Tuesday, January 19, 2010

David Gold and David Sullivan complete £100m takeover of West Ham United

David Gold, left, and David Sullivan will take a 50 per cent stake in the club

David Gold and David Sullivan have completed their takeover of West Ham United.
The former Birmingham City owners will take a 50 per cent stake in the club after meeting CB Holdings’s £100 million asking price and are expected to have the final say on all club matters.
The takeover comes with a threat of a change in the dugout at West Ham, who have debts of £80 million resulting from the collapse of Landsbanki, the Icelandic bank in which Björgólfur Gudmundsson, the former owner of West Ham, held a 41 per cent stake. However, Gianfranco Zola, whose team lie fifth from bottom of the Premier League, has vowed to confound his critics and received backing from Carlton Cole, the England forward.

Gold and Sullivan left Birmingham City in November after Carson Yeung, the Hong Kong businessman, completed his buyout. 
The package offered by the pair was preferred to a series of other offers, including interest from Intermarket, an investment company, who made the highest bid but was unable to prove that it had sufficient money for a takeover. An American group, favoured by the banks that are owed nearly £50 million by West Ham, withdrew because its request for exclusive talks was rejected. While Tony Fernandes, a Malaysian airline entrepreneur, failed to deliver.

Straumur, the Icelandic bank that owned the club, had begun talks to sell a part or a full stake after realising it could become exposed to liabilities should the club be relegated this season. Had a deal not gone through, West Ham would have had to find about £10 million by April to meet other liabilities, such as transfer payments and may have been forced to sell players.
The club's ownership was transferred to CB Holding, standing for "Claret and Blue" in June last year when Gudmundsson, the club's then owner, went bust. Straumur, a Icelandic bank, held a 70 per cent stake in CB Holding, with the remainder owned by Byr/MP Banki and Landsbanki, which together are owed about £16 million by Gudmundsson. They claimed to have a three-year plan to run the club, aiming to recoup the money it is owed when the financial climate improves.
It is an embarrassing fall from grace for Gudmundsson, who stepped down as chairman and who has lost about £500 million because of the effects of the credit crunch. He had hoped that his takeover would lift West Ham to Champions League contention, but the club paid a heavy price for overspending on transfers and wages.


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