Generic Sevco / Rangers meltdown thread

[PatHead]

Received the following email from Octopus today

We felt it appropriate to provide another update to the adviser community regarding Ticketus – one of the companies Octopus Protected EIS invests into – and the Rangers deal. The level of detail we can go into here is limited by the confidentiality clauses in the various Ticketus contracts and the ongoing administration process, but we’ll continue to provide updates when we can. The statement made last Friday explained that Ticketus has purchased tickets for Glasgow Rangers games for a number of seasons in advance, as it has done for a number of years previously with the club. The current deal between Ticketus and Rangers was closed on 9 May 2011, several days after Craig Whyte purchased the club. To clarify, the funds paid by Ticketus were not a loan in any way either to Craig Whyte or Rangers, they were for the sole purpose of purchasing tickets from the then legal owners of the club.Extensive due diligence is performed on counterparties in every deal, and numerous potential scenarios are modelled and prepared for in the way the deal is structured. But as per our previous note it should be said that no trading activity is 100% risk-free and, whilst Octopus Protected EIS targets capital preservation, it cannot, and does not, guarantee it. However, our analysis of this situation and the various scenarios that may develop from here leave us comfortable with our position. A statement made by Craig Whyte yesterday (http://sport.stv.tv/football/scottis...ement-in-full/) provided more detail on some of the ‘additional protection’ that we described in our previous email.In summary, we continue to remain confident in the product, our approach to investment, and the ticketing model. We appreciate that the level of interest in this story can create challenges for you with your clients but we are working hard with all related parties to ensure that our side of the story is communicated appropriately and that some of the incorrect assumptions that have been made are corrected. We can assure you that we are providing you and our relationship managers with as much information as possible given the circumstances. However, if you do wish to discuss this further or if you have clients who are requesting further information, please speak to your relationship manager who will be happy to help where possible.

[CropleyWasGod]

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Received the following email from Octopus today

We felt it appropriate to provide another update to the adviser community regarding Ticketus – one of the companies Octopus Protected EIS invests into – and the Rangers deal. The level of detail we can go into here is limited by the confidentiality clauses in the various Ticketus contracts and the ongoing administration process, but we’ll continue to provide updates when we can. The statement made last Friday explained that Ticketus has purchased tickets for Glasgow Rangers games for a number of seasons in advance, as it has done for a number of years previously with the club. The current deal between Ticketus and Rangers was closed on 9 May 2011, several days after Craig Whyte purchased the club. To clarify, the funds paid by Ticketus were not a loan in any way either to Craig Whyte or Rangers, they were for the sole purpose of purchasing tickets from the then legal owners of the club.Extensive due diligence is performed on counterparties in every deal, and numerous potential scenarios are modelled and prepared for in the way the deal is structured. But as per our previous note it should be said that no trading activity is 100% risk-free and, whilst Octopus Protected EIS targets capital preservation, it cannot, and does not, guarantee it. However, our analysis of this situation and the various scenarios that may develop from here leave us comfortable with our position. A statement made by Craig Whyte yesterday (http://sport.stv.tv/football/scottis...ement-in-full/) provided more detail on some of the ‘additional protection’ that we described in our previous email.In summary, we continue to remain confident in the product, our approach to investment, and the ticketing model. We appreciate that the level of interest in this story can create challenges for you with your clients but we are working hard with all related parties to ensure that our side of the story is communicated appropriately and that some of the incorrect assumptions that have been made are corrected. We can assure you that we are providing you and our relationship managers with as much information as possible given the circumstances. However, if you do wish to discuss this further or if you have clients who are requesting further information, please speak to your relationship manager who will be happy to help where possible.

Interesting stuff... thank you.

That should put to bed all the criticism levelled at Ticketus.

However, it also suggests that CW is telling the truth when he says that he has guaranteed the Ticketus money.

So.... what's your take on the scenario I suggested earlier? If the fans refuse to buy season tickets, does that leave CW picking up the tab?

[Lost_Mackem]

Are the fans really that thick that they will chant banned and offensive songs at a game? Morons.

[PatHead]

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Interesting stuff... thank you.

That should put to bed all the criticism levelled at Ticketus.

However, it also suggests that CW is telling the truth when he says that he has guaranteed the Ticketus money.

