THE Blue Knights and Brian Kennedy are close to an agreement that would see them submit a joint bid to save Rangers from liquidation.

Mr Kennedy met members of the Paul Murray-led Blue Knights' consortium during five hours of discussions.

It is believed the framework of an equal partnership agreement is in place after what one source described as "an extremely productive and constructive meeting".

Mr Kennedy, whose personal wealth has been estimated at up to £250million, owns Sale Sharks rugby union club, in Greater Manchester.

He and the Rangers-supporting businessmen who comprise the Blue Knights consortium would combine elements of their financial offers in an attempt to rescue the crisis-torn Ibrox club.

The Knights and Mr Kennedy have been mutually appreciative of their separate bids until now, but while Mr Kennedy had previously said he would support the Knights' attempts to save Rangers he is now understood to be close to a far more substantial financial commitment.

If a reconstructed bid is formalised it could be lodged with the club's administrators, Duff `& Phelps, within days.

American businessman Bill Miller continues to monitor the unfolding events around Ibrox and has drafted an £11.2m bid, which involves the creation of a "newco" club.

But it is expected the Knights/Kennedy consortium will move quickly because they realise the club is teetering on the brink of liquidation after the latest delays in the bidding process.

The value of a Kennedy/ Knights offer has still to be established, but both parties were previously prepared to pay about £10m to buy Rangers and take the club out of administration via a Company Voluntary Arrangement (CVA).

Monday was supposed to have been the deadline for naming a preferred bidder to take the club out of Craig Whyte's control.

However, Duff & Phelps had to extend that after the Scottish Football Association Judicial Panel's punishment for rule-breaking by Rangers.

The panel fined the club £160,000 and banned it from signing any player older than 18 for a year – and that again delayed any acceptable offers from being tabled.

Mr Kennedy has been a constant presence throughout the Rangers' takeover saga, but despite making two bids to own the club on his own he has cast himself as an outside candidate who wanted control only if there was a danger of liquidation.

The Hibs' supporter, who said he hoped to save Rangers as an institution in Scottish life, had publicly applauded the Blue Knights' takeover efforts from the outset.

Both Mr Kennedy and the Knights have said they were against the one-man ownership model that has put Rangers into such a grave position. It would be likely Mr Kennedy and each of the Knights would have a say on any new board of directors if their bid was successful.

The major hurdle for Mr Kennedy/the Blue Knights or Mr Miller to clear is how to get Mr Whyte's 85.3% shareholding.

London-based agency Ticketus has said it can do a deal with Mr Whyte to deliver those shares, but so far his demands have proved to be excessive.

Mr Miller has refused to deal with Ticketus or Mr Whyte but the agency is still in talks with the Blue Knights.

Mr Miller is reluctant to commit to an unconditional bid until he knows the full extent of the punishments Rangers could face from the football authorities, but the SPL's investigation into alleged undisclosed payments to players will continue for several more weeks.

Despite claims that they had withdrawn entirely from the bidding process, it is also understood that Club 9 Sports, the American sports investment company, has continued to advise Mr Miller.