Media, Scottish Football, Sevco

Emotional Investments

Good Evening.

When The Clumpany first read about ’emotional investment’ at Ibrox  today I initially assumed that there was a plan to bottle the tears of the “same club’s” stiffed creditors, sell them as souvenirs and plough the profits into Sevco…

But no.

The tale was actually much less inspired…

“Not everyone will see the benefit of financing Rangers* once again.”

Wow! What an extraordinary insight that is!

It was offered in an article in The Clumpany’s favourite attempted newspaper, and paraphrased some of the views of “football finance expert Ken Pattullo”.

Rangers will have to rely on emotional investment in any future share issue, says finance expert Pattullo

Seriously, there can’t be many less-impressive forms of words in the English language than ‘football finance expert’ ? I can only think of one, and that’s ‘football finance expert Neil Patey’.

I guess we should be thankful that we were spared the thoughts of Joe 90’s alter-ego on this occasion.

Joe 90

Neil Patey
However, Mr Pattullo did his best to amuse us with his thoughts on the prospects of investment being attracted into the Holding Company whose Engine Room Subsidiary operates Sevco FC.

My favourite quote was this one:

“The more money that can be brought in the better.”

That’s some level of expertise isn’t it?!

The rest of his observations were not much more illuminating:

“It is right to highlight the lack of retail revenue coming in and there have been various reports, both recently and further back, about how little that actually is and there is the well-publicised legal situation with Mike Ashley”

“The more money that can be brought in the better. At the end of the day, the investors there don’t have a bottomless pit of money. They will be keen to see other Rangers fans, and anyone who perhaps sees it as an investment, put more money into Rangers.

Realistically, it is probably in the main, if not entirely, going to come from Rangers fans. I don’t think many institutions out there will be looking at Rangers, at least not at the moment anyway, and thinking they are a worthwhile investment. I think the vast majority will come from people with leanings towards Rangers.”

“The share issue allows more people to invest money into Rangers and that would be a welcome boost to have other people there as well as the current board and investors.”

“There are lots of foreign investors coming in and pouring money into English football but you don’t see anything like that in Scottish football. That is a reflection of how highly regarded the Premier League is, but also how Scottish football is the opposite by comparison. It is seen as a worthwhile investment, while Scottish football just isn’t.”

“For the institutional shareholders, I think it is unlikely that they will want to pump more money into Rangers to maintain what their shareholding currently is.”

“If you look at the balance sheet of Celtic, it is very healthy at the moment. They have had a long time without Rangers being there and competing with them. Rangers are now back but even the most hard core fan would say they are not near the level of Celtic at the moment.

“It will take a bit of time to get back to the level where Rangers fans think they ought to be and genuinely challenging Celtic at the top of Scottish football.”

Mr Pattullo’s analysis and the accompanying commentary from the Evening Shark-Jump certainly appeared rather flawed.

It didn’t actually consider the underpinning fundamentals which are likely to influence the decision-making of anyone with serious money to potentially and dispassionately invest in Sevco. Minor things such as whether its cost base, debts, and capital expenditure requirements are far too high for its revenues, whether there might be any money to be made, and whether [*gasp*] some sort of cost-cutting might be a good idea.

The assessment is based around an irrelevant notion that because Sevco play in Scotland they won’t be as attractive to investors as an English club, and the fatally flawed assumption that Sevco is Rangers  FC.

The Rangers which used to spend vast quantities of (sometimes) other people’s money in an utterly unsustainable way.

The Rangers which ‘acquired’ lots of trophies and thereby created an ingrained expectation amongst its fans and cheerleaders that it should (almost by default) be at the top of Scottish football.

This was of course the Rangers which drove itself off a financial cliff to a horrible liquidated end. But that doesn’t seem to have registered with Pattullo and the Evening Shark-Jump. It’s all about Sevco getting money so that some sort of ‘expected’ position in the game can be attained. And damn the idea of sustainability and the possible consequences.

What we are left with is an analysis which concludes that only those with an emotional leaning towards Ibrox clubs are likely to ‘invest’ at the present time. Perhaps on a heart-ruling-the-head or ‘throwing good money after bad’ basis.

Hmmm. Irrational folk pumping money into an unsustainable operation which pretends to be something that is gone forever, and which left 276 disgruntled creditors behind.

That sounds like a winning formula to me!