Yorkshire Evening Post 20/8/07
Flo: I thought I was finished at Leeds United
By Phil Hay
TORE ANDRE FLO re-ignited his Leeds United career with a priceless goal against Southend United on Saturday – and then revealed how a fractured foot had threatened to force his retirement.
Flo struck for the first time in seven months as Leeds routed Southend 4-1, bringing to an end the injury problems which have plagued his troubled spell at Elland Road.
Flo: I thought I was finished at Leeds United
By Phil Hay
TORE ANDRE FLO re-ignited his Leeds United career with a priceless goal against Southend United on Saturday – and then revealed how a fractured foot had threatened to force his retirement.
Flo struck for the first time in seven months as Leeds routed Southend 4-1, bringing to an end the injury problems which have plagued his troubled spell at Elland Road.
The Norwegian's short-term contract with Leeds last season was ruined by a foot injury sustained in January – just three weeks after he first agreed to join United – and doubts over his fitness prevented him from making a single pre-season appearance this summer.
Flo was initially sidelined by a fractured foot, but the 33-year-old revealed that a second break towards the end of last term had delayed his comeback further – and left him questioning whether he would ever make a full recovery.
Flo said: "For a while during that period I was thinking 'can I ever come back?'"It's the longest time I've had out in my career. It seemed like a small thing but then it ended up being seven months.
"I was really struggling, and I then I broke the bone again. It's been a hard time. At the end of last season I was in plaster, and I wasn't even close to playing at that stage.
"But what a good feeling. I've been out for such a long time and I've had maybe the most frustrating time of my career. I've had a broken bone and an operation, and it's unbelievable to be back with a goal and to win 4-1 at home.
"That's what you work towards when you're in the treatment room and the gym. It was all worthwhile."
Flo's unstoppable volley came five minutes from time with Southend heading for a 1-1 draw and United struggling to force a winning goal.
The former Chelsea forward had been introduced as a substitute in the 80th minute, and he made an immediate impact by taking advantage of a loose ball inside Southend's box. The floodgates then opened as further goals from Manuel Rui Marques and Jermaine Beckford completed United's emphatic win.
Flo, who accepted the offer of a one-year contract from Dennis Wise two days before the start of the season, said: "I couldn't believe it – it was my first touch.
"He (Wise) has been very good to me, and he's believed in me. I'm quite old but he gave me a contract and he had faith in me.
"It's good to give something back finally, and I'd like to do more. "It would be great to play here until I'm finished.
"There seems to be a great atmosphere and that's just what we need.
"We can't let our heads go down, and we're really up for a fight."
United's impressive victory – their biggest success during 10 months under Wise – moved the Elland Road club on to minus nine points, just three victories away from overturning the Football League's 15-point penalty.
A third-minute free-kick from Alan Thompson opened the scoring on Saturday in front of a crowd of more than 24,000, and Wise was delighted to see Marques and Beckford claim their first goals for Leeds on a afternoon which fuelled a growing sense of expectation at Elland Road.
Wise said: "It's an important time for us. We need to try and clear these points as quickly as possible and catch the others up.
"I look at the group of players I've got and I think they're well capable.
"But I don't want them to get carried away because we've done nothing at the present moment."
The fans have been great as well, and we love them dearly. Hopefully they're seeing that this club will change, and that we're doing things for the right reasons – nothing else.
"We've got a younger, hungrier team that wants to play and die for Leeds United Football Club. "The same goes for the management as well.
"We've come here to make something happen.
"Sometimes it takes bad times to get good times, and we've stayed strong together."It's a bit disappointing because we should be top of the league at the moment.
"But we're not and we have to get on with it."
Wise's elation has been tempered by concerns over the fitness of Ian Westlake and Andrew Hughes, who both limped out of Saturday's victory.United are also preparing to lose defender Eddie Lewis, with the American international in the process of finalising his move to Barclays Premier League new boys Derby County for an undisclosed fee.
But Leeds look set to secure an immediate replacement at left-back by signing Wolves' former Ipswich Town and Birmingham City defender Jamie Clapham on a month's loan.
Four-star Leeds United floor Southend
Leeds United 4 Southend United 1
By Phil Hay
HAD William Shakespeare been employed to document last season, he might have noted that something was rotten in the state of West Yorkshire.
His opinion would not have provoked any dispute; Leeds United knew it, and visiting teams could smell it. The scent that drifted from Elland Road showed traces of fear, decline and implosion – everything, in short, that a football club prefers to hide. Players are routinely taught to fear United's stadium; for the past 12 months, the majority must have wondered why.
Four-star Leeds United floor Southend
Leeds United 4 Southend United 1
By Phil Hay
HAD William Shakespeare been employed to document last season, he might have noted that something was rotten in the state of West Yorkshire.
