Got this article sent to my email about finances

[cacafuego 0]

Is a Conflict of Interest forcing Sir David Murray to stand down?

Friday, 4th September 2009

Brock Stoker runs the rule over the accounts of both Murray International Holdings and Rangers Football Club.

In the business world, individuals or companies often have conflicts of interest because they are involved with more than one company. When they arise the individuals involved stand down from one or both sides. It looks to me that Sir David Murray could have a conflict of interest as Chairman of both Murray International Holdings (MIH) and Rangers Football Club (RFC). This may be why he is stepping back from Rangers.

The situation at MIH

MIH is a heavily indebted company. In itself, that is not necessarily a bad thing, but any company (or person) who needs to renegotiate borrowings in the current financial climate is not having an easy time. Now the last published accounts available for MIH are for the year ending January 2008. The figures to January 2009 are expected in November, and so the information available to outsiders is over 18 months old.

MIH debt at January 2008 was £773m, with £27m due for repayment (or renegotiation) by January 2009 - not a particular problem. However, £406m needs to be repaid, or more practically renegotiated, by January 2010 - less than six months away. Given that this is taking place against the background of a weak property market and a cautious banking sector, calling the renegotiations difficult would not be overstating the problems.

The situation at RFC

RFC has a term loan facility which stood at £21m in June 2008 and is being repaid at £1m a year, making it £20m in June 2009 and £19m in June 2010. In addition, it has an overdraft facility of £15m, which is reviewed every November. Now talk of the banks running Rangers is short of the mark, but if they are trying to reduce that overdraft limit or trying to change the repayment schedule of the term loan, then that will necessarily put constraints on the money that RFC can spend.

RFC debt at June 2008 was £21.5m, a figure which will no doubt have risen because of last season's lack of European money and the late August spending spree. But it should be well short of £35m, so where's the problem? Even if the total borrowing levels have not been reduced, the problem is that June probably represents the low point for debt in the year as the season ticket money has just been banked. This year the Champions League money has still to come, but wages and other expenses will be more than the weekly income and so debt will rise. This is what the £15m overdraft is there to cover.

In previous years, if the need for cash to pay the bills exceeded the overdraft limit, then MIH or a subsidiary would lend RFC the money in the short term. Last January's desperate attempts to offload a player may have been needed to cover the gap. In the end with Kris Boyd refusing to go, maybe MIH had to stump up reluctantly. If that's what did happen last year, then it doesn't look like it's happening this year. However, as Barrybaldy explained in some detail on the Follow Follow messageboard earlier this week, the banks now appear to be happy that the combination of sales and guaranteed Champions League money will restrict debt to a level they are comfortable with

What if MIH sells RFC?

MIH has already paid a price for underwriting the 2004 Rights Issue and ending up owning the majority of Rangers. Because it paid a price higher than the book value of RFC for the shares, it had to create £80m of "goodwill". In layman's terms goodwill represents the amount you have paid for a business over and above what the financial accounts say it is worth. By January 2008, £70m of that had been written off and it is likely that the other £10m will also have gone by now. The book value of RFC at June was still £79m although this has probably fallen in 2009. Unless MIH gets this value for its shares then it will have to write off further amounts. This represents over 70p a share compared with the current price of under 40p and the buyer would inherit all the debt. Bottom line is that unless someone values RFC around £100m - £79m plus the debt - then MIH will have to write off the difference.

So a buyer coming in for RFC would be good news for the club, but potentially bad news for MIH.

Related party transactions

In the past I have contrasted how much RFC paid to MIH for services with how much MIH paid to RFC for services. There was always an imbalance which I think peaked at around £4m going out of RFC and £0.4m coming back in. The total amounts have fallen way back, but the 2008 RFC accounts show an odd situation. At the end of June 2008, MIH owed RFC £286,000, up from £16,000 the year before - in fact, up by more than the £207,000 of services it bought. Meantime, the amounts owed by RFC to MIH, fell from £521,000 to £79,000 over the same period. It looks like RFC paid up front for everything it got and wiped out most of the outstanding balances, while MIH paid for nothing that RFC supplied it. An odd situation and one worth monitoring in the forthcoming accounts.

The Possible Conflicts

So to summarize, MIH is in a tough place and what's right for MIH may not be right for RFC. Specifically, there is little chance of RFC getting any loan facilities from the parent company - hence the transfer actions/inactions. Selling RFC for a realistic price, which would be good for the football club, does not solve any MIH problems - it could in fact make them worse. It appears that RFC is being encouraged to pay up front for any services it takes from MIH while RFC is not being paid by MIH. The forthcoming RFC accounts will tell us little, other than the new level of debt, and whether or not the overdraft facility has been reduced.

