Yesterday, we got the latest round of Ibrox equity confetti, and it’s a joke now. It is a joke. How big is the hole over there that they’re trying to plug it with yet more money? How heavy has the situation gotten that this is how they’ve chosen to respond to it? And why does the media pretend that this is somehow normal behaviour for a football club?
Let us not forget something. All this talk about new investors—we know what that means. It means what it’s always meant when it comes to that club.
They want someone else to spend the money that they otherwise wouldn’t have. And I cannot believe that so many people in our press are content to push the line that this is, in any way, a good way to run things. Instead, these people cannot wait for sugar daddy owners to start writing cheques. It’s absolutely absurd.
This latest “share issue” has “raised” more than £5 million. That money will go towards meeting the running costs to get them to the end of the campaign. The hole over there must be absolutely vast. Imagine they didn’t have the ability to lean on directors’ loans. For how much longer can this go on?
The problems that exist at that club have been allowed to grow over decades. And the reason those problems are now built into the bricks—part of the club’s DNA—is because the media has normalised this kind of thing when it should not have. They keep on talking about how Celtic is the model for what that club wants to be, but that club has no interest in trying to be Celtic. It has no interest in living within its means if that means being second place behind us.
I think that’s an appalling, amoral position for that club to hold. Everyone who surrounds them is a little mad. The investors who are allegedly planning to come in are obviously a little mad, or they would run. They would look at the situation over there right now. They would look at the financial position. They would look at the absolute state of that club, and they would run in the other direction.
Where’s the money to be made over there? Where’s the profit? Unless you can squeeze that club like a tube of toothpaste—unless you’re going to eradicate all the parts of it that aren’t making money and focus only on the ones that do—where is the profit? Except in bleeding out the playing squad for every available asset you can sell and replacing them with really, really cheap footballers. Where is the profit unless you make those fans pay more money than they’ve ever paid before to watch an even more substandard product, in the hope that enough of them renew their season tickets and enough of them continue to be loyal to actually put money in the bank?
Otherwise, that club is just going to gush money. It’s just going to leak it, and it’s going to cover the floor with more red ink than ever. I have heard any number of stories about how people with this much wealth don’t care about throwing some of it away. The truth of the matter is, if these people didn’t care about throwing money away, they wouldn’t have attained all that wealth in the first place. I don’t think they accumulated such vast fortunes by being profligate. By being stupid.
Ask Dermot Desmond. He once told a group of Celtic fans that to pour his own money into the club would be just like taking piles of into the back garden and setting them alight. He didn’t build that fortune doing stuff like that. None of these guys do.
Who knows how bad the financial figures are going to be for this season? They’re going to be dreadful. We all know that. They’re going to be worse than last season’s £17 million loss. We all know that too.
The media has stopped asking those kinds of questions. They’ve stopped caring. They’re all celebrating the takeover as if it’s deliverance from reality. And that’s what it is to them. That’s what it represents—deliverance from reality. Because reality is what has finally come to that club.
I don’t think these alleged investors have the slightest idea what they’re about to sink their money into. A black hole. All they have to do is look at the finances from the last 10 years. All they have to do is consider the media reports already spending their money for them before they’re even in the door—talk of high-profile managers, talk of transfer war chests, as if UEFA regulations didn’t matter.
There’s zero interest in being a club that lives within its means. There’s no interest in conserving and building because their fans want to see progress at once, and they want to see money spent in great quantities to get them there as quickly as possible. And the media is already—not too subtly—pressuring them to do so before their feet are even under the table.
If those people aren’t scared off by the equity confetti and the demands of the fans, the media are the ones who should give them the most pause. And if they want to see what their future looks like, they only have to ask the new CEO. He has barely unpacked his pencils, and the hacks are beating the daylights out of him already because he offered them no good news during his first weeks in the job.
Look at the coverage that guy is getting. He’s done nothing to justify that much anger from the mainstream press. That’s a foretaste of what everyone who gets involved will have to deal with if they try to run the club in a professional, for-profit, pay-back-the-purchase-price manner. They don’t stand a chance.
Yesterday’s latest dose of equity confetti should scare the so-called “investors” badly. That will be them this time next year unless they have a very good plan. They too will be trading worthless shares for their money.
Looking at the enormous number of shares in the Ibrox club and their nominal value of 1p should be all the reason these folks need to walk away from this. And if they don’t? More fool them.
Photo by Serena Taylor/Newcastle United via Getty Images
Our latest podcast, Hampden Here We Come, is up now.
Mate, this will have been covered in due diligence. Otherwise the potential buyers would already be disappearing over the horizon.
This is being reported as converting loans to shares. If so, there’s no cash going into the club at all. From a fakeover viewpoint, previously they would have taken on debt of £5M. If the price was say £50M, then £45M would go to the shareholders (assuming no other debts!). After this action, the whole £50M is spread across the increased number of shares, hence each shareholders holding is diluted, but they don’t owe the £5M either. No effect on the fakeover, no effect on the cash, no effect on the losses. Just some adjustment of holdings between shareholders.
