Former Rangers chairman Dave King has agreed to sell all his shares in the club to fans group Club 1872.

The sale, when complete, will make Club 1872 the largest single shareholder in Rangers International Football Club (RIFC) Plc.

The structure of the deal gives Club 1872 three years to complete the purchase, with the opportunity to purchase the entire shareholding prior to December 2021 for a price of 20p per share.

Through his company New Oasis Asset Ltd, South Africa-based businessman King owns 66.7million shares in the club, which – when priced at 20p each – are worth £13.3million.

To raise those funds, Club 1872 will aim to create over 20,000 legacy members of the organisation, each of whom will retain a lifetime vote on the shares held in RIFC.

King, who stepped down in March, said as part of a lengthy statement: “I do not intend to profit from my efforts over the last six years to save our club, even though the club is now substantially more valuable partly through my efforts.

“I am happy that supporters get this increased value as without them we would not have achieved the full recovery that was completed with the recent fund raise.

“I have agreed therefore to transfer my shares to Club 1872 at my historical cash cost of acquisition (which includes professional fees) and to allow Club 1872 a period of three years to build up the supporter backing that will be necessary to achieve this.

“My all-in cost is 23.7p per share and I am willing to put a pricing structure in place that accommodates 20p as the initial price to be consistent with the present share issue and, at Club 1872’s request, I have included an option for Club 1872 to buy all of the shares at 20p which would result in a loss to me. In my view the shares are presently worth in excess of 50p if properly valued.

“I have coined the term ‘Never Again’ as I truly believe that this is a once in a lifetime opportunity to make supporters – in perpetuity – the number one shareholder in the club. Fortunately, the present board supported me in my vision to see an increased shareholder influence for our fans but we cannot be sure of the fondness for this by future directors.

“The time to achieve this is therefore now.”

The Castlemilk-born tycoon continued: “I have absolute confidence that Club 1872 is the right vehicle for me to work with to advance supporter shareholder ownership – both now and in the future.

“I would urge Rangers supporters to join Club 1872 today and ensure that the events of 2012 can ‘Never Again’ be repeated.”

Club 1872 director Laura Fawkes said: “This is a huge moment for both Club 1872 and the Rangers support.

“We are very grateful to Dave King for his faith in Club 1872 and the Club 1872 board and for his ongoing commitment to ensuring that the ownership structure of Rangers remains a very healthy mix of wealthy individuals and the wider supporter base.

“As Club 1872 directors, we are very proud to present this opportunity to the Rangers support.

“We now need over 20,000 Rangers supporters to take up the baton, join Club 1872 and ensure that the events of 2012 can never happen again.

“It would be a seminal moment for both Rangers Football Club and the supporters if we could achieve the position of being the largest shareholder in Rangers in time for the 150th anniversary of the club in 2022.”