EXCLUSIVE – Graham Duffy outlines his plans for a supporter-led takeover of Rangers Football Club

Duffy’s proposals have been the subject of great debate since. In an exclusive interview with Darrell King from his home in Florida, Duffy responds to the issues every Rangers fan has been talking about since he went public last Saturday.

What is your motivation behind the moves to lead a fans buy-out 
of Rangers?

I have been a lifelong supporter; although I live abroad it does not dilute the affection for the club and its history. The reason I decided to get involved was one of necessity.

Being a businessman and understanding certain events, I was concerned when Sir David Murray suddenly resigned as chairman. The speed in which matters unravelled caught everyone by surprise. These decisions are not taken lightly, but they are taken for a reason. I think that every Rangers fan would admit that they assumed all was well at the club. But to suddenly be informed that the club was at risk, whether it was or not, caught many by surprise. Subsequently, to sit on the sidelines and wait to see what direction the club was going in was unacceptable.

Will there be any monetary gain for you in this plan?

No. This proposal has no monetary gain for any individual. The investment by the supporters shall not be invested in any other company other than Rangers.

Why should fans invest hard cash when you don’t intend to? It appears your plan is to underwrite the club’s £31m debt, but not actually invest?

I have already invested a fair bit of money at this time, albeit it is not millions of pounds. There is a business plan proposal which would ring-fence the current financial situation, as there has been no due diligence carried out at this time.

The plan is based upon three stages, short-term, medium-term and long-term. To allow the ­
short-term plan to be implemented, the creditors of Rangers Football Club plc must be secure and amicably agreeable to the proposals to permit the transition; without this support this cannot proceed.

Being realistic, it is highly unlikely that 45,000 or even 15,000 supporters are going to invest the funds required to resolve the initial situation, therefore certain individuals must underwrite certain debts that come with the acquisition, which is a severe risk to these individuals. Individuals lending money or gifting money brings risk at the same time, so this has been avoided. These individuals will also be investing by becoming members just like every other supporter, I most certainly will be buying a good few memberships, but as a supporter.

As for the fans investing money, they already do and have done for over 100 years. They are the single biggest investors in the club and, to be honest, they are not investing in a financial reward, they are investing in winning trophies and being proud to be a Rangers Supporter.

In summary, every individual, be they supporter or a member of the initial consortium involved in this plan, will be investing money, some more than others.

W ould you be prepared to invest hard cash, rather than guarantee the debt, into a takeover plan?

Individually, I have invested hard cash, but this is not a case of the club transferring from one individual ownership to another.We have to avoid a sticking plaster scenario and focus on the longer-term structure of the club. There is no need to invest hard cash in the short term. Certain mechanisms must be activated in the plan before there is any real hard cash, due diligence must be completed, problems must be solved, we have to tidy up and consolidate firstly.

If another party introduced a different business plan and wanted your support would you provide it? Would you be prepared to invest cash to help other parties improve the situation of the club?

I want what is best for Rangers
and if that plan is in the best 
interests of Rangers then I would assist whoever wished assistance. 
I already have stated that there are a lot of complications to opening a chequebook. I am not aware of any multi-millionaires who keep £200m cash in the bank, they must reinvest their capital to earn from it. I don’t think a 0.5% return on money in the bank is enticing, they would be using their capital at this time as there are a lot of bargains available, so in essence they would have to enter the debt market to invest hard cash and again this brings us back to the current situation. Do I think that others I have been in discussions with would invest some capital -- including myself? I would have to say yes, but with conditions.

How many people have you spoken to regarding forming a consortium?

I have been in discussions with a handful of individuals, some more than others, whose identities shall remain private. I wished for the discussions taking place and the individuals involved to be anonymous -- including myself. When you contacted me a month ago, I stressed my desire to have the plan progressed further before going public. Unfortunately, someone who knows me personally breached a trust and gave my details to another member of the press, and I decided to go public last week.

Did the others fully support your business plan?

They also have the best interests of Rangers at heart and they wish to have this situation resolved as soon as possible. We have had minor disagreements on some issues, but 
it was more to do with eliminating any potential impact on the club. 
In general, we have broad agreement on the way forward.

Why have they chosen not to go public and will they do so soon?

No one involved in this wished to go public, we would have preferred to have moved matters further on and completed matters at hand rather than dealing with the publicity, positive or negative. I am sure that, should the plan be adopted, then there will be no way anyone can remain anonymous as certain public documents have to be executed.

You have said that the fans have to back the plan before it can be implemented. How are you going to gauge this? Do you plan a referendum of the support?

This has been the biggest unknown. There is no guarantee that the Rangers supporters will stand up and invest in their club, but being a supporter I know at this time they will do all they can to assist in resolving this matter. We respect the fact that not everyone has cash in the bank, especially in this current climate. This is something again that has to be considered and we have proposed offering a finance package that can be paid in instalments making it more affordable and available to as many supporters who sincerely wish to become an owner of the club.

If they vote against it, would you walk away? And is a verbal pledge enough of a guarantee from the support? What if they didn’t back it up?

If the supporters withdraw their support then the club is finished -- 
the club only exists because of them. If this proposal is voted down then it will have to be revisited. Whether a revised plan could work would be down to circumstances.

The figures have stated you want 45,000 supporters over three years to invest £1000, raising £45m. In the current climate, is this realistic?

It would irresponsible and unrealistic to assume that everyone would want to just open their chequebook at this time. Some supporters do have the finances available and want to invest immediately, some supporters don’t have the finance available at this time but really wish to invest, some supporters may wish to see some progress and would choose to invest when they were satisfied that it was in their interests. I have been told by people this week that 45,000 is too low, some say it is too high, but to complete the plan we had to take into consideration some facts and we had to assume some other uncertainties. I personally feel that Rangers have an unbelievable number of supporters globally, hundreds of thousands, and 45,000 is a very small percentage to rely upon.

