Sir David Murray - The Man Behind the Facade
To answer those questions, we have to go back in time, to try to understand what drives Sir David Murray. At the height of his success, he was one of Scotland’s richest and most powerful men. He rubbed shoulders with Britain’s most influential people from Scotland’s first Minister to the future prime minister. Made a Knight of the realm in 2007, he boasted a personal fortune of £720 million. But, if I can find out what drove him to be such a success, maybe I can find out where it all went wrong.
I started by going to meet someone who knew the young David Murray as he was just starting out.
Peter Stevenson “He’s got a very unusual range of business skills. He’s a very good trader, he can deal successfully off the seat of his pants. But he is also a careful, clear thinker. He was, obviously, very bright, he was very quick, he’s a kind of guy who could buy something today for a pound and sell it tomorrow for £1.30 and then move onto the next deal. The other thing he had, and I saw this on several occasions, was that he had vision and the patience to develop something on a much bigger scale.”
Aged just 25, Sir David Murray who’d been a keen rugby player, was involved in a tragic road accident losing both of his legs.
Peter Stevenson “It seems to me, the accident, kind of galvanised him to wanting to make a success of his business and personal life. I think he would always have wanted to make a success, but the accident was a catalyst.”
By the mid-1970s, he had marked himself out as the number one metal trader in Britain. But, he would soon set his sights on targets much more glamorous.
Peter Stevenson “He told me about some metals convention he’d been to in Monaco. And he told me about meeting Joanna Lumley there. She’d have been a lovely 25-year-old then . And, he told me he’d had a crack at her, he told me he’d lost. But, the idea of the 26-year-old Scottish metal trader with no legs having a crack at Joanna Lumley. It tells you what a confident, assured guy he was, and honest, that he said he’d been rebuffed. ”
Maybe a metals trader was not the kind of title he needed to woo the likes of Joanna Lumley, he needed something else, it was time to move up to the big league and that meant buying a football club, and not just any football club.
In 1988, David Murray decided he wanted Rangers. He was no longer just a metal trader, he was now the owner of one of the most important institutions in Scotland. But, this audacious move could hold a clue for what was to come, because it wasn’t his own money that he put on the line. In a single phone call to the Bank of Scotland, he borrowed the £6 million he needed to buy the Ibrox club and changed his status in the world and Rangers place in history.
Sammy Paterson “We didn’t expect what was coming. The David Murray and Souness revolution. It was just phenomenal when that kicked off. It was like we could get anyone we wanted, the top players in Europe or wherever. Money was no object. And to see that kind of talent at Ibrox was just something else.”
Graham Spiers “Sir David Murray was a heralded figure, a euphoric figure. I remember banners at Ibrox, the Royal Bank of Murray, the Rangers fans revelled in this lavish, wealthy spending on the club, and the famous phrase for every fiver Celtic spend we’ll spend a tenner”
Sammy Paterson “To me, it was a godsend, just fabulous. It was some of the greatest times of my life as a supporter of Rangers football club.”
Graham Spiers “Everything about his relationship with Rangers in that first decade was so sweet for him, so ego-nourishing, made him feel a big man, a real player in industry and in society.”
So, David Murray had what he wanted and Rangers had what they wanted and the fans where in Blue Heaven. But, how much of this success was built on solid foundations?
This is Roger Isaacs, he’s one of the U.K.’s leading forensic accountants and insolvency experts and we’ve asked him to help us analyse David Murray’s business empire. And how its fortunes can be related to Rangers.
Roger Isaacs “If you look at the accounts for Murray International Holdings, for the year to 31 January 1999, you’ve got net debt at the start of the year of £69 million, at the end of the year £57 million. It then embarks on a period of rapid expansion where it borrows to acquire assets and properties. That borrowing is funded by the bank.”
Ian Fraser “The Bank of Scotland was very keen to grow its corporate lending book and it almost reached stage where the bank thought that Sir David Murray could walk on water. They would lend money for almost anything that he wanted.”
Rangers were coming good on the pitch again and had just won the first of three titles in a row. But that was hiding the true financial picture lurking in Murray’s accounts.
Having looked at these accounts, what was your opinion on the scale of the growth of the debts over the decade?
Roger Isaacs “Well, it’s easy to judge with hindsight. The question is when does responsible risk-taking become reckless gambling. But there is no doubt that by borrowing to the extent that this group borrowed, the group was embarking on a strategy that, by any definition, was high-risk.”
But Sir David Murray thought the higher risks were worth taking.
Sir David Murray “You know, if you don’t buy a ticket you can never win a prize. And what far too many people do, is go through life never taking any chances”
In Rangers case, that was an expensive ticket. In 2004, they owed the bank more than £70 million.
External Links
Sir David Murray - Wikipedia Page
