More intrigue over Ibrox control
Llambias and Leach ‘to quit’ as Rangers board draws £5m loan
Llambias, chief executive, admitted King had secured a landslide victory. His and finance director Leach’s departure will weaken the grip of Sports Direct owner Mike Ashley who holds 8.92% of the company.
However, the board also announced that it will drawdown the second half of the £10 million loan from Ashley’s Sports Direct, just hours after he was fined £7,500 by the Scottish Football Association over his dual interest in the club and Newcastle United.
The club says it needs the money to meet its short term liabilities.
As reported by Daily Business yesterday, King and Ashley are now heading for a showdown over running the club. Ashley is a minority shareholder, but his loans entitle him to security over the Murray Park training ground, Edmiston House, the Albion car park and the club’s trademarks. He also has a joint venture with the club over merchandising and proceeds from shirt sponsorship from 2017.
The board told the London Stock Exchange that it has “commenced the process of satisfying the conditions for drawdown of the second tranche of the facility announced on 27 January 2015 with SportsDirect.com Retail Limited and associated companies in order to meet its cash requirements for the third week of March.”
This second tranche is “subject to due diligence” by Sports Direct and has warned shareholders that there are other conditions which could affect the willingness of SD to release the funds.
But if the funds are not able to be drawn down the club will need to find alternative sources of external funding.
King holds just under 15% of Rangers shares and will expect to gain majority control. Assuming he can come up with the money to refinance Ibrox he may have to negotiate with Ashley to secure the Newcastle United owner’s exit from the share register.