His opinion would not have provoked any dispute; Leeds United knew it, and visiting teams could smell it. The scent that drifted from Elland Road showed traces of fear, decline and implosion – everything, in short, that a football club prefers to hide. Players are routinely taught to fear United's stadium; for the past 12 months, the majority must have wondered why.
On the evening of October 24, 2006, when Dennis Wise walked into Elland Road for the first time as Leeds United's manager, the state of disrepair inside the club's fortress was impossible to disguise.
Southend United departed with a Carling Cup third-round victory that same evening after nothing more than a routine performance. The Essex club had never played at Elland Road before, nor encountered Leeds in competitive circumstances, but their carefree attitude told a depressing story.
At that moment, Wise must have realised he was inheriting a shadow of the Leeds United he had known as a player; a club lacking the defiant spirit for which is was famous. The early stages of his tenure did nothing to change that view but something at last is stirring in the western reaches of God's own county.
A stadium which lent itself to charity last season has defined itself once more as inhospitable terrain. Battered Southend left Yorkshire bloodied and battered on Saturday night, and with a revised impression of United's home. Having opened Wise's eyes to the realities of his job last year, it was perhaps appropriate that the Essex club were present to witness the rebirth of Elland Road 10 months later.
Steve Tilson, Southend's manager, will ask himself how his players came to lose by a three-goal margin on Saturday when a point was within their grasp with four minutes remaining.
The punishing defeat should not have come to pass at such a late stage, and the scoreline reflected harshly on Tilson's team. But to overlook the size of United's victory is to under-estimate the influence that Elland Road and its crowd can exert over opposition teams.
The visitors were hanging on gamely for a 1-1 draw when, driven by the impetus of a crowd of more than 24,000, Tore Andre Flo intervened with a 85th-minute goal which ignited Elland Road's fuse and put Southend to the sword.
The injury-prone striker drifted into the box to poach a rebound from Sebastien Carole's cross and flash a volley past goalkeeper Darryl Flahavan, five minutes after entering the fray as a substitute.
Southend had fought back from Alan Thompson's third-minute goal to produce an equaliser through Adam Barrett, but Flo's powerful finish cracked their resilience and, in the heat of Elland Road, the visitors duly wilted.
With the clock on 89 minutes, Manuel Rui Marques met Carole's corner with a deft header which floated into the far corner of the net, and Jermaine Beckford claimed a fourth goal in injury-time when Southend's defence allowed him to run on to a long clearance and lash a shot past Flahavan.
By the final whistle, Tilson and his players seemed thoroughly relieved to escape the melting. If Saturday is a fair depiction of what lies ahead, other teams may find themselves beating a similar retreat from Elland Road this season.
The final result was emphatic, but a note of caution for Wise will come from the way in which his players allowed Southend to dictate much of the second half, at a time when he might reasonably have expected Leeds to strike for the jugular.
Leeds had shaded the first 45 minutes, but they were soon beset by the nerves and weakness of conviction that played so great a part in the club's relegation last term.
The temptation to sit on their one-goal lead became too great as the match edged towards the hour mark, and stray passes and a gradual failure to grasp possession granted Southend a licence to dominate United. An equaliser seemed increasingly likely by the time Barrett forced home a header in the 69th-minute.
Wise's defence was cut open by slick movement and passing on the left wing, and though Lee Bradbury's shot was beaten away by a brilliant parry from Casper Ankergren, Barrett ran in to steer the rebound into the net with an easy finish.
United had asked for trouble, and Southend had provided it. That story was familiar last season, and never moreso than during the 1-1 draw with Ipswich Town which confirmed their relegation in April.
On that unforgettable occasion, United's 1-0 lead had seemed under threat from the moment Richard Cresswell opened the scoring early in the first half. It was also clear that Leeds were unlikely to have an answer if and when Ipswich forced an equaliser. But on Saturday, United stomached Southend's blow and responded with vigour. The reaction spoke of a certain strength of character among the players at Elland Road.
With two wins to their name, United are already making light work of the 15-point penalty thrown at them by the Football League.
Leeds are three victories short of reaching zero points – perhaps the strangest target ever set for a manager and his players – and United's supporters can sense momentum gathering. The rest of League One can doubtless feel it too. What seemed initially like a disastrous development at Elland Road has in fact served to depict Leeds as one of the division's most dangerous teams.
It was for that reason that the queue for tickets on Saturday delayed kick-off for 15 minutes and brought a bigger crowd into Elland Road than had attended United's first home fixture last season, weeks after the play-off final.
The atmosphere crackled, but the supporters had scarcely drawn breath when Thompson converted Leeds' first chance in the third minute.
