So, Why Is The Leeds United Takeover Taking So Long, Then?

So, Why Is The Leeds United Takeover Taking So Long, Then?

By on Jan 22, 2014 in Finance, Latest | 6 comments

This evening, the supporters of Leeds United AFC could well be forgiven for contemplating the fact that it wasn’t meant to turn out like this. When Ken Bates finally surrendered the chairmanship of the club in July of last year, a new era was supposed to be at the point of dawning for a club – and a city – that has now been almost a full decade without Premier League football, but over the last couple of months a much-reported takeover of the club has stalled, whilst on the pitch the team has started to look every bit as dysfunctional as most of if its recent predecessors.

It was at the end of November that the announcement was made that the club’s current owners, the Bahrain-based GFH International, had agreed a deal with the British-based Sport Capital, a consortium featuring the club’s former managing director David Haigh and Andrew Flowers, the managing director of Enterprise Insurance, the club’s present shirt sponsors. It was not presumed that the deal would take terribly long to conclude. After all, Haigh and Flowers are hardly complete outsiders to Leeds United, and the club is believed to be in reasonable financial health after the disasters that cast such a long shadow over Elland Road for much of the last decade.

Somehow or other, however, the deal continues stutter. It was initially believed that all loose ends would be tied up by the end of December, but even now, in the third week of January, there are few signs that the takeover is to be completed, and questions are now starting to be asked on the thorny subject of why this should be. After all, GFH and made no secret of their desire to sell the club, and it had been widely reported that, in terms of a sale price, they were not looking for a great deal more than the £30m or so that they have spent on their purchase of the club and its running costs since doing so. Meanwhile, there was little doubt that Sport Capital were serious about this. Quite asides from what we already know about the two men tha have become the public faces of the bid in recent weeks, the consortium already claims to have invested around £6million into the club of late.

It is, perhaps, unfortunate that talks regarding the takeover have come at a time during which the team itself’s fortunes have taken a sudden nosedive. Since beating Wigan Athletic at the start of December, Brian McDermott’s team has won just one match, and in over the last couple of weeks a sound beating at the hands of League Two club Rochdale in the Third Round of the FA Cup and a six goal thrashing at Sheffield Wednesday that came in front of live television cameras have shone a harsh light upon its shortcomings. Such performances are exactly the sort that turn the pressure up on a manager in the hire ‘em and fire ‘em culture of modern professional football.

Against this background, we might have expected that the club would spend a little money on bringing some new blood into its first team squad in the January transfer window, but this, so far, hasn’t happened. It had been widely expected that the player brought in to offer a little attacking verve would be Brighton & Hove Albion’s Ashley Barnes, and the transfer fee of £500,000 seemed like a reasonable price to pay, but it has been recently reported that the club’s current owners blocked the signing of Barnes even though Sport Capital had made the funds available to buy him. As Leeds United stumbled towards the finishing line in the race to acquire Barnes’ signature, third-placed Burnley nipped into their place and now Ashley Barnes is a Burnley player.

At the start of this week, GFH issued a statement which said that that completion of the takeover deal was dependent upon Football League approval and Sport Capital fulfilling “certain obligations to complete the transaction”, but time is running out if money is to be sent in what is left of the January transfer window. It is commonly assented that McDermott’s squad needs fresh blood, having dropped from the play-off positions to a distinctly mediocre-looking twelfth place in the Championship table in recent weeks, but there are – at the time of writing – less than nine days left for this to happen. Had the original timetable for the takeover been adhered to, it would have all been over by now and the manager would have the whole of January in which to cast his eyes over new players. Instead, Leeds United have so far brought in two players on loan. It wasn’t supposed to end up like this.

Andrew Flowers remains bullish, and has offered the following words of amelioration to supporters of the club wondering what this delay could all be about: “As a lifelong Leeds United fan and a businessman, I can assure other fans that while the process is being finalised, we have been working hard to ensure that due diligence was completed as quickly as possible, and that there are funds in place ahead of completion to support the manager during the opening weeks of the January transfer window. We are working closely with the Football League regarding the necessary documentation, and we will do our best to keep fans fully informed.” Meanwhile, the Leeds United Supporters Trust lasts week issued an email to its membership which read as follows:

We have been contacted by a large number of fans who feel confused, frustrated and increasingly impatient as they wait for the takeover to be completed, and Gary made sure today that David fully understands the strength of feeling among fans who want to know exactly what is going on. David said that he is fully aware of the concerns being expressed, and that in response he would be happy for us to tell our members that this conversation has taken place. He told Gary that money to complete the deal is in place, that the Football League have been very helpful, and that all that remains is “crossing a few ‘Ts’ and dotting a few ‘Is.’