Apparently the decision for Sir David to step down was taken some time ago, but that does not rule out conflict as a reason, as these issues have not suddenly appeared. Given the relative sizes of the businesses, then MIH does warrant more time and you don't have them nasty fans to worry about. Every year when the MIH accounts come out, the Celtc-minded always come up with "He's doomed" articles. To date they've been wrong, and quite probably they still are. Following the fortunes of a private company is difficult at the best of times, and well nigh impossible for one as active as MIH. However, it is clear that in the current climate Sir David Murray needs to spend the bulk of his time with MIH.

Brock Stoker

[BLUEDIGNITY 33,647]

I know his brother Bram, would get blood out a stone he would ! !

[Guest therabbitt]

I know his brother Bram, would get blood out a stone he would ! !

I know his uncle, Fanny you called him. He used to be in the adult entertainment industry if I remember correctly.

[boss 1,941]

Ah, my old pal Broken Stocker makes an appearance.

Let me get a dram or two and then I'll read through his nonsense. Get the popcorn ready guys, this should be fun.

[Guest therabbitt]

Ah, my old pal Broken Stocker makes an appearance.

Let me get a dram or two and then I'll read through his nonsense. Get the popcorn ready guys, this should be fun.

You get whisky and we get popcorn. I think not.

[BLUE CYCLOPS 26]

Not the same subject, I know but curiosity forces me to ask. I don,t always understand the fine details of balance sheets, and I,m sure I,m not the only one.

Can anyone tell me the total share holding for Rangers and the price per share = total value of the club, and the same figures for Septic.?

Purely for interest sake.

[boss 1,941]

Poor Broken Stocker.

He’s only about £47m out with his numbers.

Even for Broken, that’s some sort of record. Like many stockbrokers and analysts he has plenty experience in commenting on consolidated accounts. But not in understanding them, and certainly not in the mechanics behind them.

But before the numbers, there is another point to make. He has completely failed to address the fact that the supposed ‘conflict of interest’ which may have caused SDM to stand down has subsisted since at least the share issue in 2004. At that time, it was in Rangers’ interests to be sold to a new owner for £1, but clearly not in the interests of Murray International Holdings.

Why then pen an article which suggests that a ‘conflict of interest’ that has been there for nearly 5 years is now a probable cause of SDM’s resignation? Perhaps because Broken had decided on his conclusion first and then tried to come up with some facts to fit. The implication of the title, with or without a question mark, is simply wrong. That ‘conflict of interest’ did not cause SDM’s resignation.

On to the numbers. “Bottom line is that unless someone values RFC around £100m - £79m plus the debt - then MIH will have to write off the difference.”

Oh dear. Sadly Broken has double counted Rangers’ debt. It is already included in the £79m net asset value of Rangers that was consolidated last year. So he is already out by £21m which was last years debt figure. (As an aside, don’t be surprised if our net debt in the soon to be published accounts to 30 June 2009 is north of £30m.)

The next problem with his numbers might only be understood by the most nerdy of beancounters amongst us. You’ll probably need to take my word on this one; he has completely missed the point that there are substantial minority interests in Rangers.

The last time I looked, SDM actually beneficially owned closer to 60%-65% of Rangers (I can’t recall the exact figure and it would take me a few hours to work out the current position) even though he ‘controlled’ over 90%. These minority interests, Dave King amongst them, are obviously already excluded from the shareholders funds in the MIH balance sheet.

This means that any amount by which the sale proceeds fall short of the net asset value of Rangers is attributable about one third to the minorities. So Broken’s error here puts his number out by about one third of the £79m net assets of Rangers (i.e. £26m).

Finally, his comment: "Every year when the MIH accounts come out, the Celtc-minded always come up with "He's doomed" articles." You've got to laugh. Broken Stocker has himself been doing that for years. Seriously, you couldn't make it up.

So two fundamental errors of £21m and £26m. And a title and conclusion that make no sense.

Better luck next time.

[GeneralCartmanLee 313]

Boss, I have always enjoyed your dissecting of his figures, used to be some of my favourite exchanges on follow follow, especially after the mass nodding of heads his posts used to receive, I thought he had retired in disgrace.....

[radlord 24]

Poor Broken Stocker.