Peter Clarke fouled Beckford after losing track of the striker, and Thompson whipped a free-kick from 30-yards over Southend's wall and beyond the reach of Flahavan's desperate dive.
The goal staggered Southend, though not as much as the realisation after half-an-hour that they were still trailing to Thompson's strike.
Alan McCormack rattled the post in the 14th minute with a fierce shot after Leeds surrendered the ball outside their own box, and striker Matt Harrold threatened with two efforts, the second deflecting off Frazer Richardson and flashing the wrong side of Ankergren's post.
Improved luck might have handed the visitors parity at half-time, although Beckford and Jonathan Douglas threatened to improve United's lead, but the equaliser, when it came, was clinical, and Barrett's 69th-minute header asked immediate questions of Leeds. The answer was provided by an unlikely source, United's enigmatic winger Sebastien Carole.
Carole's contribution at Elland Road could be kindly described as sporadic; in November of last year, Leeds were considering the option of terminating his contract. But, having entered the game in the 42nd minute as a replacement for Ian Westlake, the Frenchman took it upon himself to carry Leeds towards a second successive victory as the match approached full-time.
His cross in the 85th minute created an opening that Flo could not refuse, and Marques took his chance of a first goal for Leeds when Carole picked him out with a corner four minutes later.
By the time Beckford swept a confident finish beneath Flahavan in front of the Kop, Tilson's players were out on their feet and Wise struggled to contain his satisfaction. It may not even have mattered to him that Leeds made harder work of Southend than was strictly necessary. This season, after all, is supposed to be complicated.
Leedsunited.com 17/8/07
OPEN LETTER
United chairman Ken Bates this week wrote to all Season Ticket holders, Members, lapsed Season Ticket holders from 2006/07, lapsed Members, and current and lapsed corporate clients.
For those of you that haven't received a letter, here is a copy....
Dear Leeds Club Member August 2007
I have delayed my usual pre season letter until the outcome of recent events was resolved.
I can understand if you feel frustrated by the lack of information coming out of the Club but negotiations on many fronts have been both delicate and confidential. Unfortunately information given to fans is picked up by the media and we are then at the mercy of individual media reporters and editors who sometimes interpret (or in some cases misinterpret) a story according to their views or prejudices.
Only now do I feel comfortable in informing you of the position and it will be a long letter because you should know of the many aspects of the recent past including many parties, plots, intrigue and much more.
THE ADMINISTRATION (CVA)
KPMG were advised throughout by Walker Morris the Leeds based Insolvency Lawyers as well as two Senior Barristers. In view of several press articles and comments by the Football League it is essential to state that all parties behaved properly at all times. The common desire was to save Leeds United and stop the taxman's attempt to close it.
In view of the behaviour of certain parties with hidden agendas, KPMG decided to invite fresh offers but at the end of the day the offer from the Forward Sports Fund ('FSF') was still the highest and best.
After the original creditors meeting there is a period of 28 days for anybody to object. The taxman objected at 3pm on the last day just before the court closed.
At the insistence of the League, KPMG tried very hard to meet the Taxman's objections and the negotiations were conducted at the highest level. The first demand/condition was that all monies from FSF to KPMG should be paid upfront. That was agreed. The second demand was that the Football Creditors should not get preference and be paid any more than anybody else. This was an impossible demand. If Leeds didn't pay the Football Creditors in full then the Club didn't get membership of the League. We were between the devil and the deep blue sea. Damned if we do, damned if we don't. The Taxman then proposed that a sum equal to that going to the Football Creditors be paid into the general pool for all Creditors putting them in a better position. FSF agreed. The Taxman then refused to withdraw their appeal and further stated officially that they would vote against any other proposal if Football Creditors were ever paid in full. Indeed they stated that they would oppose any further CVA when Football Clubs were involved. Clearly this is an impossible situation.
What really irks the Taxman is that until 2003 they got preferential treatment in any insolvency. Now they don't. That is not Leeds fault or that of the League.
Finally, we believe that the actions of the Taxman were illegal. In the case of Wimbledon the very question of the Football Creditors was challenged in the High Court and the Taxman lost on Appeal.
Secondly, Newcastle United won in the High Court against the Taxman because of their refusal to allow VAT on Agents' fees as a deduction. Despite losing, the Taxman still submitted a huge claim for VAT on Agents' fees which was illegal. The Taxman is questioning the validity of some creditors' claims. They do not have clean hands in this matter. This dispute is not about Leeds United, it is about opposing the Football League's Rule that Football Creditors must be paid in full.
ALTERNATIVE BUYERS
At the time of buying the Club from the Administrators, FSF promised to talk to any other would be purchasers with a view to any possible cooperation. We did the best we could. This is a summary of what did or did not happen.