What would the contingency plan be if the fans only raised, say £20m? Who would meet the difference as clearly the business plan would be underfunded?

The business plan is malleable, it is not carved in stone. Again I go back to certain assumptions being made. The business plan is a bit like a road map, it allows you to map out your journey from A to B. We would assume that the map is factual and we will not have any diversions. We never assume that there will be no road works or diversions, but we believe one thing, we will get to B. That is the same as the business plan, it will change and alter as required. The business plan and the proposals are not solely about the football side. Rangers are a huge untapped successful brand, this business plan has many different revenue steams that will come online in the future.

What will the annual membership fee be?

Again the membership is based upon assumptions. There is no definitive answer as it is down to what the response is and how many members come on board. This is not a quick capital injection, it has to be monitored and corrected as progress is made. It is also not just a case of grab as much money as possible, there are benefits to being a member, there will be discounts and rewards. But again we have to assume an acceptable level of support and an unacceptable level of support, so the figures being used are between £50 and £200.

So fans have to pay £1000 as a one-off fee to become a member. Then an annual fee of £50-£200. 
And then a season ticket and all other costs? Is that feasible?

As I have stated previously, between discounts and rewards the supporters should not be expending much more than they are at this time. It is difficult to complete this transition without some form of contribution and support. The supporters have voiced their wish to become an owner of the club. According to the last accounts, Rangers had net assets of £113m, that is the stated assets; the supporters want ownership of the club and therefore the assets. To ask 45,000 members to contribute £1000 only raises £45m, not even half the value of the asset, this investment in turn is being used to eliminate any risk to that asset, which makes the asset even more secure, however, this comes with a price and a commitment.

What would your role at the club be should this plan go ahead? Would you like to be chairman, or would you sit on the board?

The proposal consists of three new Special Purpose Vehicle companies being formed. There is a constitution for each of these companies, a competent board of directors, strategic planning process and a mission statement, all in place prior to trading. Once the proposal gets to the stage of acceptance and proceeds, my role is over. At that time there would be no need for any further assistance from me -- the job will have been done. Although it would be a privilege, I have no interest in being on the board of Rangers. I would be doing the position an injustice as I would not be able to fulfil the obligations due to my other business interests and commitments.

Would you like to keep Walter Smith on as manager, should your plan go ahead?

I personally think that Walter Smith will go down in history as one of the club’s greatest ambassadors and managers. He has such a great bond and alliance with his players and I sincerely feel that he is the man for Rangers. It would be morally and ethically wrong to base the recent performances at his door -- he has been keeping motivation going in the face of uncertainty. I think that Smith should be given the respect that is deserved and one of the first port of calls -- should this succeed -- would be to sit down with the manager and discuss the proposals.

What funds would be made available to strengthen the team in your plan?

Should this succeed then everyone has to be realistic. The first priority is to stabilise Rangers and begin implementing the plan. Again it would require a discussion with the manager to find out what his thoughts are on the matter, as he is the one most qualified to decide. The plan is not an open chequebook. We paid 77% of our revenue on salaries last year, Barcelona spent 14% -- that speaks volumes. We would have input from the manager as to what he has, what he wants and what he wishes to dispose of. Once that is determined, then figures can be identified.

You have spoken of revamping the youth structure. How would you propose to do this?

I think that we must not lose sight of matters -- we must invest in our youth, on and off the park. Rangers made a significant investment in their training facility, an investment that must produce dividends. In my opinion the investment has failed to date, so something is wrong.

I know I have mentioned Barcelona and some observers have dismissed any comparison. Well my opinion is that Barcelona are succeeding in attracting youth and have grown so many international players from their programme that has made them the success today. They have managed to get a dividend out of their strategy and investment, the structure exists and is proven.

I never compared Rangers’ revenue last year to Barcelona, or the success or lack of success of Hamburg, I merely stated that Barcelona have managed to succeed where we have failed. Taking a 13-year-old kid from Argentina and nurturing and growing that player is not expensive -- it is their method and strategy that permitted this. We must follow in a similar path. I don’t think it is unrealistic to think that we cannot achieve youth growth, I also don’t think it is unachievable. Rangers are a massive club, they just have to acknowledge this fact.

Can you detail any of the fresh ideas you would bring to the club?

Every avenue of historical trade has to be visited and see what needs to be done. But the one thing we cannot disregard is the fact that Rangers are a company, a sports company, which has grown into a brand. I think Rangers have incredible potential in all areas of business. I think rather than Rangers demand that the masses come to them, Rangers shall in turn go to them.

I feel that strategic alliances should be made with clubs globally, the brand should be expanded on a global basis, the club should become a members club, we should get more involved with our supporters clubs, we should be sponsoring other activities and expanding into other sports activities … there are too many ideas to outline at this time, but I think it is time for Rangers to awake from the slumber and be what they are -- a successful global player on a global stage. It is time for the club to tap into its own energy and expand beyond its current borders.

Have you spoken to Lloyds Banking Group directly? Have you spoken to the club’s majority shareholder, Sir David Murray?

I personally have not spoken directly to Lloyds Banking Group, but I can assure you that I am not concerned about the actions of the bank. I feel that Lloyds’ actions were in the best interests of the club, they are the ones who made moves to extract Rangers, which is a positive action. Rangers are indebted to the bank, the bank are entitled to play a part to secure their investment.

As for them allegedly having a member on the board, I feel that this is a necessity until such times as they are secure in the knowledge that the club is moving forward positively and constructively and the risk has been eliminated not only for them but for the club. They clearly acknowledge that Rangers are a viable going concern. I have not communicated with Sir David Murray.