Ken Bates has been confirmed as the new owner of Leeds United after purchasing a majority stake in an attempt to head off pressure about the ownership of the Elland Road club.
In a significant and unexpected move, Leeds have announced a deal completed by their chairman to buy out previous majority shareholder Forward Sports Fund (FSF Limited), the off-shore firm whose involvement with United was the cause of growing controversy.
Bates, 79, acquired all 72.5 per cent of FSF’s shares in Leeds City Holdings Limited – the company which in turn wholly owns Leeds United Football Club Limited – through another off-shore company, Outro Limited, in a transfer negotiated last week.
Outro Limited was incorporated in Nevis, the same West Indies island where FSF was founded, and the purchase of shares has given Bates a controlling interest in Leeds United. The club has not revealed the sum paid for those shares, stating only that the deal was completed for an undisclosed fee.
The development came in the midst of increasing demands for Leeds to name the anonymous owners who have controlled the club ever since their emergence from administration in 2007.
At a recent government inquiry into football governance, Premier League chief executive Richard Scudamore warned United that they would be forced to publicise extensive details about the ownership structure at Elland Road if and when they were promoted to the top flight.
Leeds had previously complied with Football League rules requiring the disclosure of all parties with a stake of 10 per cent or more in the club, but Scudamore stated that United would be asked for information “over and above” the submissions accepted by the Football League.
Bates’ move to purchase FSF through Outro Limited is a bid to answer both calls for greater transparency at Elland Road and doubt about United’s ability to comply with Premier League rules should they win promotion from the Championship.
A statement issued by Leeds criticised what the club called “scaremongering”about their owners and said Bates’ buy-out of FSF should end queries related to the ultimate beneficiaries of United’s business.
The statement said: “Whilst the board were always confident that there were no issues, (they) recognise the concern the unknown outcome of any Premier League questions may have on our members.
“To address this issue and in the hope that this brings an end to the speculation, the chairman, Ken Bates, has completed the purchase of FSF Limited for an undisclosed sum. FSF Limited is now owned by Outro Limited which is wholly owned by Ken Bates.
“This change in ownership structure makes Ken Bates, pictured right, the controlling shareholder of Leeds United and delivers the transparency sought.”
United revealed that details of Bates’ shareholding had been issued to the Football League and the Football Association, along with the Premier League. The Football League and the Premier League have in turn confirmed that the deal complies with their rules, and Leeds “do not anticipate any issues” in securing approval from the FA.
England’s governing body recently revealed that it had no knowledge of the identities of the individuals behind FSF, and those details were never released to the general public. Speaking at the parliamentary inquiry into football governance, United chief executive Shaun Harvey said that he was also unaware of who ultimately owned the club.
FSF comprised of three independent trusts, and Outro Limited has now taken control of FSF’s stake in LCH, with the remaining 27.15 per cent of shares in LCH held by four unnamed parties.
A revised ownership statement published on United’s website read: “LCH has five unconnected shareholders, four of these hold 27.15 per cent collectively with no-one of these holding more than 10 per cent of the issued shares.
“FSF Limited (a company incorporated in Nevis) holds 102,000,000 or 72.85 per cent of the issued shares. On April 26, 2011, FSF Limited was acquired by Outro Limited.
“Outro Limited is wholly owned by Mr K W Bates and is registered in Nevis, West Indies. On this basis, Mr K W Bates is deemed to be the controlling shareholder of LUFC.”
First-team manager Simon Grayson recently insisted he was untroubled by criticism of the ownership of United, saying: “The football club’s conducted in the right manner and it’s run correctly. Whoever runs the football club will be disclosed as and when it needs to be.”
lLeeds United vice-captain Jonathan Howson has been named in the provisional England Under-21 squad for this summer’s European Championship in Denmark.
The midfielder, who made his Under-21 debut against Italy earlier in the season, is part of an initial group of 40 players selected by coach Stuart Pearce and also includes ex-White Danny Rose of Spurs.
Meanwhile, Leeds’ Championship game at QPR on Saturday has been selected for a live broadcast by the BBC.