Ex-Rangers boss Walter Smith takes stand at Whyte trial
Former owner Craig Whyte is accused of fraudulent takeover of Ibrox club in 2011.
Former Rangers manager Walter Smith has told the trial of ex-club owner Craig Whyte he did not know how bad the state of finances were at Ibrox.
Mr Smith, 69, was the first witness in the case against Whyte, who is accused of a fraudulent acquisition of the club.
His evidence was followed by that of another Rangers manager, Ally McCoist, who said signings were made after Whyte's takeover which did not keep the team to the "same standard".
He told the High Court in Glasgow about his time managing the team between 1991 and 1998, and then again from 2007 until 2011.
During the first day of evidence on Friday, the jury of eight men and seven women heard about the first meeting between Mr Smith and Whyte, 46, shortly before he took over the club in May 2011.
The meeting took place in Glasgow and also included former chief executive Martin Bain and former finance director Donald McIntyre.
Mr Smith, who identified Whyte in the dock, said the purpose of the meeting was for the prospective owner to ask questions before he went ahead and bought the club.
He said: "From Mr Whyte's point of view, he was more interested in the financial aspects of the club.
"He asked me towards the end of the meeting what I felt was required for the football team."
Mr Smith said he had told Whyte the team required investment.
"I felt the team needed a level of freshness," he said.
"He seemed to take that in. I was obviously meeting him for the first time and I was leaving as manager. I think he accepted that."
Under cross-examination by Donald Findlay QC, representing Whyte, Mr Smith acknowledged the debt at the time he left could have been in the region of £18m.
He said that he was "never overly-burdened by the financial aspects" of the club.
He told the jury that during his second stint as manger the club was successful, winning eight domestic trophies and reaching a European final.
Mr Smith agreed that "hopefully" such success on the pitch, in Mr Findlay's words, "ought to have brought with it some financial success".
However, he said that after he left in 2011 the team had gone out of the Europa League, adding that was a "major disappointment for any club". He agreed it would be a "significant financial blow" for Rangers at the time.
Mr Findlay asked: "Around the period in 2011 did you know how bad things were financially at Rangers?" Mr Smith said: "Not exactly, because we had had success over the period which I felt was helping the club lower the level of debt that it had, the exact amount I couldn't tell you."
Mr Findlay asked whether the club had been given an indication from the bank that it "had had enough of bank-rolling Rangers". "Yes, we had an indication of that prior to 2011," Mr Smith said.
Mr Smith later agreed his "impression" was Rangers had been in a "perilous" financial position at the time.
Mr Findlay then asked: "It must have been distressing to see the club in a state like that?" The former manager responded: "Yes, it was. However, we had been trying our best to handle the situation while I was there."
The jury went on to hear minutes taken from two Rangers board meetings - one in November 2010 and the other in March 2011.
During the latter, it was said to have been discussed that the "consequences" of Rangers going into administration would result in a "complete and utter shambles".
Smith told the court he had "no recollection" of that being spoke about.
'I felt the team needed a level of freshness'Walter Smith on what he told Whyte
Mr McCoist was the second witness to take to the stand on Friday.
He told how he first met Whyte during a "brief encounter" at Glasgow's Hilton Hotel. The former striker revealed how he later had discussions with Whyte after he took over the club.
Prosecutor Mr Prentice asked the 54 year-old if he had "difficulties" in boosting the squad. Mr McCoist said: "Yes, there were a number of players I would have liked to have got. Grant Holt at Norwich and a lad who played in Israel - Hemed.
"But, I just felt the offers being made were certainly not realistic enough for a chance to get the players."
Mr McCoist admitted signings were made, but not, in his opinion, one which kept the team at the "same standard".
Whyte faces two charges relating to the purchase, one of fraud and another under the Companies Act.
It is alleged he 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 £18m bank debt, £2.8m for the "small tax case" liability, a £1.7m health-and-safety liability and £5m for the playing squad.
The Crown alleges Mr Whyte had only £4m available from two sources at the time but took out a £24m 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".
The second charge under the Companies Act centres on the £18m payment between Mr Whyte's Wavetower company and Rangers to clear a Bank of Scotland debt.
Whyte denies both charges.