Craig Whyte '˜told Rangers board that he would fund takeover'

Craig Whyte told Rangers bosses the money to fund his acquisition of the football club was 'coming from himself', a court has heard.
Craig Whyte is appearing at the High Court in Glasgow. Picture: John DevlinCraig Whyte is appearing at the High Court in Glasgow. Picture: John Devlin
Craig Whyte is appearing at the High Court in Glasgow. Picture: John Devlin

The statement was said to have been made during a meeting with board members in Glasgow in March 2011 after Whyte put forward what seemed to be a “viable proposition” to buy the club, jurors heard.

The jury was also told the club’s bank wanted the deal with Whyte to go through.

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Former Rangers owner Whyte is on trial at the High Court in Glasgow, where he is accused of acquiring the club fraudulently in May 2011.

Whyte, 46, faces two charges relating to the purchase of Rangers, one of fraud and another under the Companies Act. He denies both allegations.

Former Rangers finance director Donald McIntyre, 58, told the second day of evidence in the trial that he believed the board was informed in November or December of 2010 that Whyte “had an interest in acquiring the club”.

“It seemed a more viable proposition,” Mr McIntyre told the court, adding that an independent committee was formed to look at Whyte’s offer.

“We would be looking for someone with the wherewithal and financial background to take the club forward. That was crucial,” the witness said.

The court heard Whyte ultimately bought the club’s majority shareholding for £1.

The purchaser would also have to pay £18 million to Lloyds Bank - a creditor of Rangers - and a further £9.5 million for a “small tax case” and for buying players, the court heard.

The witness said he first met Whyte at a solicitors’ office in Glasgow in March 2011 to “find out a bit more” about him. Several other board members were also present.

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Mr McIntyre, a chartered accountant, said Whyte spoke in broad terms about what he did and told of his involvement in “turning companies around and also trading in options or futures”.

Prosecutor Alex Prentice QC asked whether the directors spoke to Whyte about the source of funds for the acquisition.

Mr McIntyre said: “At the meeting, I think the question was asked, where the funds were coming from. I believe Mr Whyte said that the money was coming from himself.”

The court heard that, in minutes from a meeting on April 24 that year, Whyte was recorded as confirming funds for the transaction were coming from “Craig Whyte the individual”.

The Crown alleges in the fraud charge Whyte pretended to then Rangers owner Sir David Murray, and others, that funds were available to make all required payments to acquire a “controlling and majority stake” in the club - including clearing an £18 million bank debt, £2.8 million for the “small tax case” liability, a £1.7 million health-and-safety liability and £5 million for the playing squad.

Prosecutors allege Whyte had only £4 million available from two sources at the time but took out a £24 million loan from Ticketus against three years of future season ticket sales “which was held subject to an agreement or agreements being entered into between the club and Ticketus after said acquisition”.

Mr McIntyre said Ticketus would “provide up-front funds in order that any football club could smooth their cash flow throughout the season”.

Effectively, the firm would own the tickets which would then be bought by season ticket holders, he said.

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Donald Findlay QC, representing Whyte, put it to the witness the club’s arrangement with Ticketus was “kept hush hush from the fans”.

“There was no need to disclose it,” Mr McIntyre replied.

During questioning by Mr Findlay, the court also heard Lloyds “threatened to withdraw” banking facilities if the board did not sanction a deal with Whyte.

Mr Findlay asked whether the bank was “putting the squeeze” on the company.

“Correct,” Mr McIntyre replied. The witness agreed that the bank, in Mr Findlay’s words, was “wanting out of the football business”.

The second charge under the Companies Act centres on the £18 million payment between Whyte’s Wavetower company and Rangers to clear a bank debt.

Whyte denies the charges against him.

The trial, before Judge Lady Stacey, continues on Tuesday.