Leeds to be financially challenged

[Crybaby Bunting]

CREDIT: http://news.bbc.co.uk/sport1/hi/football/e...rem/6252310.stm

Ken Bates' proposed buyback of Leeds United is to be challenged by HM Revenue & Customs. The announcement comes a day after the news that the administrators at the football club had persuaded Mr Bates to raise his offer to creditors.

A Leeds United spokesman said it did not yet have all the details but it was "confident of a positive outcome".

Leeds went into administration on 4 May, before Mr Bates narrowly won backing to buy it back on 4 June.

'Business as usual'

While Mr Bates, the club's chairman, was able to get the backing of creditors to buy back the club, it seems HM Revenue & Customs, which is owned £7.7m in unpaid taxes, was far from happy.

Its challenge to the plan was made just before a 1600 BST deadline.

"The club can confirm that the Inland Revenue have served notice of their intentions to challenge the CVA [Creditors' Voluntary Agreement]," said a Leeds United spokesman.

"We do not have all the details as yet and do have a number of options available to us.

"We remain confident of a positive outcome, despite this disappointing news, and will carry on with business as usual in the meantime."

Monday's announcement that Leeds was increasing the amount of money it was offering creditors from 1p in the £1 to 8p has been seen by commentators as a failed move to try to persuade HM Revenue & Customs not to call in the lawyers.

'Liquidation risk'

With its debts of £35m, Mr Bates has previously claimed that any legal challenge by HM Revenue & Customs could force the club into liquidation.

Earlier on Tuesday, he told Yorkshire Radio: "If there is a legal challenge, it could take two or three months to get to court and be decided.

"In the meantime, who is going to pay to run the club?"

Leeds United's administrators at accountancy giant KPMG have insisted throughout that they have acted within the laws of insolvency.

Edited July 3, 2007 by The General

[Matt]

If it means someone other than Bates will be able to take over, then good, if it means Ken Bates coughs up the extra money or we go bust, I'll go buy my Liverpool shirt. I sensed this'd happen because Bates immediately tabled a bid to buy back the club, which can't be right, as it doesn't give other investors a chance, which is part of what administration is supposed to do. In conclusion, fuck Ridsdale and the other ex-directors, I'd prefer to be a dull 14/15th placed premiership team year in year out (which seeing as most of our best players were homegrown/brought over from a very young age, would be a low estimate of our position) than 2/3 years of fame followed by liquidation.

Eh, I don't understand what's happening, hopefully I'll find out next Friday at the York friendly (if we're still around by then).

[Captain Kirk]

I didn't understand how Bates could just buy the club again with less debt. :s

[Matt]

The creditors (the people who are owed money) would get nothing if the club died, so the club gets put into administration (which lasted absolutely no time at all because he put in a bid to buy the back within minutes) and the creditors get to choose whether they accept a portion of their money (they accepted 1% of what they were owed, for some reason) or risk not getting any.

[Big Red Fury]

The comments were made at a High Court hearing in Leeds, where the club's plans to exit administration are being challenged by HM Revenue & Customs.

KPMG said that unless the club is able to leave administration, the Football League may not let it start the season.

BBC Radio Leeds understands the Football League is as yet undecided.

No-one at the Football League was immediately available for comment.

Renewed rival bids?

The court case has now been adjourned until 3 September, while Leeds are due to play their first game of next season away to Tranmere on Saturday, 11 August.

Former Leeds chairman Gerald Krasner told Sky Sports News he thought the ownership question would be sorted out before the start of the season.

He also raised the possibility that two interested parties could join forward to buy the club if KPMG rejects Mr Bates' plans.

Those who have previously declared an interest in buying the club include Duncan Revie, son of former Leeds manager Don, and property entrepreneur Simon Morris.

Unpaid taxes

Earlier this week, businessman Simon Franks said he was ready to buy Leeds United, through his Redbus investment vehicle.

HM Revenue & Customs is unhappy at the plans of Leeds chairman Ken Bates to pull the club out of administration by paying creditors just 8p in every £1.

Mr Bates has already warned that the cost of defending the court action could cost the club its future.

Leeds United has debts of £35m, with HM Revenue & Customs owed £7.7m in unpaid taxes.

[Matt]

You have to pay footballing debts. And fuck Ken Bates; seriously fuck off, either pay the money or fuck off; stop telling us that we'll go into liquidation, Simon Franks has assured everyone that he'll pay the running costs if no-one else does.

On another note, what happens if we do miss the start of the season? Will we forfeit those games, or will they be re-arranged?

And seeing as the embargo hasn't been lifted, and won't be until September 3rd apparently, does that mean Healy and co. remain Leeds players in League One? :blink:

[Lineker]

lol, Leeds.

[Grounded Wingman]

On another note, what happens if we do miss the start of the season? Will we forfeit those games, or will they be re-arranged?

[Farmer Reil]

And seeing as the embargo hasn't been lifted, and won't be until September 3rd apparently, does that mean Healy and co. remain Leeds players in League One? :blink:

[9 to 5]

Exactly. One good way for any football team to clear debts is to sell players and thus this will be taken into account.

[TheArsenal]

The administrators are in charge of the assests to the club. This means everything from cash, to players, to copyrights, etc. and in an effort to protect creditors who are trying to regain owed money, they will act in a way that is best for the creditors. Therefore your players, and everything that Leeds owns could be up for sale, most likely at knockdown prices too.

I remember when MK Dons moved and changed their name, that while they were in administration, AFC Wimbledon made an effort to buy all the trophies the club had ever won, the copyright to the "Wimbledon" name, and the history of the club. I'm not sure how you go about buying "history" but they tried to buy the package all the same.

[King Ellis]

The news ticker at BBC says the admins have put us up for sale.

[Matt]

And seeing as the embargo hasn't been lifted, and won't be until September 3rd apparently, does that mean Healy and co. remain Leeds players in League One? :blink:

We've discussed this previously. You can't BUY players. Selling them is another matter.

So we're keeping David Healy and other players who could bring in money for the sake of it? Obviously the situation has changed since I asked and I imagine now we can sell players, but at the time, we couldn't sell anyone, hence why Kevin Nicholls can't/couldn't complete his move to Preston despite it being agreed a while ago now.

And hopefully being up for sale means Revie/Morris/anyone buys us. Gah, fuck anyone who's had any power at Leeds in the last 10 years excluding Gerald Krasner who saved us.

[9 to 5]

Who rememebers when Leeds were in the CL?

[gunnar hendershow]

Who rememebers when Leeds were in the CL?

Didn't they have a big message at the Leeds airport that read something like "Welcome to Leeds, home of the only United in England"?

[Matt]

Who rememebers when Leeds were in the CL?

Didn't they have a big message at the Leeds airport that read something like "Welcome to Leeds, home of the only United in England"?

The only United in Europe... Which was true, it was us, Bayern Munich (?), Real Madrid and Valencia.

[fineintent]

And seeing as the embargo hasn't been lifted, and won't be until September 3rd apparently, does that mean Healy and co. remain Leeds players in League One? :blink:

We've discussed this previously. You can't BUY players. Selling them is another matter.

Edited July 7, 2007 by fineintent

[Bigal]

There's a loan period for a while, then an emergency loan period in the last few months of the season.

[Matt]

Loans until early November with emergency loans thereafter, so yeah, I suppose we could get all our deals on "Loan until January and then buy/sell in the window".

[King Ellis]

Apparently we can sign a few players as we're down to about 17 players now and the rules say you're not allowed to buy more if you have 20 or over. Of course I don't know if we'll have the finances in place to sign anybody what with the admins in and all.