Wednesday, June 27, 2007

Far East entrepreneur closing on Birmingham City

Hong Kong entrepreneur Carson Yeung has held intense day-long talks with English Premier League club Birmingham City major shareholders David Sullivan and David and Ralph Gold about buying their 78 percent equity in the publicly listed club. Yeung has had his people at St Andrew's going through the books at a cost of more than £100,000 but Ben Hunt and Stuart James reported in The Guardian that discussions had gathered momentum onky since Sunday when Yeung, who was reportedly introduced to the Blues by advisor Keith Harris, the executive chairman of Seymour Pierce Investment Bank, arrived in London.

According to James Nursey in the Mirror, Yeung pledged to lodge funds with Seymour Pierce, convincing Sullivan and the Golds to take him seriously after his previous interest in Reading and Sheffield had quickly cooled. Yeung, former chairman of Hong Kong Rangers FC, hoped to shake on an agreement with BCFC's stakeholders yesterday but the latter's legal team are still reviewing the draft agreement and insist a formal statement is made to the Stock Exchange before any deal is announced. At its current share price the company has a market value of about £36.34 million, wrote Helen Burggraf of Shares Reporter

Earlier this year, Birmingham City Chairman David Gold confided in Phil McNulty, the BBC's Chief football writer, just how precarious relegation from the Premier League can be to the fortunes of a club: "The Championship is a truly amazing division. A great spectacle and such a close race, but obviously we would like to go straight back up. The parachute payments are the key. You have two years, and once they pass - as clubs like Norwich and Ipswich have found - it becomes extremely difficult because you are competing against clubs that have been relegated, that have got Premiership players, and that have got financial muscle.

"All clubs will tell you it is vital to get back into the Premiership as early as possible, and certainly within those two years. Using crude, approximate figures, your turnover increases from £17 million to £50 million, which is a dramatic rise, but invariably the vast majority goes to agents and players. I think one of the most important things about returning to the Premiership is not the money, it is the pride for the fans, players, manager and board. If we get up, we will sit down and review the situation, listen to Steve Bruce, and then come to a decision depending on which players are available"

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