Billy Get Your Guns

under-the-gune-texas-holdem-regoleToday, Dave King is firmly in the crosshairs of Mike Ashley and his team, as the Sevco AGM looms on the horizon.

Earlier in the week, the South African blusterer, known in his adopted homeland as “a glib and shameless liar” conducted his orchestra at Ibrox for the delectation of the Scottish sporting press, where softball questions were met with vague answers.

All of this was lapped up, enjoyably, by a media which confirms, as if we didn’t know, that they simply don’t have a clue.

Today, a real PR operation, as opposed to one run by discredited ex-hacks and Rangers employees, showed them not only to how ask real questions but how public relations is really done.

An early morning press release, and the leaking of limited materials relating to a forthcoming announcement, guaranteed that most of the media would have to open this morning with stories trailing certain aspects of Ashley’s planned statement.

Having done that, they now have no choice but to run all of it, and it puts things in language so blunt that only the bloggers, thus far, have written stronger condemnation.

Even the most basic reading of that statement should draw gasps.

It is a masterpiece of veiled threat and exposes the weaknesses of King and his board’s position.

King, you see, has been feted as something special in these parts for far too long.

Perhaps he had started to believe his own press releases. (Few neutral observers do.)

But he has forgotten the most fundamental principle of combat; never bring a knife to a gunfight.

Pulling a switchblade and waving it menacingly might work on the SFA … it cuts no slack at all with a man who has the resources to buy and sell this whole shower of pretenders ten times over, and who could probably have the club, or the company, or whatever it’s calling itself today, in front of the courts come Friday tea time.

The bottom line is this; whilst King and his people are standing there holding their cheap flick knives and knuckle dusters, Ashley has drawn his guns. And they are loaded.

He has told the world, in no uncertain terms, that Friday’s EGM is a high stakes game, and he is declaring, quite openly, that he doesn’t thing King has the cards.

He’s also showing some of his own … and if I were in the South African’s golf shoes, I might be shaking in them, and not just a little bit.

The line being trailed in the media is MASH’s assertion that “we are not a bank”.

Quite right too, but they aren’t reading between the lines. This is a not too subtle way of saying “this isn’t a staggered agreement … this is payment on demand, and you just got the demand.”

But the statement covers more than that. Let’s look at it in detail.

Introduction:

As you will know MASH has requisitioned a general meeting of shareholders of Rangers International Football Club Plc (Rangers Plc) to be held as it considers that there are various matters that are of importance both to Rangers Plc and its group companies and to its shareholders, that should be discussed with the new Board of Rangers PLC (the New Board). Some of those matters are clear from the various questions set out in the Notice of General Meeting dated 26 May 2015, but MASH thought that it would be helpful, after consulting with Sports Direct, to provide some further background and context as follows:

Fairly straightforward stuff that part … except that it’s a clear appeal for those not on the board to study carefully what’s about to be said.

Because this is the meat on the bones.

The next section covers one of the reasons for the request.

Delisting from AIM:

MASH was surprised and concerned as to the speed with which, following the general meeting held on 6 March 2015, Rangers Plc was delisted from AIM.

MASH had relied upon Mr. David King’s various public statements that that there was a NOMAD willing to come in to act for Rangers Plc (subject to the customary checks). Clearly, at some stage in the NOMAD appointment process, it became clear to the New Board that the potential NOMAD was not satisfied with its investigations of Rangers Plc.

The key question is when exactly did this happen and what steps did the New Board take as part of normal contingency planning to consider alternative NOMADs and engage with the AIM Regulator so as to ensure that the AIM listing was preserved?

Crucially, did the New Board leave it all to the very last minute and were then left with no viable alternative?

He’s asking, in essence, is this board clueless or did they just not care?

He’s asking if they were being honest, and simply dropped the ball, or did they deliberately lie to the shareholders and the fans?

For those who’ve been waiting to read a devastating piece of bluntness from someone outside the blogosphere, in relation to King and his “fit and proper person” status, well, look no further than here.

This is the part of the statement that, but for the closer, would be making all the headlines tonight.

The consequence of what happened is that Rangers Plc no longer has a public listing, nor is it subject to the AIM regulatory rules which is all the more important in circumstances where the new Chairman of the New Board has, as is a matter of public record, been prosecuted for and admitted liability in respect of various criminal offences in South Africa, resulting in the payment then of approximately £44 million to cover liabilities and fines in South Africa.

That’s putting as boldly as it is possible to do, with no obfuscation or sugar coating.

MASH has just said “Your new chairman is a criminal. That’s why the City of London won’t touch your company with a twenty foot pole and why it’s important that these questions need to be answered. Because with no oversight this guy could do God knows what.”

What the statement doesn’t say is that “transparency” was one of the things King was supposed to bring to the table.

That, like much else, has already fallen by the wayside.

The next section covers Rangers Retail, and there are a few gems in here too.

