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27 January 2015, 18:58
The Three Bears have hit out at the Rangers board for accepting Mike Ashley's £10million loan - insisting they had made a better offer.
Wealthy supporters Douglas Park, George Letham and George Taylor offered the desperate directors a £6.5million loan.
But Ashley's offer of two £5million tranches was accepted by the cash-strapped club on Tuesday morning.
Chairman David Somers told Sky Sports News that the Sports Direct chief's loan was a "great deal'' for Rangers - but the Three Bears disagree.
In return for his loan the cash-strapped Gers have given Ashley another 26 per cent of the Rangers Retail Ltd - putting him in control of three quarters of their retail business.
From the summer of 2017, cash generated from shirt sponsorship deals will go to RRL - rather than the club - until the loan is repaid.
Ashley - who already placed chief executive Derek Llambias and finance director Barry Leach onto the board - will also be allowed to nominate two more directors.
The Newcastle United owner, who owns 8.92 per cent of the Light Blues, has also managed to grab a floating charge on the club as well as taking Murray Park, Edmiston House, Albion Car Park and the club's registered trademarks - including the Rangers crest - as collateral.
But he has no claim to Ibrox after fan protests forced him to drop his demand for security on the club's historic home.
The Bears, on the other hand, offered up £6.5million - secured against the training ground, Edmiston House and the car park - and were prepared to let £4.5million of it be converted into shares at a later date.
The rest of the loan would be charged at an interest rate of two per cent while they also asked for two board seats.
But Press Association Sport understands Llambias walked away from a deal with the Bears after they knocked back his plea to protect director James Easdale from being axed at the forthcoming general meeting, called by former oldco director Dave King.
In a statement handed to Press Association Sport, a spokesman for the consortium said: "At one stage during the negotiations we indicated that we could increase our funding package to £10m to match the SD facility and indeed provided proof of funds in excess of this amount. 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.''
And the Bears fear Ashley's deal will prove costly to the club.
Their spokesman added: "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% of the share capital in RRL and 50% 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 SD 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.
"It appears that the only measure by which the SD facility could be considered favourable to our offer is in respect of the quantum and duration of the second tranche of £5m but there appears to be some uncertainty as to whether this will actually be required and it is subject to further due diligence by SD.
"We fail to see how the SD 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 SD facility will do nothing to repair relationships with the fans which is critical in improving the revenue streams of the club.''
RRL is a joint venture set up by the club and Sports Direct, with Rangers owning 51 per cent and Ashley's company controlling the rest.
However, Sports Direct will now control three-quarters of the business until the first part of the loan is repaid.
Rangers fans were already unhappy with RRL set-up, claiming profits were unfairly skewed in Sports Direct's favour.
The club's accounts showed the company took in £7.6million last year - leaving a £1.61million dividend to be split between Rangers and Sports Direct.
Rangers' share was £821,000 but it also owes Sports Direct £833,000 as the result of "onerous leases on unprofitable stores entered into by a previous Rangers management team''.
Now as part of the terms on Ashley's loan deal, the club will hand over its dividend share to repay these debts - meaning that for every pound collected by its own retail company, Rangers lost 1.6p.
The first £5million - which has no time-limit - will be used to repay the £3million Ashley handed Rangers last October and to cover Thursday's pay cheques. The second £5million chunk must be handed back to Ashley within five years.