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FORMER Ibrox chairman Alastair Johnston today unleashes a ferocious
attack on Sir David Murray’s running of Rangers.
Accountant Johnston says Murray’s big spending took Rangers to the
brink of “Armageddon” – at which point he “panicked” and sold up to
hated Craig Whyte. And in a startling insight into the last chapter of
Murray’s reign, his former ally accuses him of letting his ego run out
of control.
Johnston says Murray ran Rangers as a “dictatorship” and blasts him
for allowing Rangers’ fortunes to become entangled with the rest of
his empire.
SIR David Murray allowed his
ego to run riot at Rangers, then made a “panicked” decision to sell
the club as it teetered on
the brink of ruin.
That’s the explosive verdict of former Ibrox chairman Alastair
Johnston on Murray’s Ibrox “dictatorship”.
In an unprecedented and
extraordinarily detailed attack on Murray’s stewardship of the club,
Johnston claims the tycoon was
warned extensively about the dangers of selling to Craig Whyte.
He says Murray carried on with the deal because of “significant
pressure” from the club’s bankers.
And he says a senior boss at the bank told him that Lloyds, who were
owed £700million by the rest of Murray’s empire, had “incentivised”
Murray to hand Rangers to Whyte.
Johnston, 63, once a close ally of Murray, now no longer speaks to him.
In our exclusive interview, he said: “Chairmen and chief executives
are often the subject of fans’ ire for selling players, or allowing
guys to leave because of unaffordable wage demands and so on. On the
the other hand, you take Sir David Murray.
“He got too immersed in the fans’ perception of himself – as well as
his own ego and invincibility, probably.
“In the last few years he lost his business discipline, then panicked
when he saw Armageddon coming.”
Murray, who famously boasted in 2000 that Rangers would spend £10 for
every £5 spent by Celtic, sold Rangers to Whyte a year ago for £1.
The Record has told how, before the sale, a private investigator’s
report on Whyte’s business record was passed to the Ibrox board.
And Johnston, who was ousted by Whyte soon after his takeover, spoke
at length about how closely Murray and his Murray Group of businesses
were made aware of what the detective had discovered.
His allegations are highly significant, given Murray’s later
insistence that he had been “duped” by Whyte.
The SFA disciplinary panel who slapped a transfer embargo on Rangers
criticised Johnston, and other men on the Ibrox board, for not doing
enough to stop the sale.
But Johnston said he and his colleagues expressed their concerns about
Whyte “very vocally”. And he insisted there was only one man with the
power to keep him out – Murray.
Johnston said of the detective’s report: “It was made available to us
and I did see it, like I saw a lot of other information and data that
was presented to us or leaked.
“But all that information was shared with the Murray Group, because
there wasn’t much we could do about it other than jump up and down and
scream and shout, which is what we did.
“In terms of something to do about it – that is, not consummate the
transaction for these reasons – then David Murray really looks like the
only person who could actually have done something.”
Johnston added: “There were a lot of inconsistencies in Whyte’s
personal profile – where he lived, who he
was registered with, anonymous addresses and so on.
“Liberty Capital, the ultimate
guarantor of his so-called arrangement with Rangers, was formed out of
a warehouse in industrial Miami
where nobody had ever heard of him or the company.
“So we had a lot of due diligence and checked up on him, but that
information was fed to the Murray group.”
Johnston, a Glasgow-born expert in sports accountancy, joined the
Ibrox board in 2004 and became chairman in 2009. By then, the credit
crunch had hit and the fallout was still having a massive effect.
And he says Murray was under “significant pressure” from the bank, who
wanted a more independent board, to get out of his day-to-day running
of the club.
He said: “The bank, rightly or wrongly, thought David’s presence was
so omnipotent. They thought there was really just one man, and the
ruling by dictatorship had not worked.”
By this time, Rangers’ bankers were Lloyds, who took over the club’s
previous bank, Bank of
Scotland, at the height of the
financial crisis.
Johnston said Murray had enjoyed a “very good relationship” with Bank
of Scotland.