He’s only about £47m out with his numbers.

Even for Broken, that’s some sort of record. Like many stockbrokers and analysts he has plenty experience in commenting on consolidated accounts. But not in understanding them, and certainly not in the mechanics behind them.

But before the numbers, there is another point to make. He has completely failed to address the fact that the supposed ‘conflict of interest’ which may have caused SDM to stand down has subsisted since at least the share issue in 2004. At that time, it was in Rangers’ interests to be sold to a new owner for £1, but clearly not in the interests of Murray International Holdings.

Why then pen an article which suggests that a ‘conflict of interest’ that has been there for nearly 5 years is now a probable cause of SDM’s resignation? Perhaps because Broken had decided on his conclusion first and then tried to come up with some facts to fit. The implication of the title, with or without a question mark, is simply wrong. That ‘conflict of interest’ did not cause SDM’s resignation.

On to the numbers. “Bottom line is that unless someone values RFC around £100m - £79m plus the debt - then MIH will have to write off the difference.”

Oh dear. Sadly Broken has double counted Rangers’ debt. It is already included in the £79m net asset value of Rangers that was consolidated last year. So he is already out by £21m which was last years debt figure. (As an aside, don’t be surprised if our net debt in the soon to be published accounts to 30 June 2009 is north of £30m.)

The next problem with his numbers might only be understood by the most nerdy of beancounters amongst us. You’ll probably need to take my word on this one; he has completely missed the point that there are substantial minority interests in Rangers.

The last time I looked, SDM actually beneficially owned closer to 60%-65% of Rangers (I can’t recall the exact figure and it would take me a few hours to work out the current position) even though he ‘controlled’ over 90%. These minority interests, Dave King amongst them, are obviously already excluded from the shareholders funds in the MIH balance sheet.

This means that any amount by which the sale proceeds fall short of the net asset value of Rangers is attributable about one third to the minorities. So Broken’s error here puts his number out by about one third of the £79m net assets of Rangers (i.e. £26m).

Finally, his comment: "Every year when the MIH accounts come out, the Celtc-minded always come up with "He's doomed" articles." You've got to laugh. Broken Stocker has himself been doing that for years. Seriously, you couldn't make it up.

So two fundamental errors of £21m and £26m. And a title and conclusion that make no sense.

Better luck next time.

So what you're saying is we'll be in administration within the week

[BlueIsTheColour 35]

Brilliant analysis Boss.

[TheWholeStruth 7]

Boss you said this.....

As an aside, don’t be surprised if our net debt in the soon to be published accounts to 30 June 2009 is north of £30m.

I'd be interested in your opinion what you think the figure will be, and also your thinking behind it. Personally I think the figure will be in excess of £35m. This is based on my (admittedly amateur) own conclusions.

Edit - I should add, I'm shattered and off to my scratcher and look forward to your reply (if you choose to give one) in the morning.

[boss 1,941]

I'd be interested in your opinion what you think the figure will be, and also your thinking behind it. Personally I think the figure will be in excess of £35m. This is based on my (admittedly amateur) own conclusions.

Edit - I should add, I'm shattered and off to my scratcher and look forward to your reply (if you choose to give one) in the morning.

It is impossible to tell. For instance, none of us know the timing of the cashflow for transfers in and out (normally paid over a period of years). Say £4m of the Hutton money was still due in. Did we receive some or all of that before 30/6/09? That alone would have a £4m effect on the cashflow. And there are many other unknowns.

Anybody giving a definitive figure before the accounts are published is just guessing.

So I'll say £31,805,266.12.

[Brubear 2,920]

Not the same subject, I know but curiosity forces me to ask. I don,t always understand the fine details of balance sheets, and I,m sure I,m not the only one.

Can anyone tell me the total share holding for Rangers and the price per share = total value of the club, and the same figures for Septic.?

Purely for interest sake.

Rangers have 109m issued shares currently trading at a mid price of 37.5 p per share therefore= £41m

Celtic have 89m issued shares currently trading today at 41p per share therefore = £37. Celtic also have 485m of "preference shares" which are not quoted in the market but probably have a much lower value than the ordinary shares so may add anothe £5m to £10m to Celtic value.

Basically the maket place sees both companies values similarly which is not surprising as they are in the same industry, operating in the same league, similar world wide fan base and have an equal chance of competing in Europe. This means future earning potential of both clubs are very similar and that is effectively what the share price is measuring and what you are buying when you buy shares in a company, a share of its future earnings in the form of a dividend. Football clubs tend to be different in that earnings require to be ploughed back into the team to ensure future earnings, thus leaving little to return to the shareholders. This is why investment in a football club is usually for the love of the club and/or status but not for financial gain.

