Mr Green’s Brilliant Foresight and Persuasion re Rangers Investors

Charles Green is moving his Rangers outfit at high speed towards a share flotation. Everything he says now seems designed to reassure institutional investors, and to encourage fans to invest in his company.

He is trying at the same time to head off some of the questions before they are asked. The official Rangers website is a good source of information – at least here it is unlikely that Mr Green would be misquoted. I have a few posts to put up regarding recent reports from Ibrox. I hope they are of interest! My plan had been to write a piece about a number of the quotes, but some deserve a piece of their own.

This one is especially so, as it shows Mr Green’s business acumen clearly. As he said, he raised £12 million at the “start of the year” for this project – before anyone knew it would be up for sale, and at a time when he was cautious enough to consider that there was no guarantee of Rangers playing at all. To attract £12 million investment in those circumstances – at the highest risk level – deserves great credit.

And the fans and investors will be delighted by Mr Green saying that all the cash raised is to go into the club – this implies he will not be taking his £3.2 million bonus for saving Rangers and getting his Sevco entity off the ground, at least at this stage coupled with him leaving.

It is also relevant to look at the commentary – this is, after all, the official club website.

My comments are in bold.

—————————————————-

 

CHARLES GREEN is confident Rangers’ proposed share issue on the AIM market will raise the £20 million it is hoped it will generate. And he has stressed every single penny which is brought in under the initiative will go straight back into the club.

Bearing in mind the concerns that the share issue is intended to raise some funds to reward the initial investors in Sevco, this will be of great re-assurance to the fans. It would also suggest that Mr Green does not intend to use it as his own reward – 10% of the increased share capital, which would amount to £3.2 million. This is a fine gesture of his commitment to his company.

Green, along with manager Ally McCoist and financial director Brian Stockbridge, was in London today to announce Gers’ intention to float once more on the London Stock Exchange. And given he helped generate an eight-figure sum to get the club moving forward over the last few months, he expects interest in investing to be high. Chief executive Green said: “I’m definitely confident. I mean we raised £12 million at the start of the year when there was no guarantee we’d even be playing football.

Mr Green is clearly a masterful salesman. In this troubled economic climate, he succeeded in raising £12 million for a football team when there was no guarantee it would be playing football. Funny how the Presentation which was being touted round the City in May after Mr Green obtained exclusivity did not mention that there was no guarantee that they would be playing football at all.

What a persuasive man to get people to invest £12 million in a business which Mr Green saw might be closed by August 2012! And as the investment included the £5.5 million purchase price, then at least half of any investor’s money would have been lost for good.

I also note what must be a slip of the tongue. How could Mr Green have raised £12 million “at the start of the year” for this project. Surely he was not in the frame even before Rangers went into administration? If so, he deserves even more praise for his perspicacity.

“We didn’t know then either if we’d be allowed back into the league so to go to the market now, when people have seen what we’ve done, is good. We’ve got the club playing again, we’ve got big crowds and while there are still problems to overcome which we shouldn’t lose sight of, we don’t have some of the issues we had before.

Mr Green clearly is a very prudent businessman too. After all, when he bought the club, it was an SPL team, and no one seriously expected that the team would not be in the SPL? However, it seems to be the case that Mr Green foresaw this all – the struggle with the SPL, and the admission to the SFL and subsequent SFA membership.

However, there do remain a number of serious issues, as he mentions. These will be mentioned, no doubt, in the “risk section” of the Prospectus.

“The reality is we have got the fans engaged and we have got the institutional markets looking at us.

A quick straw poll of business papers saw an almost universal negative opinion towards the float. One paper compared it to “prune juice”! However the Independent was on its own, from what I saw, in stating that it could be of interest, “although not for widows or orphans”. This suggests that there is a high element of risk, and institutional investors, as opposed to venture capitalists, are not known for their attraction to high risk.

However, Mr Green says he has “institutional markets” looking at them, and we must take him at his word.

“When you look at Manchester United raising £200million and being valued at £1.5billion, why can Rangers not be worth £30million?

Mr Green is unfailingly positive, as someone in his position would be expected to be. As matters stand right now, one could say that his comparison would be like Arkwright of “Open All Hours” comparing his business to Wal-Mart – after all they are both in retail!

