That sinking feeling

The stenographers are desperate to give The People a good news story.

I get that.

I really do.

However the facts just keep getting in the way.

The headline figure from the Three Bears consortium is £6.5m.

Is that enough to keep the lights on?

My Ibrox sources tell me that the running costs of the entire Sevco operation (Ibrox and Murray Park) is £1.8m per month.

There are six months till the end of the Season (June) so that’s £10.8m.

There are outstanding bills to suppliers of (at least) £1m.

Big Mike is owed £3m.

So that’s £14.8m.

Yes, yes I know that season ticket money is due in towards the end of May, but at this stage  it cannot be really relied upon given the extent of alienation of The People.

Even with the furry friends on board many of them may still stay away.

As for the money from the Lewis McLeod transfer, should  the deal go through, will be paid in several tranches.

This is normal practice for football transfers.

Moreover, because Resolution 9 was defeated then this putative £6.5m cannot come in as part of a shareholder share option.

Therefore it will have to go to the market and because it is over £3.9m it will require a prospectus.

That is usually 5% of the principal then add other fees and, I am told, there will not be any change out of £500k

So right away we’re talking about £6m not £6.5m.

Such a market mechanism will also take time, due diligence etc.

The idea being offered to The People that magically somehow £6.5m is going to appear in Sevco’s bank account and everything will be ok.

Oh dear.

Sevco is…drum roll…a loss making business with no credit line from a bank.

Until it becomes cash flow positive and/or can access normal debt it will be in a crisis.

In a normal business someone like Llambias would cut the cost base and increase revenue streams.

At some point they would meet at breakeven point.

Because of the Onerous Contracts put in place by Charles of Normandy and, to an extent, Big Mike then that is a very difficult task at Sevco.

Douglas Park made a good living out of knowing how to look under the hood.

I suspect that when the Ursidae triumvirate has a proper look at the numbers then they will realise just what a rust bucket HMS Sevco really is.

It will bring a new meaning to “sinking your money” into a business.

Leave a Reply