SDM recognises that realisitically he can only get c. £40m for his shares in Rangers unless there was more than one interested party and a bidding war drove up the share price but this is highly unlikely. A bit like selling your house, 2 or more interested parties gets you a better price. The buyer would of course take over the debt which probably sits at c. £30m as we move into season 2009/2010, but should come down this year on the back of CL and wage bill cuts.

What we ideally need is sommeone or a consortium who are willing to put up in excess of £70m, £40m to buy out SDM, £30m to pay down the debt and anything extra to go on the team. SDM has also added another criteria that the buyer had to have Rangers best interests at heart. Unfortunately not easy to find such a beast, hence his inability to sell despite trying for several years. Another couple of good years in the league and the CL money that comes on the back of it will allow the debt to be paid down and make Rangers much more attractive to potential buyers

[boss 1,941]

Rangers ..... = £41m

Celtic ..... = £37

I know it was a typo in your post, but it made me laugh. I'll give you forty quid for them.

[likeacare 9]

cacafuego... I smell shite!

Most of if not all of the stats, which aren't totally accurate, you could find out on google.

Is there a point? Why quote this?

I'm bemused.

Email of the year, eh?

[BLUE CYCLOPS 26]

Not the same subject, I know but curiosity forces me to ask. I don,t always understand the fine details of balance sheets, and I,m sure I,m not the only one.

Can anyone tell me the total share holding for Rangers and the price per share = total value of the club, and the same figures for Septic.?

Purely for interest sake.

Rangers have 109m issued shares currently trading at a mid price of 37.5 p per share therefore= £41m

Celtic have 89m issued shares currently trading today at 41p per share therefore = £37. Celtic also have 485m of "preference shares" which are not quoted in the market but probably have a much lower value than the ordinary shares so may add anothe £5m to £10m to Celtic value.

Basically the maket place sees both companies values similarly which is not surprising as they are in the same industry, operating in the same league, similar world wide fan base and have an equal chance of competing in Europe. This means future earning potential of both clubs are very similar and that is effectively what the share price is measuring and what you are buying when you buy shares in a company, a share of its future earnings in the form of a dividend. Football clubs tend to be different in that earnings require to be ploughed back into the team to ensure future earnings, thus leaving little to return to the shareholders. This is why investment in a football club is usually for the love of the club and/or status but not for financial gain.

SDM recognises that realisitically he can only get c. £40m for his shares in Rangers unless there was more than one interested party and a bidding war drove up the share price but this is highly unlikely. A bit like selling your house, 2 or more interested parties gets you a better price. The buyer would of course take over the debt which probably sits at c. £30m as we move into season 2009/2010, but should come down this year on the back of CL and wage bill cuts.

What we ideally need is sommeone or a consortium who are willing to put up in excess of £70m, £40m to buy out SDM, £30m to pay down the debt and anything extra to go on the team. SDM has also added another criteria that the buyer had to have Rangers best interests at heart. Unfortunately not easy to find such a beast, hence his inability to sell despite trying for several years. Another couple of good years in the league and the CL money that comes on the back of it will allow the debt to be paid down and make Rangers much more attractive to potential buyers

Many thanks M8. Not being financially minded I need everything condensed into simple words of one syllable.

[outlaw69uk 123]

Rangers ..... = £41m

Celtic ..... = £37

I know it was a typo in your post, but it made me laugh. I'll give you forty quid for them.

:lol; I'll go halfs with you, we can sell it to a car park manufacturer for a big profit

[TheWholeStruth 7]

I'd be interested in your opinion what you think the figure will be, and also your thinking behind it. Personally I think the figure will be in excess of £35m. This is based on my (admittedly amateur) own conclusions.

Edit - I should add, I'm shattered and off to my scratcher and look forward to your reply (if you choose to give one) in the morning.

It is impossible to tell. For instance, none of us know the timing of the cashflow for transfers in and out (normally paid over a period of years). Say £4m of the Hutton money was still due in. Did we receive some or all of that before 30/6/09? That alone would have a £4m effect on the cashflow. And there are many other unknowns.

Anybody giving a definitive figure before the accounts are published is just guessing.

So I'll say £31,805,266.12.

Thanks for the reply.

Oh, and I'll hold you to that figure.

