Telegraph 2/6/07
Bates bid for Leeds pays off
By David Bond
Ken Bates yesterday won his bid to buy back Leeds United, but only by the narrowest of margins.
Following a stormy meeting at Elland Road, creditors owed £35million by the League One club agreed to support Bates's offer to repay one pence for every pound of the club's debt, by 75.02 per cent - just 0.02 above the figure needed to approve the deal.
The result was so tight, however, that administrators from KPMG have adjourned yesterday's meeting until Monday while they double check the vote. Major creditors such as the Inland Revenue, who are owed £6m, are also understood to be considering how they can challenge the result of the meeting.
But, according to sources, the recount is unlikely to alter the eventual outcome, leaving Bates and his financial backers free to start rebuilding the club with only a fraction of the debts they had just one month ago.
A spokeswoman for KPMG said: "The creditors' meeting has been adjourned without a decision being reached. KPMG wish to recount the votes and the meeting will resume on June 4 at 10am when the final results will be provided."
Although the administrator Richard Fleming revealed on the eve of the meeting that five rival bidders had tabled alternative offers for the club, Bates always looked favourite to pull off the controversial deal.
But creditors expressed their anger at Bates' plan to effectively write off what they are owed.
Former Leeds chairman Gerald Krasner asked the administrator to accept a further £20million of debts which would have ensured opposition of more than 25 per cent. But KPMG refused to accept Krasner's claims.
Creditors had been warned by Fleming that failure to back Bates would place the club in danger of being liquidated as the Leeds chairman made it clear he would block any rival bid.
Bates and three offshore investment funds - Astor, Krato and Forward Sport - were the club's biggest creditors at the time it was placed in administration on May 4 with more than 45 per cent of the debt. That meant that even if Bates' plan was rejected, he and his backers had sufficient voting rights to leave the club in stalemate. Faced with such a fait accompli, the administrators and the majority of the creditors had no choice but to accept his offer.
Yesterday's result means the end of the road for property millionaire Simon Morris, who had proposed an alternative offer of £8million. It is believed two bids from consortiums in America and two from the UK were also vying with Bates and Morris for control of Leeds.
The Football League, who automatically docked Leeds 10 points after they went into administration confirming their relegation from the Championship, must still sign off after Monday's meeting.
But, while the Bates rescue deal is certain to attract criticism from fans, the League's approval is expected to be a formality leaving Bates clear to resume control of Leeds next season.
Daily mail 1/6/07
Leeds in limbo after Bates wins but faces a recount
By CHRIS WHEELER
A wedding party formed a bizarre backdrop for Ken Bates to renew his vows to Leeds United yesterday. But as the former Elland Road chairman edged closer to regaining control of the stricken club, it was clear the honeymoon period could be very short indeed.
Small creditors, who stand to be the principal losers if Bates is successful in buying back the club he put into administration with debts of £35million, narrowly failed to vote out his offer of one penny in the pound during two stormy meetings at Elland Road.
Many felt administrators KPMG failed to act in their best interests by agreeing to sell the club back to Bates so quickly.
Andrew Simister, of STL Harrogate, said: "The reaction of creditors was one of disbelief and frustration. There were offers to people like myself of at least 15p in the pound but the administrators only seemed interested in Ken Bates’ offer.
"It seems to have been masterminded from start to finish by Mr Bates." Bates was at the stadium but he did not attend the meeting.
Needing 75 per cent of the votes among 1,300 creditors, he polled 75.02 per cent — a margin so slight that a recount was ordered and another meeting called for Monday morning.
However, even if he is successful, he faces the threat of legal action which could drag on to leave the club in a state of limbo, unable to buy or sell players as they prepare for life in League One.
Ray Fell, chairman of the Leeds Supporters Club, said: "This is a big worry for all true Leeds fans. Where do we go from here? It seems to be a long runner.
"We are worried about the start of August and being ready for the first game. The voting was very close and the fans will be like myself, bewildered and concerned."
A representative for small creditor PKF added: "It was a shabby meeting. When a decision is made I don’t think that will be the end of the matter. I think it could well end up in the High Court."
Former Leeds chairman Gerald Krasner, who was at the meeting to represent smaller creditors free of charge in his role as a corporate insolvency expert, warned the matter could be taken further. He said: "They have disallowed substantial votes by creditors on both sides and there may well be challenges in court."
