Hull City deal on ice but still on the table

HULL CITY have reopened talks with other interested parties after a proposed takeover by a consortium of Saudi investors led by former chairman Paul Duffen was put on hold until the new year.

Hull City's former chairman Paul Duffen (Picture: Terry Carrott).

The Allam family, in charge of the Tigers since 2010, had been confident of selling the Championship club after agreeing a price believed to be in the region of £40m-£45m.

However, despite proof of funds having been provided to the satisfaction of the club’s legal advisers a sale that the Hull hierarchy initially hoped could be concluded as early as the end of last month’s international break suddenly stalled.

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The Yorkshire Post understands one member of Duffen’s consortium, a specialist in property investment, is seeking further clarification on possible future development of the 34.2 acre site that houses the KCOM Stadium before being willing to complete the purchase.

Club insiders were last night quick to stress the deal with the Saudis is not dead.

But talks have resumed with two parties who had previously met the Allams to discuss a possible takeover during the autumn.

Such a turn of events is frustrating for supporters and the Allam family, who it is understood only learned of a possible problem when enquiring late last month as why there was a hold-up despite a fortnight-long due diligence process into the club’s affairs having flagged up nothing.

Just what reassurances are being sought over possible future development of the land surrounding the KCOM are unclear.

Nor is it known what concrete plans the Saudi group have for a site that has housed both Hull and Hull FC rugby league team since late 2002.

But it is understood that reviving the deal in the new year would be a straightforward process.

For a start, the agreement between the Tigers and Duffen’s consortium, including a sale price set when the original head of terms was drawn up in the autumn, still stands.

Nothing has changed in the meantime with Hull’s recent upturn in form making the club, if anything, a more attractive proposition as a team in League One as opposed to the Championship would be worth a lot less.

One hurdle still to be negotiated if the deal is revived in the new year is the Football League’s Owners and Directors’ Test.

This newspaper understands Duffen’s group is yet to submit an application to the governing body.

This process usually takes a few weeks to complete as the League makes background checks on anyone involved in a proposed takeover.

Duffen’s backers are known to be from Saudi Arabia, though their identities have yet to be publicly revealed.

It is a similar story with one of the other two interested parties with whom talks have resumed over the past few days.

Other than the consortium being made up of US businessman, possibly with a British figurehead, little is known.

The third bidder is SportyCo, a crowd-funding organisation whose chief executive Marko Filej is known to have met Hull chairman Assem Allam in October.

Hull City Supporters Trust have publicly thrown their support behind SportyCo.

Compared to Duffen’s consortium, these two parties are in the early stages of a possible takeover process. Any agreement with either would be months away.

In the wake of those hopes that a deal would be concluded before Christmas being scuppered, Hull insiders insist it is business as usual with the January transfer window looming large.

Just what budget will be available remains to be seen. But the Allams will be determined to maintain the careful husbandry of resources that has made Hull attractive to prospective buyers despite the antipathy between owners and supporters that led to just 10,530 – the lowest league crowd at the KCOM – watching Saturday’s victory over Brentford.

Hull are understood to be on course to break even in the current financial year, which will bring a reduced parachute payment on the £41m banked from the Premier League in 2017-18.

That income helped the Tigers post a profit of £23.7m in the season after relegation, down slightly on the surplus of £35m generated during 2016-17.

Under Football League profit and sustainability rules that state clubs can lose a maximum of £39m over three years, any new owner could – in theory – use these healthy financial returns to plough £60m-£70m into Hull’s playing budget without fear of breaching regulations.