Manchester United do have certain advantages, in relation to TV money, merchandising, European income, huge sponsorship deals, attendances 50% higher than Ibrox capacity etc, but what is wrong with aiming high?

One might ask, if one was in BDO, the soon to be liquidators of the former Rangers company, how it was adequate consideration to pay £5.5 million for assets worth £30 million?

I am sure Mr Green has his answer prepared already for that question, should it be asked of him.

“Ours’ is a long-term strategy and part of the money which is raised will be put towards very important infrastructure projects around the stadium. We announced recently that David Murray has agreed to sell Edmiston House back to the club and we want to turn that into a megastore and a café/bar. That will require investment. I’d like to put something similar to Bar 72 into the Broomloan Stand as well.

Is it note-worthy that the first matter Mr Green mentions is unconnected to the team? Property investment and expansion of the licensed trade might not be seen as being as glamorous as buying Lionel Messi, but it could generate income for the team. That suggests that the existing facilities do not generate enough.

How good is the track record of his management team in running licensed premises, at a time when pubs and clubs across Scotland are closing at a rate of knots?

Mr Green is clearly very smart in looking to take on an area of business where times are very hard, and must be confident of his ability to succeed where many have failed.

“There are a whole raft of things we’d like to invest in which will generate income for many years to come.

“It is very important for Rangers fans to understand there is no confusion about where this money is going to go. None of the original shareholders are selling shares.

There is the reassurance people have been looking for. How long the original investors are tied in for is another question, which I am sure will be answered soon enough.

“Every penny we rein will go into Rangers Football Club and will be used for the club and when the transfer ban comes off, Ally will have cash to enter the market.”

Great stuff! Fans can be reassured that the money will be used for these infrastructure developments and, by January 2014, for player additions. Mr Green also believes Mr McCoist will still be his manager then, answering those who have criticised the manger for on-field results.

It isn’t just from home Green anticipates there will be interest in investing. He believes people from further afield will be keen too. The Rangers story has gripped football fans from around the world and the way the club has galvanised itself has intrigued so many. Green added: “We had one of the big German financial papers come to do a big article on the club along with publications from France and America.

Yes – but the article in Forbes magazine did not meet with much approval from Mr Murray, the Chairman, did it?

“People have taken an interest in Rangers and not just the sporting press worldwide but the financial press too. The whole world understands now what the value of soccer is as a product and that’s why people are showing an interest in us outside the media as well. When Imran (Ahmad) and I were in America, we had a meeting in New York on Wall Street with potential investors. They see and know the Rangers brand and name and I think there will be very good interest in this initiative from abroad.”

Well done Mr Green! In a time of continuing economic uncertainty, how well he has done to find investors potentially willing to put large sum towards an investment in another country, in a sport where financial returns, with very few exceptions, have proved to be money down the drain.

Obviously Mr Green has found the secret of turning base football metal into gold. In that case his issue of shares will undoubtedly be over-subscribed many times, and the shares will immediately start to trade at a premium.

Such a result would be his best response to those, like me, who are sceptical about his plans!

Posted by Paul McConville

 

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47 Comments

Filed under Charles Green, Rangers

47 responses to “Mr Green’s Brilliant Foresight and Persuasion re Rangers Investors

  1. mick

    great read paul once agian great to see sally in his long term plans but for him to 12mil at atart of year means major wrong doing whyte and ticketus
    £12 million at the “start of the year” for this project – before anyone knew it would be up for sale Gratuitous Alienation is the only word to describe it quit shocking evidence and 1 for bdo to examine undervalue sale and would lord hodge not take an intrest in this quote to it all seems well murky

  2. John Burns

    Re the recent Jimmy Savile situation, where it now appears that although many people were of aware of his alleged conduct, no one was prepared to ‘put their head above the parapet’ and point the finger, and so it went on and on.

    It seems to me that Green, in all his Rangers brand and financial dealings, appears to be getting a ‘free run’, completely unchallenged in the media, and his pronouncements seem to be getting more and more bizarre.

    Is there no one who will to stand up and state that his ramblings are in the realms of fantasy – that he is a Walter Mitty character and that his fighting talk aimed at the SFA/SPL is merely a ploy to get the less cerebrally gifted within the ‘herd’ to part with their money?

