Thursday, 4 June 2015

King v Ashley - the continuing divide


By Stuart Johnston

Rangers will hold their third general meeting in six months on June 12 after Ashley called for shareholders to decide whether the Club should repay the funds loaned to them by the Newcastle owner’s Sports Direct firm (MASH). Ashley has since demanded immediate repayment of this loan and has raised concerns over the Club’s de-listing from the AIM Stock Exchange as well as the terms of a separate £1.5m loan issued by director Douglas Park and wealthy shareholders George Letham and George Taylor.

This has been well documented in the press over recent weeks. Rangers have responded to his demands by saying:

“The Company has taken advice from Senior Queen’s Counsel on the terms of this Resolution and been advised that it would not, in any way, oblige the Directors legally.”

He has also spoken with Mike Ashley with regards re-negotiating the merchandise deals that are in place to become fairer to Rangers.

A major concern is that why after fighting so hard against Mike Ashley to remove any boardroom links he had at Rangers does King now wish to convince Shareholders to vote against this resolution? Mr King has said of late that the future of the club is paramount and that money is available, so why continue dealing with Mike Ashley? The man has ripped off Newcastle fans for many years causing frustration and now diminished league attendances. This same man uses zero-hour contracts and thinks nothing of sacking people as he sees fit; the man is addicted to making money for himself not others.

A statement from the club read:

“The Directors do not consider that, at this time, the repayment of £5million to Sports Direct is the best use of the Company’s resources.”

What it fails to say is what, in their view, would be the best use of our resources. By paying this loan back, the 26% return of interest goes some way to helping with running costs. Murray Park, Edmiston House and the brands being held as collateral against this loan is also in my view completely unacceptable. Rangers need to consolidate, pay off any debts and work within their own remits.  We are not going to be able to spend a fortune on players, simply because they do not want to play in the 2nd tier of Scottish football, 500k for Scott Allan should just not happen. Hearts managed to get back to top-flight football spending very little cash. So why not pay off Ashley now? Or does Mr. King not wish to put his hand in his pocket as much as he made out? At least Ashley handed Rangers cash to keep us afloat. So far nothing of that size has hit the Ibrox coffers from the Three Bears Consortium.

More needs said by Mr King; he promised transparency, and we the fans deserve this. The deals with Sports Direct are probably fightable considering they were made with Ashley’s inside men who he forced onto the board.  So surely we should be looking at ways of ripping these up rather than re-negotiating with Sports Direct. I am no lawyer but if in fact Mike Ashley’s Sports Direct henchmen Derek Llambias and Barry Leach were sacked then this deal could be seen as suspect and not in the best interests of Rangers but in the interest of a shareholder and as such, voided. To be using expensive general meetings is not the way forward. Mr. King needs to finish the job he started and get this charlatan out of Ibrox. People like Ashley have no place in football never mind at Rangers and our association with him needs to be controlled and hopefully in the future ended.

So in the words from the movie Jerry McGuire: SHOW ME THE MONEY!!

44 comments:

  1. I would disagree that money does not need to be spent on the team. We need to get out of this league next season and we won't do it with the youth players and old heads that we have on board at present. I equally doubt that we will be able to secure free transfers of a quality that is needed, especially given that we are already behind the 8 ball in terms of the recruitment. I would suggest that there are a number of players that would be happy to sign for Rangers and indeed should Warburton be given the job I suspect that there would be a number of Brentford players happy to follow him up the road! Where I do agree is with regards to King and Co, he has done plenty of talking to get the support onside, in the process promising to invest substantially in the team. Now is the time for him to walk the talk and put his money where his mouth is!