1. DUNCAN REVIE - Did not and has not made any offer at all. Neither has he contacted me or any other Director.
2. SO CALLED AMERICAN INVESTMENT FUND - One phone call and they have not been in contact since. Absolutely no discussion.
3. REDBUS - Mark Taylor, a lawyer, had one meeting and one phone call. No proposal.
4. SIMON MORRIS - He made contact through a middle man. We informed him to call us direct. We weren't prepared to negotiate through a third party. We haven't heard from him. In the newspaper it was reported that in buying Leeds it would be part of a £500/600 million pound development in the surrounding area. Unfortunately (for him) he doesn't own the land and Leeds City Council have put it out to possible public tender. e also employed two PR companies to run a dirty tricks campaign against me which backfired. We obtained a background memo, a copy of which is enclosed. PROJECT PEACOCK is the code name for Leeds and PROJECT PILGRIM is the code name for Boston United. Gerald Krasner was the Administrator for Boston United and Morris hoped to get the Boston Club ground for redevelopment but he was unsuccessful. Despite all the media speculation we knew of no other interested party.
MELVYN LEVI
Levi was a member of the Yorkshire Consortium (YC) who briefly owned Leeds United until it was sold to the FSF in January 2005.
For technical reasons, FSF acquired 50% of the Club at the time and had an option to buy the other 50% in June 2005. FSF exercised the option but Levi refused to sign over the shares.
All decisions by YC had to be unanimous, consequently Levi's actions blocked the deal. From that day to this Levi has worked in the background attempting to frustrate every effort to strengthen the Club's finances. We planned a rights issue to raise a further £5m for the Club but Levi frightened off the participants. Last October we agreed a deal with an Irish consortium who would put £10m of new capital into the Club and lend us the money to buy back Elland Road and the training ground. Levi found out and rang the would be investors and put them off. This is well documented.
Then Weston (see later) got in on the act with Levi and they demanded 10% of the Club, £200,000 in cash and Directors' Box tickets for life in return for honouring the option. Levi has denied this but we have witness statements on file.
This is a brief summary of what has occurred but suffice to say Levi has been actively trying to frustrate all our efforts to strengthen the Club's financial position. He even went to court and obtained an injunction against Leeds printing a match programme. The Judge threw out his case after 40 minutes.
Robert Weston is the first husband of Levi's wife. Levi arranged with Weston (who lives in Jersey) to handle Leeds season ticket credit card transactions. For two years we have been trying to recover the £190,000 which Weston owes to Leeds. He has used every possible delaying tactic to avoid repaying the money which he has acknowledged he owes. We have at last obtained judgment and should get the money this month. Weston has been in jail for trying to pervert the course of justice.
Levi is a disgrace.
PLAYERS, BUYING AND SELLING
Player transactions are very complicated and when fans jump to conclusions they do not always know the full facts which, for important reasons, cannot be revealed at the time.
Let me take David Healy as an example. Healy's agent voted against the CVA. Healy had one year left on his contract which meant he could sign a pre contract in January and walk out next June on a free transfer. Everybody said we should get £3m+ for him but nobody offered it. He was a high earner and his agent wanted him away. Fulham's was the only genuine offer and we got £1m for him plus add-ons. He cost us £750k from Preston plus 20% of any profit. We still owed Preston £200k so of the £1m we actually got £750k net. We have already spent £500k on buying Casper and Hughes.
A year ago Danny Rose refused to go to Chelsea because he "loved Leeds". Last month his agent refused a new contract and Rose walked out. After a lot of haggling we got £750k plus add-ons of £250k. To buy or sell a player (a) he has to want the move (b) the other Club must be willing to do a deal and (c) we must afford him, otherwise we are back in a Ridsdale situation.
One example is of a young promising striker from the South. Free transfer and earning £600 a week. Deal done, except that his agent suddenly demanded £6,000 a week in wages. No deal.
I know it is frustrating sometimes for fans but we do not reveal our plans publicly, it just alerts the opposition.
Rest assured, Wisey plans to recruit experienced but mainly younger players who are hungry for success and want to achieve things, not those looking to delay their retirement with no ambition other than to have another pay day.
THE WAY FORWARD
We now have a Club with no debt, the last legacy of the Ridsdale era is behind us.
We still have the consequences of the Krasner, Levi and Morris actions with us. They sold Elland Road for £8m. We have to buy it back at £15m meanwhile paying £1.1m a year in rent.
We have tightly controlled budgets and all the staff know that every penny counts.
We are willing to have discussions with any serious investor who has the Club's best interests at heart, rather than hoping to make a quick buck from the property.
We are preparing plans to develop Elland Road to enable non footballing income to come into the Club to strengthen our buying power on a permanent basis.
