Rangers International Football Club (RIFC) plc is expected to join London's junior market on 19 December. For fans, that means the opportunity to grab a stake in Glasgow Rangers, 54-times Scottish champions, as an early Christmas present. The official name is now Rangers Football Club Ltd. RIFC is to own and operate Rangers FC, which, after exiting administration earlier this year, is now debt-free but plying its trade in the fourth tier of Scottish football.
The complicated structure has not prevented Charles Green, chief executive, from drumming up interest among institutional investors ahead of the Aim listing. Mr Green had originally intended to raise £20m from the IPO, but £17m has already been committed, at 70p a share, from a range of investors. These include Hargreave Hale, which is to purchase 4.95m shares and acquire an 8.58 per cent stake (before the public offer). Artemis (7.43 per cent), Cazenove Capital (4.25 per cent) and Legal & General (3.47 per cent) are among the other investors. Pre-IPO investors also include Mike Ashley, UK retail entrepreneur and owner of Newcastle United, who has 3m shares.
Mr Green expects the public offer to raise another £10m, taking the IPO total up to £27m. Although £500 is the minimum price to get a stake in RIFC, that is unlikely to deter fans. According to one source, speaking to Investors Chronicle, Capita Registrars has received subscription demand for RIFC shares totalling £24m.
True, there are some concerns. Languishing in Scotland's fourth tier as punishment for going into administration, lucrative European football is some years away. The prospectus also mentions the threat of legal action from some players, complaining they were not consulted about contract changes after the old club was liquidated. Mr Green is no doubt counting on Rangers worldwide fan base, estimated to be in excess of 5m, to more than offset those negatives.
There are some reasons to think this football IPO might buck the trend of awful performance by football investments. For one thing, the assets - which include Ibrox (the club's stadium), the Murray Park training facility, the players and the brand - add up to around £100m. Moreover, by next May - when totting up the money from pre-IPO fundraising, the Aim listing and expected season ticket sales - RIFC could be sitting on a net cash pile of £50m. The IPO, however, gives RIFC a market cap of £50m. One to watch.