Bates bid for Leeds pays off
By David Bond
Ken Bates yesterday won his bid to buy back Leeds United, but only by the narrowest of margins.
Following a stormy meeting at Elland Road, creditors owed £35million by the League One club agreed to support Bates's offer to repay one pence for every pound of the club's debt, by 75.02 per cent - just 0.02 above the figure needed to approve the deal.
The result was so tight, however, that administrators from KPMG have adjourned yesterday's meeting until Monday while they double check the vote. Major creditors such as the Inland Revenue, who are owed £6m, are also understood to be considering how they can challenge the result of the meeting.
But, according to sources, the recount is unlikely to alter the eventual outcome, leaving Bates and his financial backers free to start rebuilding the club with only a fraction of the debts they had just one month ago.
A spokeswoman for KPMG said: "The creditors' meeting has been adjourned without a decision being reached. KPMG wish to recount the votes and the meeting will resume on June 4 at 10am when the final results will be provided."
Although the administrator Richard Fleming revealed on the eve of the meeting that five rival bidders had tabled alternative offers for the club, Bates always looked favourite to pull off the controversial deal.
But creditors expressed their anger at Bates' plan to effectively write off what they are owed.
Former Leeds chairman Gerald Krasner asked the administrator to accept a further £20million of debts which would have ensured opposition of more than 25 per cent. But KPMG refused to accept Krasner's claims.
Creditors had been warned by Fleming that failure to back Bates would place the club in danger of being liquidated as the Leeds chairman made it clear he would block any rival bid.
Bates and three offshore investment funds - Astor, Krato and Forward Sport - were the club's biggest creditors at the time it was placed in administration on May 4 with more than 45 per cent of the debt. That meant that even if Bates' plan was rejected, he and his backers had sufficient voting rights to leave the club in stalemate. Faced with such a fait accompli, the administrators and the majority of the creditors had no choice but to accept his offer.
Yesterday's result means the end of the road for property millionaire Simon Morris, who had proposed an alternative offer of £8million. It is believed two bids from consortiums in America and two from the UK were also vying with Bates and Morris for control of Leeds.
The Football League, who automatically docked Leeds 10 points after they went into administration confirming their relegation from the Championship, must still sign off after Monday's meeting.
But, while the Bates rescue deal is certain to attract criticism from fans, the League's approval is expected to be a formality leaving Bates clear to resume control of Leeds next season.
Daily mail 1/6/07
Leeds in limbo after Bates wins but faces a recount
By CHRIS WHEELER
A wedding party formed a bizarre backdrop for Ken Bates to renew his vows to Leeds United yesterday. But as the former Elland Road chairman edged closer to regaining control of the stricken club, it was clear the honeymoon period could be very short indeed.
Small creditors, who stand to be the principal losers if Bates is successful in buying back the club he put into administration with debts of £35million, narrowly failed to vote out his offer of one penny in the pound during two stormy meetings at Elland Road.
Many felt administrators KPMG failed to act in their best interests by agreeing to sell the club back to Bates so quickly.
Andrew Simister, of STL Harrogate, said: "The reaction of creditors was one of disbelief and frustration. There were offers to people like myself of at least 15p in the pound but the administrators only seemed interested in Ken Bates’ offer.
"It seems to have been masterminded from start to finish by Mr Bates." Bates was at the stadium but he did not attend the meeting.
Needing 75 per cent of the votes among 1,300 creditors, he polled 75.02 per cent — a margin so slight that a recount was ordered and another meeting called for Monday morning.
However, even if he is successful, he faces the threat of legal action which could drag on to leave the club in a state of limbo, unable to buy or sell players as they prepare for life in League One.
Ray Fell, chairman of the Leeds Supporters Club, said: "This is a big worry for all true Leeds fans. Where do we go from here? It seems to be a long runner.
"We are worried about the start of August and being ready for the first game. The voting was very close and the fans will be like myself, bewildered and concerned."
A representative for small creditor PKF added: "It was a shabby meeting. When a decision is made I don’t think that will be the end of the matter. I think it could well end up in the High Court."
Former Leeds chairman Gerald Krasner, who was at the meeting to represent smaller creditors free of charge in his role as a corporate insolvency expert, warned the matter could be taken further. He said: "They have disallowed substantial votes by creditors on both sides and there may well be challenges in court."