We will invest in our scouting and youth policies to continue Leeds' great history of developing home grown players.
The 15 point "sanction" is a scandal and a travesty of justice. We are appealing that decision to the Football Association but meanwhile will get on with the job of strengthening the team and getting back firstly to the Championship and then the Premiership.
Dennis, Gus and myself are here for the long haul. So the mindless minority who do their silly chants had better get used to it.
On a lighter note may I point out that under the Sex Discrimination Act demonstrations that invite men getting their shirts off is only legal if the Ladies do the same!
Finally, thank you all for the tremendous support throughout the difficult time. Fulham, Man City, Derby, Aston Villa and Middlesbrough have all been in our current position, look where they are now.
Marching on Together
Ken Bates, Chairman
Project Peacock
The Brief
The target development area consists of three sites adjacent to one another; Elland Road (owned by Jacob Adler}; British Road Haulage site (BRS) owned by the Castle family and over which Stanley Leisure ("Genting") has an option which expires on 2nd July; and a Council-owned plot.
The objective is to acquire all three sites for development re-locating Leeds F.C. to a site nearby which wouId be supported by a number of retail outlets and a 50,000 seater arena.
The value of the fully developed target would be in the region of £1 billion following the injection of £15/16 million development investment by Socius Capital Partners ("Morris Properties").
A number of contingent conditions will determine whether we are able to gain control of the target: (i) being able to persuade the Castle family to sell at a realistic price; (ii) being able to convince Stanley Leisure that their plans for BRS are unlikely to come to fruition; and (iii) being able to wrestle control of Leeds F.C. from the current Chairman, Ken Bates.
It is noted that Stanley Leisure wish to gain permission for building a casino and that Mr Bates is exposed to a charge of seeking to defraud creditors of Leeds F.C, ("the Inland Revenue") and that Mr Bates has fallen out with Leeds City Council.
Strategy
In order to meet the brief we advise that we should adopt a dual track strategy from now onwards, partly private; partly public. In both cases we need to present ourselves (accurately) as the people best able to save Leeds F.C. - placing it on a sound financial footing - and best able to regenerate the surrounding area bringing facilities and prosperity to an underdeveloped and run down plot. We should prepare a well thought out approach, and carefully choose our
time to commence negotiations with Jacob Adler (Elland Road owner) and with the Castle family (owners of the BRS site) - see timeline. In doing so we need to position ourselves as the partner of choice safeguarding the heritage of Leeds F.C. as welt as being the people with the liquidity to offer them with a quiet exit.
It should be noted that we intend to inject substantial funds into the whole project as well as providing a fair price for the ground. We should emphasise to the Castle family that we are in a position to act as saviours and regenerators.
Bearing in mind the imminent timeline we should also prepare a detailed case outlining our plans to Leeds City Council. With this in mmd we should ensure that certain key decision makers and opinion formers in the local government arena are aware of our plans and that are supportive due to the power of our advocacy.
At this stage we are agreed that the following people need to be targeted: . Jean Dent, Estate and Planning, Councillor-Leader Andrew Carter; Terry Hodgkinson, Highways and Road Development Agency, in addition, we will need to present to the local MP, Hilary Benn.
In tandem with the above, we are seeking to engage the active support of Keith Harris, Chairman of Seymour Pierce to whom we have written and to whom we hope to speak following his return to the office from holiday on or following, 16th April.
Mr Harris had been identified as a potential key opinion former and supporter in Project Pilgrim and Project Peacock because of his financial and footballing clout and credibility. Following an initial meeting we intend to arrange a meeting of principals in the week commencing 16 April.
In order to unlock the present situation we will also need to dislodge the position of the two incumbents: Stanley Leisure owned by Genting, who wish to build a regional casino on the BRS site and Ken Bates current owner of Leeds F.C We advise that we should assemble a black book on each of these deploying our dedicated research team and at the right time, providing non attributable press briefings in the first instance followed by on the record briefings at the appropriate time.
While the current owner of Leeds F.C. should in no way be under-estimated, it is noted that the club is in severe financial difficulties and that PAYE is owed to the Inland Revenue.
Similarly, as foreign owners about whom very litlle is known, Genting, is vulnerable to press scrutiny about its intentions from certain sections of the press, notably, the Daily Mall and the Mail on Sunday who are bitterly opposed to government plans to fuel the spread of the gaming industry, especially in areas in which they believe there are a disproportionate number of low income and, therefore, vulnerable people.
At the nght moment, we would advise that we introduce Simon Morris to Chris Slackhurst, the city editor of the Evening Standard, positioning him as one of the key people who have turned around the City of Leeds, and to Jon Rees. the media correspondent of the Mail on Sunday, who we believe would be very interested in taking the lid off Genting.