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    1. Tom I think you raise some very good points, I did say 'We are not going to be able to spend a fortune' so I agree we need to spend money just not half a million on one player. A young bright squad with bags of potential and plenty playing time would be ideal, enough to rotate the squad and keep everyone fresh with lots of competition. Some teams in the Championship are potentially worth 500k if not less so I think a reality check is required by everyone at Rangers. With regards free transfers - I agree I also think it will be difficult to gain all the players in this manner - but a couple will probably happen. Vukic would be one I would do my damndest to get. Danny Wilson being the other. It might take some persuading but it is definitely something to look at. Wilson I believe to be our top transfer target, whether he comes will be down to our current league and whether he wants to do promotion again...Vukic's issue will be his International squad status

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  2. Regarding Dave King, where is the promised 30 million ?

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    1. Stuart in one breath you are quite rightly extolling the virtues of a side that may cost £500,000 or so but then you want £30million spentt - are you confused or do you, in reality, just want a return to the bad old days of spending big money on gash players?!

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    2. No, I want 30 million invested or at least someone to do what they promise to. Gone is the philosophy that if its in the coffers we need to spend it. Positive bank balances are the way forward and tenacious, sensible contract negotiations.

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    3. give him a chance to build our club,,it wont happen over night and we need to get behind the club every chance we get, not come on here and talk shit,,watp

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    4. So Stuart - so that I understand you - do you expect King to stump up the £30 million in one lump sum RIGHT NOW?!

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    5. Somewhere in the region of 10 million is reasonable in my view. Enough to clear of this silly loan and 5 million to get us setup for next years requirements. King said to get us back to a reasonable standard he expected around 30 million would be required. Of course this won't and shouldn't be in one go, but I will wait until Friday and see what is announced along with our manager decision before asking more questionson this point.

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    6. Fair enough Stuart! All I would say about the loan is that it is interest free and we don't know the precise terms of how it is linked to the additional RR profit payable to the Fat Man - it may well be that there are good reasons why it isn't being paid off immediately and, as we don't know one way or the other, I am prepared to give King & Co the benefit of the doubt - after all there is no other show in town!!

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  3. I'm beginning to doubt like a lot of bears if King etc. actually have the money they promised. Not good.

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    1. I think the issue is transparency, If they would communicate what they were thinking more it would settle us all more in my view, the problem is they need to remember we are a pretty un-trusting lot right now.... no shame to this considering the path of the last 5 years. Their job is to connect with the fans I believe this is paramount if King wishes to gain loyal support.

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    2. give them a chance,,

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    3. With all due respect they should really have this in place,you don't buy a business without some form of business plan. King has been after the club for a while and knows what is required. They have has several years to sort things out, and chances to step in all along the way. You earn chances.

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  4. I don't understand the rush to pay Ashley back. All we get in exchange for paying him back is an extra £3.75 in every £100 spent on merchandise at SD!! Rangers would get more than that in interest if they put the £5m in the bank. Ashley can't do anything with Murray Park, E.H. or the badges unless Rangers default so thats not an issue either.
    Make Ashley wait for his money, its better in our coffers and offers far more leverage when trying to renegotiate contracts.

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    1. Agree fully with u mate

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    2. Here's why:

      Newcastle released a statement insisting 100 per cent of income from goods sold in club shop went back into the club

      Rangers Deal:

      For every £10 spent on retail Rangers receive just 75p

      We have no leverage - he already has it all.

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    3. I fully agree as well... What the author of this continually fails to point out is that 26% is the same as 51% of fuck all... The board hold a card over this fat chunt right now... the loan obviously holds some leverage regarding dual interest and we'd be foolish to sit here and not give that consideration... King wanted him off the board, so there's a good reason he's not getting rid of him as a creditor... I'd hate to think that our lack of trust in anyone now is going to let fat boy back in...

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    4. The only thing this loan offers is doubt over the ownership of our brand, Murray Park and other assets. I live in the North East and I am fully aware of what Ashley is capable of, it is well documented here. 50% of retail sale profit is not F all bud. If it was Ashley would not be interested in the other 50%. We really want creditors who call in loans early?

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    5. The only leverage we have with Ashley is the £5m. That's why it's not going back any time soon.

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    6. I disagree the contract itself it the real chip, if it is proven to be 'dodgy' as it undoubtedly is then bye bye all influence Mike Ashley - he is not the only sportswear retailer out there.

