Rangers Accept £10M Loan From Newcastle Owner


The news today is that Rangers have accepted a £10M loan from Mike Ashley that means the Newcastle United owner’s company Sports Direct will have 26% of the club’s retail business.

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Mike Ashley – Newcastle United owner

The loan is secured against the Murray Park training ground and other assets, but does not include Ibrox, which was Ashley’s initial demand, but Rangers fans protested that possible agreement.

Rangers are in desperate need of funds to keep them going and Mike Ashley is getting agreements from the club in return for the loan, and he is really the man in control of Rangers now although he owns 8.92% of the shares.

The loan is split into two £5M transactions – with the first one being made immediately available to the cash strapped club.

The Rangers Board issued a rather lengthy statement to the stock exchange on Tuesday:

“The Board of Rangers announces that Rangers Football Club Limited has entered in to agreements with SportsDirect.com Retail Limited and associated companies (“SD”), to provide a long term on-going credit facility of up to £10M (the “Facility”).”

“The Company’s financial condition has been perilous for a number of months exacerbated by lower than expected match attendances.”

“The Directors have implemented a cost cutting program with which they have made significant progress.” “There is however an immediate need for a substantial injection of capital, and the directors have considered a number of options.”

“The terms negotiated with SD (which are reversible in respect of the Facility) represent the optimum combination of quantum and duration of funding, allowing the Company time to arrange permanent capital which can be used for strengthening the playing squad.”

“The Facility is structured in two separate interest free tranches. £5M will be available immediately for working capital purposes and for the repayment of the credit facilities with MASH Holdings Limited which was entered into on October 27 2014. All rights and security associated with the MASH facility will be cancelled.”

“The Club will transfer 26% of the share capital in Rangers Retail Limited (“RRL”) to SD for the duration of the Facility (the “Transfer”), which will be transferred back, at no cost, upon repayment of all outstanding sums owed by Rangers and its subsidiaries to SD. There is no specified repayment period for the first tranche of the Facility.”

“The Facility is to be secured by a floating charge over the Club’s assets and fixed charges over Murray Park, Edmiston House, Albion Car Park, and the Club’s registered trademarks.”

“None of the security that is being given to SD covers Ibrox Stadium, which is specifically excluded and remains in the full ownership of the Club, free from any security.”

“SD will also have the right to nominate two directors to the board of Rangers for the duration of the Facility, any such nomination will be subject to regulatory consent pursuant to the AIM Rules and other regulatory bodies.”

“If the entire sum drawn down is repaid, the Facility will be deemed to be terminated, all security will be released, the 26% of RRL will revert to the Company and all rights of SD to nominate Directors to the Board of the Company will cease.”

“The second tranche of £5M, which repayable 5 years after draw down, will be used, if required, for working capital purposes and is subject to due diligence by SD prior to drawn down.”

“The Company has also agreed that from the 2017/18 season, for the duration of the Facility, any future shirt sponsorship proceeds will be for the benefit of RRL.”

“RRL will declare a dividend of a total of £1,610,000 prior to the Transfer. The Club will use the proceeds of its share of this dividend, inter alia, to repay sums owing to SD in respect of the cessation of onerous leases on unprofitable stores entered into by a previous Rangers management team.”

“RRL is a joint venture between the Club and SD whose business is selling merchandise both on-line and in stores. In the period ending April 27 2014, RRL made a profit before tax of £1,172,893.”

“SD is a Related Party under the AIM Rules and accordingly the Facility is a Related Party Transaction pursuant to AIM Rule 13.”

Notice that Mike Ashley is also now able to appoint two Directors to the Board for the duration of the loan, and that gives him even more power at the Scottish club.

There is also a meeting today in Scotland on dual ownership being held by the Scottish FA (SFA) and being conducted by conference call and involves lawyers representing the SFA, Rangers and Mike Ashley.

But it seems it’s just to discuss a time-frame for the next hearing, when Mike Ashley will be expected to attend in person.

What’s Mike Ashley up to with Rangers?

Comments welcome.

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12 comments so far

  • firebug666

    Jan 27, 2015 at 8:13 AM

    Comment #1

    IT’s BENEFICIAL TO SPORTS DIRECT!