    Surely after the Craig Whyte “off the radar billionaire” tripe, it is incumbent on the Scottish pack to start ‘flagging things up”?

    Neil Doncaster said recently that the SPL had coped surprisingly well with the absence of Sevco/The Rangers; however bearing in mind the convulsion that has engulfed the whole of Scottish football since 14 February 2012, can we really afford to go through it all again?

    • cam

      Couple of questions for you,,,when CFC realised in their own reality that the reason they were being defeated on the fitba pitch was purely by the hunnish machinations of match officials,why didn’t they as they did with Glasgow Cooncil infiltrate and take over the refereeing structure?
      Why now don’t the army of bloggers and assorted obsessed maniacs launch their own paper and tell the truth to the waiting world?
      Think about it the tabloid press is still a money spinner and the trillions of members of the “celtic family” could buy a good quality paper.employ(at last) Phil 3 names as editor,get Paul in to do in depth analysis on legal matters(about Rangers!),get Subo in on a glamour page,
      I can envisage a wee section on how to beat the ATOS testers and maximise your welfare benefits in the stock market hosted by eco.
      Mick could do the crossword page,,,it would make the wee stinker look like childs play.
      Situations vacant;Mr McKelvie will sort you out!
      Might even find a job for Thomo,he could pen a wee section on hallucinogenics.

  3. My memory scans back to the pyramid sales talk. They always had many important business people interested but you never get to see them or their money.
    Thanks for a great article

  4. mick

    http://www.sales-training-sales-tips.com/positive-thinking.html

    greens should do a blog on his new found positivity am sure all the rangers men that run companys would love him round the office to creat a positive vibe he could ad it to the 12 or so companys already listed and related to sevco what 1 of the companys is he acually floating ?

  5. Michael

    “None of the original shareholders are selling shares”

    This is because they don’t have shares. They have debt notes and these + interest will be repaid with the investment from the fans. That is what this IPO is about.

    • ecojon

      @ Michael

      OK if the debt notes or debentures get converted to shares you can see what’s coming. Even if he doesn’t sell a single share to a fan he’ll be able to declare the float a success as he has ‘sold’ 22 million shares.

      And even if he just sells a few million to fans then it’s an overnight oversubscribed soaraway success. But are the original shares subject to lock-in if the shareholder has 10% or more of the total shares issue?

      There are supposed to be 19 of them and just over 22 million shares. So anyone with 2.2 million shares is on the 10% threshold. And 2.2 million shares at 50p a pop is £1.1 million. So it could well be that those who have invested £1 million might just be caught in a lock. If so then they will be spitting-tacks but is that why chico sayd none are selling their shares – because they are locked-in and can’t?

      Neat 🙂

  6. Michael

    To be fair “start of the year” could mean from 14th February.

  7. Ernesider

    For a man of Charles Green’s experience, it all sounds very hopeful and amateurish to me. I can’t see serious investors taking any interest.

  8. ecojon

    @ Paul

    In CityA.M. yesterday Seer Chico stated: “[I told some investors two years ago], put £50m into Rangers and you’re guaranteed to play in Europe every year – and it’s the only league in Europe that has that guarantee.”

    So looks as though chico’s interest in Rangers stretches back way beyond the start of this year. The man must be gifted wi Second Sight 🙂

    So what else was happening on the share front back in October 2010?

    Well the majority of Millwall supporters had their shareholding in the club cancelled in October 2010. Since floating 20 years previously a large number of shareholding issues had highly diluted share value so that they were trading at less than 0.02p per share and more than 37 billion shares were held by shareholders which twice the number issued in oil group BP at the time.

    Indeed, small share denominations had joined the ranks of Imperial Russian railway bonds, German Weimar Republic Reichmark bills and Zimbabwean dollars in not being worth the paper they were printed on. I am a bit worried at the railway bonds now that chico wants to start building railway stations – ach disnae matter it’ll aw be payed fir wae Monopoly Money 🙂

    • @eco

      Quite apart from the 2010 claim, that whole sentence makes no sense at all (and yes I’ve read the whole crazy rant!)

      “you’re guaranteed to play in Europe every year – and it’s the only league in Europe that has that guarantee.” What league? What guarantee?

