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SBD Global/April 9, 2014/Finance

Massimo Cellino Completes Takeover Of League Championship Club Leeds United

Massimo Cellino said he will pay staff, players unpaid wagers.
Italian businessman Massimo Cellino "has completed his takeover" of League Championship side Leeds United, according to the BBC. Cellino agreed to a deal to buy a 75% stake in the club through his company Eleonora Sports in February, but his takeover "was vetoed by the Football League in March." His lawyers Mishcon De Reya tweeted, "Massimo has been appointed a director of LUFC Holdings & ESL has completed its purchase of 75% of the shares." The Football League is "yet to confirm that the deal has officially been completed" (BBC, 4/8). In London, Riath Al-Samarrai reported Cellino claimed that "he will pay staff and players their unpaid wages by the end of the week." The Football League "will meet on Thursday to ratify the takeover" after their initial decision to bar the 57-year-old on the grounds of a conviction for tax evasion in a Sardinian court "was overturned on appeal." Cellino’s lawyers believe that the ratification of the deal "will be a formality." The club has been in such a "dire financial situation" that players and staff "were forced to accept a partial deference on their March wages." But after buying his stake, Cellino "pledged to settle those bills before leading the club to the Premier League." Cellino: "The deal is completed. I will go to the game against Watford tonight, then I will go to Leeds and from tomorrow start sorting things out. There is no point waiting to pay people. I will start tomorrow" (DAILY MAIL, 4/8). The PA reported Cellino "has hinted" that he will give Leeds Manager Brian McDermott "the chance to turn around the club's on-field fortunes." Cellino: "I think he has to show he's a good manager. He's had a lot of problems with the team, with the property, with the market but now we've solved that problem." Cellino, who has owned Serie A side Cagliari for 22 years, sacked Manager Diego López on Sunday. López, 39, "is the 36th manager to be dismissed by Cellino during his time in charge." Cellino said, "Brian has got to do his job good and I'm going to give him everything that is good for the team" (PA, 4/7).

FINANCIAL FIGURES: The PA also reported Cellino's task of transforming the fortunes of Leeds "was brought into sharp focus" on Tuesday when the club revealed losses of £9.5M for the '12-13 financial year. The Football League's Financial Fair Play regulations allow a maximum loss of £8M ($13M) this season and a January transfer embargo "looms for clubs that fail to comply." The club's accounts for the previous financial year showed a profit of £317,000 with an operating loss of £3M (PA, 4/8). The BBC noted Leeds "saw turnover fall" by over £3M from the previous year, while attendances dropped by almost 8%. The club now owe over £30M ($50M) to creditors and Cellino "will now have to bring the debt down" if the club is to comply with FFP (BBC, 4/8).

QUESTIONS RAISED: In London, Andrew Bounds reported questions "were raised" over the Football League’s regulation of club owners after Leeds "changed hands for several months last year." Accounts filed with Companies House reveal that GFH Capital "sold half its stake between March and June to an unnamed party before buying it back" in December, reaching 85% ownership. This meant there was “no controlling party” of the Championship club for at least six months. The League, which regulates the sport, "is supposed to assess whether owners are fit to run clubs after a string of high profile cases of teams going into administration" (FINANCIAL TIMES, 4/8). SKY SPORTS reported Cellino "has apologised for comparing Cagliari to a Fiat but stated that he sees Leeds United as his chance 'to drive a bigger car.'" Some of his recent comments "have upset Cagliari, and club captain Daniele Conti criticised Cellino over the weekend for suggesting that 'being with certain sides it is like driving a Ferrari, while here it is like driving an economy car.'" Cellino "is sorry to have caused any offence as he remains committed to the club." He is "excited about the potential at Leeds." Cellino: "I was almost sold to the Arabs. In the meantime, I envisaged an opportunity to buy Leeds. And since I cannot retire to fishing, I have tried to see where I can go in my professionalism" (SKY SPORTS, 4/8).
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