‘Ashley’s way or highway’ as King steps up Ibrox pressure
Newcastle United Supporters Trust board member doubts Rangers can overturn Sports Direct contract
RANGERS were last night warned they have virtually no chance of reaching an amicable agreement with Mike Ashley and Sports Direct over their “onerous” seven-year merchandising contract.
Dave King, the Rangers chairman, issued a strongly worded statement following a board meeting at Ibrox on Tuesday accusing Sports Direct of “poor business practices” and “corporate governance failures”.
King, who assumed control at the Championship club following the EGM he requisitioned back in March, also vowed the sports goods company will be “held accountable legally and financially”.
The previous regime at Ibrox agreed to a long-term deal which the Rangers Supporters Trust has calculated nets the Glasgow club only 75p for every £10 which is spent.
That situation has led to widespread unhappiness among the Rangers support and to large numbers of disgruntled fans refusing to buy replica jerseys and official club products.
King and his associates have been unable to arrive at a compromise with Sports Direct – despite vowing to greatly increase the number of strips the nationwide chain of stores sells if they do – at a series of meetings since seizing power.
Michael Martin, a board member at the Newcastle United Supporters Trust and the editor of the True Faith fanzine, is highly doubtful Rangers will be able to negotiate with the enigmatic billionaire in the future.
“I desperately hope that Rangers supporters get a hold of their club and get to run it the way they want to run it,” said Martin. “But I would be staggered if Rangers made any headway in changing the deal.
“You would think that he (Ashley) would want to keep supporters onside so they buy his products. He isn’t even interested in keeping his own shareholders at Sports Direct onside. That is his character. His policy seems to be ‘my way or the highway’.
“I think it will come down to whoever blinks first with the legal bills; Sports Direct or Rangers. But he has got unlimited funds to fight those actions whereas Rangers are desperate for commercial income so they can compete with Celtic again.
“The thing is, for the amount of money involved at Rangers, it is quite small in the scale of his fortune. This guy is making his money out of sport, but seems to hate the nature of it.”
An almost identical situation exists at Newcastle United, the struggling English Premier League club which Ashley owns, to the one at Rangers.
Newcastle supporters are deeply unhappy with the terms of a commercial deal about which few details are known publicly and are refusing to endorse official club merchandise in the same high numbers as they did in the past.
“During Ashley’s tenure as Newcastle owner our commercial income has fallen year on year,” said Martin. “It has risen in the last couple of years because of the controversial shirt sponsorship deal he has done with Wonga.com. But that has subsequently led to a huge drop in the amount of merchandise they sell.
“I have been going to St James’ Park more times than I care to mention and I live on Tyneside. Ten years ago, every third person had a Newcastle United strip on. Now they’re not so popular. I would put that down to the deal with Wonga.com.
“In terms of the merchandising, there is an online deal with a company which has been set up called NUFCDirect.com. That is run from Shirebrook where Sports Direct’s headquarters are. Because Newcastle United isn’t a public limited company we can’t really find out who gets what.
“We are shy of detail on that. The managing director, Lee Charnley, has said that it’s a great deal for Newcastle. But he would say that wouldn’t he?”
Martin added: “St James’ Park is absolutely plastered with Sports Direct advertising. It is all over the training ground as well. Anywhere there might be a photograph or a camera rolling.
“For all of that, Newcastle United gets the princely sum of absolutely nothing. He gets free advertising across the country, possibly across the world because the Premier League is the most watched league in the world.
“It has to be noted that he does have quite a large (£129 million) loan to Newcastle which is interest free. The club claim that the free advertising he gets is offset by the lack of interest payments. But that isn’t the act of somebody who wants to build up a football club is it?”
The widespread disillusionment with how Newcastle is being run and the falling revenue from merchandising hasn’t, however, resulted in Ashley or Sports Direct amending their business plan or acting with transparency.
“We are banging our heads against a brick wall,” said Martin. “The Newcastle United Supporters Trust is one of the few members-only fan groups. It is very well organised and very well connected.
“The reason why he is hanging on to the club is because of the TV deals. The value of Newcastle United increases every time one of these deals is struck. He has got an asset that is appreciating in value. All he needs to do is keep it in the Premier League.
“He wants players to come into the club who can be given a polish, put in the shop window and sold. That seems to be the policy. There isn’t a manager. There is just a guy who trains the players as they come in and go out. To all intents and purposes it isn’t a football club.
“Rangers are in a better position than Newcastle because he doesn’t have control and he can be fought.”
This guy is making his money out of sport, but seems to hate the nature of it