New directors Salem Patel and David Haigh joined Shaun Harvey to face questions at Elland Road.
Why did GFH Capital decide to invest in Leeds United?
Salem Patel (United director and GFH Capital director): “We had a brainstorming session in May. We have a new acting CEO and we were looking for new ideas. Being from England and being passionate about football, I said we should look at English football. It was before the new (Premier League) broadcasting deal had been announced. We were looking for different types of investments. Everyone is investing in health care and defence sectors. I thought ‘let’s push the boat out a bit.’
“We are really pioneers of investment in the Middle East and we thought football would be a very good sector to go into. We looked at several clubs and it was coincidental that we happened upon Leeds. But when we got the investment memo from the broker saying ‘this is for sale’, I was in London at the time and met the broker. I liked what I heard and relayed the message back to head office. I went back to Bahrain and within a week I was back meeting Shaun Harvey and being shown round. Within another week we signed our first agreement with Leeds.”
David Haigh (United director and GFH Capital deputy chief executive): “I was the one that was pushing it every time it looked like it might not happen but the idea was Salem’s. I was always making sure the papers were on the top of the in-tray.”
The takeover of Leeds United took more than seven months. At the outset, how long did you expect the process to take?
SP: “We didn’t have a timeline but we didn’t think it would take as long as it did. Ken Bates is Ken Bates and we are not individuals. We’re a regulated bank and certain processes have to be taken if we’re to invest in anything. It’s not like Roman Abramovich coming along and saying ‘I don’t care what’s going on, I have the money to sort this out.’ We had to ensure we knew everything about the club before we bought it. The period of due diligence finished in October. It really did take that long. But now we are here as the owners of Leeds United.”
DH: “This is probably one of the longest ever takeovers, 206 days. That’s quite unusual in football but we’ve had seven months to get to know this club inside out. That puts us in a very good position.”
The deal is reputed to have cost £52million. How much has GFH Capital actually paid for Leeds United?
SP: “A lot of money.”
DH: “We’ve had a fantastic confidentiality clause in place for the past few months and part of it still remains so we can’t discuss that. Not now.”
What exactly has GFH Capital bought?
SP: “We’ve bought 100 percent of the holding company that owns Leeds United Football Club. We’ve bought 100 per cent of Leeds City Holdings Limited.”
DH: “The most fantastic football club in the world, that’s what we’ve bought. Not just a company.”
There are suggestions that GFH Capital plans to flip Leeds United – buy the business and then sell it quickly at a profit. Is this your strategy?
SP: “The way our business model works, it’s not about flipping or long-term, short-term. The way we typically work would be to identify a project then bring strategic investors with us.
“If people want to call that flipping then it is flipping. But to us it’s not flipping. It is identifying an asset and then bringing the right people on board – whether that is management or shareholders or investors – to help try and build that asset to take it to the next level. We’ll not be selling 100 per cent, we’ll be maintaining a shareholding in this club.”
There are concerns about the financial strength of GFH Capital and its parent company, Gulf Finance House. Where has the funding for this takeover come from?
DH: “To us it is very clear. Despite the rumours, this is a cash purchase. We have used our money. We are a regulated bank in Dubai and owned by a regulated bank in Bahrain, listed on four stock exchanges. All of our shareholders are clear. You can see that on the Internet. There is total transparency.”
Ken Bates claimed that you are backed by “a very rich individual who is very close to the government of Bahrain.” Is that correct and if so, who is he?
SP: “That is what Ken says. We never said that.”
Bates is remaining as chairman until the end of the season. Why did you take that decision and what influence will he have on club policy?
SP: “It’s a period of transition, certainly. We want to leverage on his experience. But that was the deal.”
DH: “We have the same goal – to get this club back to where it belongs. To wake the sleeping giant. Do you have as many people to help you as possible? Yes, you do.
“As of today, Salem has joined the board of the football club. I joined a couple of weeks ago. Our CEO Hisham (Alrayes) has joined the board, together with Ken and Shaun. We are now very much in control and the buck does stop with us.
“Ken has been a fantastic steward of the club. He’s taken it from difficult times and he’s primed it off the pitch for the Premier League. We’ve got a lot of thanks to give him for that.
