Takeover hits turbulence

I’ve not commented so far on this takeover because as a Leeds fan you get used to these things rumbling on for an age with little facts and information coming to light. As Leeds fans we just get used to being kept in the dark. This one though seems to have reached a point where it cannot be ignored anymore. When GFH bought Leeds United we knew they were in it to make a profit, whether that be in the short term or the long term. They looked to reduce their liability and sold off stakes in the club to investors such as International Investment Bank and current chairman Salah Nooruddin. Any betting man would tell you that they would look to sell further shares in the club or, if possible and if the price was right, sell the club outright.

It did, however, come as a bit of a surprise when it became known that current Managing Director of Leeds United and Deputy Chief Executive of GFH Capital David Haigh was leading a consortium to buy 75% of the club. The consortium included Andrew Flowers, managing director of Leeds’ shirt sponsor Enterprise Insurance, and it was stated that both Haigh and Nooruddin would remain in place at the club. The consortium operating under the name Sport Capital had already put ‘working capital’ into the club and had negotiated a number of assurances. GFH Capital had granted a period of exclusivity to Sport Capital in readiness for the January transfer window and also the “two parties had signed a share acquisition agreement for the purchase of shares”.

But here we are with the transfer window closing in just over 2 days with no deal concluded. It would seem madness that the current Managing Director of the football club and Deputy Chief Executive of the current owner cannot broker a deal to buy the club in good time. Things seem to have become even more confused this week with the introduction of two new potential owners. Firstly Cagliari owner Massimo Cellino appeared on the scene, being shown around Elland Road and Thorp Arch and rumoured to be at the Ipswich game last night. In true Italian style Cellino has two previous convictions for fraud and is awaiting a trial on charges of embezzlement, not the kind of owner most Leeds fans would want at Elland Road.

The start of this week also saw the re-emergence of the ‘Farnan Group’. The consortium headed by ex-Manchester United employee Mike Farnan includes Welcome to Yorkshire chief executive Gary Verity and ex-Hull City chairman Adam Pearson, and secured the backing of Leeds legend Lucas Radebe. The group made a £7 million bid for Leeds United back in November but this was dismissed out of hand by GFH. Farnan has suggested though that should Sport Capital fail to conclude a deal in the next few days they could re-enter the fray.

With the situation looking more confused than ever and Sports Capital struggling to conclude a deal, consortium member Andrew Flowers hit out at GFH last night. Flowers claimed GFH had “breached their covenant with Sports Capital but much more importantly have breached their covenant with the fans” by holding talks with Massimo Cellino. He was also very critical of the prospect of Cellino owning Leeds United;

“We are convinced this will not be in the interests of the club, the manager, the players or the fans. We must ask the question whether the prospective preferred bidder understands anything about the culture of Leeds United, its fans, its heritage or British football.”

Flowers also revealed that following the process of due diligence Sport Capital had revised their offer for the club downwards. “We were fully justified in revising our bid because a number of things have come to light which were not as originally described”. He is adamant though that their bid remains the best prospect for Leeds United “However as lifelong fans we believe our offer and plans were in the best interests of the club and its loyal supporters. This boils down to much more than money but GFH have chosen to ignore that”.

So we have a bidder in the ‘Farnan Group’ who seriously undervalued the value of the club, Sports Capital who were not aware of certain issues when naming their initial price despite a member of the consortium being Managing Director of the club and the Italian Bates in Cellino, currently the preferred bidder according to Flowers. All of this takeover talk can only disrupt the club. Leeds went into last night’s game having lost their last 5 matches and in desperate need of strengthening their squad in the transfer window. Despite that Leeds have only been able to sign two players, Kebe and Stewart, on loan deals and it’s rumoured a deal for Ashley Barnes was stopped by current owners GFH.

The current situation is so concerning that the Leeds United Supporters trust released a statement regarding rising concerns. It is clear that for the good of the club this deadlock needs to be broken. Whoever has the best interests of Leeds United and its fans needs to step forward and do the right deal because at the moment the club and its fans are suffering, again.