[come on the gers 0]

Not the same subject, I know but curiosity forces me to ask. I don,t always understand the fine details of balance sheets, and I,m sure I,m not the only one.

Can anyone tell me the total share holding for Rangers and the price per share = total value of the club, and the same figures for Septic.?

Purely for interest sake.

Rangers have 109m issued shares currently trading at a mid price of 37.5 p per share therefore= £41m

Celtic have 89m issued shares currently trading today at 41p per share therefore = £37. Celtic also have 485m of "preference shares" which are not quoted in the market but probably have a much lower value than the ordinary shares so may add anothe £5m to £10m to Celtic value.

Basically the maket place sees both companies values similarly which is not surprising as they are in the same industry, operating in the same league, similar world wide fan base and have an equal chance of competing in Europe. This means future earning potential of both clubs are very similar and that is effectively what the share price is measuring and what you are buying when you buy shares in a company, a share of its future earnings in the form of a dividend. Football clubs tend to be different in that earnings require to be ploughed back into the team to ensure future earnings, thus leaving little to return to the shareholders. This is why investment in a football club is usually for the love of the club and/or status but not for financial gain.

SDM recognises that realisitically he can only get c. £40m for his shares in Rangers unless there was more than one interested party and a bidding war drove up the share price but this is highly unlikely. A bit like selling your house, 2 or more interested parties gets you a better price. The buyer would of course take over the debt which probably sits at c. £30m as we move into season 2009/2010, but should come down this year on the back of CL and wage bill cuts.

What we ideally need is sommeone or a consortium who are willing to put up in excess of £70m, £40m to buy out SDM, £30m to pay down the debt and anything extra to go on the team. SDM has also added another criteria that the buyer had to have Rangers best interests at heart. Unfortunately not easy to find such a beast, hence his inability to sell despite trying for several years. Another couple of good years in the league and the CL money that comes on the back of it will allow the debt to be paid down and make Rangers much more attractive to potential buyers

Many thanks M8. Not being financially minded I need everything condensed into simple words of one syllable.

I also found the Brubear and Boss good easy to understand posts, we are not all into high finance and these guys make it much more clear.

[Bluedell 14]

I'd be interested in your opinion what you think the figure will be, and also your thinking behind it. Personally I think the figure will be in excess of £35m. This is based on my (admittedly amateur) own conclusions.

Edit - I should add, I'm shattered and off to my scratcher and look forward to your reply (if you choose to give one) in the morning.

It is impossible to tell. For instance, none of us know the timing of the cashflow for transfers in and out (normally paid over a period of years). Say £4m of the Hutton money was still due in. Did we receive some or all of that before 30/6/09? That alone would have a £4m effect on the cashflow. And there are many other unknowns.

Anybody giving a definitive figure before the accounts are published is just guessing.

So I'll say £31,805,266.12.

The transfer fee receivable in relation to the Alan Hutton sale is spread over a 29 month period to June 2010.

[BasileBoliSoup 9]

Just out of curiosity, why are you called cacafuego?

It's the nickname of a ship named after the Mother Mary.

[cacafuego 0]

cacafuego... I smell shite!

Most of if not all of the stats, which aren't totally accurate, you could find out on google.

Is there a point? Why quote this?

I'm bemused.

Email of the year, eh?

Hmm, lovely little soul aint you.

The point is that it is an article about our clubs finances that was all over the internet yesterday.

Seems like it led to some fruitful and interesting discussion on here, isnt that also the point?

It was my email of the day.

[brockstoker 0]

Hello Boss! Nice to hear from you again. I've annotated your response

Poor Broken Stocker.

He’s only about £47m out with his numbers

Nowhere do I quantify the loss. I stand by the assertion that unless someone values RFC at £100m MIH will have to write off the difference. As you point out it's well nigh impossible to work out just how much of the stock is held directly by MIH.

Even for Broken, that’s some sort of record. Like many stockbrokers and analysts he has plenty experience in commenting on consolidated accounts. But not in understanding them, and certainly not in the mechanics behind them.

Your faith in my abilities is touching. As you've never met me in any professional capacity that's quite a leap of faith on your part. The only material of mine you've read has been written with the non-financial reader in mind. I'm happy to sacrifice technical correctness, for layman's understandability.

But before the numbers, there is another point to make. He has completely failed to address the fact that the supposed ‘conflict of interest’ which may have caused SDM to stand down has subsisted since at least the share issue in 2004. At that time, it was in Rangers’ interests to be sold to a new owner for £1, but clearly not in the interests of Murray International Holdings.

