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The situation with shareholder loans is sustainable until we run out of shareholders willing to finance this. None of the shareholders are providing these loans expecting some kind of return - they know their shares are being devalued. However, at the moment, there appears to be plenty of fans willing to do this so it's not a problem until they say it is.
Also, if another club were to do this I doubt Rangers and Celtic fans would be screaming about financial fair play. Mostly because those rules don't apply to the SPFL. As I've said plenty of times before, I would welcome a more competitive league where every draw doesn't feel like an apocalypse.
Rangers and Celtic are never going to match teams in the CL for finance. Both clubs know this. It's not their aim.
Isnt this exactly the same situation as with the old club?

Rich guy(s) buy club. Plow money into club chasing success. Money runs out and club left saddled with mounting debts and owner(s) desperate to sell club to anyone.

Surely repeating the same strategy is not a good idea.

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1 minute ago, RedLichtie86 said:

Isnt this exactly the same situation as with the old club?

Rich guy(s) buy club. Plow money into club chasing success. Money runs out and club left saddled with mounting debts and owner(s) desperate to sell club to anyone.

Surely repeating the same strategy is not a good idea.

No.

David Murray only once converted his loans into shares, in 2006 (I think).

Murray had no need to convert loans into shares, because he already had majority control over the club with something like 80% of the shares. So the loans stayed as loans and were added to the balance sheet. When the Great Recession hit, the bank effectively took over the running of Murray's holding company MIH, and wanted these loans paid back during the second Smith era. HBOS had even less need for new shares than Murray did.

The difference this time is the loans being converted into shares. This means Rangers have no debt, so such a scenario cannot take place. The other difference is instead of one majority shareholder who's vulnerable to shocks, the ownership is made up of several HNWI, spreading the cost and minimising the risk.

Money is only being plowed into the Club until it reaches the same position as Celtic - where it needs to sell a player each year or reach the CL groups to break even. Once it does this, it will be self-sustainable. Had either COVID not hit or Morelos had been sold, there likely would have been no rights issue because there would be no need for one.

There's an argument to be made that the Club currently is self sustainable and that the share issues are ultimately paying transfer fees, but realistically a club like Rangers is going to pay transfer fees to secure players. It's an investment.

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No need to capitalise 'club'. We understand what you are referring to.

It's an ethereal being with no legal existence, right?

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That’s us above Ukraine. We’ll be doing very well to hold that though. 

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5 hours ago, Ranaldo Bairn said:

No need to capitalise 'club'. We understand what you are referring to.

It's an ethereal being with no legal existence, right?

quote me next time you little bitch

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6 hours ago, G51 said:

No.

David Murray only once converted his loans into shares, in 2006 (I think).

Murray had no need to convert loans into shares, because he already had majority control over the club with something like 80% of the shares. So the loans stayed as loans and were added to the balance sheet. When the Great Recession hit, the bank effectively took over the running of Murray's holding company MIH, and wanted these loans paid back during the second Smith era. HBOS had even less need for new shares than Murray did.

The difference this time is the loans being converted into shares. This means Rangers have no debt, so such a scenario cannot take place. The other difference is instead of one majority shareholder who's vulnerable to shocks, the ownership is made up of several HNWI, spreading the cost and minimising the risk.

Money is only being plowed into the Club until it reaches the same position as Celtic - where it needs to sell a player each year or reach the CL groups to break even. Once it does this, it will be self-sustainable. Had either COVID not hit or Morelos had been sold, there likely would have been no rights issue because there would be no need for one.

There's an argument to be made that the Club currently is self sustainable and that the share issues are ultimately paying transfer fees, but realistically a club like Rangers is going to pay transfer fees to secure players. It's an investment.

You just got another €1.5 million for the win today, so that should help.

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4 minutes ago, AmericanFan said:

You just got another €1.5 million for the win today, so that should help.

Thought it was €570,000 for a win mate? 

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14 minutes ago, TheGoon said:

That’s us above Ukraine. We’ll be doing very well to hold that though. 

Shakhtar are likely to get at least 3rd in their CL group, so either 5 bonus points for the CL last 16 or a better chance of results in the EL R32. Need Ferencvaros to beat Dynamo Kiev to 3rd in their CL group. Zorya Luhansk with 0 points so far but games against AEK Athens coming up.