  9. Thomas

    Cheers Paul!
    Love it!
    Reminds me of a master towel salesman in the Barras, massive crowd, machine gun banter 1979 throwing ‘free’ towels away at the front, “cmon mum lets get down the front quick!”
    “son, that woman with the free towels will be his wife, the quality is rubbish I can see it when he throws it and its a towel! dont be so easily duped!” see mums, pure dead brilliant.

  10. mick

    Charles “acid” Green.

    Every company he touches gets dissolved.

    joke of the day stolen from twitter added to kds then copied and paste to here

  11. Dear Chales.
    If I buy 500 shares for £500, what do you believe my shares will be worth:
    1) After 1 day
    2) After 1 year

  12. campsiejoe

    How do you know when Charlie is telling porkies ?
    His lips move
    An oldie, but very appropriate in this case

  13. mick

    check out the sevco in london taken sally to greggs lol

  14. mick

    what a sick and sad and sinister reponse alex tommo has had to his blog on sevco threat after threat a hope green is worse than whyte after this they have no comprahention of reality and are a embarssing bunch of trash why are they still here its shocking they are the most vile group of people on earth a stiane on humanity and a constant embarresment to our country zombie scum the only 2 words a can see fit to describe them ,4 in the 4 tier so we wont be seeing them for a longtime if not ever as greens well conning them lol

    • It’s ridiculous mick – I just hope the moronic ‘minority’ keep it up and comment on all the other London-based reports as they start coming in over the next month or so – sadly, only way to give them a showing up is by as many people as possible learning what low-life idiots they are (Andy and other sensible gersmen excepted, of course!).

      • mick

        @kenny mcc am just glad they are in div3 at least we can hide them there and they wont embarass us in europe anymore the the uk parisides they stand about all day at work with there hands in there pockets smoking and feeling big there the scum of the country WATP=we avoid tax payments

    • cam

      Only one problem with that imbecilic statement,,,,its OUR country!

  15. mick

    An annoyingly self-righteous Charles Green went to the doctor for a check-up.

    He said, “I feel terrible. Please examine me and tell me what’s wrong with me.”

    “Let’s begin with a few questions,” said the doctor. “Do you drink much?”

    “Alcohol?” said the man. “I’m a teetotaler. Never touch a drop, tea is the drink for me.”

    “How about smoking?” asked the doctor.

    “Never,” replied Charles. “Tobacco is bad, and I have strong principles against it.”

    “Well, uh,” said the doctor, “do you have much sex life?”

    “Oh, no!” said Charles. “Sex is sin. I’m in bed by 10:30 every night, and I always have been.”

    “Do you suffer fromw work related stress?” asked the doctor.

    “Oh, no!” said Charles. “My company is debt free, with 36,000 members and another 40,000 about to raise £20 million for me.”

    The doctor paused, looked hard at the man, and asked, “Well, do you have pains in your head?”

    “Yes,” said Charles. “I have terrible pains in my head.”

    “OK,” said the doctor. “That’s your trouble. Your halo is on too tight!”

    I’ll get me coat!

  16. mick

    http://www.dailyrecord.co.uk/sport/football/football-news/comments-suspended-on-football-articles-1374220

    this means that something big is about to come out and the record are trying to silence non sevconians a flick throw the sport bits now and then its not that bad so the bdo or taxman must be about to drop a bomb on them

  17. mick

    the last time the record changed its comments was 13 feb 2012 so it must be big and they are trying to silence it now how would they know and why do they not want comments ?????

  18. ecojon

    @ mick

    It could be just because of the reasons given below as the Record has a legal duty of care towards its employees. It also cannot allow the propagation of hate speech and sectarianism and could be held complicit by allowing it to continue.

    ‘We are talking about personal abuse directed against other users and members of our staff, foul language, hate speech, sectarianism and systematic, tit-for-tat deletion of posts’.

    • mick

      @ecojon yes but why now its been like that for years and they dident down it its strange you use to just add a comment on it then on 13 2 2012 they changed to facebook now this the site is mainly celtic laughing at sevco and always has been there is lots of negative banter and a top modiration system inplace so why now

      • ecojon

        @ mick

        If I was in conspracy mode I think I would say that all the Bear organised petitions to the Scottish Parliament has resulted in someone having a look at what is going on around the internet between fans and I think there has been a shock horror reaction. A lot of this stuff IMHO is actionable legally and I reckon the quiet word is going out to keep the MSM away from the firing line before the axe falls.