We also recommend a background briefing programme for Simon Morris with business editors of the local media to explain the business and to establish a relationship.
Timeline
At this stage we have identified certain key dates which will have a bearing on Project Peacock:
19th April 2007 paye deadline, Leeds F.C. (monies unavailable)
3rd May 2007 Local Elections (heightened political awareness of
regional issues)
4th/5th May 2007 Leeds F.C. relegation (cash flow dries up)
Mid May 2007 Winding up notice
2nd July 2007 Stanley Leisure option on BRS expires
Mid July 2007 Unveil rescue package and regeneration plans
Next Steps
• Agree key messages
• Create corporate materials and presentation
• Arrange private briefings (off the record)
• Arrange press interviews (on the record)
• Start negotiations with Jacob Adler and the Castle family
OPEN LETTER
United chairman Ken Bates this week wrote to all Season Ticket holders, Members, lapsed Season Ticket holders from 2006/07, lapsed Members, and current and lapsed corporate clients.
For those of you that haven't received a letter, here is a copy....
Dear Leeds Club Member August 2007
I have delayed my usual pre season letter until the outcome of recent events was resolved.
I can understand if you feel frustrated by the lack of information coming out of the Club but negotiations on many fronts have been both delicate and confidential. Unfortunately information given to fans is picked up by the media and we are then at the mercy of individual media reporters and editors who sometimes interpret (or in some cases misinterpret) a story according to their views or prejudices.
Only now do I feel comfortable in informing you of the position and it will be a long letter because you should know of the many aspects of the recent past including many parties, plots, intrigue and much more.
THE ADMINISTRATION (CVA)
KPMG were advised throughout by Walker Morris the Leeds based Insolvency Lawyers as well as two Senior Barristers. In view of several press articles and comments by the Football League it is essential to state that all parties behaved properly at all times. The common desire was to save Leeds United and stop the taxman's attempt to close it.
In view of the behaviour of certain parties with hidden agendas, KPMG decided to invite fresh offers but at the end of the day the offer from the Forward Sports Fund ('FSF') was still the highest and best.
After the original creditors meeting there is a period of 28 days for anybody to object. The taxman objected at 3pm on the last day just before the court closed.
At the insistence of the League, KPMG tried very hard to meet the Taxman's objections and the negotiations were conducted at the highest level. The first demand/condition was that all monies from FSF to KPMG should be paid upfront. That was agreed. The second demand was that the Football Creditors should not get preference and be paid any more than anybody else. This was an impossible demand. If Leeds didn't pay the Football Creditors in full then the Club didn't get membership of the League. We were between the devil and the deep blue sea. Damned if we do, damned if we don't. The Taxman then proposed that a sum equal to that going to the Football Creditors be paid into the general pool for all Creditors putting them in a better position. FSF agreed. The Taxman then refused to withdraw their appeal and further stated officially that they would vote against any other proposal if Football Creditors were ever paid in full. Indeed they stated that they would oppose any further CVA when Football Clubs were involved. Clearly this is an impossible situation.
What really irks the Taxman is that until 2003 they got preferential treatment in any insolvency. Now they don't. That is not Leeds fault or that of the League.
Finally, we believe that the actions of the Taxman were illegal. In the case of Wimbledon the very question of the Football Creditors was challenged in the High Court and the Taxman lost on Appeal.
Secondly, Newcastle United won in the High Court against the Taxman because of their refusal to allow VAT on Agents' fees as a deduction. Despite losing, the Taxman still submitted a huge claim for VAT on Agents' fees which was illegal. The Taxman is questioning the validity of some creditors' claims. They do not have clean hands in this matter. This dispute is not about Leeds United, it is about opposing the Football League's Rule that Football Creditors must be paid in full.
ALTERNATIVE BUYERS
At the time of buying the Club from the Administrators, FSF promised to talk to any other would be purchasers with a view to any possible cooperation. We did the best we could. This is a summary of what did or did not happen.
1. DUNCAN REVIE - Did not and has not made any offer at all. Neither has he contacted me or any other Director.
2. SO CALLED AMERICAN INVESTMENT FUND - One phone call and they have not been in contact since. Absolutely no discussion.
3. REDBUS - Mark Taylor, a lawyer, had one meeting and one phone call. No proposal.
4. SIMON MORRIS - He made contact through a middle man. We informed him to call us direct. We weren't prepared to negotiate through a third party. We haven't heard from him. In the newspaper it was reported that in buying Leeds it would be part of a £500/600 million pound development in the surrounding area. Unfortunately (for him) he doesn't own the land and Leeds City Council have put it out to possible public tender. e also employed two PR companies to run a dirty tricks campaign against me which backfired. We obtained a background memo, a copy of which is enclosed. PROJECT PEACOCK is the code name for Leeds and PROJECT PILGRIM is the code name for Boston United. Gerald Krasner was the Administrator for Boston United and Morris hoped to get the Boston Club ground for redevelopment but he was unsuccessful. Despite all the media speculation we knew of no other interested party.
