Sports Direct strategy turns into a PR nightmare

Last updated : 16 June 2015 By Grandmaster Suck

Rangers released the results today of last Friday’s EGM.

The shareholders voted not to repay the £5million loan from MASH and, on the second resolution, to support the directors in seeking a re-negotiation  of the Sports Direct retail deal.

Resolution 1 - in favour of repaying the loan immediately - was voted on thus -

For - 29,376,675 (46.36%)

Against - 33,988,991 (53.64%)

That margin may seem narrower than expected but as was shown by the reaction to a couple of speakers at the EGM a lot of people just want Ashley out and the quicker the better.


Resolution 2 - relegation of the Sports Direct retail deal on a basis that is fair and reasonable -

For - 39,760,539 (62.5%)

Against - 23,852,291 (37.5%)

Obvious Ashley and the remnants of the Green Gang would have voted against.


Ashley and his advisors are not, one would think, stupid men.  But hey have been very foolish in pursuing this line of attack.  It’s ended in a PR disaster for them, increased the bitterness of the fans against Sports Direct and drawn the attention not just of Rangers fans but of millions of potential Sports Direct customers to their business practises.  Not a good day at the office.

The tactics employed were those of the bully - getting gagging orders against directors and serving them at their homes - calling an EGM which they know is expensive in monetary and in management time to carry through.   It’s Ashley trying to show he’s boss.  He’s only succeeded in looking like a time wasting halfwit.  To use Glaswegian parlance - he kopped a doing, and a very public one it was.

I thought the Board handled it almost perfectly - only two Rangers directors bothered to show up (along with the company secretary) and they just stood at the front of the stand - no desk, no chairs - complete indifference and contempt was shown.   They delivered their lines well and the tone of the meeting was highly anti-Ashley.   In fact, one of the largest cheers of the day was when one shareholder spoke in favour of giving him his money back just to be rid of him.

Things are, or course, a little more complicated than that.   Dealing with Ashley is like holding a fish - you need several points of pressure to be able to control him - holding back the loan repayments and the fans boycotting merchandise are very worthwhile weapons in the Rangers armoury.   Don’t forget that as well as Newcastle Ashley has business relationships with other clubs and he clearly intends to roll out a model which involved shirt sponsorship and control of club shops as a means of expansion - he actually needs the Ibrox example like a hole in the head.

However powerful Ashley appears - and he certainly is - he is not super human.   He’s faced shareholder revolts in the past and the shambolic performance of his company chairman in front of the House of Commons committee are a couple of examples of where pressure can be applied.

Sports Direct provide one possible route to market for Rangers - and the alternative of rebuilding what we once had before David Murray hived off the family silver seems a distant memory - and one that can be beneficial to both parties if the terms are right.

The problem for Sports Direct is that Rangers fans have become interested in every nook and cranny of the club’s business over the last few years - if the club if getting a pittance for each shirt sold then the sales simply will not come until the contract is rebalanced.

The way forward is negotiation - but it also needs continued pressure from fans to keep minds focussed.