        I wouldn’t be in the least surprised if there was action againbst some of the more sectarian and hate-ridden sites by the boys in blue and about time too.

  19. Well tackled Paul, great read. I expect this particular series of posts will go on for a bit, given the sheer volume of words spouted by the would-be alchemist over the last 48hrs or so. Good luck with that then…

    As regards the £12m(!), whether it appeared before or after St Valentine’s Day – or even if anything before May can be termed “the start of the year” for that matter – I’m more interested in the ‘raised’ side of it, not to mention the amount.

    As you point out, £12m, especially around then, represented a pretty massive leap of faith by whomsoever was putting it up, so I can only guess it was already part of some sort of ‘war chest’ and most probably was readily available because the people involved were pretty close to the action already.

    It does makes rather more sense, to me at least, if we imagine that the money and ‘the plan’ were more or less in place BEFORE Mr G came onto the scene. He probably wasn’t involved in any ‘raising’. Judging by his performance over the last few days, he is definitely in his element doing his Barnum bit, and as a lot of people have suspected, he could well be more the monkey than the organ-grinder – indeed he has more or less said as much himself.

    So it will be interesting to eventually see who comes out behind all this. Cue some well-known face or faces to be ‘invited’ to take the club to the next phase, once Charlie’s job is done, perhaps? Let’s face it, he’s not really a typical football club CEO, is he?

    OK, conspiracy shmiracy – and apologies to the blue faithful – but it really is interesting that this £12m gets mentioned only now, and in the absence of proper facts and figures (as ever in this saga), I feel justified having at least a stab at guessing (even though that’s one of the things Corporate Social Responsibility is supposed to avoid).

    Just one more, small point that caught my eye: the phrase “I’m definitely confident” used by Green. Why the need to add “definitely”? Any linguists out there?

  20. james larkin

    i find it strange that green is NOW saying he raised £12,000,000,
    because originally, he claimed they [his investors] had raised £30,000,000 !!!

    yet, still no-one from the MSM asks about these discrepancies/lies !!!?

    he says they are debt free.
    i guess the original investors DO NOT want their cash back, they just gave chico the cash and told him to keep it.

    AYE RIGHT.

    • ecojon

      @ james larkin

      It is difficult to nail jellyfish to the wall especially when the room is spinning.

      But my take is that the £20 or £30 million in investment was dependent on the cva being accepted and Rangers therefore staying in the SPL and Europe. It may well be that chico was talking up the amount but I do think that there may well have been an original plan for a more medium term investment strategy in the beginning especially if Naquvi was the lynch-pin of Blue Pitch Holdings.

      I think the CVA failure changed everything and the big bucks just didn’t materialise which meant everything ended up hand to mouth. I’m also certain that this prevented chico from putting a deal together and picking up his commission cheque and walking away relatively quickly after the flotation.

      I think they have raised approx £10-£12 million and that little is left so the flotation is needed. But I’m not so sure that chico will have enough to walk or maybe he thinks he can keep going and reach another flotation date next year. Again it’s hard to know if he has any concrete reason to believe that league restructure is imminent or it could equally be pie in the sky he’s feeding to the masses to prove he stands up for Rangers when no one eklse ever has.

      It might even be his pet plan and explains all – the what a wonderful place to be is the SFL and these people are our friends and honourable as well. If he is trying to swing league reconstrcution he needs votes from the SFL.

      But eveything remains pure guesswork and this flotation might provide no real answer. If it is a total failure then Rangers collapse but even a middling success will keep it staggering along and if he raises £20 million and the original investors are locked-in for 12 months then he could make it to the next tranche of ticket sales but it will still be tight.

      Then if League restructure is announced for 2013-14 or even 2014-15 then a bigger flotation happen on the basis that new players are needed for step upwards then that too might work. But there’s always the ticking time bomb of when the locked-in shareholders decide to sell their shares and get out.

