SARS prepares King for Rangers battle

DAVE King, South Africa’s most famous Scottish import after single malt, can’t seem to stay out of the headlines.

You might think that after paying a giddying R706-million to make his tax headache go away last September, King would be keen to stay out of the public eye. But then the 58-year old son of a Scottish policeman, who arrived in South Africa with R170 in his pocket in 1976, never has shied away from the spotlight.

Back in 1997, King listed Specialised Outsourcing on the JSE. Over the next few years, King’s trust discreetly sold its 70% share, pocketing R1.2-billion.

When news that King had sold his shares emerged, the stock tanked. Asset managers such as Old Mutual were livid.

But it was SARS’s efforts to wrestle tax on these profits from King that sparked a decade-long tussle that ended only last year.

It seems King’s taste for a good scrap has not waned. Unless you have followed the UK press closely, you will have missed an intriguing tussle between King and the Rangers football club chairman, David Somers.

King was previously a director of the club, and sank £20-million into the enterprise — cash which he then lost.

Fresh from donating R706-million to this country’s tax coffers, King says he has now prepared to sink another £30-million into the unprofitable Rangers.

At least that £30-million will go to noble pursuits — like enabling Rangers to buy enough players to compete with Scottish champions Celtic — rather than financing a R246-million holiday home for the president.

The Daily Mail quoted King as saying: “My view of what it will take to make Rangers competitive again is bottom-end £30-million, but probably £50-million . . . I would probably have to put in £30-million of the £50-million”.

The easiest way for Rangers to secure this would be to issue new shares. That would put King in pole position.

But what has most caught the eye is King’s aggressive boardroom strategy, tactics probably fine-tuned over the past 10 years battling Pravin Gordhan.

So for a start, King urged Rangers supporters not to renew their season tickets, but rather to deposit their cash into a trust fund until the club has become financially transparent.

“The board has previously [given] categorical assurances that there was sufficient funding until the end of the season. We now know that these assurances were untrue,” he said.

Instead, “emergency financing has been put in place on terms that are not commercial”.

Now it is no lie that Rangers is in dire straits. After listing on London’s AIM exchange in 2012 and raising £22-million, its stock has plunged 58%. This week, Rangers revealed a £3.5-million loss for the seven months to December and that it had to borrow cash from one of its biggest shareholders at what equates to a punishing 30% interest rate.

Rangers, it seems, is taken aback by King’s tactics. Rangers chairman Somers has described his statements as “astonishing”, and challenged him to explain.

“These statements and innuendos are very damaging to the club, which we can only assume is your intention,” he said.

This week, the Daily Mail reported King as saying: “The SARS business was a huge burden, one that has finally been removed. It was onerous, very onerous given the extended time and the tying up of most of my capital.”

It’s a battle that may yet have further repercussions for King.

The paper said King’s having pleaded guilty to breaking South African law raised questions about whether he would pass the Scottish Football Association “fit and proper person” test presumably needed for him to return to the Rangers boardroom.

Although King said he was “certain” he would pass the test, the body’s CEO, Stewart Regan, said last year it would be “premature” to pronounce on this.

You would have to say that if King could thwart the might of SARS, and sidestep the lesser National Prosecuting Authority, with little more than a bloody nose, you would be wise to put money on him outmanoeuvering the Rangers board.