Leeds United is a once-proud English football team that just over a decade ago was in the European Champions League semifinals. But mismanagement and misfortune ensued, sending the club as low as Division One in England. Theyâ€™ve currently been floundering in the Championship League, one level below the Premiership, for the past handful of years, on the outside looking in. But now a prospective Bahraini takeover of the team has its fans dreaming of a return to glory. Unfortunately, the financial portfolio of the Bahraini group may turn those dreams to continued nightmares. But the Dubai-based investment firm negotiating to take over Leeds, one of English soccerâ€™s most famous clubs, appears to have little financial fire power to complete the deal, accounts of its Bahrain parent firm Gulf Finance House show.
Dubai-based GFH Capital has been in exclusive talks to buy Leeds, which it estimates has a market value of around 52 million pounds ($83 million). But GFH group had more than a quarter of a billion dollars of accumulated losses and less than $6 million in cash at the end of June. And the Bahrain company has previously taken big fees from projects that rarely see completion, according to an internal document from 2010 reviewed by Reuters and verified by four former insiders.
â€œWords donâ€™t buy football clubs; money buys football clubs. We would expect to see evidence of GFHâ€™s ability to fulfill their claims and promises in the very near future after the takeover,â€ said Gary Cooper, Chairman of the Leeds United Supportersâ€™ Trust, an independent fan group with over 8,300 members.
GFH Capital Chief Executive David Haigh said his company had the resources to complete the transaction and buy new players, but gave no further details on the deal, citing a non-disclosure agreement during negotiations. â€œWe have the funds to buy the club, and it is our intention to buy Leeds United as quickly as possible,â€ he said. Referring to the period when players are bought and sold, he added: â€œWe have identified a budget for the January transfer window; that is critical for the future requirements of the team.â€
Leeds United declined to comment, citing the confidentiality agreement, while current owner Ken Bates, who tends to communicate with the press via public statements, told Leeds United channel he was not responsible for the delay in closing the deal, first announced on Sept 27. Leeds fans are so fed up with Bates that they have been chanting â€œBates Outâ€ at many of the home matches. It appears that those chants may continue to go unanswered.