Who says they were ever here in the beginning?
This was all started with the ‘Chiseler’ King trying to offload his shares.
There has been ZERO coverage in the US of A regarding any ‘49er’ interest.
Bearing in mind that the 49er owners are Catholics with a long history of Charitable works
with several US Catholic Charities its unlikely that they would be interested and get involved with any Consortium, as if they
needed to be invested in a joint project. They could buy The Tribute Act out of Petty Cash.
Even the Leeds CEO, a part of the 49ers investment management team, was uncommitted in his comments, saying only that his team were always looking for opportunities, without mentioning Sevco at all.
The only other person mentioned over the past fortnight is a guy called Cavanagh. A US businessman man, hooked by King, who has just sold his American Health Business and is minted. He’s been pictured with the Sevco Board at I think it was the Murder’well game and at the Fernabace game in Turkey. No one has interviewed him.
No SMSM churnalist has asked any of the DeidCo Directors for a comment. It’s all piss n’ wind unless someone CREDIBLE makes a statement on it. Even if there is any substance to the rumour mill, then if it comes to pass then the last 12 years for the Ibrox follow, follow brigade will seem like an all expenses paid,luxury holiday in comparison to what lies in store for them.
Investment to them means a Suggar Daddy with very deep pockets. The reality is something that will terrify them. Ask the fans of any UK Club bought by the Yanks, it will be a nightmare.
They will be bled and bled and bled till there is nothing left but a carcass. That will also be sold under the feet of the Debtdome hordes. Ibrox will go, Murray Park, the lot will be sold off and the faceless US investors will disappear Stateside laughing at the most gullible fans on the planet ?.
Your last paragraph SFATHENADIROFCHIFTINESS….
All I can say is – HOPEFULLY !!!
James, I don’t understand why you are so concerned about what they do. Let them dig a deeper hole. a hole so deep that they can never get out of it, it’s what I want and what we all should want.
Fk them all, the long and the short and the tall.
I do think that we definitely need to keep an eye on all The Sevco skullduggery and dark arts that they indulge in on a daily basis Johnny as we slept at the wheel before and suffered badly as they racked up their very tainted EBT silverware along the way.
They even got to keep these dirty medals and that Doncaster said that they were the same club ‘absolutely’ and Lawwell did the square root of fuck all to counteract that seen me end a 25 year association of paying through the turnstiles to see Celtic (I still buy a fair bit of merchandise though)…
Not that I would ever read them (The Scummy’s) but there’s not a snowballs chance in hell of them investigation Sevco so that is why I for one am highly delighted that James and The Celtic Blog and others are on their case on a daily basis…
Scotland and it’s football is one fuckin place where one ABSOLUTELY has to know one’s enemy inside out 24/7/365 in ma humble opinion !!!
Shares unregulated they will sell for whatever someone wants to pay.
In normal practice share dilution changes the cost of share on the market as the asset values would not increase accordingly. Certainly profits have not driven positive share prices.
The buying company will have agreed overall cost of ownership, if indeed they will not just come in and purchase King’s shares from him. If they get a big enough shareholding they can have a bigger say on how the club is run, maybe overall say and they could make key decisions on assets and players leading them to the profits they want.
Investors do so for profit or maybe tax liabilities can be written off against rangers losses.
Whatever the MO it will not be the overall sugar daddy role the klan crave. This could be the shackle for decades where they are just a cash cow being onerously milked.
My oft repeated view – What Ann Budge was to Hearts, the Americans, whoever they are, could be to The Rangers. If the due diligence shows major financial and/or structural problems, and the projected losses for season 24-25 are significantly greater than last season’s £17M, administration could be their way in.
If they’re as hard nosed as a lot of American business types consider themselves to be, they’ll not lose sleep over the losses incurred by existing shareholders and directors.
If the Yanks get involved in the Ibrox club and I still think it’s a big if, I would think that they will run a tight ship, at least initially. Let’s face it they’re starting from scratch, there is a big rebuild needed.
if they’re sensible they will take their time, but we all know that the fans and the Media will put pressure on them for quick results. When McCann saved Celtic most of us who bought season tickets at Hampden and bought into the Shares issue were realistic, and knew we had to give him a few years for the business and the team to come good. He didn’t disappoint us.
Whether the Ibrox crowd and their Media cheerleaders have the patience, we will see within a short time. .
Celtic are in the driving seat, and if there is a change of ownership at Ibrox it will make it very interesting. I’m sure Celtic will be up for any challenge, if it indeed it actually comes.
Hi James, great article as ever. My knowledge of finance is zilch but it seems to my layman’s brain things have moved on. It appears that Sevoo, according to Companies House documentation, may have borrowed against transfer receivables on a secured basis. People seem to be getting rather excited about it all and comparing it to the Ticketus scenario. I look forward to reading your more learned assessment as my old head doesnt understand it all
They won’t Have Earned any money the CHancer I Like Don’t think And Before U can Spend you Earn Case open