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  5. As an NUFC supporter Rangers should be aware that one of the ploys used by Ashley is to divide supporters as can be seen by the many bloggs he is very good at getting supporters at eachothers throats. You and your board need to get rid of him as quickly as you can.

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  6. Giving Ashley his money back achieves nothing in the short term. I believe what the board are trying to do is renegotiate the terms of the deal. Why just hand him the money back and then say hey lets renegotiate the deal so its mutually beneficial when you are now in a weaker position. King said that himself previously. The board have constantly said they don't want rid of Sports Direct , they want to renegotiate the deal so that's its beneficial to both parties - by retaining the funds they have a chip on the table to renegotiate with, along with anything else that's been uncovered so far. By giving him his money back and then trying to re-negotiate then you lose advantage in the negotiation strategy . I trust in the board to have a strategy for approaching Sport Direct and renegotiating with them- time for cool heads

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    1. I agree it's time for cool heads, Sports Direct and Ashley have it all already, we have nothing to bargain with, Ashley is not bothered about the loan, 5 million is nothing to this man, and all he has to pay is 75 pence in every 10 pounds. So not only does he get profit(paying back his 5 million) but he gets a worldwide fanbase and advertising FREE. This is so much more than just a poor deal for Rangers.

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  7. Why did Ashley have to put the money in? and round and round we go

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  8. WELL SAID TOM !!

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  9. It makes absolutely no sense to pay Ashley back at the moment. The board want to renegotiate the entire Ashley deal, including the rip-off retail deal he was given. How can they do this if they undermine their position in advance of any serious discussion. Throwing money into a public company is not something that can be done immediately. A share prospectus needs to be drawn up and circulated to all interested parties - a process which is most certainly now underway. Ashley can do nothing with any of the assets as long as the club do not default. I fail to see why anyone with a modicum of common sense would demand that the money be repaid now. If the club can hang onto it in the short to medium term, then it is 5 million less that needs to be found over that period. It is an old adage that it is always best to run a business with someone else's money. Things will become much clearer over the next few days, and I expect a lot of announcements both before and during the EGM. I don't think that either King's resources or commitment are something over which there should be any doubt.

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    1. I enjoyed reading your comments, they left me somewhat perplexed.

      You sound like you have much more information than the rest of us. Why should we not doubt Mr. Kings resources? We didn't doubt Craig Whyte's or Charles Green's regime and look where that got us. So what do we do, the same thing that didn't work the last time?

      You say: 'If the club can hang onto it in the short to medium term';

      If we don't pay this cash back now, where is the cash going to come from to pay him back next season or the season after. Last I checked there isn't much prize cash in Scottish Championship or even Premiership football. Any incomes will be used to help run the club. If King has money lets use it it to secure the long term future of the club, one without Mike Ashley being even discussed.

      Lastly

      You state: 'Throwing money into a public company is not something that can be done immediately.' - Mike Ashley certainly threw a loan into the club very quickly and easily so why can't King loan 10 million? He promised an estimated 30 million in investment - Makes Ashley's 5 million a bit irrelevant.

      I will have doubt in King's commitment until he makes one other than promises. This is not his fault, but once bitten as they say....

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  10. Think the board are correct not to give him the money at present as they need a bargaining chip but King needs to get some money on the table and appoint a manager in the next few days. Other teams are signing players for next season. Time we got started as the present pool of players is not nearly good enough to win the championship.

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  11. On a slight tangent - I was really grateful for the responses on this article. It was nice to have rational, troll free discussion with fellow bears (and a Newcastle fan). Thanks to everyone who took the time to read it.

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    1. You sweet little man. Bless you! But pass me a bucket first!!

