Rangers will keep losing money until we’re in Champions League, says King
Dave King describes himself as the “Bank of first resort” for Rangers. Since leading the takeover of the Ibrox club just over three years ago, he estimates his personal commitment to it at north of £30 million.
Scepticism of King’s stewardship of Rangers and the manner in which it is financed is never difficult to find. The club posted a loss of £6.7m last year with interest-free loans from King and other investors, which he freely admits will never be repaid, leaving a debt of almost £16m.
As the club continue to willingly run at a deficit, King says he has also personally provided cash guarantees to the Scottish FA and Uefa of Rangers’ ability to operate in compliance with their licensing regulations next season.
As it stands, rumours of fresh external investment in the club remain unfounded. King confirmed as much at a media briefing at Ibrox, three days after the high-profile appointment of Steven Gerrard as the club’s new manager, at which plans for a £6m share issue next month were revealed.
Gerrard, having committed himself to a four-year contract, is clearly content with the assurances he has been provided of backing in the transfer market. As far as King is concerned, doubts regularly expressed from elsewhere about the financial policy of Rangers are without substance.
“If anyone looks at what we have done over the past couple of years, we have been completely consistent,” insisted King.
“I don’t think there is a single thing we said we’d do that we haven’t done. There have been accusations of not putting money in. We have put in a lot more than we said we would put in.
“We continue to do the right things. The strategies have been clear. There is a preference for the media and a very small group of supporters to debate these things in public. We are not going to do that.
“I look at where we are
0 Steven Gerrard will take over the reins at Ibrox next month. and certainly off the pitch there’s been huge progress. We wouldn’t have got Steven Gerrard if there wasn’t huge progress off the pitch. The area where it’s not working well is on the pitch. That’s something we have to deal with. We have made managerial appointments that didn’t work out, but what do you do? We were under pressure to make an appointment this time and didn’t see an immediate appointment we felt was appropriate so we waited for months.
“We think that was the right thing to do and it’s been justified with the appointment that we’ve made. It would have been difficult if it wasn’t but you make your decision and you have to see it through. And we remain very, very consistent with what we’re going to do with the club.
“We will come back, we will win titles. There are setbacks, of course, but it’s our job as a board to deal with the setbacks and not be overly influenced by the noise level coming from the media and small minority of supporters who are just vociferous on these issues.
“I mean, if we got to the Champions League final and lost it we’d be criticised for lack of ambition for not winning it. It’s the way supporters are but we are realistic from the board’s point of view and carrying on, despite the setbacks we’ve had. We analyse it and keep moving on.
“One of the factors involved is getting our licence and because we run a deficit deliberately, we’ve always got to satisfy the licensing authorities – the SFA and Uefa – that we have sufficient funds to fund our deficit. We’ve already had to give cash guarantees in advance of next season. Whether we raise money from the rights issue or not, I’m in for the money because right now I’m underpinning the cash.
“If there wasn’t a rights issue, my money would go into the club. If there is a rights issue, less of my mine will go in. The club is fully funded for the next season. Every single club goes through the same process and, I repeat, because we are consciously and deliberately running at a loss, you’ve got to let the authorities know that you can fund the loss.
“We are not going to run it to make a profit in the foreseeable future. I would expect us only to start making a profit when we are back playing Champions League. Until that point, I think we are going to have to continue funding the deficit every single year.
“Basically we’re in a situation where I am saying ‘if we really have to do something and there’s a setback and we need money then I’m underpinning it’. I am in that position where I can at least provide the cash guarantees that I have to. But
I’m doing it on the hope that it’s not drawn on. That’s my preference, I’d rather other people put the money in right now to at least make progress. But I’m the bank of first resort, hopefully not last resort.”
Rangers obtained a credit facility of £3m with merchant bank Close Brothers earlier this year, secured against the Edmiston House property and Albion car park at Ibrox.
“It’s our single greatest achievement since coming into the club,” claims King. “That was huge for this club, that we could actually go into the marketplace and finally get a third party to give us that facility. That was enormous for the normalisation of this club.”
King remains in conflict with the Takeover Panel, having lost a legal battle against their ruling he acted in concert with fellow investors when assuming control at Rangers in March 2015.
An offer of 20p a share to other shareholders must now be made but King is seeking an extension to the deadline as he transfers the required funding proof of around £11m from South Africa to the UK.
“I could make it easier maybe in some ways but I think they’ve got it wrong,” said King. “They’ve tried to bully me. The Takeover Panel have been bullies. You can’t ask me to do it, get my acceptance to do it and not give me the extension to comply. That’s absurd.
“It (the share offer) has no chance of being accepted. The offer is a technical thing that I have to do to comply with and I am doing my best to do it within the circumstances we have got. At the end of the day, it will mean nothing. It will not happen. It is a process we have to go through. It has absolutely no effect on the football club, it is an irrelevance.”
Last week there was upheaval in the Rangers boardroom with the resignation of two directors, Hong Kong-based businessman Barry Scott – who only joined the board in December – and Paul Murray, who assisted King in his takeover of the club.
“Barry is going through a personal situation with his businesses and bits and pieces where he feels he can’t give his time and attention to the club and he needs time to look at his own affairs,” said King.
“Paul, I don’t actually know why he resigned and you are probably better finding out from Paul. His resignation was a surprise to me. I just got an email saying he was going to resign. It was a surprise, the timing was a surprise to me. I actually saw Paul on Saturday night, I was at dinner when he came into the restaurant, but it wasn’t the environment where I could really chat to him about where he was coming from.
“Having said that, I completely understand it. Being a Rangers director is not fun and there is a pressure on those in Glasgow in particular. There is a strain and stress and perhaps he has just had enough.”
Rumours have continued to circulate of a possible return to Rangers as an investor of former chairman and owner Sir David Murray but that was nipped curtly in the bud by King.
“Zero per cent chance of that happening would be a bit on the high side,” he said. “It’s more than unlikely.”