RANGERS chief executive Derek Llambias wanted the Douglas Park consortium to vote in support of current board members as a condition of accepting its offer of a £6.5 million loan, it was claimed on Monday night.
It is understood that Llambias wanted a guarantee that the Park consortium would not vote against James Easdale when an extraordinary general meeting is held in a few weeks. The consortium would not agree to that and its offer of emergency funding was turned down, with a £10m loan package from Sports Direct tycoon Mike Ashley approved by the board instead.
Park's consortium has criticised that decision and insisted that the board damaged the club by accepting another Ashley loan on unfavourable conditions. Park, George Letham and George Taylor, known as The Three Bears, purchased a 16 per cent stake in Rangers for around £2.7m and wanted to provide short-term funding to the current board in return for two places on the board and security over Murray Park.
"Our main aim was to make short term funding available to the club to ensure that an insolvency event would be avoided," said a spokesman for the consortium. "Our final offer to the Board was for a facility totalling £6.5m. A £4.5m tranche of the facility could be converted to equity at a future share issue (which we would partially underwrite)." The Park consortium will vote in favour of resolutions submitted by former director Dave King at an EGM he has called, the date of which has still to be announced by the board. King wants to oust Llambias, James Easdale, David Somers and Barry Leach from the board and have himself, Paul Murray and John Gilligan appointed.
"At one stage during the negotiations we indicated that we could increase our funding package to £10m to match the Sports Direct facility and indeed provided proof of funds in excess of this amount," said the Park group's spokesman. "However after the EGM was called we felt that agreeing an excessive long term loan package with a board who may be removed in six weeks was not appropriate.
"We were subsequently advised by Derek Llambias that our funding offer would be difficult for the board to accept if we did not provide irrevocable undertakings to vote against EGM resolutions to remove certain existing board members. We felt this was completely inappropriate and advised that our current funding offer was not affected by the EGM process.
"The announcement from the Board suggests that the SD facility is interest free but the loss of revenue to the club from the transfer of 26 percent of the share capital in RRL [Rangers Retail Limited] and 50 percent of the shirt sponsorship proceeds from 2017/18 equates to an annual interest rate significantly higher than our offer and probably in double digits. Security for the Sports Direct facility involves the club's registered trademarks and a floating charge over the club's assets. This is disadvantageous to the club compared to the security required under our offer.
"We fail to see how the Sports Direct facility can be described as better for the club than the funding offer we made. It isn't and should not have been accepted if the best interests of all the shareholders were considered. Acceptance of the Sports Direct facility will do nothing to repair relationships with the fans which is critical in improving the revenue streams of the club."
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