Why then pen an article which suggests that a ‘conflict of interest’ that has been there for nearly 5 years is now a probable cause of SDM’s resignation? Perhaps because Broken had decided on his conclusion first and then tried to come up with some facts to fit. The implication of the title, with or without a question mark, is simply wrong. That ‘conflict of interest’ did not cause SDM’s resignation.

There are times when a potential conflict of interest does not matter. Given the increasing financial pressure both companies are coming under I would suggest that we have reached a point where it does matter.

On to the numbers. “Bottom line is that unless someone values RFC around £100m - £79m plus the debt - then MIH will have to write off the difference.”

Oh dear. Sadly Broken has double counted Rangers’ debt. It is already included in the £79m net asset value of Rangers that was consolidated last year. So he is already out by £21m which was last years debt figure. (As an aside, don’t be surprised if our net debt in the soon to be published accounts to 30 June 2009 is north of £30m.)

Not double counting. If I bought Rangers at book value of £79m (last year) I would also have to take on the debt of £21m, therefore I would have to value the club at £100m. You're surely familiar with the term Enterprise Value?

The next problem with his numbers might only be understood by the most nerdy of beancounters amongst us. You’ll probably need to take my word on this one; he has completely missed the point that there are substantial minority interests in Rangers.

The last time I looked, SDM actually beneficially owned closer to 60%-65% of Rangers (I can’t recall the exact figure and it would take me a few hours to work out the current position) even though he ‘controlled’ over 90%. These minority interests, Dave King amongst them, are obviously already excluded from the shareholders funds in the MIH balance sheet.

This means that any amount by which the sale proceeds fall short of the net asset value of Rangers is attributable about one third to the minorities. So Broken’s error here puts his number out by about one third of the £79m net assets of Rangers (i.e. £26m).

I've not quantified the actual loss to MIH. I stand by what I said; buy Rangers at less that £79m and MIH will take a hit to its balance sheet.

Finally, his comment: "Every year when the MIH accounts come out, the Celtc-minded always come up with "He's doomed" articles." You've got to laugh. Broken Stocker has himself been doing that for years. Seriously, you couldn't make it up.

You just have! I defy you to find any article that I have written saying MIH is doomed. I can assure you I've never written one. But hey, why let the truth get in the way of few cheap shots.

So two fundamental errors of £21m and £26m. No and No And a title and conclusion that make no sense. Maybe not to you!

Better luck next time. Et tu Brute!

[cacafuego 0]

Just out of curiosity, why are you called cacafuego?

It's the nickname of a ship named after the Mother Mary.

Cacafuego is a word which means 'a swaggering arrogant braggart or boaster'.

Apparently comes from the Spanish for 'shit fire' and is, as you rightly say, the nickname (fireshitter) of the Nuestra Señora de la Concepción which Sir Francis Drake captured in the 16th Century.

Happy now?

[boss 1,941]

I stand by the assertion that unless someone values RFC at £100m MIH will have to write off the difference.

So Broken Stocker is indeed a stalker. Surprised at your appearance given the financial maulings you have taken in years gone by. But welcome all the same.

Your comment above is simply wrong for the reasons in my first post. Wrong to the tune of about £47m. And this board deserves better than your half baked financial misunderstandings.

1. The £21m debt IS already included in the £79m net assets consolidated. Have a look at the accounts (page 14):

http://www.plusmarketsgroup.com/cgi-bin/re...rangers2008.pdf

If you still refuse to accept you are wrong I will type out the balance sheet for you. For goodness sake, if this is the basic error you made, heaven knows how you are going to understand the next point.

2. Your reply did not even mention the minority interests. Is that because you don't understand them? The minority interests at January 2008 represented about one third of Rangers. See MIH's balance sheet - I think the total minority interests were about £47m from memory, some of that re other MIH subsids. So only about two thirds of the value of Rangers is included in MIH's shareholder funds. So only two thirds of any shortfall in value will hit MIH's shareholders' funds. This point at least I won't blame you for not understanding - it is exceptionally complicated - but I am right.

So your assertion that "unless someone values RFC at £100m MIH will have to write off the difference" is wrong for the above two fundamental mistakes. (I won't complicate you further with your smaller mistake about goodwill.) Rangers isn't in the MIH shareholders' funds for anything like £100m and I defy you to prove otherwise.

Hope to have the opportunity to tear apart your financial analyses in the future.

Until we meet again.