soccerbest
Starting XI
Leeds United plc have confirmed the club could be forced into administration, after they failed to reach agreement with their major creditors over the restructuring of the club's £80 million debt.
The Whites have been meeting with their principal creditors, but have failed in their bid of providing extra income through a possible share issue scheme.
The directors of the plc still hope that negotiations will be successful and that would allow the club to move forward, but warned that failure could very well mean administration for the fallen West Yorkshire giants.
"The directors remain of the view that, if all of these negotiations are concluded successfully, they will provide adequate funding for at least three months in which to conclude arrangements designed to achieve a more permanent refinancing of the group," read the statement.
"But, if the negotiations referred to above are unsuccessful, the directors may be forced to seek the protection of an administration order.
"As announced on 28 October 2003 in our preliminary statement of results, the directors have been negotiating the first phase of a complex debt restructuring of the group's finances with its principal finance creditors to provide the group with additional working capital and to give it time to implement a more permanent restructuring plan.
"In the preliminary statement we also referred to a commitment through a share issue to inject £4.4 million in cash from Allan Leighton and A.R.M. Holdings Group Ltd.
"Unfortunately, after a long period of constructive discussions, negotiations have failed to reach a satisfactory conclusion in time to issue a circular and obtain shareholder approval before Christmas. As a result, it has been decided not to go ahead with the planned subscription for shares and, contrary to the expectation expressed in the preliminary statement, there will be no circular issued to shareholders.
"Nevertheless, the company continues to be in constructive discussions with its principal finance creditors and proposed investors with a view to providing the group with additional working capital and to give it time to implement a more permanent restructuring plan. In addition, Allan Leighton has already confirmed that his funds remain available for investment in the group.
"The directors are continuing to take steps to manage cash flows, including the implementation of the cost savings described in the preliminary statement and management of working capital."
The Whites have been meeting with their principal creditors, but have failed in their bid of providing extra income through a possible share issue scheme.
The directors of the plc still hope that negotiations will be successful and that would allow the club to move forward, but warned that failure could very well mean administration for the fallen West Yorkshire giants.
"The directors remain of the view that, if all of these negotiations are concluded successfully, they will provide adequate funding for at least three months in which to conclude arrangements designed to achieve a more permanent refinancing of the group," read the statement.
"But, if the negotiations referred to above are unsuccessful, the directors may be forced to seek the protection of an administration order.
"As announced on 28 October 2003 in our preliminary statement of results, the directors have been negotiating the first phase of a complex debt restructuring of the group's finances with its principal finance creditors to provide the group with additional working capital and to give it time to implement a more permanent restructuring plan.
"In the preliminary statement we also referred to a commitment through a share issue to inject £4.4 million in cash from Allan Leighton and A.R.M. Holdings Group Ltd.
"Unfortunately, after a long period of constructive discussions, negotiations have failed to reach a satisfactory conclusion in time to issue a circular and obtain shareholder approval before Christmas. As a result, it has been decided not to go ahead with the planned subscription for shares and, contrary to the expectation expressed in the preliminary statement, there will be no circular issued to shareholders.
"Nevertheless, the company continues to be in constructive discussions with its principal finance creditors and proposed investors with a view to providing the group with additional working capital and to give it time to implement a more permanent restructuring plan. In addition, Allan Leighton has already confirmed that his funds remain available for investment in the group.
"The directors are continuing to take steps to manage cash flows, including the implementation of the cost savings described in the preliminary statement and management of working capital."
