Creditors could challenge Leeds takeover

Ken Bates' retaking of English Leeds United could face a series of legal challenges from angry creditors.

After Bates reclaimed control of the club by a 0.2 percent margin, creditors consulted legal counsel to see where they stand. Bates placed the club into administration, formed a new company and bought back the club.

But five other parties were interested in Leeds United, and many – if not all – were offering debt repayment better than the 1p on the GBP that Bates was offering.

And, interestingly enough, the top creditor, holding 45 percent of the club debt, claimed it would block any of the other contenders aside from Bates from running the club.

"There were about 120 people in that meeting on Friday and 115 of them were against Ken Bates's offer," said one person who was at the creditors' meeting. "Major creditors are taking independent advice as to whether to mount a high-court challenge. There are 28 days to consider that option."

Some of those at the meeting claimed that they heard one of Bates' men say that leading creditor Astor Investment Holdings was connected to Leeds United's previous owner, Forward Sports Fund.

Administrator KPMG claimed it had received affidavits swearing the connection had been severed six months ago.

Source: euFootball.BIZ © Copyright 2006 - All rights reserved.