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SBD Global/March 25, 2014/Franchises

Football League Unanimously Votes To Block Massimo Cellino's Takeover Of Leeds United

Serie A Cagliari Owner Massimo Cellino's prospective takeover of Leeds was denied.
League Championship side Leeds United has been "plunged into fresh chaos" after the Football League announced on Monday that it had blocked Serie A Cagliari Owner Massimo Cellino's "prospective takeover" of the club, according to James Ducker of the LONDON TIMES. Cellino had "signed an agreement with Gulf Finance House (GFH) Capital, the Leeds owner," to buy a 75% stake in the club for £25M ($41.2M). Yet at a board meeting on Sunday, the Football League "ruled unanimously to veto Cellino's proposed buy-out in the wake of his conviction for tax evasion in an Italian court last week over unpaid import duty on a yacht." The news is "another blow to Leeds and raises fresh doubts over the club's financial position." It "remains unclear who will pay" this month's wage bill of just less than £2M ($3.3M), which is due on Friday. Cellino "footed the bill for January and February's wages." GFH had "written to the League last week to voice their dismay at the time it was taking to bar or approve Cellino's attempted takeover." Sources at Leeds "believe the League was deliberately delaying the decision until after his court case in Sardinia had been heard" (LONDON TIMES, 3/24).

TAKING A HARD LINE
: The London TELEGRAPH reported the Football League said in a statement, "Mr. Cellino was recently found guilty beyond reasonable doubt by a Court in Sardinia of an offence under Italian tax legislation relating to the non-payment of import duties on a boat. ... Having fully considered the matter, the board agreed unanimously that the decision of the Italian court does constitute a disqualifying condition under its owners' and directors' test. The relevant disqualifying condition being that Massimo Cellino has been convicted of an offence involving acts that would reasonably be considered to be dishonest." Cellino is "entitled to lodge an appeal against the decision within 14 days" (TELEGRAPH, 3/24). REUTERS' Keith Weir reported English football authorities have "been under pressure to take a tougher line on scrutinising club owners" after League Championship side Birmingham City Owner Carson Yeung "was jailed in Hong Kong this month for money laundering" (REUTERS, 3/24).

CLOSING THIS CHAPTER: In London, James Riach wrote "there is at least a semblance of closure in a saga that has played out dramatically" since Cellino's interest first became apparent. Yet the club's plight "has arguably never been more fraught with danger." If Leeds descend into deeper financial trouble and administration becomes a possibility, "investors would most likely wait and then swoop in to buy the club for a vastly reduced sum" (GUARDIAN, 3/24).
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