      Has chico got the energy and the appetiteto last the course because by then if nothing has started to appear on the ground like pubs, clubs, shops, railways stations, academies. global TV deals, winning away games, selling pies for more than they cost and all the other promised-land material then he will have real probs with the support – at that stage he will no doubt buy them off for another season by providing an orange strip.

      • Michael

        Sorry as I’ve said before there are no locked in shareholders. Even if there were then there would need to be buyers of their shares. Who would do that? The original investors are creditors and will get their money back + interest from the money “invested” by the fans. That is what this IPO is about. Nothing more and nothing less.

  21. COYBIG

    ‘MEMOIRS O’ EUR YORKSHA RIPOFF’. BY CHARLES GREEN.

    ME ‘N FA’ LAD’S TRIP TA AMERICA

    Everybody wants ta invest int’ Rangers. Ah already knew ‘a’, bur ah wor abaht ta finn’ art ‘a’ ah wor reet i’ uz guess ‘a’ ah could mek myself..ah mean T’ Rangers eur few bob, when ah went abaht ta advertivse t’ share issue.

    Ah wor o’a i’ America wi’ Imran. He ‘ed ta buy tikets for twoa seyts ont’ plane, t’ fa’ lad ‘a’ ‘e is. We wor on eur tour o’ t’ deluded…t’ fan clubs ova’ there. Bur we still managed ta meed um reeight powerful fowk while we wor theear.

    Fust off, me ‘n Imran wor walkin daahn t’ street i’ ‘ollywood ‘n Imran started ta jump up ‘n daahn li’ eur lahl lass. Ah sez, “Wha’ is rong wi’ you fa’ lad?”. ‘e sez, “Ther’s Tom Cruise”. Ah looked up ‘n theear wor eur miget walkin t’wards uz. “Tom, whoa?” Ah sez. “T’ biggest actor int’ world” Imran replyed. “Gi’o’a!” Ah sez, “‘e is onny 4 foot 8”. “‘e is worth millions” ‘e sez. “Really?” Ah sez. “Tom!” Shahted Imran. “Can we gerr eur picture..”. “Shurrup fa’ lad” Ah sez, “Let me doa t’ talkin.” Ah shuk ‘is lahl ‘an’ ‘n sez, “ayup Tom, ah’m Charles Green. Jont ta buy shares i’ world famous football team T’ Rangers?”. “Ah can’t, orl uz brass is tied up wi’ Sientology ah’m afraid” ‘e sez. “Sientology, whats ‘a’?” Ah sez. “Nivva min’. Tint as gurt is T’ Rangers Tom, gi’ T’ Rangers thy brass”. “Ok then”. Sez our Tom. “I will”. Sa you see, even t’ biggest actor int’ world nos orl abaht T’ Rangers. ‘e nivva gev uz ‘is numba thoa, bur ah’m sure ‘e will be i’ touch soon. ‘n ah’m sure ‘e will be geein orl o’ ‘is millions teur T’ Rangers.

    Meetin our Tom wor girt, bur it wor nowt compared ta whoa we met t’ next day when we wor i’ Washington DC. Ah wor takin pictures o’ fa’ lad infront o’ t’ Whi’ ‘ouse, when tha’il nivva guess whoa walked by. President Obama. ‘n ah saw T’ President, ah sez “ayup Barack, jont ta buy shares i’ world famous football team T’ Rangers?”. ‘e sez, “Sure why ivva not Charles, ‘n ahl sen’ o’a Air Force ‘un for you ‘n t’ team ta use ta fly ta thy games i'”. “Geez!” Ah sez, “Really Barack lad?”. ‘e sez, “Sure Charles you ‘n T’ Rangers are mooar important than ahl ivva be. It is onny reet you fly i’ fi’ star luxury”. Sa you see, even t’ leada o’ t’ free world loves T’ Rangers. Ah tried ta gerr ‘is numba, bur t’ gurt men i’ suits pulled me ‘n fa’ lad back, then thee broke our camereur. Oh well, ah’m sure Barak will be flyin o’a soon, ta drop off t’ Air Force ‘un, ‘n buy ‘is shares.

  22. Paul, Glasgow

    Your article explains why Green had lunch with Whyte in the Savoy Hotel when he was in London. He must be one of the potential investors that Green is talking about, but he will not get as many shares for his £1 this time! Spotted by a very reliable source.

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