Sunday, June 10, 2007

East Asian buy-out of Birmingham City FC tipped

The owners of English Premier League club Birmingham City have reportedly agreed to sell out in a £70 million deal to a "Far East-based businessman". According to Paul Smith in the Sunday Mirror (UK), co-owners David Sullivan and Ralph and David Gold have sanctioned the takeover. "Auditors representing the buyer will arrive at St Andrews this week to conduct due diligence after the club agreed to open their books. Key players in the deal have signed confidentiality agreements. It now seems certain that barring any unforeseen circumstances Birmingham will be in new hands in less than three weeks," Smith reported.

He wrote that Birmingham City insisted on seeing proof of funds from the buyer before they moved to the next stage of negotiations "and have already called an emergency board meeting for tomorrow."

UPDATE

Birmingham City FC co-owner and Chairman of the club's public company, David Sullivan last night made a statement to Birmingham's Sunday Mercury newspaper insisting that the club is unable to comment on the reports. "Under stock exchange rules, we cannot comment on these things. The club may or may not comment in response to the story next week - if we do, it will be via the stock exchange," he said.


UPDATE (11 June)

"It is understood that no firm offer has been received at St Andrew’s. A statement confirming the interest of a potential buyer is scheduled to be released by the club today," reported Russell Kempson in The Times. A source close to the club told him yesterday: "Conversations have taken place, but that’s as far as it has gone at the moment. There is no firm offer. As yet, there is nothing concrete."

David Sullivan, the club's co-owner and plc Chairman "has admitted to growing disillusioned with football, especially the huge drain of players’ wages, and that he would be willing to sell. David Gold, the club chairman, had considered buying him out, but would only sell – along with Ralph Gold, his brother and fellow co-owner – if it was 'in the best interests of the club'."

However, two weeks ago David Gold did concede that Birmingham was ripe for a takeover from abroad: "It wouldn’t surprise me at all if the club were approached by foreign investors. What’s happening in the Premier League is that, as the super clubs are being taken over, Birmingham will start to become the next iconic club. It bears the name of one of the greatest cities in Europe and, with the likes of Manchester United and Newcastle United having gone, you will find that, slowly, Birmingham is at the top of the pile. If I was an American billionaire, I cannot think who I would want other than Birmingham City. I don’t think foreign ownership is bad for football. It adds a different dimension. There’s no evidence that foreign owners are raping and pillaging the clubs, I don’t see them doing any harm. They’re not coming into football to make money. It’s all about the excitement of the Premier League."

UPDATE (11 June)

Birmingham City has confirmed to the Stock Exchange that it has received an offer of a potential takeover bid: "The directors have noted the recent movement in the share price and the press speculation and confirm that they have had an approach with regard to a possible acquisition of the issued share capital which may or may not lead to an offer for the company. Such discussions are at a very preliminary stage and the directors note that there is no certainty that a transaction will result from the approach."

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