January 2 – The powerplay turmoil in the Rangers boardroom battle continued over New Year as the largest shareholder Laxey Partners sold their 16.32% stake to consortium of wealthy fans for £2.6 million.
The consortium is led by Douglas Park, George Letham and George Taylor and is in opposition to the current management of the club, and in particular the increasing influence of Mike Ashley, owner of English Premier League club Newcastle United.
For Laxey the sale of shares was done at a significant loss, reflecting the poor trading position and a loss of confidence in the club, as well as now the unlikely return to the Scottish Premier League this season. Laxey sold 13 million shares at 20p each, two years after buying them at 70p.
The share buy by the consortium is separate from a previous funding package from Park, Letham and Taylor, who had offered £6.5 million to underwrite a share issue in January which would take their ownership to 30% of the club and secure two seats on the board.
Rangers seems incapable of shaking off its financial travails and again finds itself in a desperate cash position needing to find at least another £6 million to see out the season. Mike Ashley has now loaned the club £3 million and has taken a greater control in the running of the club.
Ashley had made a bid to increase his shareholding last year but this was turned down by the Scottish Football Association (SFA) with his stake limited to 10%. He had wanted to increase it to 30%, in line with his strengthening influence over the club’s operations.
In ruling against Ashley’s MASH Holdings Limited, the SFA said: : “The board, under article 13 of the Scottish FA articles of association, is required to have due regard to the need to promote and safeguard the interests and public profile of association football, its players, spectators and others involved with the game.”
Rangers said: “The board of Rangers Football Club are very disappointed with the SFA’s decision and we will now consider all our options.”
Ashley’s Sports Direct currently handles Rangers’ merchandising operations and the club face a hearing an SFA on 27 January examining whether Ashley’s dual intersts in Sports Direct and Rangers have breached SFA rules and their agreement.
Derek Llambias, the former Newcastle managing director is now Rangers’ chief executive and a director, while Sports Direct executive Barry Leach is t the club acting as a consultant.
While the Scots are uncomfortable with Ashley’s position in the club, ultimately the deciding factor will be cash, which Ashley has and is not afraid to gamble. The Scots on the board and in the shareholding will have to dig deeper into the pockets on their side of the table unless they are saved by the SFA regulators.
But that in itself may bring problems as if the club is running on Ashley’s cash and goodwill and he decides to pull out and demand his cash back, then Rangers could find themselves on the edge of an even deeper pit.
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