Last ditch talks have been taking place at a hotel somewhere in England under a media blackout between Arena Coventry Limited (ACL), the operators of the Ricoh Arena, and Coventry City in the hope of reaching an agreement. This will not be easy given the bad blood between the parties.
Last ditch talks have been taking place at a hotel somewhere in England under a media blackout between Arena Coventry Limited (ACL), the operators of the Ricoh Arena, and Coventry City in the hope of reaching an agreement. This will not be easy given the bad blood between the parties.
However, they both have incentives to settle their differences. For ACL, not having a football club at the Ricoh undermines its purpose and their financial position. For Coventry City, for all their brave talk of announcing a new stadium site within eight weeks, it is by no means clear that they can secure a suitable one. The club could well end up marooned at Northampton for five years.
Needless to say, the proposed move has been deeply unpopular with Sky Blues supporters who have made their feelings clear in demonstrations and through other means. Only 300 season tickets are reported have been sold at Northampton which underlines the commercial risks involved.
Both sides agreed to the negotiations at a meeting on Monday with administrator Paul Appleton. It is understood Coventry City owners Sisu/Otium agreed to negotiate because they desperately want ACL to sign Mr Appleton’s proposed CVA. Under his CVA proposals, ACL would get £590,000 return on CCFC’s £1.3million rent debts from a £1.5m sale of CCFC Ltd to Sisu-related company Otium. It is thought Coventry City will insist on ACL signing the CVA before there can be any second round of discussions over playing at the Ricoh.
The club wants CCFC Limited to exit administration so that a Football League transfer embargo can be lifted and new players signed. The earliest the club can come out of administration is three weeks into the new season which starts in ten days – as a 28-day ‘cooling off’ period must follow any CVA agreement.
Mr Appleton has stated the alternative to CCFC Ltd exiting administration via a CVA is liquidation – which could incur a further 15-point League deduction from the club’s 2013/14 League One campaign.
There are claims ACL would be willing to discuss terms over rent payments and who receives matchday revenues – after it previously offered to lower annual rent from £1.3m to £400,000. However, Sisu may want 100 per cent ownership of the Ricoh which is unlikely to be on offer.
Another major problem is Sisu’s outstanding High Court application for a judicial review against Coventry City Council’s £14m taxpayer deal in January to buy out ACL’s ‘mortgage’ bank loan. The club claims the council acted against EU ‘state aid’ laws, created unfair competition and sought to ‘wrest control’ of the club from its lawful owners – allegations the council denies.