GFH Capital revealed last night that its proposed takeover of Leeds United had been sent to the Football League for approval as the club’s supporters waited anxiously for confirmation that the deal was complete.
A cursory statement published on United’s official website said the Football League had begun examining GFH Capital’s planned buy-out following six months of negotiations between the club and the Dubai-based firm.
But confusion continued to surround the takeover amid firm indications from sources on both sides that a binding agreement is still to be reached between the company and United owner Ken Bates.
News of the Football League’s involvement appeared to suggest that GFH Capital’s attempt to acquire a 100 per cent stake in Leeds had taken another crucial step towards completion.
The Football League, which refused to discuss the matter when contacted by the YEP, requires anyone purchasing a stake of 30 per cent or more of any of its 72 member clubs to pass its Owners and Directors Test before giving approval to a major investment deal.
GFH Capital has lined up a £52million buy-out of Leeds but protracted negotiations and concerns raised about the private equity firm’s financial strength have cast continuous doubt over the outcome of a lengthy process.
The statement issued last night said GFH Capital’s bid was still protected by exclusivity, despite claims that a clause agreed with Leeds earlier this summer had expired yesterday.
Two rival parties remain interested in buying Leeds, American multi-millionaire Preston Haskell and a private investor from Saudi Arabia. An offer from the Saudi Arabian party could materialise as early as the end of next week unless GFH Capital’s takeover is formally agreed.
But last night’s statement read: “GFH Capital have announced that they are in exclusive negotiations with Leeds United in respect of the proposed acquisition of the club.
“The relevant agreements are being processed by the respective legal teams and information supplied to the Football League as required under their regulations.”
A senior source at GFH Capital told the YEP that the firm anticipated few problems in gaining Football League approval.
Its parent company, Bahraini investment bank Gulf Finance House, is listed on the London Stock Exchange and has been in operation for more than a decade, though recent analysis of the bank’s accounts revealed worries about its future health.
GFH Capital has never revealed how funds have been raised to secure full ownership of Leeds but the company claimed from the outset that its operations were separate to those of Gulf Finance House and its takeover of Leeds would be a cash deal paid for up front.
But the company’s source declined to comment on whether the involvement of the Football League meant a deal with Bates was now in place and subject only to the League’s approval.
Football League rules require clubs to submit details of proposed new directors no later than 10 working days before an appointment is due to be made. A decision on the application is normally received from the governing body within five working days.