MELVYN LEVI
Levi was a member of the Yorkshire Consortium (YC) who briefly owned Leeds United until it was sold to the FSF in January 2005.
For technical reasons, FSF acquired 50% of the Club at the time and had an option to buy the other 50% in June 2005. FSF exercised the option but Levi refused to sign over the shares.
All decisions by YC had to be unanimous, consequently Levi's actions blocked the deal. From that day to this Levi has worked in the background attempting to frustrate every effort to strengthen the Club's finances. We planned a rights issue to raise a further £5m for the Club but Levi frightened off the participants. Last October we agreed a deal with an Irish consortium who would put £10m of new capital into the Club and lend us the money to buy back Elland Road and the training ground. Levi found out and rang the would be investors and put them off. This is well documented.
Then Weston (see later) got in on the act with Levi and they demanded 10% of the Club, £200,000 in cash and Directors' Box tickets for life in return for honouring the option. Levi has denied this but we have witness statements on file.
This is a brief summary of what has occurred but suffice to say Levi has been actively trying to frustrate all our efforts to strengthen the Club's financial position. He even went to court and obtained an injunction against Leeds printing a match programme. The Judge threw out his case after 40 minutes.
Robert Weston is the first husband of Levi's wife. Levi arranged with Weston (who lives in Jersey) to handle Leeds season ticket credit card transactions. For two years we have been trying to recover the £190,000 which Weston owes to Leeds. He has used every possible delaying tactic to avoid repaying the money which he has acknowledged he owes. We have at last obtained judgment and should get the money this month. Weston has been in jail for trying to pervert the course of justice.
Levi is a disgrace.
PLAYERS, BUYING AND SELLING
Player transactions are very complicated and when fans jump to conclusions they do not always know the full facts which, for important reasons, cannot be revealed at the time.
Let me take David Healy as an example. Healy's agent voted against the CVA. Healy had one year left on his contract which meant he could sign a pre contract in January and walk out next June on a free transfer. Everybody said we should get £3m+ for him but nobody offered it. He was a high earner and his agent wanted him away. Fulham's was the only genuine offer and we got £1m for him plus add-ons. He cost us £750k from Preston plus 20% of any profit. We still owed Preston £200k so of the £1m we actually got £750k net. We have already spent £500k on buying Casper and Hughes.
A year ago Danny Rose refused to go to Chelsea because he "loved Leeds". Last month his agent refused a new contract and Rose walked out. After a lot of haggling we got £750k plus add-ons of £250k. To buy or sell a player (a) he has to want the move (b) the other Club must be willing to do a deal and (c) we must afford him, otherwise we are back in a Ridsdale situation.
One example is of a young promising striker from the South. Free transfer and earning £600 a week. Deal done, except that his agent suddenly demanded £6,000 a week in wages. No deal.
I know it is frustrating sometimes for fans but we do not reveal our plans publicly, it just alerts the opposition.
Rest assured, Wisey plans to recruit experienced but mainly younger players who are hungry for success and want to achieve things, not those looking to delay their retirement with no ambition other than to have another pay day.
THE WAY FORWARD
We now have a Club with no debt, the last legacy of the Ridsdale era is behind us.
We still have the consequences of the Krasner, Levi and Morris actions with us. They sold Elland Road for £8m. We have to buy it back at £15m meanwhile paying £1.1m a year in rent.
We have tightly controlled budgets and all the staff know that every penny counts.
We are willing to have discussions with any serious investor who has the Club's best interests at heart, rather than hoping to make a quick buck from the property.
We are preparing plans to develop Elland Road to enable non footballing income to come into the Club to strengthen our buying power on a permanent basis.
We will invest in our scouting and youth policies to continue Leeds' great history of developing home grown players.
The 15 point "sanction" is a scandal and a travesty of justice. We are appealing that decision to the Football Association but meanwhile will get on with the job of strengthening the team and getting back firstly to the Championship and then the Premiership.
Dennis, Gus and myself are here for the long haul. So the mindless minority who do their silly chants had better get used to it.
On a lighter note may I point out that under the Sex Discrimination Act demonstrations that invite men getting their shirts off is only legal if the Ladies do the same!
Finally, thank you all for the tremendous support throughout the difficult time. Fulham, Man City, Derby, Aston Villa and Middlesbrough have all been in our current position, look where they are now.
