By Kenny MacDonald

GLASGOW  - New Rangers manager Walter Smith said on Friday the club and the Scottish FA had resolved their differences over his decision to quit the national job.

The SFA threatened to sue Smith for breach of contract and Rangers for inducing him to leave as Scotland manager after he moved to Ibrox on Wednesday. A formal announcement of an agreement is now expected from the two sides on Monday.

Anticipating a deal to avoid a legal battle, Smith told a news conference: "That was a regretful aspect of the past few days. I am glad now that is over with and I think it allows each of us to get on and do what we want to do. At the end of the day, it is a business thing more than anything else and I don't think it was particularly personal.

"But it was obviously a situation that from my own side I would have liked to have avoided."

Smith, who led Rangers to seven league titles during a previous spell as manager from 1991-98, has replaced Frenchman Paul Le Guen, who left Ibrox by mutual consent after just seven turbulent months in charge.

Rangers trail champions and Scottish Premier League leaders Celtic by 17 points and were knocked out of the League Cup by second division St Johnstone at home in November. They exited the Scottish FA Cup last weekend, losing 3-2 to Dunfermline, who are bottom of the SPL.

Looking to strengthen his side, Smith said: "We would obviously like to bring in one or two players in the transfer window and we will endeavour to do so over the next couple of weeks."

He confirmed that Rangers are in talks to sign Falkirk striker Alan Gow but dismissed reports of a dressing-room split, saying: "There is always that talk...but it's not evident when you come in and it never is.

"It is not one of those things you can identify immediately, so therefore we have to wait for competitive games which will show us if we have any problems. So far, within the dressing room, everything seemsOK."

Smith begins his new era on Saturday with a league game against Dundee United, a club with whom he played and coached. He said: "I have an affinity with Dundee United as well. They have had one or two good results against Rangers in the last period, but I don't think we can look back.

"We have just got to look forward and see what we can achieve tomorrow. I don't think previous results will be any great indicator." He declined to say if Barry Ferguson would return as captain.