Leeds United: Pressure’s on Parkin’s bid
YEP 4/4/13
By Phil Hay
Steve Parkin’s bid for a majority stake in Leeds United is in doubt after an exclusivity agreement between him and club owner GFH Capital expired without completion of a sale.
Parkin has not withdrawn his offer for a 51 per cent shareholding at Elland Road but there is growing uncertainty about the likelihood of him proceeding with his attempt to take control of United.
The Yorkshire-based businessman – the chairman of distribution firm Clipper Logistics and a lifelong Leeds supporter – is two months into negotiations with GFH Capital after agreeing in principle to buy a large stake in the club.
His proposed purchase was subject to due diligence and consideration of United’s financial position under GFH Capital, the Dubai-based private equity firm which bought Leeds from chairman Ken Bates in December.
Parkin was in Dubai as recently as last week and legal work has continued in the past few days but the YEP understands that he is unlikely to follow through with his plan to plough money into the club unless he succeeds in securing the financial support of investors in the Middle East.
His bid was originally thought to have the support of the wealthy Saudi Arabian individual who considered buying Leeds while GFH Capital was finalising its own deal last November but that party is no longer believed to be interested in involving himself with the Elland Road club.
Parkin is understood to be engaged in active talks with potential backers – talks described by a source as “positive” – but he is yet to secure a guarantee of the assistance he needs.
He was unavailable for comment last night but the source claimed Parkin remained “cautiously optimistic” about pulling off a 51 per cent purchase, in spite of the lapse of his exclusivity agreement with GFH Capital.
United’s owner is continuing to actively seek investment having agreed last Thursday to sell 10 per cent of Leeds to the International Investment Bank (IIB), a financial institution in Bahrain.
GFH Capital – itself owned by Bahraini investment bank Gulf Finance House – has promised further announcements of equity deals in the weeks and months ahead, though the company claims that it plans to retain a long-term share in United.
The sale of 10 per cent to IIB saw the bank’s chief executive, Aabed Al Zeera, added to the board of Leeds City Holdings Limited, United’s parent company.
Al Zeera spoke about IIB’s motivation for buying shares in an interview with Bloomberg yesterday, saying: “I believe this stake has a great potential in terms of capital appreciation. Maybe not this year or next but surely over the medium term it will grow in value.”
Any further investors would be joining a club who are managerless and heading for a 10th straight season outside the Premier League following the sacking of Neil Warnock earlier this week.
Meanwhile, Leeds have compiled a short-list of candidates to replace Warnock, with Brighton and Hove Albion’s Gus Poyet and ex-Reading manager Brian McDermott both prominent.
A move for Poyet would be complicated by both Brighton’s on-going pursuit of promotion to the Premier League and a £2.5m release clause in his contract while McDermott has admitted that his interest in available jobs would depend heavily on the stability of the clubs in question.
McDermott, who won the Championship title at Reading last season, said: “Everything needs to be right – finances need to be right, relationship with both the board and owner.
“A lot of things need to be taken into consideration and it has to be the right match.”
By Phil Hay
Steve Parkin’s bid for a majority stake in Leeds United is in doubt after an exclusivity agreement between him and club owner GFH Capital expired without completion of a sale.
Parkin has not withdrawn his offer for a 51 per cent shareholding at Elland Road but there is growing uncertainty about the likelihood of him proceeding with his attempt to take control of United.
The Yorkshire-based businessman – the chairman of distribution firm Clipper Logistics and a lifelong Leeds supporter – is two months into negotiations with GFH Capital after agreeing in principle to buy a large stake in the club.
His proposed purchase was subject to due diligence and consideration of United’s financial position under GFH Capital, the Dubai-based private equity firm which bought Leeds from chairman Ken Bates in December.
Parkin was in Dubai as recently as last week and legal work has continued in the past few days but the YEP understands that he is unlikely to follow through with his plan to plough money into the club unless he succeeds in securing the financial support of investors in the Middle East.
His bid was originally thought to have the support of the wealthy Saudi Arabian individual who considered buying Leeds while GFH Capital was finalising its own deal last November but that party is no longer believed to be interested in involving himself with the Elland Road club.
Parkin is understood to be engaged in active talks with potential backers – talks described by a source as “positive” – but he is yet to secure a guarantee of the assistance he needs.
He was unavailable for comment last night but the source claimed Parkin remained “cautiously optimistic” about pulling off a 51 per cent purchase, in spite of the lapse of his exclusivity agreement with GFH Capital.
United’s owner is continuing to actively seek investment having agreed last Thursday to sell 10 per cent of Leeds to the International Investment Bank (IIB), a financial institution in Bahrain.
GFH Capital – itself owned by Bahraini investment bank Gulf Finance House – has promised further announcements of equity deals in the weeks and months ahead, though the company claims that it plans to retain a long-term share in United.
The sale of 10 per cent to IIB saw the bank’s chief executive, Aabed Al Zeera, added to the board of Leeds City Holdings Limited, United’s parent company.
Al Zeera spoke about IIB’s motivation for buying shares in an interview with Bloomberg yesterday, saying: “I believe this stake has a great potential in terms of capital appreciation. Maybe not this year or next but surely over the medium term it will grow in value.”
Any further investors would be joining a club who are managerless and heading for a 10th straight season outside the Premier League following the sacking of Neil Warnock earlier this week.
Meanwhile, Leeds have compiled a short-list of candidates to replace Warnock, with Brighton and Hove Albion’s Gus Poyet and ex-Reading manager Brian McDermott both prominent.
A move for Poyet would be complicated by both Brighton’s on-going pursuit of promotion to the Premier League and a £2.5m release clause in his contract while McDermott has admitted that his interest in available jobs would depend heavily on the stability of the clubs in question.
McDermott, who won the Championship title at Reading last season, said: “Everything needs to be right – finances need to be right, relationship with both the board and owner.
“A lot of things need to be taken into consideration and it has to be the right match.”