So.... what's your take on the scenario I suggested earlier? If the fans refuse to buy season tickets, does that leave CW picking up the tab?

Certainly looks like it but I wonder where he would get money from? Does he have 24million mates who would give him a loan of a pound?

[CropleyWasGod]

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Certainly looks like it but I wonder where he would get money from? Does he have 24million mates who would give him a loan of a pound?

LOL...

That said, Ticketus are smart enough to do due diligence on him. I also reckon they would do more than the David Murray "show us yer bank statement" model. They do say in that statement that they are comfortable in all scenarios.... presumably including the one where they have to chase CW.

I am wondering if the stockbroker firm (Pritchards?) was complicit in establishing his "credit-worthiness".

Loving the mystery...

[green glory]

Looks like Whyte not Rangers will have to cover it, leaving the club with an owner unable to invest . No money coming in from season ticket sales. Dwindling attendances due to poor performances , with reduction in the amount of ST's sold affecting the club's ability to buy decent players AND pay off the current debts. (puff pant). That's the optimistic scenario anyway. I haven't even covered the big tax bill. Ouch!

[CropleyWasGod]

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Looks like Whyte not Rangers will have to cover it, leaving the club with an owner unable to invest . No money coming in from season ticket sales. Dwindling attendances due to poor performances , with reduction in the amount of ST's sold affecting the club's ability to buy decent players AND pay off the current debts. (puff pant). That's the optimistic scenario anyway. I haven't even covered the big tax bill. Ouch!

You're a gloomy *******.

[Saorsa]

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Are the fans really that thick that they will chant banned and offensive songs at a game? Morons.

Even thicker than that, some of them

[Seveno]

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LOL...

That said, Ticketus are smart enough to do due diligence on him. I also reckon they would do more than the David Murray "show us yer bank statement" model. They do say in that statement that they are comfortable in all scenarios.... presumably including the one where they have to chase CW.

I am wondering if the stockbroker firm (Pritchards?) was complicit in establishing his "credit-worthiness".

Loving the mystery...

They must know CW well and are comfortable that he'll be able to 'borrow' sufficient funds from someone else to cover any potential debt on this deal. We need a copy of his birth certificate to see if his middle name is Ponzi.

[CropleyWasGod]

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They must know CW well and are comfortable that he'll be able to 'borrow' sufficient funds from someone else to cover any potential debt on this deal. We need a copy of his birth certificate to see if his middle name is Ponzi.

Given that Pritchards isny worth a "Whyte pound" any more, the boy may struggle.

Shame

[green glory]

It just gets worse.

http://news.stv.tv/scotland/west-central/

Even their future pies belong to someone else.

[CropleyWasGod]

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It just gets worse.

http://news.stv.tv/scotland/west-central/

Even their future pies belong to someone else.

STV are clearly getting their stories from Hibs.net. I posted that days ago

[StevieC]

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That said, Ticketus are smart enough to do due diligence on him.

Wasn't there something in the papers about one of Whyte's appointed board members was chairman of Octopus "something-or-other", a company that was in the same group as Ticketus?

To me it is sounding more and more like this whole scheme was organised and put into plan by a bunch of business "shysters" before the take-over was even close to being confirmed, and I'm not convinced that "due dilligence" would have been carried out. It's clear that the Ticketus money has been used to purchase the club and to get his Octopus mate a nice bonus/wage on the board at Rangers. On this basis strings may well have been pulled to get the deal done.

It all sounds like a fool proof plan to get full control of Rangers and your fingers into some lucrative money earning opportunities, with the back up of ownership of Ibrox and Murray Park should things really go wrong.

To be honest, I think it would have all been going according to plan if there hadn't been the monumental European failure.

[CropleyWasGod]

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Wasn't there something in the papers about one of Whyte's appointed board members was chairman of Octopus "something-or-other", a company that was in the same group as Ticketus?

To me it is sounding more and more like this whole scheme was organised and put into plan by a bunch of business "shysters" before the take-over was even close to being confirmed, and I'm not convinced that "due dilligence" would have been carried out. It's clear that the Ticketus money has been used to purchase the club and to get his Octopus mate a nice bonus/wage on the board at Rangers. On this basis strings may well have been pulled to get the deal done.