“We’re in a transitional period where we’ve just taken ownership. We’re in the middle of the season and we’ve got to make sure we’ve got the best chance of getting to the Premier league. The way to do that is to strengthen what’s already here and that’s exactly what we’re doing.”
The plan is for Bates to step down as chairman and become club president at the end of next season. What active role will he have?
DH: “We’ve outlined clearly that Ken will remain as chairman until the end of the season and thereafter become honorary president of the club. We very much see an honorary president as not a day-to-day executive role.”
Will David Haigh replace Bates as chairman?
SP: “We’ve never actually said that David would become chairman and we really don’t know why that rumour started. We don’t actually know as of today who will become chairman in six months’ time. Whoever it will be will have experience, somebody who can help us to take the club forward.”
DH: “The key thing is to focus on now. That’s something we can look at the end of the season. We need to focus on the football, getting promoted etc. Deciding who’s going to sit on the top row of the directors’ box is not necessarily the most important thing at this stage.”
Do you plan to buy back Elland Road and Thorp Arch and what timescale would you set on those deals?
SP: “Any club would love to own its stadium. The stadium is the heart of the activity of a football club. Currently, Leeds United do not own their stadium or the training facilities. It is part of our plans to buy back the stadium but we’re not at liberty at this moment to put a timescale on it.”
Shaun Harvey (United director and club chief executive): “It’s the club which has the right to exercise the buy-back on Elland Road. No such option exists on Thorp Arch but over Elland Road – which I believe is the key interest to the majority of fans – it is there for a very considerable period of time. It’s not time-dependent.”
How has manager Neil Warnock reacted to the completion of the takeover?
SH: “He did ring me and say ‘when can we have the conversation about January, Shaun?’ Like all managers, Neil will roll with what’s going on and concentrate on the job he has which is to achieve what all of us want – to get promoted.”
SP: “We’ve been speaking to Neil on and off since pretty much the process began so he knows us fairly well and we know him fairly well.”
DH: “He was a very important point of our deal. It was actually a term of our contract – that he remained. That’s how much we rate Neil.”
How much financial backing will he have in January?
SP: “As you all know, it’s not a great time to do business. Thankfully for us we’ve already got quite a good squad and a few players coming back from injury. Neil’s already stated publicly what he wants. We’re going to try our best to help him. But if you’re asking me how much money we’re going to spend in January, unfortunately we’re not going to be able to answer that.”
But success is going to take investment?
SP: “Obviously it’s going to take investment and we wouldn’t have bought a club like this if we weren’t prepared to make that sort of investment. What we want to say is that we’re not going to be spending crazy money like some football club owners have. What we want to do is make the investment sustainable and make the club successful, as simple as that.”
How important is Premier League potential to GFH Capital’s plans?
SP: “Any new owner or any existing owner of a football club that is in the Championship or in the divisions below has the dream to go into the Premier League. Financially it’s the place to be. That is where we hope to take the club to. But our business model is not predicated on the club being in the Premier League.”
How do you plan to increase crowds at Elland Road and bring back supporters who no longer attend?
DH: “We start today. The easy way to do that is to win more matches and everybody will come back. But there’s lots of initiatives that we’ll be doing. One of them is that we now have an official Twitter account (@LUFC). Leeds is the 10th most mentioned club on Twitter but didn’t have an account. That’s been rectified. One of Salem’s ideas is half-season tickets and that comes into play very shortly.”
SP: “It’s also about re-engaging with fans and re-engaging with supporters both in Leeds and outside of Leeds. This club has tremendous support in the Middle East, believe it or not, and in Norway, Sweden and Ireland. It’s about listening to what they have to say. We set up a GFH Capital Leeds account where we received thousands of emails so we’re already listening and trying to take on board as many things as we can.
“We’ll take a fresh approach. This is a fresh start. We realise the club is part of the city. On Wednesday night (before United’s League Cup tie against Chelsea) the hotels and the restaurants were full. Same with the bars and the taxis. The city must have been grateful that such a big game was taking place.
“We want to see that throughout the season and I think having a thriving football team helps. Leeds is by no means one of the worst cities in England. It’s thriving. But we think a successful football team can help the city to also grow and expand.”