Marching on Together
Ken Bates, Chairman
Project Peacock
The Brief
The target development area consists of three sites adjacent to one another; Elland Road (owned by Jacob Adler}; British Road Haulage site (BRS) owned by the Castle family and over which Stanley Leisure ("Genting") has an option which expires on 2nd July; and a Council-owned plot.
The objective is to acquire all three sites for development re-locating Leeds F.C. to a site nearby which wouId be supported by a number of retail outlets and a 50,000 seater arena.
The value of the fully developed target would be in the region of £1 billion following the injection of £15/16 million development investment by Socius Capital Partners ("Morris Properties").
A number of contingent conditions will determine whether we are able to gain control of the target: (i) being able to persuade the Castle family to sell at a realistic price; (ii) being able to convince Stanley Leisure that their plans for BRS are unlikely to come to fruition; and (iii) being able to wrestle control of Leeds F.C. from the current Chairman, Ken Bates.
It is noted that Stanley Leisure wish to gain permission for building a casino and that Mr Bates is exposed to a charge of seeking to defraud creditors of Leeds F.C, ("the Inland Revenue") and that Mr Bates has fallen out with Leeds City Council.
Strategy
In order to meet the brief we advise that we should adopt a dual track strategy from now onwards, partly private; partly public. In both cases we need to present ourselves (accurately) as the people best able to save Leeds F.C. - placing it on a sound financial footing - and best able to regenerate the surrounding area bringing facilities and prosperity to an underdeveloped and run down plot. We should prepare a well thought out approach, and carefully choose our
time to commence negotiations with Jacob Adler (Elland Road owner) and with the Castle family (owners of the BRS site) - see timeline. In doing so we need to position ourselves as the partner of choice safeguarding the heritage of Leeds F.C. as welt as being the people with the liquidity to offer them with a quiet exit.
It should be noted that we intend to inject substantial funds into the whole project as well as providing a fair price for the ground. We should emphasise to the Castle family that we are in a position to act as saviours and regenerators.
Bearing in mind the imminent timeline we should also prepare a detailed case outlining our plans to Leeds City Council. With this in mmd we should ensure that certain key decision makers and opinion formers in the local government arena are aware of our plans and that are supportive due to the power of our advocacy.
At this stage we are agreed that the following people need to be targeted: . Jean Dent, Estate and Planning, Councillor-Leader Andrew Carter; Terry Hodgkinson, Highways and Road Development Agency, in addition, we will need to present to the local MP, Hilary Benn.
In tandem with the above, we are seeking to engage the active support of Keith Harris, Chairman of Seymour Pierce to whom we have written and to whom we hope to speak following his return to the office from holiday on or following, 16th April.
Mr Harris had been identified as a potential key opinion former and supporter in Project Pilgrim and Project Peacock because of his financial and footballing clout and credibility. Following an initial meeting we intend to arrange a meeting of principals in the week commencing 16 April.
In order to unlock the present situation we will also need to dislodge the position of the two incumbents: Stanley Leisure owned by Genting, who wish to build a regional casino on the BRS site and Ken Bates current owner of Leeds F.C We advise that we should assemble a black book on each of these deploying our dedicated research team and at the right time, providing non attributable press briefings in the first instance followed by on the record briefings at the appropriate time.
While the current owner of Leeds F.C. should in no way be under-estimated, it is noted that the club is in severe financial difficulties and that PAYE is owed to the Inland Revenue.
Similarly, as foreign owners about whom very litlle is known, Genting, is vulnerable to press scrutiny about its intentions from certain sections of the press, notably, the Daily Mall and the Mail on Sunday who are bitterly opposed to government plans to fuel the spread of the gaming industry, especially in areas in which they believe there are a disproportionate number of low income and, therefore, vulnerable people.
At the nght moment, we would advise that we introduce Simon Morris to Chris Slackhurst, the city editor of the Evening Standard, positioning him as one of the key people who have turned around the City of Leeds, and to Jon Rees. the media correspondent of the Mail on Sunday, who we believe would be very interested in taking the lid off Genting.
We also recommend a background briefing programme for Simon Morris with business editors of the local media to explain the business and to establish a relationship.
Timeline
At this stage we have identified certain key dates which will have a bearing on Project Peacock:
19th April 2007 paye deadline, Leeds F.C. (monies unavailable)
3rd May 2007 Local Elections (heightened political awareness of
regional issues)
4th/5th May 2007 Leeds F.C. relegation (cash flow dries up)
Mid May 2007 Winding up notice
2nd July 2007 Stanley Leisure option on BRS expires
Mid July 2007 Unveil rescue package and regeneration plans
Next Steps
• Agree key messages
• Create corporate materials and presentation
• Arrange private briefings (off the record)
• Arrange press interviews (on the record)
• Start negotiations with Jacob Adler and the Castle family
