MASSIMO CELLINO is closing in on completing the purchase of Leeds United after a leading figure in a rival consortium pulled out of the race to take over.
Andrew Flowers, managing director of United shirt sponsors Enterprise Insurance, announced last night he had withdrawn from the bidding after being part of a group of buyers who met club owners Gulf Finance House in London for talks about an alternative deal earlier this week.
That group, fronted by former Manchester United International managing director Mike Farnan and also including Welcome to Yorkshire chief executive Gary Verity and ex-Hull City chairman Adam Pearson, represents the only opposition to a £25m takeover from controversial Italian businessman Cellino, who looks the strong favourite to be the new club owner, subject to league approval.
Farnan last night revealed his group, Together Leeds, were still in the race to buy the club.
Meanwhile, Flowers – part of the failed attempt by the Sport Capital consortium to secure a 75 per cent stake in Leeds which collapsed last week – has slammed GFH in a strongly-worded statement, accusing them of carrying out a ‘fire-sale’ transaction with Cellino.
Bahraini-based investment bank GFH agreed terms with Cellino to take over last Friday, only to then re-engage in talks with a consortium hastily brought together over the weekend aimed at scuppering his hopes.
Cellino caused a public outcry among United fans by sacking Brian McDermott on Friday night, despite his takeover deal not being completed, with contracts still awaiting to be exchanged.
Flowers, whose company have issued a winding-up petition against United over an alleged unpaid debt – to be heard in the High Court on March 17 – said: “I entered discussions in good faith to buy this club for the simple reason that I am a lifelong supporter and sincerely believed that I could make a real contribution towards the goal of promotion to the Premier League and at the same time provide the stability and sound financial governance the club desperately needs.
“However, the emergence of Mr Cellino’s bid, and the nature of the transaction, seems to have crystallised the attitudes of both GFH and the Leeds United board, enabling them to dispose of the club with no consideration for its ultimate security and wellbeing,” he added.
“In effect, it is a ‘fire sale’ transaction which is not in the interests of Leeds United, its players, staff or loyal supporters.
“Both myself and my company, Enterprise Insurance, have been enormous financial supporters of the club for the last few years and while we may understand the commercial expediency which leads the owners to accept the superficially attractive Cellino offer, we remain firmly convinced this deal will not give the club the stability or investor commitment it badly needs.
“I have no other comment to make at this time about outstanding financial and legal issues between us and the current owners.”
Flowers’s statement came after it was announced on Tuesday that Enterprise Insurance had issued a winding-up petition against the Elland Road club regarding a loan of £1.7m from the Gibraltar-based company in October 2012 – at seven per cent interest for repayment in 2015.
Enterprise Insurance announced on Friday that they would be withdrawing their support for the club after the axing of McDermott, who was reinstated the following day.
In response to the petition, GFH said in a statement: “The winding-up petition issued by Enterprise Insurance, a sponsor whose managing director, Andrew Flowers, claims to support the club, is misconceived and an abuse of legal process.
“Under the ownership of GFH Capital, Leeds United has always met its financial obligations, and it will continue to do so.”
Despite the statement, worries about United’s parlous-looking financial situation remain abound among supporters, given the fact the club has already taken out several loans this season to pay for outgoings including running costs, wages and transfers.
Managing director David Haigh is said to be owed around £3.5m, with Flowers also contributing to a £6m sum put in by Sport Capital to help pay for club outgoings, with the financial picture looking an increasingly chaotic one.
The latest development saw Cellino loan United £1.5m, with the payment believed to have been used to pay last month’s wages with big question marks remaining about United’s current ability to meet their monthly costs.
United’s revenue streams this season have been hit by the £3.3m payment of cash to Ticketus as part of the decision to mortgage the East Stand redevelopment against future season-ticket sales in 2011.
Money from the shirt-sponsorship cash from Enterprise Insurance last September was also swallowed up by funding a new deal for Ross McCormack.
As regards Cellino’s takeover bid, the Football League have given no timescale regarding a final decision on the offer from Eleonora Sports Ltd, the Cellino family’s company.
Cellino has two previous convictions for false accounting in Italy, but with both spent under English law, some reports suggest he will pass the league’s Owners and Directors’ Test, which appears the main obstacle left in his quest to take over.