Rangers Retail Limited Joint Venture (Rangers Retail):

Whilst the contractual arrangements relating to the Rangers Retail joint venture are covered by confidentiality provisions, there are some matters that are non-confidential:

1. The relevant time, it would not have made commercial sense for RFC to finance its own retail operation, nor did it have all the necessary retailing expertise to do so. It recognised that its expertise should lie in the running of a football club, not in the running of a retail organisation.

In other words, stick to what you’re good at. Which is allegedly football. (No laughing at the back, alright? This is serious!)

2. RFC chose to partner with the most successful sports retailer in the UK market. Sports Direct has proven retail prowess, significant buying power and a far reaching distribution network.

In short, we are experts. You know it, and we know it.

3. Prior to entering into the Sports Direct joint venture, it is understood that RFC had entered into a 10 year joint venture with JJB Sports as its retail partner.

Which is a thinly veiled dig at King and Murray, who were on the board which signed that ludicrous deal with a company that subsequently went bankrupt, with the loss of thousands of jobs. It now trades as a retail arm of Sports Direct.

4. RFC benefits not only from goods and merchandise sold in the Ibrox Megastore and online, but also from sales of Rangers goods and merchandise sold in Sports Direct retail stores and on the Sports Direct website.

Their way of saying “you get a good deal here, so why are you bitching?”

Sports Direct notes from the recent voting advice statement issued by the new Board on 3 June 2015 that the New Board are saying that there has been: “a continued and dramatic reduction in income generated by retail operations”.

Sports Direct is of the opinion that there is no basis for this statement whatsoever, and invites the New Board (subject to complying with confidentiality obligations) to explain in detail the facts behind this statement.

This is a response to that part of Sevco’s statement last week, but it’s also a response to King’s barmy assertion yesterday that the club, and Sports Direct, are losing money out of the deal.

The club might be squealing like pigs, but Ashley is saying “things are just tickety-boo from where I am sitting.”

Therefore, he’s saying “I see no need to change anything.”

So much for getting him to re-negotiate the contracts. Not going to happen.

Sports Direct remains of the view that profits can be increased at Rangers Retail through more focused budgeting and ordering of products and that the historic profitability of Rangers Retail has been badly affected by the over ordering of products in the past and the opening of additional retail stores outside of the Ibrox Stadium.

I guess this is what comes of ordering half a million shirts on the back of a supremacy complex and expecting them to go like fairy cakes at a kid’s party.

In Sports Direct’s experience, the ordering of products should reflect the football league in which RFC operates and standalone stores outside of the main stadium are rarely profitable.

Oooft. Sore.

This is their way of asking who was the genius who thought a second tier team in Scotland ought to be outselling Inter Milan and Manchester City in merchandise? It also puts the kibosh on those big plans for a Shankhill Road shop.

Aww. Shame that.

It should not be forgotten that at the end of the day, Sports Direct is not a bank, it is a supportive business partner and it entered into £10 million loan facility with RFC on the basis of providing much needed financial support at the relevant time.

As has previously been announced, this loan facility was entered into together with other contractual documents to bolster that joint venture relationship, but it was always drawn on the basis, at least as far as Sports Direct is concerned, of being a short term loan facility that RFC would be incentivised to repay and restore its shareholding in Rangers Retail back to what it had previously been.

Purely and simply, this is the section that says “you had a short term loan on the basis of pay-on-demand … well, fella, this is the demand.”

Newsworthy, and this is why Ashley let this section leak to the media this morning, knowing they’d run with it, knowing too that it would force them to print the rest of the statement in due course.

That is why if, nevertheless the New Board and the shareholders of Rangers Plc believe that the current shareholding in Rangers Retail of 75% Sports Direct and 25% RFC is too generous to Sports Direct, then the solution is simple.

RFC is fully entitled at any time to repay the current £5 million loan to Sports Direct and revert back to the prior shareholding in Rangers Retail of 51% RFC and 49% Sports Direct.

This is MASH telling them that “if you don’t like the arrangement, then let’s end it.”

The mechanism for doing so is quite clear.

He’s talking to the Sevco fans, and the small shareholders. He’s saying “if your man King really wants rid of us, he only has to reach for the chequebook.” And although it’s not expressed, he’s asking them to read between the lines and ask why King won’t.

But it’s this bit that lays out, to the Sevco supporters, precisely what’s up for grabs, and what the real nature of that £5 million loan is.

This would also result in the release of security over: (i) the Rangers’ brands owned by RFC; (ii) the Murray Park training ground; (iii) the Albion Street car park; and (iv) Edmiston House; and also release RFC from the current restrictions preventing it from being able to provide security over the Ibrox stadium without the prior consent of Sports Direct.

So there we have it then; all the cards are showing.

In poker terms we’ve got the Ten of Spades, which is the Sevco branding.

We have The Devil himself, the old Jack of Spades, which is Murray Park.

We have The Bitch, (in Hearts anyway) the Queen of Spades, which is the Albion Street Carpark.

And we have the King of Spades, the Man in Black, which is Edmiston House.

All these cards, they were face up on the table before today.