But he added that it was “probably too good”, and the bank had loaned
miillions to Rangers “too easily” without proper checks and balances.
He went on: “When Lloyds came, I think they knew to some extent there
was a lot of toxic debt. But I don’t think they quite realised the
extent of it.
“They realised the governance and operations needed tidying up.”
When Johnston became chairman, he was “shocked” to find all
discussions involving the bank were dealt with personally by Murray
and the Edinburgh team who helped run the rest of his empire, which
spans call centres, metal firms and commercial property.
He said: “Nobody at Rangers Football Club knew the bank. The bank
didn’t deal with Rangers.
“It was totally incongruous in my experience that a bank that loaned a
company £40million had no history in dealing with the chief
executive or finance director of
that company.”
In 2009, two new men were appointed to the Rangers board.
One was Murray’s right-hand man, Mike McGill. The other, financial
strategist Donald Muir, was the eyes and ears of Lloyds.
Muir’s arrival was seen as a sign that Murray’s hold over the club was
weakening.
Johnston said it was a
condition of the bank’s renewal of the club’s credit facility.
He added: “Within two years of my chairmanship with an independent
board, we reduced the debt from about £35million to £18million.
“The bank, believe it or not, at that time were very happy with us.
Our arguments with them were more
about reducing the debt by another £2million to £16million, in order
for them to be totally satisfied it was a sustainable working debt.”
Then, early last year, the bank’s
position appeared to change – for reasons yet to become clear.
Johnston said: “They originally didn’t believe in Craig Whyte. That’s
the irony. They were as wary as we were about the fact he was one of
the ‘here today, gone tomorrow’ types that didn’t have the money.
“The first time they were invited to meet with Whyte in London, he
didn’t show up. It wasn’t until a couple of months before the
transaction concluded that the bank started to believe the deal might
be for real.
“David Murray and Craig Whyte got involved around October 2010. It
wasn’t until around March 2011 when the bank turned on us
very badly.
“They started talking much more seriously about Whyte. This was within
four or five weeks of the transaction being concluded.
“They basically saw a chance
to get all £18million back in one
fell swoop.”
It was at this time, Johnston claims, that a senior bank executive
told him Murray had been “incentivised” to seal the Whyte deal.
He said: “I pointed out to the banker that I felt David Murray may not
want to sell.
“The reply, and this is a very key statement, was, ‘Alastair, David
Murray is heavily incentivised to get rid of Rangers Football Club.
Let me leave it at that.’
“I understood that to mean that certain things would then be
triggered in his £700million
relationship between Murray Group and the bank.”
Johnston said Murray first mentioned Whyte’s name to him in November 2010.
He recalled: “David Murray rang me on my mobile and said, ‘I think
we’ve got someone and this is a really good one. Unlike any others
before, he’s spent a lot up front.
“‘He’s hired some high-powered lawyers and spent some money on them,
and he’s hired a high-powered PR team. He’s spent a lot of money on it
so he must be serious.’”
But the sale turned out to be, as Murray now calls it, a “huge
mistake”.
Johnston said: “One of the
big giveaways about Craig Whyte was the fact he wasn’t worried about
working capital. He didn’t
care about it.
“He was much more concerned about the contracts.
“His modus operandi was, ‘How many of them can we get out of, how many
of them can we deny paying until at least some of them will drop by
the wayside.’”
In another withering criticism of Murray, Johnston added: “Whyte
didn’t put a cent into the club, as we all know.
“That’s why I was jumping up and down and telling anyone who would
listen. But there were only some people who would listen.”
Murray last night declined to respond to Johnston’s attacks. He said:
“I will keep my counsel on this for a future date.”
Lloyds refused to explain why they were so keen to see Rangers sold,
or to respond to the allegation that Murray was “incentivised” to
do the deal.
They said: “The deal was a matter between Craig Whyte and Sir David Murray.
“The bank’s involvement was in relation to the debt owed by Rangers
FC, which was repaid in full, in accordance with all required
regulatory checks.”
attack on Sir David Murray’s running of Rangers.
