Stadium Owners Seize Income Of League One Coventry City To Recover $2M In Unpaid Rent
Ricoh Arena bosses "dramatically upped the stakes in their dispute" with League One side Coventry City by "serving debt orders, which could see the stadium recouping rent arrears by May," according to Les Reid of the COVENTRY TELEGRAPH. The legal move "would lawfully entitle" Arena Coventry Ltd. to recover the £1.3M ($2M) rent by "collecting any monies owed to the club by other companies and third parties." The third parties named include League Championship club Hudderfield Town. ACL "could also have first call on rate rebates" from Coventry City Council to Coventry City FC. Friday's developments "follow the collapse of talks to try to resolve the increasingly bitter dispute over rent payments for playing at the Ricoh" (COVENTRY TELEGRAPH, 2/15). In Coventry, Steve Carpenter reported ACL claims that the cash-strapped League One club owe £1.347M in arrears after "refusing to pay the cost of playing at the stadium since February last year." ACL Chair Nicholas Carter said, "We don’t want to have to resort to such means as obtaining interim Third Party Debt Orders." He added: "But if the club won’t agree to the very generous deal on the table and pay what it lawfully owes, we have a duty to our stakeholders to take all the necessary steps to protect ACL’s interests. It’s our responsibility as directors to do all we can to make sure ACL gets paid" (COVENTRY OBSERVER, 2/15).
NOT WINDING THEM UP: The BBC reported the ACL board underlined that "it is not a winding-up order on the Sky Blues." The club was "initially given until Boxing Day to pay up, or face a winding-up petition, a deadline that was then extended" until Jan. 2, since when the two parties "have been in negotiations" (BBC, 2/15). The PA reported in light of the latest developments, Coventry has made its first official comment. A statement on the club's website read: "Despite the recent campaign by ACL to force the football club into a deal that would be completely disadvantageous, Coventry City Football Club remains committed to work through to the conclusion of a deal that is acceptable to both parties." The statement continued: "This deal must take into consideration matchday revenues to support the need for a squad, which is strong and competitive and yet still complies with Financial Fair Play and salary cap rules" (PA, 2/16).