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The IPO Conumdrums

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One of the most surprising line items in the first RIFC published accounts was the £6.75m  “to acquire the assets from the administrators.” As I understood matters, the original placees provided the seed capital to acquire the assets and were later rewarded with an allocation  of equity. This was confirmed by the minutes of a board meeting and in the prospectus. So why was £6.75m deducted from the IPO pot?

The projections in the IPO prospectus were that £24.5m would be raised and that RIFC would bear the £2m costs of the share issue. The reality was that £22m was raised with costs of £5.9m. When you account for the £2.4m used to acquire  Edmiston House (£800,000) and The Albion Road Car Park (£1.6m), you are left with a balance of  £13.7m. From this amount £2.2m was spent on stadium facilities maintenance. When you then deduct the £6.75m, only £4.75m remains in the bank. This is then added to the £6.45m in season ticket returns as of June 30 to provide a balance of £11.2m.

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