Accountant Johnston says Murray’s big spending took Rangers to the
brink of “Armageddon” – at which point he “panicked” and sold up to
hated Craig Whyte. And in a startling insight into the last chapter of
Murray’s reign, his former ally accuses him of letting his ego run out
of control.
Johnston says Murray ran Rangers as a “dictatorship” and blasts him
for allowing Rangers’ fortunes to become entangled with the rest of
his empire.
SIR David Murray allowed his
ego to run riot at Rangers, then made a “panicked” decision to sell
the club as it teetered on
the brink of ruin.
That’s the explosive verdict of former Ibrox chairman Alastair
Johnston on Murray’s Ibrox “dictatorship”.
In an unprecedented and
extraordinarily detailed attack on Murray’s stewardship of the club,
Johnston claims the tycoon was
warned extensively about the dangers of selling to Craig Whyte.
He says Murray carried on with the deal because of “significant
pressure” from the club’s bankers.
And he says a senior boss at the bank told him that Lloyds, who were
owed £700million by the rest of Murray’s empire, had “incentivised”
Murray to hand Rangers to Whyte.
Johnston, 63, once a close ally of Murray, now no longer speaks to him.
In our exclusive interview, he said: “Chairmen and chief executives
are often the subject of fans’ ire for selling players, or allowing
guys to leave because of unaffordable wage demands and so on. On the
the other hand, you take Sir David Murray.
“He got too immersed in the fans’ perception of himself – as well as
his own ego and invincibility, probably.
“In the last few years he lost his business discipline, then panicked
when he saw Armageddon coming.”
Murray, who famously boasted in 2000 that Rangers would spend £10 for
every £5 spent by Celtic, sold Rangers to Whyte a year ago for £1.
The Record has told how, before the sale, a private investigator’s
report on Whyte’s business record was passed to the Ibrox board.
And Johnston, who was ousted by Whyte soon after his takeover, spoke
at length about how closely Murray and his Murray Group of businesses
were made aware of what the detective had discovered.
His allegations are highly significant, given Murray’s later
insistence that he had been “duped” by Whyte.
The SFA disciplinary panel who slapped a transfer embargo on Rangers
criticised Johnston, and other men on the Ibrox board, for not doing
enough to stop the sale.
But Johnston said he and his colleagues expressed their concerns about
Whyte “very vocally”. And he insisted there was only one man with the
power to keep him out – Murray.
Johnston said of the detective’s report: “It was made available to us
and I did see it, like I saw a lot of other information and data that
was presented to us or leaked.
“But all that information was shared with the Murray Group, because
there wasn’t much we could do about it other than jump up and down and
scream and shout, which is what we did.
“In terms of something to do about it – that is, not consummate the
transaction for these reasons – then David Murray really looks like the
only person who could actually have done something.”
Johnston added: “There were a lot of inconsistencies in Whyte’s
personal profile – where he lived, who he
was registered with, anonymous addresses and so on.
“Liberty Capital, the ultimate
guarantor of his so-called arrangement with Rangers, was formed out of
a warehouse in industrial Miami
where nobody had ever heard of him or the company.
“So we had a lot of due diligence and checked up on him, but that
information was fed to the Murray group.”
Johnston, a Glasgow-born expert in sports accountancy, joined the
Ibrox board in 2004 and became chairman in 2009. By then, the credit
crunch had hit and the fallout was still having a massive effect.
And he says Murray was under “significant pressure” from the bank, who
wanted a more independent board, to get out of his day-to-day running
of the club.
He said: “The bank, rightly or wrongly, thought David’s presence was
so omnipotent. They thought there was really just one man, and the
ruling by dictatorship had not worked.”
By this time, Rangers’ bankers were Lloyds, who took over the club’s
previous bank, Bank of
Scotland, at the height of the
financial crisis.
Johnston said Murray had enjoyed a “very good relationship” with Bank
of Scotland.
