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Darlington FC chairman threatens to walk out

Wed 16th Feb 2011 | Football Club Administration

Darlington Football Club’s future is again under threat with chairman Raj Singh threatening to walk away amid a new financial crisis.

It’s understood that the holding company which owns the stadium and the surrounding land, has been placed in receivership.

According to The Northern Echo Singh, who has pumped more than £2.5m into the club since taking over from former chairman George Houghton in the summer of 2009, risks losing control of both the stadium and the land surrounding it.

If he does lose control of the stadium, it is likely Singh will sever his ties with the club, a move that would place the Blue Square Bet Premier club’s future in grave doubt.

Prior to Singh’s arrival, the holding company incurred a £1.7m debt to Philip Scott and Graham Sizer, former senior executives with the Darlington-based care home company Southern Cross Healthcare.

Scott and Sizer are reported to have no interest in running the football club, which operates as a separate company under the name Darlington Football Club 2009, but are willing to honour an existing lease that enables the club to use the stadium for the next 13 years at £10,000 a year.

However, if Singh loses control of the stadium and surrounding land, he does not feel the football club justifies a continued investment, understood to be about £20,000-a-week.

“I have always maintained that, without the stadium and the land that goes with it, there isn’t really a business there at all,” Singh told the Northern Echo.

“We can’t move forward without ownership of the ground. This is a debt that was incurred prior to my time here, and I have made what I believe to be a perfectly generous offer. However, it has been turned down. Unless this can be resolved fairly quickly, I don’t think I have any option other than walking away.”

Scott, who is chief executive of Priory Group, said he did not want to see the football club’s future in jeopardy, but regards either the sale of the stadium or its transfer into his hands as the only way of recovering his debt.

“Some three-and-a-half years ago, when the club was in real difficulty, Graham and I, at the request of the then chairman, George Houghton, provided loan funds of £1.7m,” said Scott.

“Naturally, those loans were interest bearing, however, on an accrued basis, and to date, we have never received any interest payments or dividends.

“When the club experienced further difficulty and Raj decided to acquire the football club, Graham and I agreed to a new lease that allows Raj and the club to operate at a very nominal rent.

“Yes, he did make us an offer, which was unacceptable as it was less than 25 per cent of the total debt. That said, he still has the right to continue operations under terms of the lease that has the nominal rent.”

Former chairman Houghton said: “It was always, and still is, Raj’s duty to pay those guys off. The loan always related to the property and the land.

“I have not benefited by £1 from the club, and have lost several millions since I became involved. I own a minority share of 25 per cent of the property and the land.

“Raj has to pay off the two, but now appears to be blaming me in what appears to be a premeditated strategy.”

 

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