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Rangers borrow £10m from Ashley's company

After resuming existence in the fourth tier of Scottish football as a result of liquidation, the Glasgow giants have been beset by continued financial strife despite consecutive promotions leaving them in the Championship.

Ashley is currently locked in a battle for power at the club with current owner, South African businessman Dave King, but has seen attempts to increase his stake in Rangers - currently under nine per cent - blocked due to his ownership of Newcastle.

Fan disillusionment has been felt this term, with attendance at Ibrox falling from almost 43,000 last season to under 33,000 this.

And this has prompted the club to take action by loaning from Ashley to provide working capital.

A statement released to the London Stock Exchange read: "The company's financial condition has been perilous for a number of months exacerbated by lower than expected match attendances. 

"The directors have implemented a cost-cutting program with which they have made significant progress. 

"There is however an immediate need for a substantial injection of capital, and the directors have considered a number of options. 

"The terms negotiated with SD represent the optimum combination of quantum and duration of funding, allowing the company time to arrange permanent capital which can be used for strengthening the playing squad."

Half of the £10m will be available as working capital, although some will be used to repay a £2m credit facility agreement taken out with Ashley's holding company in October.

For his part of the deal, Ashley gets security over Rangers' training ground, their registered trademarks and any other properties, although their Ibrox home is not part of the agreement.

Ashley also receives a further 26 per cent of shares of Rangers Retail Limited, to add to that 49 per cent he already has titles to, for the duration of the loan's terms.

The second half of the £10m will only be drawn down if required.