But he added that it was “probably too good”, and the bank had loaned
miillions to Rangers “too easily” without proper checks and balances.
He went on: “When Lloyds came, I think they knew to some extent there
was a lot of toxic debt. But I don’t think they quite realised the
extent of it.
“They realised the governance and operations needed tidying up.”
When Johnston became chairman, he was “shocked” to find all
discussions involving the bank were dealt with personally by Murray
and the Edinburgh team who helped run the rest of his empire, which
spans call centres, metal firms and commercial property.
He said: “Nobody at Rangers Football Club knew the bank. The bank
didn’t deal with Rangers.
“It was totally incongruous in my experience that a bank that loaned a
company £40million had no history in dealing with the chief
executive or finance director of
that company.”
In 2009, two new men were appointed to the Rangers board.
One was Murray’s right-hand man, Mike McGill. The other, financial
strategist Donald Muir, was the eyes and ears of Lloyds.
Muir’s arrival was seen as a sign that Murray’s hold over the club was
weakening.
Johnston said it was a
condition of the bank’s renewal of the club’s credit facility.
He added: “Within two years of my chairmanship with an independent
board, we reduced the debt from about £35million to £18million.
“The bank, believe it or not, at that time were very happy with us.
Our arguments with them were more
about reducing the debt by another £2million to £16million, in order
for them to be totally satisfied it was a sustainable working debt.”
Then, early last year, the bank’s
position appeared to change – for reasons yet to become clear.
Johnston said: “They originally didn’t believe in Craig Whyte. That’s
the irony. They were as wary as we were about the fact he was one of
the ‘here today, gone tomorrow’ types that didn’t have the money.
“The first time they were invited to meet with Whyte in London, he
didn’t show up. It wasn’t until a couple of months before the
transaction concluded that the bank started to believe the deal might
be for real.
“David Murray and Craig Whyte got involved around October 2010. It
wasn’t until around March 2011 when the bank turned on us
very badly.
“They started talking much more seriously about Whyte. This was within
four or five weeks of the transaction being concluded.
“They basically saw a chance
to get all £18million back in one
fell swoop.”
It was at this time, Johnston claims, that a senior bank executive
told him Murray had been “incentivised” to seal the Whyte deal.
He said: “I pointed out to the banker that I felt David Murray may not
want to sell.
“The reply, and this is a very key statement, was, ‘Alastair, David
Murray is heavily incentivised to get rid of Rangers Football Club.
Let me leave it at that.’
“I understood that to mean that certain things would then be
triggered in his £700million
relationship between Murray Group and the bank.”
Johnston said Murray first mentioned Whyte’s name to him in November 2010.
He recalled: “David Murray rang me on my mobile and said, ‘I think
we’ve got someone and this is a really good one. Unlike any others
before, he’s spent a lot up front.
“‘He’s hired some high-powered lawyers and spent some money on them,
and he’s hired a high-powered PR team. He’s spent a lot of money on it
so he must be serious.’”
But the sale turned out to be, as Murray now calls it, a “huge
mistake”.
Johnston said: “One of the
big giveaways about Craig Whyte was the fact he wasn’t worried about
working capital. He didn’t
care about it.
“He was much more concerned about the contracts.
“His modus operandi was, ‘How many of them can we get out of, how many
of them can we deny paying until at least some of them will drop by
the wayside.’”
In another withering criticism of Murray, Johnston added: “Whyte
didn’t put a cent into the club, as we all know.
“That’s why I was jumping up and down and telling anyone who would
listen. But there were only some people who would listen.”
Murray last night declined to respond to Johnston’s attacks. He said:
“I will keep my counsel on this for a future date.”
Lloyds refused to explain why they were so keen to see Rangers sold,
or to respond to the allegation that Murray was “incentivised” to
do the deal.
They said: “The deal was a matter between Craig Whyte and Sir David Murray.
“The bank’s involvement was in relation to the debt owed by Rangers
FC, which was repaid in full, in accordance with all required
regulatory checks.”
