ENGLISH FA CUP: Leeds United's major creditors last night granted the acting chairman Trevor Birch until Friday to continue takeover talks with an unnamed consortium or find other means to raise the £5 million needed to continue trading for the rest of the season.
Birch now has four days to smooth the sale of the club to the four-man consortium or sell players before the closure of the transfer window on February 2nd. His only other option to stave off administration will be to persuade Leeds's players to take a 35 per cent wage deferral until the summer.
The Yorkshire club confirmed talks with the locally-based consortium over the proposed £20 million takeover have reached "an advanced stage". Like a previous £5 million investment offer from the former deputy chairman Allan Leighton, which was rebuffed, it does not involve a bid for the club's shares.
Yet Birch will be at pains to scrutinise the nature of the quartet's interest, and in particular their future plans for Elland Road, with club insiders last night insisting the Leeds board were not pinning all their hopes on the mystery group. Survival is not necessarily dependent upon striking a deal, with a temporary cut in salary or the sale of the club's chief playing assets remaining an option, albeit one Birch is desperate to avoid.
To that end, Leeds have already opened negotiations with Middlesbrough to off-load their England defender Danny Mills, currently on a season's loan at the Riverside, for a fee of £1.5 million. His sale would also remove the full back's £35,000 weekly salary from the long-term wage bill.
In the meantime negotiations will continue with the consortium after the club's major creditors, who include the German insurers Gerling and the United States-based bondholders MetLife and Teachers, were persuaded that talks are sufficiently advanced to offer genuine hope of safeguarding the club's future.
In a statement released to the Stock Exchange last night, the plc board announced the "standstill agreement" with creditors, who are owed a combined £82 million, had been extended until 5 p.m. on Friday. There remains the possibility of a further extension to February 6th "conditional on achievement of certain financial and other covenants".
That will come into play if the potential takeover gathers pace; however, as long as mystery shrouds the identity of the consortium's members, doubts will remain as to the plan's viability. The group have been at pains to retain their anonymity, though both the former Bradford City chairman Geoffrey Richmond and the wealthy Leeds-based Ziff family yesterday denied they were involved.
However, unless the creditors receive guarantees by Friday that at least £5 million can be raised, they will be forced to place the club - albeit reluctantly - into administration. The club's share price rose sharply yesterday morning amid hopes that a deal would be agreed by last night, before falling back when the extension was announced. The shares finished the day up 11 per cent at 3.75p.
