Time Running Out for Leeds Takeover - Guardian 13/1/04

Guardian Unlimited Football | News | Time running out for Leeds takeover Matt Scott Tuesday January 13, 2004 Leeds United do not expect to secure a takeover for the club before their January 19 deadline. A statement to the Stock Exchange yesterday indicated that negotiations are ongoing but that none of the current proposals amounts to a buy-out. "Further to its announcement on December 4 2003, the board of Leeds United confirms it is in continuing, constructive discussions with a number of parties regarding proposals to purchase the company's business and assets or to inject funds," said the statement. "However, none of the interested parties' proposals contemplates an offer for the company's shares." Leeds's best hope is to gain interim funding that will take them to the end of the season, by when the relegation-threatened club's footballing fate will be known. With a £20m discrepancy in revenues between the Premiership and the First Division, potential investors are unwilling to commit to a full purchase until the future value of the club becomes clear. Even that would prove expensive for the short-term investor, however. Though the club are breaking even after the raft of redundancies and debt restructuring undertaken by the club's former chairman Professor John McKenzie, interest payments on the club's overdrafts are soaring. One possible solution would be the sale of players, which would result in a reduction to the wage bill, but even that recourse would prove complicated. The purchases of several Leeds players were underwritten by the insurance firm Gerling. Yet the funds recouped by the sales of Olivier Dacourt and Robbie Fowler, players bought under the scheme, did not cover associated loans. The balance was then loaded on to the contract of Mark Viduka, whose registration was already mortgaged to the tune of £5m. Consequently, even if Viduka's desired sale were to raise £8m, it is believed such a fee would not cover the loans against his contract. "We are working very hard to try and resolve the situation and hope that an equitable agreement can be reached," said Gerling in a statement yesterday. The registrations of Paul Robinson and Alan Smith are not leased, making their potential transfers an attractive proposition for Leeds. However, the goalkeeper has already turned down a move to Aston Villa and Smith is determined to remain atElland Road for the fight against relegation. Even so, possible suitors are more likely to wait for Leeds's situation to deteriorate - since administration would significantly reduce any fee the club could request for their assets. The Leeds defender Michael Duberry has suffered a hamstring injury which may keep him out for up to a month.