But in Five Card Stud, you play with four cards face up, and one card “in the hole”, a hidden card, the one your rival across the table gambles on, the basis of the game’s reputation as one to induce night sweats.

You’re not obliged to show your hole card until the heads up … but Ashley, for the first time, is revealing his, and it’s not a great surprise to note that he’s been holding the Ace of Spades all along; some kind of security over Ibrox, which really means his grip over Sevco is like iron.

This point goes to the heart of the proposed Sports Direct resolution, RFC has the ability to equalise the profit arrangements at Rangers Retail and release itself from security provisions; that is entirely a decision for RFC to take.

He’s saying to King, “This is what I’ve got. I’m sitting on a Royal Flush, little man … now let’s see the colour of your money.”

In poker terms, King is done for of course, and this makes that quite clear.

But Ashley, knowing King is a desperate man, and remembering that there’s an old Western aphorism, that you can still beat a straight flush with a Smith and Wesson, knows that doesn’t necessarily mean that the game is over.

So aside from putting his cards on the table he’s also drawn his six-shooters.

King, unfortunately for Sevco, has already demonstrated his own lack of firepower by backing down on key resolutions and trying to bluster his way through this week’s shambles of a press conference.

I’m struggling not to laugh here.

Friday is going to be very, very interesting.

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Comments on Billy Get Your Guns

  • sam stone

    I like Mr Ashley, he is a very nice man. I hope he has a nasty side.

  • Veritas

    James,
    I suspect you are absolutely right and you still yet may be wrong but you know what? That is a superb dissection and analysis of that MASH release .
    And done i in short order . outstanding!
    You put our media to complete shame .
    it is a real pity that you are probably viewed as a crazy out there CFC type ..because your input here is top drawer and every single RFC fan should read this
    Btw do you happen to drink in the same pub as that Ninjaman guy?

  • http://tiscali Johncampbell Johncampbell

    Superb blog again James the cowboys are surrounded by big Mikes indians

  • Bill Morrison

    Personally I think DCK has 2 pairs in his hand; Aces and Eights! (http://tinyurl.com/yv6gz8)

  • dixie dean

    Very impressive dissection of the statement.

  • DavieL

    James

    Try High Court tomorrow! Looks like he’s ring fencing the £5m! They really shouldn’t piss this guy off – he’ll end up liquidating them for sport!

    DavieL

  • Gerry Sweeney

    How can Ashley demand the loan be repaid when he can only demand payment f Rangers use the second £5m of the £10 he loaned them. Isn\’t it a fact that as long as they don\’t touch that £5m then he can\’t demand payment?

  • jas

    I’m not struggling not to laugh,haw haw haw, GIRFUY ya scummy institution

  • Harry Mclintock

    Another brilliant piece James..I think it would be in the interests of all decent sevco fans to read your blogs..they would get a proper insight into the shenanigans that is inflicting their club instead of the mince which is fed to them..

  • Coco

    in a previous blog you said you believed MASH probably still had the first £1.00 profit he had made. I would not doubt that, but I also have a sneaky suspicion he knows exactly how much each of the RRM have in their bank accounts.

  • Tiercel

    I\’m no expert, but surely the glib & shameless has failed in his primary duty as a company chairman. Ie, that of looking after the interests of the shareholders. He\’s rendered their shares worthless & untradable, overnight. Yet bizarrely he\’s stated his intention to initiate another share issue. How can an unlisted, or rather de-listed compant possibly trade shares?

    How this chancer has been deemed to be \”a fit & propper person\”, by the SFA, is a mystery. It\’s like Harold Shipman being re-granted a license to practice medicine.

  • Monti

    This is funny, it’s just funny!

    Bowl.Anyone?

  • thomas cochrane

    A great piece up to your usual high standards,I,v read some blogs from the other side.Well well ! they,r not nearly as concise or truthful as here,true that may be expected.Question is why don,t these other guys demand the truth of their bloggers ?………Oh wait succulent lamb comes to mind,they may all be addicted to it as well as bawbaggery and wearapeepilness !.Oh dear how sad too bad !………

  • dixie dean

    @harry Unfortunately, if you look at the facebook page https://www.facebook.com/davekingloyal?fref=ts

    it would appear sevco fans are more interested in listing their fave loyalist songs.
    i.e. on 10/06/15 @ 3.51 the admin of the page posted the M.A statement.
    @4.21 same day the admin posted ” What’s everyones fave Loyalist song?” which received 45 comments as opposed to the MA post which received less than 10.

  • joe mccormack

    Lets assume Rangers agree fees for Ciftci and Allan, say £1.5m and £1m respectively.

    Payment terms anyone?

    Terms Mr King……..are you jesting. You are a convicted felon who is also refusing to pay back a loan from a major shareholder.

    Terms……100% up front, end of.

    Wonder if they have made allowances for that in their financial planning?

  • ROSCOBHOY

    Great read as usual,tried to give a donation there James don\’t know what happened with it il try again & keep up the good work hh

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