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  12. As Ashley has called this totally unnecessary General meeting,surely there must be some way of taking the cost of the meeting out of what we owe him

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  13. When publishing a blog - especially on our Club - there is a responsibility to deal in facts mixed with a bit of common sense and unfortunately this issue of Ibrox Noise lacks both!
    1. Ashleys loan doesn't provide him with a '26% return of interest' (whatever that means!) - the loan is interest-free so on that point alone there is no need to repay Ashley until the agreed payment date or when suits the board and only a fool would suggest otherwise;
    2. The terms of the loan appear tie Rangers in to giving Ashley 26% of Rangers Retail profits - Kings QC has already advised that confidentiality clauses stop both parties making public the terms of those loans but it is self-evident that the Boards lawyers will be all over those contracts like a rash trying to get the fat man out - and our ire should be directed at those responsible for entering into such onerous contracts - something Ibrox Noise continuously fails to do!!

    Common sense says all this takes time - as does appointing the right nanager - and rather than sowing the seeds of doubt, creating division and always focusing on the negative this blog would do well to start being a little more positive!

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    1. this is complete tosh!!!! It is an extra 26% of the profits. The boards lawyers will be matched quite evenly I would suggest by Sports Direct or MASH lawyers. If Ashley decides to put a date on his return of monies then if King does not come up with it we no longer own substantial properties.

      I would also suggest if you don't like Ibrox noise, then don't log in, we may in your eyes lack common sense but we will always reserve the right to ask questions

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    2. Rangers Retail Ltd was owned by Rangers (51%) and Sports Direct (49%). The terms of the £5m Ashley loan included an increase in the SD shareholding in Rangers Retail from 49% to 75% . If Rangers pay back the loan SD's share of Rangers Retail reverts to 49%. That is the 26%.

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    3. Complete tosh?! Really?!!
      1. The loan is interest free - fact!
      2. Ashley gets 26% additional RR profits as a condition of the loan - fact; (although I should have included the word 'additional').
      As for Ashley putting a date for the repayment of the loan you obviously know a lot more about the precise conditions of the loan than anybody else - or are you just surmising with no basis in fact?! I think we know the answer!!

      As for not logging on to the blog just as you have a right to question what is happening at the club - and I agree you/ we all do - the readers of the blog have just as much right to question what Ibrox Noise and others posters publish as well!

      And one other thing - I put my name out there whilst the majority hide behind 'Anonymous'!!

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    4. So putting a name will change everything, same as King coming in will revive Rangers (just asWhyte or Green did), still curious, if we still had Ashley where would we be, not debating his loan, looking forward to the Premier League and probably a good tie up with another club who can provide some decent players. No we now await your promises Mr King, we will wait and wait or worse still that very few mention, wait and see, oh and by the way when the opportunity to reply as anonymous was taken away the thread died, just like we are doing at the moment. J

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    5. Well my name is there and I am happy to debate things with anyone, you seem to like having our clubs assets being at risk. They are all worth more than 5 million and should never have been added as security to this man. If King wanted to he could have offered a loan when Rangers required it. Sure it is interest free ... so what ... I'd rather my club was free. Is King gonna charge us interest in comparison when he puts his monies forward? I doubt it. Hopefully King will not require these securities. So I really fail to see what your issue is. We want King and that comes at a price as he knows, his money. We don't want Ashley and his...

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  14. As far as I'm aware, a condition of the loan was that MASH would have two representatives on the board but as King & Co have sacked them, the loan may now be in default, hence the demand for repayment??
    Pay him back and end this diversion and division.

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    1. make him wait,,,or even pay him back £1 a week,,the fat rat,,

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    2. Another poster who knows more about the fine detail of the terms of the loan than everyone else!!

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  15. Going by the amount of blogs on the situation regards ashley and rangers there are an awful lot of financial whizz kids with inside knowledge supporting us these days

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  16. There are an awful lot of tossers supporting ye's too. I can defo see a pattern developing here. Let's look at it subjectively though, if you lot know what that big word means (damn a don't have time to explain) Ashley is a tosser but he's using you lot and ur manky club to make more money and get even fatter at ur expense. So who's the bigger tosser? I know where my money is goin? How bout u?? Ahhh, guid point. U don't have any. Shucks :-/

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