to be English Premier League club will become their feeder club according to the Ibrox intelligentsia.
Every day is April Fool’s Day in their unparalleled universe.
You can clearly sense the desperation for the “takeover “within the klanbase and that it needs to be done at all costs. I still hope nothing comes of it personally but going by this if it goes ahead they should still manage to hold onto being Simply the 2nd Best for a while yet and might get lucky with an occasional domestic cup now and again.
The recent confetti was the promised funding from Directors that was stated in the last agm of 8.6m , they stumped up 8.95m over the 2 separate issues (3.6 + 5.35) so they slightly underestimated the shortfall. 1 billion shares or a trillion doesn’t matter , watering down the whisky doesn’t equal more whisky and at this rate the whisky will be palatable enough for the tee total Douglas Park.
Agree, the club is worth what its worth, and the number of shares is irrelevant to that. What it will do though is provide a guide as to how accurate the 20p a share nominal cost is. Since they’re only buying 50%, and thus presumably only those presently/formerly on the board of directors will be bought out, presumably at some sort of premium that won’t apply to when they try buy everyone else out. To that regard it doesn’t make sense to drive the value of the club up until they get to that stage as they’re only making it more expensive for themselves to acquire the remaining shares.