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  • sing in the corner

    Jan 27, 2015 at 8:15 AM

    Comment #2

    Theres a tipping point though Firebug, its all cumulative and I genuinely think there aree factors converging that will make it come to a head now. Rangers fans opposing Ashley, his indifference to what anyone thinks, slap after slap in the face to the fans. I think we’re probably going to see over the coming months that AP, despite his percieved failings and what anyone does or doesn’t think of him, actually ‘played’ the Ashley thing as well as or better than anyone who he’ll employ is going to.
    When the ball gets rolling it could gain momentum. Right now its word of mouth and if season ticket sales go down, results continue to be crap and we lurch closer to the Champ… a boycott / virtual no show becomes more of a possibility. Then Ashley’s hand is forced one way or another

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  • Average_Contents

    Jan 27, 2015 at 8:19 AM

    Comment #3

    Wow. So now he has them in an even tighter stranglehold. He’s got the club badges and crests now. 2 more members appointed to the board and out of the initial £5m loan, he’ll be getting his own personal loan back lol. What a twat he is. This rrf that’s been setup between rangers and SD stinks of them stripping all the merchandising on the sly but legally. Set up to bamboozle any onlookers.

    The cash-strapped Rangers board has agreed a £10million emergency loan deal with Mike Ashley’s Sports Direct firm, it has announced to the Stock Exchange.

    Without the injection of fresh funding, the Ibrox outfit would not have been able to cover pay cheques due to be delivered on Thursday.

    The loan will be secured against Murray Park, Edmiston House, Albion Car Park, and the Club’s registered trademarks – but not Ibrox.

    The move spells the end of attempts by the Three Bears – wealthy fans Douglas Park, George Letham and George Taylor – to have their own loan offer accepted.

    It was their promise to match Ashley’s deal whilst demanding Ibrox remained unsecured that forced the Newcastle United owner to drop the stadium from the terms of his agreement.

    In return for the money – which will be paid to Rangers in two £5million tranches – Ashley will be able to nominate two more directors to the Light Blues board. His associates Derek Llambias and Barry Leach are already serving as chief executive and financial director.

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    As well as that, Rangers will transfer 26 per cent of its holding in Rangers Retail Ltd (RRL).

    RRL was a joint venture set up by the club and Sports Direct, with Rangers in control of 51 per cent and Ashley’s company controlling the rest. Fans, however, were already concerned that it was overly beneficial to Ashley.

    Now as part of the new loan deal, the club has also agreed that from the 2017/8 season, for the duration of the loan, any future shirt sponsorship proceeds “will be for the benefit of RRL”.

    Ashley has now strengthened his grasp on the money streams entering the club

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  • firebug666

    Jan 27, 2015 at 8:19 AM

    Comment #4

    sing in the corner

    I would love you to be right here, but I just do not see our fans uniting and getting organised enough to make an impact.

    We are split into to many factions, each one believing they are right, no unity – no cohesion – no cooperation – no leadership = no protests that have an impact.

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  • banjax

    Jan 27, 2015 at 8:21 AM

    Comment #5

    Now we know where the Transfer budget has gone !

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  • ToonMatt

    Jan 27, 2015 at 8:23 AM

    Comment #6

    The cancer truly is spreading!

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  • JackButler

    Jan 27, 2015 at 8:24 AM

    Comment #7

    I hope they continue to take his money, I hope he continues to appoint members to the board as I hope he goes ahead and buy the whole lot then sells us so we are able to get our belief, passion and ambition back. The sooner Ashleys time is condemned to the history books the better for all involved

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  • catchy in norway

    Jan 27, 2015 at 8:39 AM

    Comment #8

    whats Wonga with this I wonder, he is a bigger loan shark then our sponsors

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  • Average_Contents

    Jan 27, 2015 at 8:42 AM

    Comment #9

    Could it be all these personal loans he’s given rangers have been in aid of him getting his “foot in the door” solely so SD could take over? His loans will be paid back from the SD loan and THEIR name will be on the secured assets and all revenue streams go to SD. In effect he’s secured rangers for them. He ain’t selling us if that’s the case. Still milking us while his company milk rangers.

    Fat fcuking scheming slug.

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  • Gregor4

    Jan 27, 2015 at 9:19 AM

    Comment #10

    Firebug

    Were you born with jelly between your ears? Change the record for gawds sake. Gregor.

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  • lesh

    Jan 27, 2015 at 10:15 AM

    Comment #11

    Cute and shrewd. Ashley’s swung it now that any debt owed to MASH Holdings (NUFC owner) is cleared, transferred to SD. Now he’ll argue there’s no dual ownership as SD is a publicly listed company in which he’s not the only shareholder

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  • firebug666

    Jan 27, 2015 at 10:42 AM

    Comment #12

    Gregor4

    One word pal….”Typical”

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