Rangers on verge of megabucks American transformational takeover … or are they?
All the signs point to the Ibrox giants becoming the latest Scottish club to become a property of Americans ... but whether they will transform them remains to be seen
This piece was commissioned for the new Nutmeg Substack and I’m writing for them once a month. Those pieces will appear here, and over there. More about Nutmeg, the Scottish Football Quarterly, later.
A draft version of this piece was briefly published in error on Wednesday evening. Apologies.
Breaking news on Sky Sports earlier this week told viewers and readers that a takeover of Rangers had been “agreed in principle” with American investors including a “health insurance tycoon” and a senior figure from the San Francisco 49ers.
That NFL team are five-times Super Bowl winners and are valued at between $7.4bn and $9bn.
Depending where you heard that news - and the coverage was extensive across many media outlets - you might already know that among the rich and famous minority shareholders in the 49ers are actors Will Ferrell and Russell Crowe, Olympic swimming titan Michael Phelps, Major golf winners Jordan Spieth and Justin Thomas, businesswoman and socialite Paris Hilton, and NBA star Russell Westbrook.
It’s easy to get the picture: massive money and American glamour are about to arrive at Ibrox. But.
There is often a but. What we don’t know about this venture far outweighs what we do, as we shall see.
The aforementioned tycoon, variously described by different outlets as a “healthcare mogul”, a “high net worth American” and “a health insurance magnate” is a former banker called Andrew Cavenagh, about which there is limited detailed information in the public domain.
Cavenagh (below) is the co-founder of a Philadelphia-based insurance company, ParetoHealth, and until last month was its CEO; he has stepped down from that role to become executive chairman.
The senior 49ers figure is Paraag Marathe (below), the president of 49ers Enterprises - an investment company that takes stakes in non-NFL clubs and assets for the 49ers - and also the chairman of Leeds United, owned wholly by 49ers Enterprises since a £170m takeover in 2023.
The Sky story said these two men are leading figures in a US consortium that aims to buy “at least” 51 per cent of Rangers’ shares, completing the deal before next season. Due diligence is reportedly underway.
The same story and other outlets made claims about Cavenagh’s firm, saying variously that ParetoHealth “manage around £5.2bn ($6.6bn) in assets” and “manages over $8bn in assets.” That sounds massive. But what does it actually mean? We’ll get to that.
Marathe, as the chairman of Leeds, has made a hugely positive impression on those he has worked with and dealt with in English football.
“He’s a great guy,” said one source who knows him well. “He gets the sport business. He gets football. He understands fans and what they want. If I were a Rangers supporter, I would have no worries around him.”
Marathe himself has said absolutely nothing, on the record, about any Rangers bid or potential bid.
Somebody, almost certainly at Ibrox, has been providing information about the takeover. I don’t think it’s been coming from the 49ers side. I’ve been in touch with Marathe’s office several times this week and he has politely declined to talk, or indeed give any briefing, on or off the record.
The closest we have to confirmation from him that 49ers Enterprises are looking to add to their football portfolio came last week when Marathe appeared as a speaker at the Financial Times “Business of Football” summit.
"I can't really comment on whatever rumours might be out there," he said about reports that the 49ers want a share of Rangers.
“But like I said, we are always looking at other opportunities. We have been. And I think it is doable to replicate the passion.
"What we are looking for is clubs with the right bones, clubs with the right history of success. Clubs with the right potential for growth and if you're a sportsperson and you love it and you treat it as a way of life, so to speak, like I do, then absolutely there's enough room in your heart.
"Just like there is to love all of your children, there's enough room in your heart to love all your sports properties.”
So what is actually happening at Rangers?
Today’s piece will tell you, in detail:
The objective financial value of Rangers as a business, or to put it another way, how much could / should the US consortium spend for a majority stake?
The key figures who are actually in the driving seat in this deal.
The riches or otherwise of Andrew Cavenagh and his company: is he a sugar daddy with billions or a guy who has done well and has millions to spend?
Who are the current shareholders of Rangers who need to agree a deal, and how likely is it that they will?
The state of Rangers’ current finances and why they are potentially challenging to investors.
How the Rangers deal would differ from the deal that 49ers Enterprises deal that saw them take control of Leeds in 2023.
The possible motivation of 49ers Enterprises in buying a controlling stake in Rangers.
The regulatory issues that might - but almost certainly won’t - prevent a takeover despite the potential buyers of Rangers already owning Leeds.