It all sounds like a fool proof plan to get full control of Rangers and your fingers into some lucrative money earning opportunities, with the back up of ownership of Ibrox and Murray Park should things really go wrong.

To be honest, I think it would have all been going according to plan if there hadn't been the monumental European failure.

Octopus Investments own Ticketus.

On the Board of Ticketus is the owner of Close Finance, who have the now-infamous "pie mortgage".

And, I absolutely agree with the last line.....it all hinged on CL money. (see my earlier post about Rule Number 1 in football budgeting).

[Spike Mandela]

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Certainly looks like it but I wonder where he would get money from? Does he have 24million mates who would give him a loan of a pound?

What is Alistair Johnstone's agenda in all this. I reckon he is hoping criminal charges can be laid at Whytes door saddling Whyte with the £18m debt and hey presto Rangers FC is £18m cheaper for any prospective buyer.

[CropleyWasGod]

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What is Alistair Johnstone's agenda in all this. I reckon he is hoping criminal charges can be laid at Whytes door saddling Whyte with the £18m debt and hey presto Rangers FC is £18m cheaper for any prospective buyer.

I was thinking about this earlier, Spike.

For the last few weeks, he has been the apparent "man in white", asking all the so-called important questions, with threats of police action and the like.

I am now starting to think that it might all be a vanity project for him. Either that, or he is angling to be back at RFC under a new regime, or he is deflecting any criticism of the Murray regime. SDM knows where the bodies are buried here, I am sure of that, and they will be scrabbling to escape the smell.

[jgl07]

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Looks like Whyte not Rangers will have to cover it, leaving the club with an owner unable to invest . No money coming in from season ticket sales. Dwindling attendances due to poor performances , with reduction in the amount of ST's sold affecting the club's ability to buy decent players AND pay off the current debts. (puff pant). That's the optimistic scenario anyway. I haven't even covered the big tax bill. Ouch!

Due diligence obviously did come into the Ticketus calculations.

Rangers were £18 million in debt to Lloyds Bank Group and had a potential tax bill of £53.3 million (£49 million for the big one and £4.3 million for the little one) hanging over it. They were, according to Craig Whyte burning £9 to £10 million a year. How the hell were they going to survive with much of the season ticket cash pre-empted by Ticketus.

Craig Whyte argued that 'one of his companies' had indemnified Ticketus for the deal. He could presumably liquidate this particular company and Ticketus would get nothing as most of Craig Whyte's assets look illusory.

This could still leave Whyte as the secured creditor for Rangers in the event of liquidation and given the ownership of Ibrox and Murray Park for an outlay of diddely squat!

[CropleyWasGod]

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Due diligence obviously did come into the Ticketus calculations.

Rangers were £18 million in debt to Lloyds Bank Group and had a potential tax bill of £53.3 million (£49 million for the big one and £4.3 million for the little one) hanging over it. They were, according to Craig Whyte burning £9 to £10 million a year. How the hell were they going to survive with much of the season ticket cash pre-empted by Ticketus.

Craig Whyte argued that 'one of his companies' had indemnified Ticketus for the deal. He could presumably liquidate this particular company and Ticketus would get nothing as most of Craig Whyte's assets look illusory.

This could still leave Whyte as the secured creditor for Rangers in the event of liquidation and given the ownership of Ibrox and Murray Park for an outlay of diddely squat!

Don't agree

RFC Group owe RFC £24m... the Ticketus money that wasn't passed on. RFC owe RFCG £18m...... what they paid Lloyds. Net effect is that RFC are owed £6m.

There is no creditor IMO.

[green glory]

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Octopus Investments own Ticketus.

On the Board of Ticketus is the owner of Close Finance, who have the now-infamous "pie mortgage".

And, I absolutely agree with the last line.....it all hinged on CL money. (see my earlier post about Rule Number 1 in football budgeting).

They're so *****in screwed man.

[ancienthibby]

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Don't agree

RFC Group owe RFC £24m... the Ticketus money that wasn't passed on. RFC owe RFCG £18m...... what they paid Lloyds. Net effect is that RFC are owed £6m.

There is no creditor IMO.

But is the Ticketus deal still not 'legal'?

