Planet Football
The latest edition of Private Eye, the UK's best and only fortnightly satirical magazine, has an interesting piece on the finances of Rangers Football Club.
Seems like the original directors - including one Charles Green - who brought the club out of bankruptcy made a huge financial killing whereas the ordinary fans paid through the nose for their shares.
Football is crazy, right enough.
PLANET FOOTBALL
Rangers
One of the great mysteries almost a year ago was why institutional investors backed the flotation of the Glasgow club with £17 million when it emerged from administration.
Artemis Investment Management, Cazenove Capital Management, Legal & General Investment Management and Insight Investment Management all took stakes of 3-7 percent, buying 1.9 million - 4.3 million shares at 70 pence a pop. Along with unit trust clients of Malborough Fund Managers, who were put in for just under 5 million shares, institutions acquired a total of 42 percent of the club.
Today the shares are 48.5 pence, having been as low as 41 pence. But these masters of the investment universe have been strangely silent.
The share price collapse is not surprising, as all but one of the directors at the time of the flotation have resigned - as have some who joined since, such as chief executive Craig Mather, who left two weeks ago. Now there are only two directors. Furthermore, Rangers are on their third nominated adviser. Cenkos, who floated the club on AIM, left in July, and then Strand Hanson lasted only until the beginning of October, to be replaced by brokers Daniel Stewart.
Former chairman Charles Green and his broker Imran Ahmad, who helped him put together the flotation, have both been big sellers. Green had 5 million shares and Ahmad 2.2 million at the time of the flotation, which they may have paid as little as 1 penny. Both now have less than 3 percent, or 1.8 million shares - or none at all. There was a six-month lock, or 12 months for directors, but Green was not a director when his stake went below 3 percent in September.
Director Alexander "Sandy" Easdale, who was not on the original board, now owns or controls the votes of almost 24 percent of the shares, having acquired support from two major offshore owners whose true beneficial identity was not disclosed in the prospectus.
Meanwhile, some shareholders are seeking to have a new slate of directors elected - a move resisted by the club. Perhaps it is time L&G, usually a champion of intervention over poor performance or behaviour, and the other institutions pressured the AIM authorities at the London Stock Exchange to step in and enforce something more resembling good governance for a public company.
'Slicker'
