CRAIG Whyte used around £3 million of future income to refurbish Rangers' catering facilities.

The club entered into a hire purchase agreement with finance company Close Leasing in the middle of last year to pay for new kitchen equipment and to improve catering facilities.

The Herald understands that prior to the takeover, Azure, which provides catering at the stadium, agreed to put up £1m while Rangers put up nearly £2m. In return Azure was to have its contract extended and have other "royalty" payments enhanced.

Mr Whyte, as part of a commitment to takeover the club in May, said his Rangers FC Group would provide £1.7m to "fund capital expenditure in relation to improving kitchen and public address equipment at the stadium".

It was understood that the catering refurbishment was needed as Rangers had been warned facilities would not pass health and safety regulations.

According to Companies House filings, Close Leasing now has a security over future catering revenues, a move usually brought in to guarantee payment.

Close Leasing has refused to comment on the matter. Whyte's representatives would not comment.

Sources for the administrators Duff and Phelps confirmed the equipment was bought on a hire purchase agreement.

Last year, Azure renewed its contract with Rangers for nine years, and also took over cleaning duties at Ibrox, in a deal worth £35m.

The revelation comes after Whyte confirmed he had sold future season ticket sales to London firm Ticketus for £24.4m to help fund his takeover. Duff and Phelps said £18m had been taken from the deal to pay off the club's debt to Lloyds Banking Group.