Rejected Leeds United buy-out bidder ‘issues a winding-up petition’

Petition issued by key member shows intention to takeover club still there

Wed, Feb 5, 2014, 01:21

The key member of a rejected bid to buy Leeds United from its current owners, Gulf Finance House (GFH), is reported to have issued a winding-up petition against the club.

Andrew Flowers, owner of Gibraltar-based Enterprise Insurance, the club’s shirt sponsor, was said by the Financial Times to have issued the petition on January 29th, the day after his long negotiations with GFH collapsed.

The petition, said to be for an unpaid debt Flowers claims is due, has not yet been advertised in the official insolvency proceedings journal, the London Gazette.

This move by Flowers demonstrates that he still intends to buy the club and is employing a range of tactics to win the battle over the Cagliari owner, Massimo Cellino, with whom GFH has reached an agreement in principle to sell a 75 per cent stake in the club.

GFH will now be forced to deal legally with the winding-up petition, and if other people or businesses are owed money, they are likely to come forward in the hope that they will be paid quickly.

Flowers is expected to hold a press conference today in London to set out further details of his continued bid.

David Haigh, the GFH executive and Leeds managing director, who was working with Flowers, said that it had failed because his consortium could not come up with the money. Flowers, however, has said that he made a lower bid following his due diligence and GFH were in breach of their contractual covenants to talk subsequently to Cellino.

Enterprise loaned Leeds £1.7m in 2012 at seven per cent interest and Haigh is understood to have put about £2m into the club in recent months. GFH argues that Flowers’s and Haigh’s consortium did not produce the money for the sale and therefore they were entitled to negotiate with Cellino.
Guardian Service