At a meeting of Rangers directors and shareholders that began on Friday and ran into the early hours of yesterday morning, the Newcastle United owner outlined his intention to offer further loans and consider a share issue to ensure that Rangers plugged the perilous funding gap that has been created by the consistent failure of the club to live within its means.
Ashley’s deal was preferred to that of a similar offer submitted by Scots businessman Brian Kennedy. A £16m recapitalisation proposal from Dave King was rejected earlier in the week. It is understood that Ashley’s deal gives him the right to appoint two directors to the club board. Ashley had previously called for an emergency general meeting (EGM) to remove chief executive Graham Wallace and director Philip Nash after they backed King and blocked an earlier offer of a cash injection that would give the Newcastle United owner the rights over Rangers trademarks. Nash resigned on Friday but Wallace, on a family holiday in Greece, is thought to be unwilling to resign, meaning the EGM will be required to remove him.
Rangers manager Ally McCoist, speaking after his side’s 3-0 win at Dumbarton, said he won’t seek clarification on the situation, stating that “when the time is right someone will relate the reality to me”. “My position is getting wins for the team and the supporters,” he said.
McCoist said he had spoken to Wallace before yesterday’s match, but that conversation did not involve talk of the Ashley loan or its possible effect on Wallace. “It was a football discussion, he asked about the team and how I thought the game would go, as we normally do before a game. He never mentioned his own position and I absolutely know nothing about that. I haven’t spoken to anyone about any off-field issues.” Asked if he expected Wallace to remain in post, McCoist reiterated: “Time will tell”.
The fight for Rangers was always going to be a walkover for Ashley. Rangers are essentially owned by city institutions. With an estimated £2 billion personal fortune and a Sports Direct business empire, the Londoner is well connected and well regarded in the City. Equally, unlike the blunderbuss approach of King, he has embarked upon a rescue plan that, in the first instance, will not destroy the value of existing shareholdings – as would have been the case with King’s £16m recapitalisation plan.
Moreover, in contrast to King and Kennedy, Ashley has built up a stake in Rangers since the new Ibrox club emerged from the liquidation of the old club in 2012. He now has an 8.92 per cent holding, and the support of the Easedale brothers, Sandy and James, and their proxies covering another 26 per cent. His power base is certain to trump any other offers to keep the club afloat.
Ashley’s intentions for Rangers remain unclear. Sources in Newcastle believe he is seeking a controlling interest in the club because he believes this offers him the opportunity to have European football exposure for his Sports Direct brand. To do that, he must deliver Rangers to that stage. That will take the investment that the majority of the support crave, but which they wanted to be provided by King. They considered him the desired option – as did Wallace and Nash. When this pair blocked a move for Ashley to provide funding in exchange for the rights to the club’s trademarks last month, it made them obvious casualties if Ashley’s loan was accepted.
Ashley is understood to be considering putting his former Newcastle United managing director Derek Llambias in charge of the day-to-day running of the Ibrox club. This would nominally would put Ashley in breach of an agreement with the Scottish Football Association that he would not own more than 10 per cent of shares, or have a major influence in the affairs of Rangers while still owning Newcastle United.
The SFA is reported to have asked Ashley to make a business case for dual club ownership, but since UEFA’s rules allow for two clubs to have the same owner, as long as they do not meet in European competition, the SFA could fall back on that regulation.
The Union of Fans umbrella organisation of supporters may be implacably opposed to Ashley’s involvement because of the hatred among the Newcastle faithful for his stewardship, but the St James’ Park club have posted profits for each of the past three years. And the fans bodies may have to ask themselves if their backing of King was ever likely to be met with similar approval from the Rangers shareholders.
It can hardly be considered perverse that they were not sold on giving over the running of the club to a man who was a director of the old Rangers when it was liquidated and has since been convicted of 41 counts of evading tax in his adopted homeland of South Africa.
Kennedy, meanwhile, said: “We put an offer in but it was not accepted so we graciously walk away and hope it all works out for Rangers.”