Rangers announced on 10 July that the £16m share issue was completed and fully subscribed by existing shareholders.
This could have a trickle-down effect on the expansion of Ibrox, something that fans have wanted for a while.
Rangers supporters have also complained about the quality of the seats, which were evident to the wider public during the announcement of the new third kit.
What is your reaction to the new third kit?
It's fair to say a lot of Rangers fans have hated it…
Rangers need a sure footing financially before making grand Ibrox development promises
The aforementioned share issue is typically used to finance capital demands in the short term, Adam Williams, GRV Media’s Head of Finance and Governance has told Rangers News.
For things like the development and expansion of stadiums, long-term debt is used.
This money will be in order to pay the bills, finance transfers this season, and be in a better place than they were under the former regime.
Rangers News understands that the club will primarily focus on building a solid footing so as to absorb the losses that come with no Champions League football before spending big money on expanding Ibrox.
What changes would you like to see at Ibrox?
The money is there to be spent!
Williams said: “Typically, share issues are reserved to satisfy short-term capital demands, while long-term debt is used for infrastructure projects, like redeveloping the stadium. This falls into the former category.
“When Rangers announced they wanted to raise capital in March, they said the investment would be ringfenced for the men’s first team. That will be to pay the bills, keep up with transfer instalments and so on.
“They have been cash flow negative before owner funding consistently in recent years, and, therefore, external investment is needed primarily to build a squad that can get them back in the Champions League with the prize money and matchday income that brings.
“That’s the short-term concern. I think it will only be after they get to a place where they can count on being in Europe and have a decent cash buffer to absorb the losses in the seasons when they don’t make it that they will consider any real major alterations to Ibrox.
“If and when they expand, it’s going to be very expensive. Labour and material costs are high, as are interest rates, so they need to be on a sure footing financially before they press ahead with those plans.”
- Read more: Andy Halliday and Derek Ferguson believe Rangers star has played his final game at Ibrox.
