Dave King defies Takeover Panel order to issue £11m buyout offer

[ian1964 10,429]

Gers chairman facing possible court threat as fears grow that it could cause further damage to the reputation of the Ibrox club.

 

Keith Jackson

 

Dave King could be dragged into yet another high-profile battle against the authorities after effectively choosing to stick two fingers up at the Takeover Panel yesterday.

 

The Rangers chairman is in hot water after flouting an order to launch an £11million offer to buy out the rest of the club’s remaining shares as a penalty for breaching strict financial rules when he succeeded in ousting the previous regime two years ago.

 

The authorities ruled King was leading a “concert party” when he teamed up with a group of fellow fans known as the Three Bears – George Letham, Douglas Park and George Taylor – to hoover up 30 per cent of the club’s shares and boot Mike Ashley’s allies out of the Ibrox boardroom.

 

After losing a long running appeal against that decision last month, King was given a 30-day deadline to offer to buy all remaining shares at a price of 20p. But that deadline came and went yesterday afternoon without King meeting the watchdog’s demands.

 

While there will be no punitive repercussions for the club, sources in London expect the Takeover Panel to react angrily to King’s defiant stand. At the very least they could effectively render him a pariah in the financial world, causing further damage to the reputation of his club.

 

But they could also seek a court order to force King’s hand. Should that happen, he could then face a contempt of court charge unless he stumps up enough cash to cover the cost of a possible buy-out.

 

King’s legal team do not expect such a fierce reaction. But a source at the Takeover Panel said: “The panel has various powers when it comes to enforcement and we must now wait and see what happens.

 

It’s fair to say this is not a normal set of circumstances“People usually comply more promptly so it’s fair to assume this will be treated in a serious fashion.”

 

King has already publicly questioned the logic of the decision to boot out his appeal. He is adamant the vast majority of shareholders would have no interest in taking up the offer of 20p per share.

 

But a source said: “It’s not as easy as saying the fans don’t want to sell their shares. In order to establish this legally, King would have to spend enormous sums in hiring the services of a financial firm in London. That could be anywhere between £500,000 and £1m.

 

“On top of that, Dave King would have to deposit another £11m into an account to cover the cost of all eventualities as, in the worst-case scenario that 100 per cent of shareholders took him up on it, that is the amount required to underwrite the entire offer.”

 

King reacted to last month’s appeal defeat by insisting he would take time to weigh up his options and hold talks with supporters’ groups before deciding on his next move.

 

He was also scathing of the entire process and blamed it on a complaint from former chairman David Somers, who he claimed was acting against the best interests of the club in a desperate attempt to cling to power.

 

King said: “It is my belief the takeover appeal board has not understood the true nature of what occurred at Rangers and the tremendous role that the activism of supporters played in ensuring regime change.

 

“I am only one of a vast number of Rangers supporters and share-holders who fought to rescue our club. The club should never have become caught up in a takeover struggle. Those who placed it in that position bear a heavy responsibility.”

[ian1964 10,429]

Maybe admin can merge this into the other thread, I missed that due to the headline change!

[Uilleam 5,458]

The Takeover Panel has ordered that Dave King issues a Prospectus and makes a formal offer to all shareholders @20p/share, which as far as I can see is some 12p below current market value. This absurd exercise will cost north of £500K, per the Daily Rhebel, which may or may not be accurate, but we can rest assured that it will involve a significant amount.

Quite why anyone, at all, would decide to sell at significantly under value is a matter for conjecture, but, to the man on the Cessnock omnibus, it seems pretty damn clear that such an 'offer' will 'flop'.

That the Takeover Panel will pursue court action, with all the concomitant expense to both parties, to enforce this nonsense (which would surely fail any 'reasonableness' test to which it was subjected) is something which travels well beyond Dickens's declaration of the Law's asinine nature. Truly we would be witnessing, through the looking glass. a pissing contest conceived by Lewis Carroll out of Franz Kafka. It would be edifying to no one, and productive to neither party.

 

I wonder if shareholders, en masse, could take a view, and an active role, here. If, say, sufficient numbers were to declare that they would not sell at that price, that they felt that the exercise was no more than a sham doomed to fail, and that, in their considered opinion was not in the interests of the Company, then, perhaps, the Takeover Panel would reconsider its position.

 

I wonder, also, whether the imposition of a takeover bid, however nonsensical, will open the door for a counter offer, or counter offers.

Edited April 13, 2017 by Uilleam

[der Berliner 3,264]

I had to push myself to read further than Keith Jackson ...

 

You wonder who is actually in that Takeover Panel and who is pulling the strings behind it. While somene will say: "hey, let not get paranoia in the way here!", you do wonder why they clearly voted in favour of a chairman who rode the club into this trouble and financial mismangement, yet come up with an apparently costly and - going by logic, market value et al - unreasonable demand?

 

The question remains, untouched by Jackson, if the demand of the Panel can be challenged further.

[boabie 230]

I see the mank sites are now pushing the line that because King cannot now have a share issue Rangers will not be able to get a licence to play in Europe should we qualify. Apparently the "experts" have decided that the soft loans do not mean there has been financial fair play. The tarred one says paperwork submitted by Rangers to the SFA was sent back to us last week marked "incomplete" and requesting clarification.

Needless to say they are now bombarding the SFA and UEFA with complaints, all in the interest of sporting integrity of course.

Edited April 13, 2017 by boabie

[Bluedell 5,348]

That the Takeover Panel will pursue court action, with all the concomitant expense to both parties, to enforce this nonsense (which would surely fail any 'reasonableness' test to which it was subjected)

 

Does a reasonableness test come into it? Is there such a get-out clause?

[Bluedell 5,348]

You wonder who is actually in that Takeover Panel and who is pulling the strings behind it. While somene will say: "hey, let not get paranoia in the way here!", you do wonder why they clearly voted in favour of a chairman who rode the club into this trouble and financial mismangement, yet come up with an apparently costly and - going by logic, market value et al - unreasonable demand?

What chairman are you referring to?

[pete 2,499]

What chairman are you referring to?

 

Somers? made the complaint.

[Uilleam 5,458]

Does a reasonableness test come into it? Is there such a get-out clause?

 

I don't know. In general, as far as I understand, unreasonable actions may be viewed as legally faulty, throughout most, if not all, branches of law. From the layman's point of view, forcing David K to undertake an expensive exercise purely for the sake of undertaking that expensive exercise, seems an unreasonable position on which to found an action. From the same perspective, it does seem that undertaking this unreasonable exercise is not in the interests of the Company, nor of any of the shareholders.

[union 0]

TOP have instructed proceedings against king in the court of session as of a few minutes ago.