Rangers have generated close to £7m in share capital following the issuing of close to 35 million shares at Ibrox.
The share issue will result in close to 34,904,703 new shares being sold at 20p per share, totalling just shy of the not inconsiderable figure.
Reputable Price of Football journalist Kieran Maguire believes that it’s “highly probable” the share issue is a conversion of loans owed by the club rather than fresh shareholder investment.
Rangers create just under £7 million of shares by issuing 35 million at 20 pence each. Highly probable a conversion of loans into shares rather than fresh money from shareholders. #RangerFC pic.twitter.com/x2u2os30hA
— Price Of Football (@KieranMaguire) October 2, 2019
The news comes after the dropping of legal action against Dave King concerning a previous share issue, where the South African-based businessman was ordered to purchase a controlling stake in the club.
Whilst King attempted the share issue – thought to be worth up to £11m – the Rangers chairman didn’t secure the required 50% of the shares to complete the takeover [Herald].
This was seen as a victory by Dave King who would likely rather save such extravagant investment for other areas of the football club.
Dave King and the “Three Bears” would then secure a controlling stake in Ibrox [Rangers] after converting £14m of loans they had pumped into the club into shares in June.
The “controlling interest” came after a total of £14.1m in loans was converted into 70,601,941 shares a 20p a share.
Whilst share conversions dilute the value of shares at the club, they appear to be part of Rangers’ wider business strategy as the club looks to return to the pinnacle of Scottish and European football.