So far as we know it was concluded before CW was a director or majority shareholder in RFC?

I have known of any number of deals in the past requiring, as the legals like to say, to be ''cured'' but this is so fundamental - who, in RFC authorised CW to do the deal with Ticketus??

[CropleyWasGod]

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But is the Ticketus deal still not 'legal'?

So far as we know it was concluded before CW was a director or majority shareholder in RFC?

I have known of any number of deals in the past requiring, as the legals like to say, to be ''cured'' but this is so fundamental - who, in RFC authorised CW to do the deal with Ticketus??

Whether or not it was legal is irrelevant, IMO. The fact is that the Group took cash that should have gone to the Club.

As for your last question....... one would hope that the admins, Lord Nimmo Smith, the polis, the FSA are asking the same question.

If I were a suspicious man, I might think that you should look first at the people who wanted the deal to happen. But would they admit to it?

Besides, we can't say that, lest Hibs.net gets sued

[ancienthibby]

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Whether or not it was legal is irrelevant, IMO. The fact is that the Group took cash that should have gone to the Club.

As for your last question....... one would hope that the admins, Lord Nimmo Smith, the polis, the FSA are asking the same question.

If I were a suspicious man, I might think that you should look first at the people who wanted the deal to happen. But would they admit to it?

Besides, we can't say that, lest Hibs.net gets sued

Pardon me if I'm wrong Mr Croppers, but 'the Group' is a CW company whereas the club is not??

Legal dodgy, dodgy illegal - whit's the difference??

[CropleyWasGod]

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Pardon me if I'm wrong Mr Croppers, but 'the Group' is a CW company whereas the club is not??

Legal dodgy, dodgy illegal - whit's the difference??

I am not sure who the shareholders in RFCG are, but lets assume it's CW for the moment. It's easily checked, if you've got a couple of quid (as Cav said earlier, that's more than the club is worth)

The club is 83.3%(?) owned by RFCG.

RFCG paid off Lloyds, and RFCG took the Ticketus cash.

So RFCG owe RFC £6m.

Or have I missed your point? :0)

[jgl07]

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Don't agree

RFC Group owe RFC £24m... the Ticketus money that wasn't passed on. RFC owe RFCG £18m...... what they paid Lloyds. Net effect is that RFC are owed £6m.

There is no creditor IMO.

I hope that you are right on this one.

[CropleyWasGod]

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I hope that you are right on this one.

So do I

If I'm not, I shall slink away to the land of the Yamanomists.

Seriously, though, I can't see any other explanation. The diversion of the Ticketus money has been established by the admins, and admitted by CW. The paying-off of Lloyds was claimed by CW (not that I would believe him on anything, of course.).

The best scams are often the simplest.... and this one would have worked, had it not been for those pesky kids that stopped RFC from getting into the Champions League.

[ancienthibby]

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So do I

If I'm not, I shall slink away to the land of the Yamanomists.

Seriously, though, I can't see any other explanation. The best scams are often the simplest.... and this one would have worked, had it not been for those pesky kids that stopped RFC from getting into the Champions League.

On the wee Jobbie, it's now 50% larger!

http://news.stv.tv/scotland/west-cen...ously-thought/

[Saorsa]

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On the wee Jobbie, it's now 50% larger!http://news.stv.tv/scotland/west-cen...ously-thought/

[CropleyWasGod]

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On the wee Jobbie, it's now 50% larger!

http://news.stv.tv/scotland/west-cen...ously-thought/

FFS.

Actually, £4m of the extra must relate to the VAT on the Ticketus deal.

So, £11m for VAT on walk-ups, plus PAYE etc, for the period from May to January. £1.2m per month.

I'll get my head around that soon

[CropleyWasGod]

Hang on.... what's this?

"unpaid PAYE and VAT worth around £9m had been deducted from employees’ wages, "

That's a good one... deduct VAT from your employees' wages???

And then keep it???

He's a beezer, eh no?

[ancienthibby]

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Hang on.... what's this?

"unpaid PAYE and VAT worth around £9m had been deducted from employees’ wages, "

That's a good one... deduct VAT from your employees' wages???

And then keep it???

He's a beezer, eh no?

It's called managing your cash flow