Still, extended the gap to Turkey and Denmark, who are struggling to pick up points, so 12th is becoming more secure. Austria in 10th are 5 wins away.

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11 minutes ago, G51 said:

Thought it was €570,000 for a win mate? 

Whoops, my bad. Well, that's still a good haul. €1.14 million in a week is solid.

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6 minutes ago, AmericanFan said:

Whoops, my bad. Well, that's still a good haul. €1.14 million in a week is solid.

Aye, I wouldn’t mind that

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36 minutes ago, G51 said:

quote me next time you little bitch

😄

It was literally the post under yours, although it definitely seems to have touched a nerve.

Edited by Ranaldo Bairn

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On topic, good result for the Tic but could have been excellent. 

Rangers frankly astonishing Euro form continues. Fair play.

The crunch will come with 5 teams: more than likely there will be a down swing, although being in the Conf should hopefully ensure a few good early points.

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10 hours ago, G51 said:

No.

David Murray only once converted his loans into shares, in 2006 (I think).

Murray had no need to convert loans into shares, because he already had majority control over the club with something like 80% of the shares. So the loans stayed as loans and were added to the balance sheet. When the Great Recession hit, the bank effectively took over the running of Murray's holding company MIH, and wanted these loans paid back during the second Smith era. HBOS had even less need for new shares than Murray did.

The difference this time is the loans being converted into shares. This means Rangers have no debt, so such a scenario cannot take place. The other difference is instead of one majority shareholder who's vulnerable to shocks, the ownership is made up of several HNWI, spreading the cost and minimising the risk.

Money is only being plowed into the Club until it reaches the same position as Celtic - where it needs to sell a player each year or reach the CL groups to break even. Once it does this, it will be self-sustainable. Had either COVID not hit or Morelos had been sold, there likely would have been no rights issue because there would be no need for one.

There's an argument to be made that the Club currently is self sustainable and that the share issues are ultimately paying transfer fees, but realistically a club like Rangers is going to pay transfer fees to secure players. It's an investment.

Do you think the fans groups are happy with their share values being diluted all the time with the extra shares being created to dissolve the debts being run up? After all  it was ment to be a fan owned club but every season that ownership is getting further away? Or is it all about 10. Is that the be all and end all of the new club? 1 in a row is everything?

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6 hours ago, Spring Onion said:

Do you think the fans groups are happy with their share values being diluted all the time with the extra shares being created to dissolve the debts being run up? After all  it was ment to be a fan owned club but every season that ownership is getting further away? Or is it all about 10. Is that the be all and end all of the new club? 1 in a row is everything?

As a Club1872 member I can tell you my thoughts.

The initial goal of C1872 was to get to 25%+1, so that we could veto special resolutions. 50%+1 was the next step.

It's a long term process but yes, ideally C1872 would have been asked to participate in the share issues. But there is a huge amount of trust between the organisation and the fans who together hold a majority of the shares, so it's not a pressing issue. The long term goal continues.

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On 28/10/2020 at 07:52, G51 said:

We don’t really have financial issues, outside of the same ones every club is experiencing with COVID.

If we make a loss, then that is covered by the rich fans that own the club, who make soft loans that they convert into equity to ensure the club remains debt free. 

The Club is in more or less the same position as Celtic, with one key difference. Both clubs need to sell a player for a decent fee each year OR make the Champions League group stages in order to break even / be profitable. If Celtic don’t do that, then their losses are absorbed by their cash in the bank (€20m), if Rangers don’t do that then their losses are absorbed by the shareholder loans.

What the CL group stages would allow us to do is invest some of that money into expanding the stadium and other investments, which would improve our revenue base. The gap between our revenue and Celtics is closing, but a year of CL money would likely close that gap completely.

Surely the pockets of your rich fans are not bottomless ?

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8 hours ago, edinabear said:

Well done Sevco. Again bringing pride back to the Scottish game

Persevere

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12 minutes ago, ewan14 said:

Surely the pockets of your rich fans are not bottomless ?

I'm sure they're not. But the vast majority of the funding has already been injected, so I'd consider it very unlikely that would be a problem now.

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