calscot 0 Posted November 11, 2016 Share Posted November 11, 2016 Sorry BD I must be getting the wrong end of the stick here , the way it was getting discussed elsewhere was if for example there were £20 million worth of shares being issued but those directors who had coughed up the soft loans were due £10 million , then there would only be £10 million coming into the club as the other £10 million would be getting converted to shares due in place of the loans , if that's not the case then I'm wrong about this Don't know the ins and outs, but isn't the easy solution to that just to do a 30m issue? 0 Quote Link to post Share on other sites More sharing options...
rbr 1,247 Posted November 11, 2016 Share Posted November 11, 2016 Don't know the ins and outs, but isn't the easy solution to that just to do a 30m issue? Your still losing £10 million , which at this point in time we need .I am not saying they shouldn't get their money back , just not right now 0 Quote Link to post Share on other sites More sharing options...
Bluedell 5,329 Posted November 11, 2016 Share Posted November 11, 2016 Your still losing £10 million , which at this point in time we need .I am not saying they shouldn't get their money back , just not right now We're not losing £10m. To try and simplify it. We have been given £10m and it's in our bank account and is also sitting as a loan as we are due to repay it. We have a share issue and give £10m of shares to the directors (no cash is involved) and the loans are therefore converted to share capital. We are still sitting with £10m in the bank but no longer owe anyone £10m. The directors are sitting with £10m of shares and not £10m of loans due to them. The club are better off as they no longer owe the cash, and the directors are better off as, realistically there was no chance of Rangers ever repaying the loans as they now have shares, which they can sell if they wish. if the club also wish to raise £10m or £20m they can make the share issue for £20m or £30m. 0 Quote Link to post Share on other sites More sharing options...
calscot 0 Posted November 11, 2016 Share Posted November 11, 2016 Your still losing £10 million , which at this point in time we need .I am not saying they shouldn't get their money back , just not right now I don't follow your loss of 10m. Equity is better for the finances than debt. They're not getting their money back per se, they are swapping it for shares. With the absence of a dividend, that costs the club nothing - it just changes the proportions of the shareholders. 0 Quote Link to post Share on other sites More sharing options...
rbr 1,247 Posted November 11, 2016 Share Posted November 11, 2016 Sorry I might not be describing my position very well , I agree 100% with Bluedell description , I have never tried to distort that , at this precise point in time we have no money , nada , zero , zilch , no retail nor commercial deals to speak off , we do have soft loans which for the sake of argument we are rounding off at £10 million , these loans do not accrue interest or dividends and are interest free . All I am trying to get across is at this precise point in time when we desperately need cash to buy better players to give ourselves a better chance of pressuring Celtic and winning cups and possibly doing better in Europe next year ( I fully expect us to finish second and qualify ) , surely if we are having another share issue , now is not the time to convert the soft loans into equity .No matter how you put it if at this point in time you convert debt into equity you are reducing the amount that goes into the bank in pounds and pence , I get the balance sheet bit, I get the fact it's going to happen , I just don't see the need to do it now . 0 Quote Link to post Share on other sites More sharing options...
rbr 1,247 Posted November 11, 2016 Share Posted November 11, 2016 We're not losing £10m. To try and simplify it. We have been given £10m and it's in our bank account and is also sitting as a loan as we are due to repay it. We have a share issue and give £10m of shares to the directors (no cash is involved) and the loans are therefore converted to share capital. We are still sitting with £10m in the bank but no longer owe anyone £10m. The directors are sitting with £10m of shares and not £10m of loans due to them. The club are better off as they no longer owe the cash, and the directors are better off as, realistically there was no chance of Rangers ever repaying the loans as they now have shares, which they can sell if they wish. if the club also wish to raise £10m or £20m they can make the share issue for £20m or £30m. Sorry Bluedell I posted before fully reading you and calscots posts , but we don't have £10 million in the bank it's gone , plus according to the accounts we are going to need another handout from the directors to get us through this year , we are cash poor , more going out than coming in , so why are we paying back this money now , it's crazy IMHO . The 3 bears are continually telling us , they are here for the long haul , why the need to repay it now, that's all I'm saying 0 Quote Link to post Share on other sites More sharing options...
Bluedell 5,329 Posted November 11, 2016 Share Posted November 11, 2016 No matter how you put it if at this point in time you convert debt into equity you are reducing the amount that goes into the bank in pounds and pence , I don't see how that's the case. All you are doing is increasing the number of shares being issued to allow the conversion. It won't reduce any cash being raised by the sale. 0 Quote Link to post Share on other sites More sharing options...
Bluedell 5,329 Posted November 11, 2016 Share Posted November 11, 2016 , so why are we paying back this money now , it's crazy IMHO . We are not repaying any cash. 0 Quote Link to post Share on other sites More sharing options...
rbr 1,247 Posted November 11, 2016 Share Posted November 11, 2016 We are not repaying any cash. Ok I will try this way , if we have a £30 million share issue that's fully subscribed , taking costs out of the equation , how much goes into our bank £30 million . If we have a £30 million share issue and £10 million of soft loans get swapped for equity but the rest is full subscribed , again taking costs out the equation £20 million goes into our account or am I incorrect . 0 Quote Link to post Share on other sites More sharing options...
calscot 0 Posted November 11, 2016 Share Posted November 11, 2016 Ok I will try this way , if we have a £30 million share issue that's fully subscribed , taking costs out of the equation , how much goes into our bank £30 million . If we have a £30 million share issue and £10 million of soft loans get swapped for equity but the rest is full subscribed , again taking costs out the equation £20 million goes into our account or am I incorrect . As previously said, if that's a problem, increase the share issue by another 10m... The amount that will be raised by the share issue is a fixed, finite number - as long as they don't allow it to be oversubscribed. So when issuing the shares, you take that number and add 10m more worth of shares to convert the loans. The amount of cash you raise will not change by a penny. The main thing is to make sure it's not over-subscribed, which would obviously restrict the amount of cash coming in. As far as I can see, they also want to be careful of begin under-subscribed as that means they could lose control if they are unwilling or unable to maintain their percentage holding and someone else makes a move. 0 Quote Link to post Share on other sites More sharing options...
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