Bates returns with £10m takeover deal for Leeds - Times 21/1/05

Times Online - Sport Bates returns with £10m takeover deal for Leeds By Ashling O'Connor KEN BATES, the former chairman of Chelsea, was last night poised for a dramatic return to football by buying control of Leeds United, the debt-ridden Coca-Cola Championship club. Bates, 73, was in talks yesterday with the Leeds board and, as he boarded a train for London, rumours abounded that he had agreed a deal. Bates, now based in Monaco, is believed to have offered about £10 million in cash for a 51 per cent stake in the club and the position of chairman. To acquire such a majority he would need to buy out Simon Morris and Melvyn Levy, two of the directors, whose shareholdings together make 51 per cent. Leeds would only confirm that the club was considering an offer of investment from Bates. There is still a rival offer on the table from a local business consortium led by Norman Stubbs and backed by Allan Leighton, the City financier and former Leeds deputy chairman. “We are still talking to all consortiums and Mr Bates is one of those,” Bryan Morris, a club spokesman, said. “No deal has been finalised but as soon as negotiations have been concluded we will issue a press statement.” Bates was unavailable for comment. It is understood that the Stubbs and Bates deals are separate. The Stubbs consortium has agreed only to put £15 million directly into the club. It does not intend to buy out the present board of directors, who saved the club from administration in March last year. The club’s directors, led by Gerald Krasner, the chairman, are owed about £4.7 million in loans that have been guaranteed by their homes and businesses. While they have reduced Leeds’s debt from £103 million to about £25 million, the club is still on shaky financial ground and they stand to lose out financially if it goes into administration. Leeds are fourteenth in the Championship, eight points above the relegation zone. Administration would lead to a ten-point deduction by the Football League. The board will be keen to recover some of its money, so the Bates deal is a sweeter one for them to consider. Krasner told The Times last night: “No deal has been signed, sealed and delivered.” Yet Leeds sources expected an announcement as soon as today that the club had been sold to Bates. Fans are likely to be in two minds about the prospect of Bates running their club, given his tempestuous relationship with Chelsea supporters during his 22-year reign at Stamford Bridge. “This is the man who wanted to put up electric fences at Chelsea and his business track record leaves a lot to be desired,” John Boocock, chairman of the Leeds United Supporters Trust, said. “At no point has he shown any interest in Leeds as a club or a city. He just wants to have a toy to play with. If he is doing this without due diligence, he is not aware that the club needs far more.” Bates has long been searching for a way back into the professional game after selling Chelsea to Roman Abramovich, the Russian oil billionaire, for £140 million in July 2003. He made at least £17 million from the deal. Bates tried to invest in Sheffield Wednesday but his approach was rejected by the board, despite the club also being £25 million in debt. His interest in Leeds first came to light through Sebastian Sainsbury, the great-grandson of the supermarket chain founder, who claimed that he had been offered £10 million in exchange for 51 per cent. At the time, Bates denied any link to Leeds. Sainsbury’s proposed takeover eventually collapsed, leaving the path clear for Bates to negotiate directly with the board. If he completed a deal, it would end the continued uncertainty surrounding the club’s ownership. Since Krasner’s consortium took over nearly a year ago, there have been 13 groups that have considered investing in Leeds. Fans have grown weary of hearing about takeover talks that amount to nothing. “We never believe anything at Elland Road until it actually happens,” Ray Fell, chairman of the Leeds United Supporters Club, said. “If it did, there would be a little apprehension, but we are in an awkward position of not being able to resist takeovers like other clubs. We need investment. If Mr Bates is the one to provide it, then so be it.” Leeds still needs substantial investment to cover debt repayments, the most pressing of which is £1.2 million owed to the Inland Revenue. There are still outstanding repayments owed to the bondholders who bankrolled Peter Ridsdale’s failed dream to qualify for the Champions League every season