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Leeds United will be allowed to begin the season, but the possibility of ending it with relegation to the fourth tier of English football looms, as last night the Football League deducted 15 points from the stricken giant for failing to find an acceptable way out of their financial crisis.
The League decided, for the first time, to use the “exceptional circumstances” provision within its insolvency policy to allow Leeds to compete in Coca-Cola League One this year despite breaching its rules on how to exit administration. But it punished the club with the points deduction for failing to comply.
“The Football League Board agreed that, notwithstanding the manner in which this administration has been conducted, the club should be permitted to continue in the Football League,” a statement read. Leeds have appealed against the punishment. The appeal will be held at a special meeting of all league clubs, at a time yet to be announced.
“We are delighted we are back in the league,” Ken Bates, the Leeds chairman, said. “We are surprised it has taken so long. We intend to appeal against the 15-point deduction because we have still to have an explanation for that.”
“The only good news is that we will be able to compete in the league, but the fans are bewildered by it all. It’s a recipe for relegation,” Ray Fell, the chairman of the Leeds United Supporters’ Club, said.
With the club in administration, creditors voted in June for a newly formed company headed by Bates, the former Chelsea owner, to take charge. He made an offer of 8p in the pound. But HM Revenue and Customs, which was owed £7.7 million, felt that was insufficient and challenged the Company Voluntary Arrangement (CVA). The case was due to be heard in September.
Fearing the club would fold in the meantime, KPMG, the administrator, put the club up for sale again. Bates’s new bid, offering up to 52.9p in the pound but without a CVA, was accepted last month but the Football League refused to sanction the deal because it was unhappy with the terms and wanted the CVA reinstated.
Bates’s company, Leeds United 2007, bought Elland Road and the players’ contracts, but not the player registrations. Until now, the League withheld Leeds’s right to enter this season’s competition, meaning that the club were unable to sign any players.
Their squad went unpaid for much of the summer and they do not have a fit goalkeeper on their books. Their first match, away to Tranmere Rovers, is a week today.
Leeds have been deducted 25 points in three months. Effectively already relegated to the third tier for the first time in their history, they went into administration with debts of about £35 million the day before their final match of last season. Duly deducted ten points, they finished bottom of the Coca-Cola Championship.
Leeds are the highest-profile victims of the League’s determination to punish clubs for financial mismanagement, which in the club’s case goes back to the days when they were in the Premier League and racked up debts of about £100 million in an attempt, as Peter Ridsdale, the chairman at the time, described it, to “live the dream”. The dream turned sour and a footballing decline precipitated a financial collapse from which they are yet to recover.
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Leeds will continue their current march down the divisions! They made their bed and now they have to sleep in it. Not too many supporters from other clubs will have much sympathy for them either.
Cliff, Marseille,
As a Chelsea fan I understand how Leeds are feeling very well, not that long ago we were in a right mess and Bates managed somehow to turn it around. I think he will get it right given time but the immediate circumstances are pretty dire.
If Leeds had of folded then I think it would have been a sad day indeed for football,
Will, Cambs,
Oh the memories,
European triumphes, Cup finals, League championships.
A hearty welcome to Leeds to the abyss
From a Forest supporter!!
iain, nottingham,
What's all the fuss about Leeds have too long been living in the past relishing in the glory days of Revie perhaps this will finally be the wake up call they actually need. I have never come across such biggeted fans in all my life they disgust me. Only 15 points it should have been at least 20 quite frankly. Long live Ken Bates I think he is doing a stirling job, no really 'cos the way it is going Leeds may well disapperar once and for all.
tim, Leeds, West Yorkshire
Everyone hates Leeds United and always has done.
We will rise from this situation to be a force in football once again.
I along with my three sons,like many others will be travelling 600 miles next week to see Leeds United.
WE ARE LEEDS
Darren Barlow, Southwick, England
There have been some interesting precidents set here. In future, any club going into receivership and entering into a CVA will be challanged by the Tax Office. They did this with Leeds on a matter of principle, ie football debts taking priority. Also, any club having already been deducted points for entering administration, will be deducted further points at the point of sale of the club, unless this is done through a CVA, which will now have to go through a lengthy court preceeding with the Tax Office. Whatever your thoughts on the rights and wrongs of the Leeds case, is this whole going to make the sale of clubs in danger of going bust any easier?
Leeds Fan, Leeds,
Only 15 points? How is Ken Bates a fit person to run a football club? Look forward to seeing the mighty Leeds playing at Spotland and Sincil Bank. That's if they don't coà llapse completely. Isn't it time that the West Yorkshire Police took a look at all this? The only good thing to come out of Leeds was Stuart McCall.
J.A.W. Clough, REYSSOUZE, France
This is a vicious punishment having no president and certainly not reflective of that imposed on West Han and even those clubs involved in the curruption scandle in Italy. I dont think that Iam paranoid but there seems to b a latent manevolance against Leeds that surfaces at every opportunity.
This is a sanction against some of the most loyal supporters in Footba, the punishment shuld be against those most deserving. For example, why is Ridsdale still allowed to be in football!!
I don't know who to be most angry at KPMG for their obvious mis handling, Bates for his shifty dealings, the league for taking this stance or Leeds City Council who can now proudly boast that they are the biggest city in the world without a first class football team quite a prestigious suituation to be in. Contrast that with the commitment the people of London are having to make for the 2010 Olympics. I am on hol;iday writing this overlooking Villefranche Bay and sething!!
steve Townend, Hook, Hants
The hypocrisy of the Football League stinks. So the League considers it OK for West Ham to change ownership and use that to get around the rule violating Tevez contractual arrangements to avoid any points deduction and relegation, a matter now made more questionable by revelations of the past week and the latest clearance for Manchester United to sign Tevez. The League also considers it OK for Peter Ridsdale and his co-directors to act in a financially irresponsible manner and effectively ruin a football club without being punished by the League, and for Ridsdale to subsequently be involved with other football clubs. But conversely the League does not consider it OK for a football club ruined by that Ridsdale era debt to change ownership, be placed in administration, which confirmed relegation, and then be bought again by Ken Bates. It is simply unbelievable that the Football League have the gall to deduct points from Leeds that they would not deduct from West Ham.
Roger Wilcockson, Baguio City, Philippines
Don Revie always said there was a curse on the club, which I dismissed. Perhaps he was right after all.
Peter Day, Doncaster, UK/ Yorkshire
As a Liverpool fan I take no pleasure from seeing Leeds in this position and as they were always one of my favourite (and interesting) away days hope the get back to the prem as soon as is possible.
I sincerely hope they manage to do it without Ken Bates who almost bankrupt Chelsea (shame) and is now suceeding with Leeds
jon, Liverpool,
Whilst all regimes of Leeds need to take their fair share of the blame for the current situation there does appear to be a large degree of unfairness applied to this by the football league. They have dragged their heels all through the summer (partly the fault of Bates as well) and appear to have done all they can to make life for Leeds as difficult as possible.
All football fans want is even handedness - the "punishment" handed to West Ham for what is increasingly emerging as a "murky" deal is evidence of this. One can only hope that some form of fairness will emerge and that Leeds can rebuild . . . but, as a Leeds fan all you have now come to expect is more hurdles and barriers.
Nick, Bromley,
Why doesn't Bates just get out, buy himself an island and disappear? He's awful for the game.
Bryan Schaaf, Ashland, United States/Ashland