Rangers' retail dispute with Mike Ashley escalates

Rangers have stepped up their struggle to escape Mike Ashley's clutches after announcing they plan to rip up contracts held with the merchandise company they run with Sports Direct.

The Ibrox outfit own 51 per cent of Rangers Retail Ltd (RRL), with Ashley's company in control of the rest of the joint venture's shareholding.

But Gers chairman Dave King and the rest of the board are deeply unhappy with the arrangement, originally set up by former chief executive Charles Green to sell items like the club's kits.

It reportedly earns the Ladbrokes Championship winners just four pence from every pound spent in their club shop.

As a result, the angry Ibrox faithful have refused to buy the club's official merchandise, leaving a gaping hole in the club's finances.

King has tried on several occasions to renegotiate the deal but has been rebuffed at every turn by Newcastle owner Ashley, with the pair's relationship growing increasingly bitter following a string of courtroom battles.

Rangers have already triggered the seven-year notice period required to cancel their ties to Sports Direct but now club chiefs hope to expedite the process.

They have notified billionaire tycoon Ashley they are ready to snatch back control of the intellectual property agreements - which include the right to sell products bearing the club's crest.

It is likely the matter will lead to yet another costly face-off in the courts, although Press Association Sport understands the club are confident they have grounds to tear up their RRL agreements.

In a statement, the Ibrox outfit said: "The Rangers Football Club Limited has today served notice on Rangers Retail Limited terminating the IP Licence and Rights Agreement with that company with immediate effect.

"The club now needs to speak to its commercial partners to agree the next steps flowing from the termination and will make no further comment on this matter whilst discussions are ongoing.

"The club will endeavour to communicate further with its supporters and customers for Rangers Kit and other Rangers products as soon as it is in a position to do so."

Ashley owns 8.92 per cent of Rangers but could be forced to relax his control of the club's commercial activities following Newcastle's relegation from the Barclays Premier League to the Sky Bet Championship, where the Football League operate far stricter rules on dual ownership than in the top flight.