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Coventry City, £38m in debt and restricted by a transfer embargo, have taken a calculated risk by filing a court notice to go into administration in the hope that a proposed takeover will be completed in the meantime. 'This is merely a process protecting the bank and its creditors,' a club statement said, 'and should speed up the potential takeover and therefore take Coventry City into a solvent financial situation. The legal notice gives Coventry City a 10-day working window to complete the takeover talks with Ray Ranson and Sisu Capital, along with other parties.' The proposed deal would give Sisu at least a half share in the stadium, the Ricoh Arena. The talks are by no means a foregone conclusion and are now focusing on £2m of losses which have been incurred in the past few weeks since Sisu mounted their takeover bid, indicating the extent of the club's financial problems. The Coventry Evening Telegraph commented, 'The nightmare possibility of Coventry City slipping into administration is now very real ...And the damage would not be confined to the club. The repercussions would be felt throughout the city.'
Elsewhere in the Championship, Ipswich Town have announced that the takeover by entrepreneur Marcus Evans has been agreed and will be confirmed by an emergency meeting of shareholders on December 17th. Under the agreement, Evans will take a 87.5 per cent stake in the club, wiping out debts of £32m and investing a further £12m. Things may be looking up at Ipswich, but Cardiff City could be forced into administration if they lose a court hearing on Monday.
UPDATE - 12/12/07: GREEK BILLIONAIRE MAY RESCUE COVENTRY
With Thursday's insolvency deadline looming, a Greek billionaire businessman may step in to save Coventry City. Also a film director and actor, Alki David described the club as a 'sleeping giant'. He said, 'We need to look at the books to see what the debt, but it's a club that has had entry to the Premoreship so on that level it would be a good deal. I'm a film maker and football is not my first love but apparently it's a fine club.' The 39-year old is already a shareholder at Panathinaikos, the 19-times Greek champions and the Nigerian club Leventis United, but wants to move into English football. He is personally worth £4bn and his late father was the managing director of the Leventis-David group, a family business which owns bottling plants for Coca-Cola in 23 countries. He is the majority shareholder and has set up other companies, including Independent Models, the largest modelling agency in the UK, and 11 Pictures Ltd, a UK-based movie production outfit.
Coventry City insist that they are still in talks with the Sisu consortium led by Ray Ranson. However, last week they filed papers with this week's deadline for going into administration in an attempt to force the pace with Sisu. Roy Ranson has been involved in a number of bids for football clubs that have not been brought to completion. Although the Sky Blues must be pleased to have two bidders in the frame, the deadline to complete a deal is short and they could still suffer a ten point penalty for going into administration.
UPDATE II - 14/12/07 : GREEK BILLIONAIRE MAY RESCUE COVENTRY
It went right down to the wire, but shortly before the 4 p.m. deadline Coventry City concluded a takeover deal that saved them from administration and a ten point penalty. An agreement has been reached with the hedge fund Sisu Capital fronted by former footballer Roy Ranson who will become the Sky Blues' new chairman. Ranson has been involved in unsuccessful takeover bids for his former club Manchester City, Aston Villa and most recently Southampton. Major shareholders Craigavon and Sir Derek Higgs who between them hold 71.4 per cent of the club's shares have agreed to the offer. It has to be accepted by 90 per cent of all shareholders and will be forwarded to the remaining 28.6 per cent for acceptance. Sisu have told supporters that Coventry's reported £38m debt will be restructured to ensure ongoing financial and operational commitments are met. It is thought that the club's main creditors, the Co-op Bank, are satisfied with the deal. Resources up to the value of £20m have been promised. Sisu have signed a co-operation agreement with Ricoh Stadium owners ACL for the continued use of the stadium, but it is unclear whether they will take a stake in it and share in its other revenues as was originally envisaged. Greek billionaire Alki David emerged as a rival bidder earlier this week, but then withdrew claiming that the club was 'falling apart'.
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