Dave King and his Three Bears group are to have a controlling interest in Rangers as a bid to convert over £14m of club loans into shares has got the go-ahead.

The Rangers board were today asking independent shareholders to agree to a crucial 'waiver' that would mean Mr King did not have to make another multi-million pound shares offer to other shareholders as he and his partners tighten their hold on the club.

And at a general meeting, that waiver was passed with 81.8% in favour.

READ MORE: Rangers chairman Dave King wins fight to avoid £8m club share purchase... just

The group wanted to convert £14,120,388 in loans into 70,601,941 shares at 20p each, but there were warnings the move would have been on the rocks had the waiver not been agreed by other shareholders.

It has now emerged there were 48,565,961 votes in favour of the resolution with 10,772,951 (18.1%) against.


Rangers chairman, Dave King, thanked shareholders for their continued backing and said: "This is an important marker in the recapitalisation of the company and significantly improves its balance sheet, enabling the conversion of over £14m of debt into shares.”

The loans-to-shares move gives Mr King's group the power to decide whether resolutions at future general meetings pass or fail and block special resolutions. That means they have control over strategic decision-making processes, including the election of directors and chief executive, approving executive pay and passing financial accounts.

In February, Mr King won a long battle to avoid paying out on a court-ordered shares offer, which could have cost him as much as £19m, after it just failed to get enough acceptances from shareholders to become valid.

READ MORE: Rangers director warns loss-making club cannot run on loans indefinitely

Mr King was obliged to make the bid by the Takeover Panel financial regulator, which ruled he, and the Three Bears group of investors made up of Hong Kong-based investment banker George Taylor, Park's Motor Group founder Douglas Park and investment banker fan George Letham, had acted "in concert" to acquire more than 30% of the Ibrox club's shares.  They they over the club from a group said to be allied to Sports Direct founder Mike Ashley in 2015.


The Takeover Panel confirmed that the requirement to make the general offer for the balance of shares not owned by the King group would be waived, if the shareholders pass the resolution.

There was an earlier warning in a letter to shareholders from John Bennett, chairman of the independent directors of RIFC, that if the so-called Whitewash Resolution was not passed the loan conversion will not go ahead.

And he said that "may create issues" for Rangers if the 'soft loans' which were integral to allow the club to meet its debts when due and invest in the playing squad were subsequently withdrawn.

READ MORE: Ex Rangers chief Sandy Easdale to sell shares as he tells Dave King: 'I want out'

According to financial papers supporting the bid, the extra shares Dave King’s group would get from the loan conversion would mean their slice of Rangers International Football Club plc would rise from 34.06% to give them a majority 53.93% stake.

Once converted Mr King's slice through his New Oasis Asset Limited company will grow from 14.57% to 26%, Mr Park's holding will rise from 6.14% to 13.94%, Mr Letham will have 5.7%, up from 4.05%, while Mr Taylor's interest will drop from 9.3% to 8.14%.


The letter to shareholders from Mr Bennett explained that the loans were provided by shareholders to assist with the costs of "restoring Rangers Football Club to a position at the top of Scottish Football and as a force in European football".

"Rangers Football Club’s footballing success benefits the financial position of the company. Converting the loans to shares ensures that such assistance is ongoing and that the company does not have to repay this funding," he wrote.

"The loan conversion will significantly improve the balance sheet of the company and ensure that it complies with The UEFA Financial Fair Play Regulations."

The independent directors in information supporting the motion said: "When the current board of RIFC were appointed, the club had suffered greatly through years of financial distress and upheaval.

"Consequently, RIFC was making significant losses with no immediate possibility of those being stemmed whilst restoring the fortunes of Rangers Football Club. Such losses have now been greatly reduced and the fortunes of both Rangers Football Club and RIFC have been significantly restored.

"There is still work to be done both on and off the field with sporting success for Rangers Football Club being the key driver to improved financial performance for RIFC."


Under Takeover Code rules Mr King and the Three Bears, should have made a written offer to buy the shares of other shareholders at the time of the takeover having overtaken a 30% threshold.

The 63-year-old businessman, had previously stated that delays in fulfilling court orders over the offer were the result of needing government approval to transfer the funds from South Africa to the UK The offer came after a Court of Session contempt case in front of Lady Wolffe was paused in December after the Rangers chief said he was now “100%” committed to making the multi-million-pound offer.

During one hearing in October, Mr King's advocate Lord Davidson of Glen Clova QC argued that he "is penniless" adding: "Any order wouldn't secure compliance. It won't. It is pointless."

The King-led takeover group had always denied that they had acted 'in concert' to purchase shares in Rangers on December 31 2014 and January 2, 2015.

But in December, 2017 Lord Bannatyne ruled in favour of the Takeover Panel that Mr King acted in concert with the Three Bears to oust the Mike Ashley-allied board.