Warehouse developer and fund manager ESR in October scored Hong Kong’s second-largest IPO of 2019, raising HK$14 billion ($1.8 billion) in cash, and instantly making multi-millionaires of its founders and early investors.
Now one of ESR’s shed magnates has decided to put a slice of that windfall to work buying a piece of his hometown football club.
Stuart Gibson, the Scottish co-founder and co-CEO of Hong Kong-listed logistics platform ESR, is said to be preparing to make an investment in Rangers Football Club, with UK media reports putting the figure at £20 million ($23 million).
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A source close to the ESR boss told Mingtiandi that Gibson, who declined to comment for this story, is a lifelong fan of the financially troubled Glaswegian club and would be funding the investment from his personal finances.
With Rangers having lost £11.3 million in the financial year ending 30 June 2019 and having fallen 13 points adrift of league leaders and cross-town rivals Celtic, the source said that Gibson just wants to help out.
The ESR co-founder is said to have no plans to take over the club, which is managed by former Liverpool star Steven Gerrard, despite rumours in the Scottish press that Gibson intends to buy out current chairman Dave King’s 25 percent stake in the club.
The cash injection would come at a particularly timely moment for the club, which faces a sharp drop in revenue following the suspension of the Scottish League as a result of the coronavirus pandemic.
With the bulk of Rangers’ earnings coming from gate receipts, merchandising and broadcasting rights, the club is looking to raise funds, according to the source, as it faces a league shutdown expected to last several months. During the most recent financial year, the club had already resorted to selling fresh equity to raise £18.2 million needed to cover its losses.
The reported £20 million bailout from Gibson will help foot a wage bill that, last year, cost Rangers £34.5 million, with average first team players earning just shy of £500,000 a year.
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Mingtiandi understands that Gibson was introduced to the club by fellow Scot George Taylor, who is Morgan Stanley’s Asia Pacific head of investment banking and handled ESR’s IPO last October, although the timing of the talks at Rangers’ home at Ibrox Stadium is unknown.
Gibson will be hoping that his personal investment will help Rangers close the gap on its ancient enemy Celtic, with the two clubs known as the Old Firm to locals. After having once dominated football in the land of single malts and haggis, Rangers have failed to win a league title since 2011, with the club having lived in the shadow of their Glaswegian rivals for the last decade.
But for the time being, the most pressing concern for the 148-year-old side will be financial survival, with the fallout of the Scottish League’s suspension already hurting smaller clubs. Hearts, which sit at the bottom of the table and face relegation, have asked players and staff to take a 50 percent pay cut as a result of the drop in income, in a move that is expected to be repeated elsewhere.
Rangers’ average first team salary has grown to £650,000 this season as the board tries to secure the club’s first league title in a decade, causing financial pressures at Ibrox to mount. South Africa-based King has bankrolled the club since he took over as chairman in 2015, rescuing the club three years after it went into liquidation.