High Court gives Sheffield Wednesday more time
Wed 17th Nov 2010 | Football Club Administration
Sheffield Wednesday have been given 28 days to find new owners and resolve their £27m debts by a High Court judge.
The Owls had been facing a winding-up petition from HM Revenue & Customs (HMRC) over £1.4m in unpaid taxes.
However, the judge said the club are trading insolvently and it is only due to exceptional circumstances that he has allowed the extension.
Wednesday had been hoping to strike a deal with one of four potential new owners on Tuesday but time ran out.
It is unlikely that any further adjournments following this would be granted, so takeover negotiations will proceed with a renewed sense of purpose.
Rotherham businessman Spencer Fearn and Sheffield accountant John Roddison front one of the four bids.
"We are doing our best to get the best deal for our club, that's all I can say at the moment," said Fearn, whose group have funds available to proceed with a takeover.
Another bid comes from a group led by former Wednesday director Mick Wright, who is one of six current and former club directors still owed money by the Hillsborough club.
The two remaining bids come from a UK-based businessman and a Middle Eastern group.
Little is known of the latter, although they are not the Certified Oil Rentals group that former manager and player Chris Turner brought to the table last month. They lost momentum when lead financier Keith Mundie pulled out for family reasons.
The identity of the UK-based businessman is unclear although it has been strongly suggested that Leicester City chairman Milan Mandaric's decision to walk away from negotiations earlier on Tuesday is not quite as final as was originally reported.
The League One side's main creditor is the Co-operative Bank, which is owed £23.5m of the £27m total debt.
The Manchester-based bank paid off a £1.1m tax bill in September,but that was done on the understanding that a takeover was imminent and the Co-op might see some of its money back.
Since then it has maintained a firm line that it wants to help the club but is unwilling to bankroll it any longer.
So far, Mandaric is the only bidder to show the proof of funds Co-op wants to see, but he was unable to strike a deal with former Wednesday chairman Dave Allen over the £2.4m he is still owed by the club.
Allen, now the majority shareholder at nearby League Two side Chesterfield, said he is willing to accept £1.5m in staged payments but was made a "derisory offer" by the Leicester chairman and former Portsmouth owner.
Fearn and Roddison's "Wednesday Forward" group is believed to be proposing an immediate injection of cash with more to come as the Owls climb back up the league ladder to the level their fan base and history demands. Wright's plan is believed to follow a similar line.
But if no agreement can be reached in the coming days, administration remains a very real option.
That would make the immediate threat of liquidation go away and provide some short-term stability, but it would also trigger an automatic 10-point penalty from the Football League, with the prospect of further sanctions to come.
Such is the seriousness of the situation that local MPs David Blunkett and Nick Clegg, the Deputy Prime Minister, are applying gentle pressure on all parties to come to a sensible compromise.
In the meantime, the club's supporters are left on tenterhooks, wondering if their team could be heading for rebirth or League Two.
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