A troubled realm

If Rangers International Football Club was a country then it might by now be considered to be a failed state.

The ruling elite are clearly divided and serious financial problems are threatening the continuation of normal operations.

Meanwhile some of the common folk are in open revolt while others remain loyal to the regime.

It does not appear to be a happy realm.

Since I last visited the kingdom of Sevco the circus has continued to produce a bizarre spectacle.

For example I understand from sources that there was a clear the air meeting scheduled for today between Philp Nash those nice people at Laxey Partners.

I understand that the Institutional investors would also be represented.

The late late show from Laxey Partners did not please Philip Tudor Nash.

He was out of the loop when the private equity firm decided to go back on their decision not to take part in the Shareholder Share Option.

There are question marks over actually how much real money came into the club’s coffers by this method two weeks ago.

However, I understand that it will provide operating money for two months at most.

Philip Nash met with Deloitte the auditors this week.

Even if the accounts are signed off on Monday then that kicks off a timetable for setting a date for an AGM.

It would be early November before that vital meeting could be called.

Deloitte signed off on the accounts last year because three things were in place that gave them a degree of comfort.

(1)    There was money in the bank.

(2)    There was the provision for a Shareholder Share Option.

(3)    There was a private credit line of £2.5 million.

Now those three things are all gone.

If an AGM approves a full rights issue then it will have to be a stonking success in the Square Mile.

I know that Colin Kingsnorth himself has been giving presentations in the City about the investment opportunities in a stabilized RIFC.

So far there have been no takers and Laxey Partners met with no more success than Graham Wallace.

So why did Laxey jump in at the last minute?

I understand that they were very uncomfortable that Blue Pitch Holdings and Margarita Holdings appeared to be very content with the prospect of RIFC failing.

This makes no sense unless, perhaps, the shy chaps at Blue Pitch and Margarita have a Plan ‘B’.

If they do-and it is not clear that they have such a plan-then it can only be based upon the key assets post liquidation.

As has been reported here passim Laxey Partners prepared a controlled two week Administration last February and before the Share Holder Share Option they recalibrated those plans.

So here we have a publicly listed company where one faction want a controlled Administration to reduce the cost base and another shadowy offshore faction who appear to be comfortable with the entire thing collapsing into liquidation.

The latter perhaps being among the beneficiaries of contracts that the Chief Executive described as ‘Onerous’ in his 120 day review.

In the here and now some suppliers remain unpaid and don’t be surprised if they start to get antsy about it.

That said there is enough cash now to make basic payroll until November.

That includes being able to access the Season Ticket money on a match by match basis.

At this stage even RIFC’s Nomad ,Daniel Stewart and company, would probably be happy to exit stage left.

I understand that their participation in this farce has the chaps from the Alternative Investment Market (AIM) Regulatory Team calling them on an almost daily basis.

Given that Daniel Stewart and company have a strong association with Laxey partners then the fact that they might want out is a further sign of how messy this entire RIFC business has become.

Of course ,anytime that a publicly listed company has a deep split in the boardroom then it is never good news for the long term health of the firm.

On the one side we appear to have Blue Pitch Holdings, Hargreave Hale and Margarita Holdings.

Facing them across the boardroom table are Laxey Partners and the Institutional Investors.

The Easdale family hold their own counsel and appear to vote on a case by case basis.

Once more the bile that is aimed at them by a section of Sevco fans utterly baffles me.

The Easdale family bought in at the IPO and then bailed out the club in February with a £500,000 emergency loan.

Once more, they stumped up in the Shareholder Share Option.

Another major player, Mike Ashley, decided not to take part in the finance raising operation.

However the man who controls the Ibrox superstore could find tens of millions of pounds to take a punt on Tesco.

Of course £43million would buy the entire club and recapitalise it.

However the onerous contracts would still be in place and the Newcastle United owner knows that.

There is also the small matter that he would not be allowed to own both of the clubs simultaneously.

However there was nothing preventing him from taking part in the Shareholder Share Option.

His position at Sevco is strong and profitable. He controls the commercial income in the Superstore and he is almost certainly happy with that.

In the past week I understand that both Laxey Partners and another major shareholder attempted independently of each other to raise a credit facility.

They were both unsuccessful.

It would appear that the Dave-King-Ready-To-Invest-In-Rangers story is a staple of pressurised sports desks in Glasgow.

When the most recent such story broke in the Daily Radar David Somers bought it and called Mr King’s man in the UK.

The story was quickly shot down, but the hacks got their splash.

For the avoidance of doubt Mr David Cunningham King is not a foolish man.

He knows that if he buys a controlling interest in RIFC he will find himself paying monies, via onerous contracts, for as much as twenty years to shadowy offshore entities.

Moreover, there are several parties around the Ibrox boardroom table who would not welcome his investment in the first place.

Even if they did Mr King could not be sure about how much of the company he would actually be buying with his money.

The RIFC board are now aware that Charles of Normandy has options on another two million shares.

He told them so and Charlie never lies.

The concern among some of the people around the boardroom table at Ibrox is that more of the original Sevco crew may have similar share options a la Brian Stockbridge.

However,apart from that everything is fine at Ibrox and the United Kingdom is a hugely successful and harmonious family of nations.

Leave a Reply