Davis spent part of last season on loan at Ibrox and Smith had been keen on a permanent deal.

"There's no dialogue between Rangers and Fulham at the moment, but there is money left over to buy players on top of Madjid Bougherra, Kenny Miller, Kyle Lafferty and Andrius Velicka," said Smith in the Daily Record.

"What you're looking for is good value in terms of transfer fee and wages.

"You don't want to break into squad wage levels."