The parlous state of Rangers’ finances has been highlighted once again, as a power struggle at Ibrox lurches towards enforced conclusion.
Sandy Easdale, a Rangers director, has loaned the club £500,000 with a statement to the London Stock Exchange confirming: “The facility will be used by the company for general working capital purposes over the next few days.
“The directors of Rangers, having taken advice from their nominated adviser, WH Ireland PLC, believe that the terms of the facility are fair and reasonable as far as shareholders are concerned.”
Easdale will receive a fee but no interest for his trouble. The intervention itself merely illustrated how dire Rangers’ cash flow situation is. The club sold its star playing asset, Lewis Macleod, to Brentford as soon as the transfer window reopened.
The noticeably short timeframe in that Monday morning Stock Exchange notice was explained by subsequent news that Rangers has an outstanding liability to HM Revenue and Customs. The club had admitted in its last annual report that more than £8m needed to be raised – starting this month – simply to keep the business trading through the current financial year. For all it is unwise to second guess anything in this crisis, fiscal pressures mean an end game is approaching at a business which has slipped from crisis to crisis since David Murray handed over ownership to Craig Whyte for just £1 in 2011.
Easdale is at the epicentre of what has become an increasingly fraught battle for Ibrox control. He, along with the chief executive, Derek Llambias, and the chairman, David Somers, is viewed as a close ally of the Newcastle United owner, Mike Ashley, who himself has loaned Rangers £3m this season.
There is no current sense that Ashley is willing to do more than protect a strong commercial position at Rangers; his position, though, as a major and secured creditor is potentially significant. So, too, is his present boardroom grip despite a shareholding of just 8.92%. He tightened that on Monday with the appointment of Barry Leach as Rangers’ finance director. Leach is a long-time Ashley associate and this move provides an indication that the Sports Direct tycoon is not of a mind to quietly slip into the background.
Last week’s virtually simultaneous purchase of share chunks by a group of three wealthy Rangers supporters – George Letham, Douglas Park and George Taylor – and a firm controlled by the South Africa-based Glaswegian Dave King was widely welcomed by those fans who want the involvement of Ashley, Easdale, Somers and Llambias at Ibrox to end.
In terms of shareholding, the Three Bears consortium and King now hold considerable sway over Ashley but there can be no dispute over whom has the deeper pockets. Some form of deal must now be struck in order for Rangers to meet imminent financial obligations and, presumably, for Ashley to remain content with his lot. A planned share issue to raise £6.5m of working capital will first be offered to those with an existing stake in the business.
As Easdale’s spokesman hailed his client’s willingness to assist Rangers at such short notice, a snapshot of the hostility within this scene arrived from King. From his home in Johannesburg, King claimed this was “the minimum he [Easdale] should have done”.
A late and surprise entrance into this fraught scene has been made by Robert Sarver. The owner of the Phoenix Suns NBA team apparently has aspirations of moving into European football and contacted Somers directly with a takeover plan last month. The subsequent stock purchases by King and his allies – who will themselves inevitably seek control of boardroom affairs – renders that a near impossibility.
It is feasible that Sarver could work in conjunction with others if he so desires but there would be suspicion as to his motives. Sarvar is expected to release his own statement to the Stock Exchange on Tuesday morning, which will make his intentions more obvious. In contrast, the Scottish Professional Football League has been conspicuous by its silence on Rangers’ lack of even medium-term financial certainty.
