Rangers: Fans’ fury over £4m share issue bid

Rangers shareholders, James, left, and Sandy Easdale. Fans are worried over fears of another administration. Picture: John Devlin

The club’s announcement to the London Stock Exchange yesterday morning has sparked fears the company could be heading for administration again.

The stock exchange was told the Ibrox club hopes the latest share issue will help “rebuild and re-establish Rangers as a stable, sustainable and successful business”. It was also revealed that the club “expects to raise between £20m and £30m” over the next three years with the open offer an “important planned part of this fund-raising strategy”.

Chief executive Graham Wallace admitted in his controversial business review released in April that the Ibrox club may turn to existing shareholders to help meet the shortfall in their revenue stream. That came after it was revealed in the review that the club had “mismanaged” almost £70m in the 18 months since they were reformed following liquidation.

The club will offer 19,864,918 new ordinary shares at 20p each with the offer not being underwritten. If the aggregate level of subscription is less than 15m, the offer will not proceed.

Should this occur, yesterdays’s statement suggested “the company will be unable to pay its creditors as they fall due and the future of the company will be uncertain; the directors will immediately have to seek emergency financing, which may or may not be available”.

The club also confirmed the £1.5m in secured loans from shareholders Sandy Easdale and George Letham were due for repayment on Monday, “part of which will come from the proceeds of the open offer”. Even if there is full subscription, the club statement said there would still be a requirement for additional external funding in the latter half of the financial year to keep the club running.

However, supporters made their feelings clear in a strongly worded statement issued by the Union of Fans group at 10pm last night, which read: “We note with utter dismay the board statement regarding their plans for a further share issue. There are several disingenuous claims made by the board which we feel are bordering on another deliberate attempt to mislead shareholders. The board’s inaction and incompetence over the past nine months has led the club once again into an extremely precarious financial position which could easily have been avoided.

“Graham Wallace and the other board members have known for at least nine months that significant levels of investment were required not only to see out the current season but also to invest properly in the club.

“They have also been, or should have been, well aware that this level of investment would not be raised from current shareholders and that only those with a genuine love for the club were willing to put such sums in. They have continually refused to take the necessary steps to allow those outside the existing shareholder base to invest the funds required. Indeed they have continued to pursue every option to keep those people out.

“They now hang the threat of a second administration over the heads of both fans and shareholders when they remain fully aware that funding can be brought in from outside.

“For the avoidance of doubt, if this board would finally start to do their job properly, there can be absolutely no threat of administration. The board are attempting to dress this stop-gap measure up as being for the benefit of the club. It will be used to repay loans, to pay fees and to pay bills. Nothing else.”

Ally McCoist refused to talk about the share issue when asked at his press conference to preview today’s Championship match against Queen of the South at Ibrox. But the Rangers’ manager remains hopeful of signing new players ahead of the transfer deadline at the end of the month, but concedes transfer activity may prove difficult. He said: “I’m ready to be busy, I don’t know if I expect to be busy. In the current climate, I wouldn’t imagine there is a lot of money to spend on players and bring wages in. Without being told I have to get people out to get people in, I would imagine it would be pretty difficult to bring people in.”

But McCoist is satisfied with Rangers’ start to the season so far, after recovering from defeat to Hearts to win their last four games.

He said: “I’ve been fairly happy with the way things have started.

“The disappointing result was the Hearts result at home, when we lost the goal in the 93rd minute. I think the form has certainly picked up. Clyde was good. Dumbarton was good.

“The other night against Queen’s Park [in the League Cup] could have been better. We have had a fair start but we always look to improve.”