They also added in this email that, “that Brian McDermott has funds available for players he wants, is able to deal in the transfer market without hindrance during the takeover,” but this viewpoint seems to have been rather undermined by the Ashley Barnes saga, and this sort of communication that somebody, somewhere, for some reason, is being economical with the truth. If we take it as read that it isn’t the LUST that is doing so – and there is no reason whatsoever to believe that it would – then who is, and why? As ever at Leeds United, the answer may well be a long time in coming. It could be argued that funds were available but that GFH will blocked attempts to use them. This however, starts to look like a debate over semantics at a time when what is needed is for the takeover deal to be completed once and for all.

On top of everything else, a new name was thrown into the ring with regard to the ownership of the club when it was reported that Massimo Cellino, the owner of Serie A club Cagliari, might also be interested in purchasing it. Cellino has a reputation for being a bit of a fire-brand, a description lent some credence by the fact that he has seen thirty-six managers come and go in twenty years with the club, but for now he remains little more than a distraction. He will, of course, cease to be anything like as trivial as a distraction should he manage to blindside Sport Capital.

The appeal to Cellino – or anybody like him – should be obvious: former champions of England are emerging hard times, but the club is comfortably the most senior footballing represenatives of a city of three quarters of a million people and a wider metropolitan area of getting on towards two and a half million people, and is surely more than capable of getting back to the land of milk and honey that is the Premier League. However, the danger of a complete outsider getting involved in the club is that money needed to be invested into the team can easily find itself going elsewhere in the name of recouping one’s initial investment in the club. In addition to this, Massimo Cellino has sniffed around the Premier League before and, as pointed out at that time, his track record did him few favours then.

It’s plausible to argue that all concerned with a takeover which may yet become a shambles are getting off a little lightly because they are Not Ken Bates. There will come a time, however, when the patience of supporters on this matter will start to wear thin, especially if no new signings come into the club before the end of the month and the team continues to fail to live up to expectations on the pitch. “We are working closely with the Football League regarding the necessary documentation, and we will do our best to keep fans fully informed” were the recent words of David Haigh. It’s surely time for GFH and Sport Capital to tie up this deal, before this season drifts towards too closely towards being yet another wasted opportunity for Leeds United AFC.

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    6 Comments

  1. Hi
    Like so many life long leeds fans
    We suffer day in day out.
    We part with our hard earned cash!
    What in return?
    Nothing but chancres looking for a quick BUCK
    Exactly why no serious investment on players.
    Enough is ENOUGH.
    Watch the crowds soon down to 17,000. You will see
    On and on. Yeah. !

    Rob

    January 22, 2014

  2. You can’t blame the fans that were supporting the team right from the start. Fans get mad because they only want the best for the team. Just assure them that the process won’t take long.

    Wendy

    January 23, 2014

  3. Can you please not post links to the daily mail? It causes great distress.

    Rich

    January 23, 2014

  4. The delay in this takeover happening is unbelievable. I do not care less who owns the club as long as the manager can make the changes both he and every Leeds supporter can see need to happen on the field. I will rephrase that “as long as it’s not Ken Bates”. Clearly the delay is stopping players from coming in ( and going out). Who is telling the truth and who is saying what they want us to hear.

    Stephen Richmond

    January 23, 2014

  5. Isn’t Shaun Harvey a bigwig at the FL now? can’t see him being too helpful pushing it through somehow.

    mick

    January 23, 2014

  6. Is Paul “Dewsy” Dews still employed as the Club’s COMMUNICATIONS Officer?
    While it’s lovely to read about our “Stonewall” Flagship partner status, I think we’d all like rather more “engagement” from Messrs Haigh, Patel and Nooruddhin.

    OzTyke

    January 23, 2014

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