Cov Tel - Les Reid Article - Football League admits serious errors
Coventry Telegraph Article - Written By Les Reid
http://www.coventrytelegraph.net/news/coventry-news/football-league-admits-coventry-city-5741590
Football League admits serious errors in Coventry City administration saga
16 Aug 2013 13:33Questions raised over Sky Blues sale after League accepts 'administrative oversight' meant players were registered to wrong Sisu company
The Football League has admitted it made serious and unique errors in registering Coventry City players to the wrong company, the Telegraph can reveal.
The revelation raises serious questions about the whole sale process which enabled the club to emerge from administration under the previous owners Sisu - in the guise of related company Otium.
Under repeated questioning from the Telegraph, the League has confirmed publicly for the first time that it made an “administrative oversight” in registering Sky Blues players to Coventry City Football Club (Holdings) Ltd.
The League admitted the players’ contracts ought to have been registered with another company - Coventry City Football Club Limited - because it held the League’s “golden share” which allowed it to play in the league as the club.
We can also reveal the League is writing to sports minister Hugh Robertson to admit the errors.
It says the mistakes in allowing players to reside in CCFC Holdings were also made by the FA.
Part-Coventry City Council-owned Ricoh firm Arena Coventry Limited (ACL) has insisted, ever since it filed for CCFC Ltd’s administration in March, that all the playing assets should have been in one company, CCFC Ltd.
As the Telegraph has reported since March when CCFC Ltd went into administration, League documents and CCFC Ltd’s last filed accounts for 2010/11 provided evidence that CCFC Ltd constituted the playing side of the club.
The League also told the Telegraph it has now put in place procedures to make sure such “administrative oversights” never happen again.
The League refused to say whether some or all Coventry City players were registered by the League’s “player registration department” and FA in the Holdings company.
Crucially, it also declined to say over what period the errors were made.
The Telegraph has learned the League will tell the sports minister that, over time, the business model of Coventry City became increasingly complicated, and the errors had occurred within that period.
The League told the Telegraph it became aware of the errors around March, following its initial investigations.
The League says its has since carried out an “audit” of all other 71 League clubs - which found there was no such division of assets between companies anywhere in the country.
The League claims the errors did not breach its rules and regulations, claiming assets can straddle two companies - but it accepts it was not “ideal” and “should not have happened”.
The League has waited until now to publicly admit the mistakes.
It comes after the Football League on August 2 transferred the golden share - which had been suspended since March’s administration - to Sisu company Otium.
By then, Otium had been selected by administrator Paul Appleton as the buyer of minor assets in CCFC Ltd for £1.5million - which crucially excluded the sale of staff and players’ contracts held by Sisu company CCFC Holdings Ltd.
Other bidders and potential bidders who had hoped to take over the Sky Blues have told the Telegraph the sale was stacked in favour of Sisu-related companies as the major creditors - because they were not able to bid for the whole club.
Those bidders and potential bidders included US property investor Preston Haskell IV and Warwickshire businessman Michael Byng with potential Chinese investment.
Mr Byng complained the process would have meant them buying minor assets in CCFC Ltd - with no knowledge of whether they would get the golden share, or whether Sisu boss Joy Seppala would later be prepared to sell the players to them.
Other potential bidders, who wished to remain anonymous, have told the Telegraph they were also put off bidding because of the “messy” situation.
Expert Alan Limb, an insolvency practitioner of BRI (Business Recovery and Insolvency), who is also a Coventry City fan, said: “Had all the assets including players been in the company for which Paul Appleton was administrator (CCFC Ltd), the outcome could have been very different because he would have had the ability to sell the club as a whole.
“It raises questions as to whether people might have been prepared to bid for all of those assets at a price the administrator could accept.”
The revelation follows the Telegraph’ interview with Football League chairman Greg Clarke, in which he said he did not know if players’ contracts had been registered with Holdings, and that the information would have to come from the League’s lawyers.
He said: “I don’t know the answer to that question. It may be interesting to get to the bottom of - but it wouldn’t change anything. The club has been sold.
“To the best of our ability, we and the FA registered players in the right place within the corporate structure.. I am reasonably confident we did it right.”
He said the League had deferred to the court-appointed administrator, Mr Appleton, to decide who would buy the assets in CCFC Ltd.
Tim Fisher, Sky Blues boss and Otium director, has long argued the players were located in the Holdings company, that there was no wrongdoing or “transfer” of any assets between companies, and that Holdings had a “beneficial” claim to the assets in CCFC Ltd.
Mr Appleton has said the “beneficial ownership” argument could only be tested in the court, and that the process left him no option but to sell to Otium as the best offer available to discharge debts to non-connected creditors, including ACL.
Mr Appleton’s report to creditors in May stated CCFC Ltd was created as a subsidiary of Holdings (formerly called The Coventry City Football Club Limited) in May 1995, when the club was in the Premier League, established in 1992.
The club was relegated into the Championship, administered by the Football League, in 2001.
The club claims the assets in Holdings, including players’ contracts, have now been transferred to Otium following Mr Appleton’s sale - so that all the playing assets are now in one place.
Coventry Telegraph Article - Written By Les Reid
http://www.coventrytelegraph.net/news/coventry-news/football-league-admits-coventry-city-5741590
Football League admits serious errors in Coventry City administration saga
16 Aug 2013 13:33Questions raised over Sky Blues sale after League accepts 'administrative oversight' meant players were registered to wrong Sisu company
The Football League has admitted it made serious and unique errors in registering Coventry City players to the wrong company, the Telegraph can reveal.
The revelation raises serious questions about the whole sale process which enabled the club to emerge from administration under the previous owners Sisu - in the guise of related company Otium.
Under repeated questioning from the Telegraph, the League has confirmed publicly for the first time that it made an “administrative oversight” in registering Sky Blues players to Coventry City Football Club (Holdings) Ltd.
The League admitted the players’ contracts ought to have been registered with another company - Coventry City Football Club Limited - because it held the League’s “golden share” which allowed it to play in the league as the club.
We can also reveal the League is writing to sports minister Hugh Robertson to admit the errors.
It says the mistakes in allowing players to reside in CCFC Holdings were also made by the FA.
Part-Coventry City Council-owned Ricoh firm Arena Coventry Limited (ACL) has insisted, ever since it filed for CCFC Ltd’s administration in March, that all the playing assets should have been in one company, CCFC Ltd.
As the Telegraph has reported since March when CCFC Ltd went into administration, League documents and CCFC Ltd’s last filed accounts for 2010/11 provided evidence that CCFC Ltd constituted the playing side of the club.
The League also told the Telegraph it has now put in place procedures to make sure such “administrative oversights” never happen again.
The League refused to say whether some or all Coventry City players were registered by the League’s “player registration department” and FA in the Holdings company.
Crucially, it also declined to say over what period the errors were made.
The Telegraph has learned the League will tell the sports minister that, over time, the business model of Coventry City became increasingly complicated, and the errors had occurred within that period.
The League told the Telegraph it became aware of the errors around March, following its initial investigations.
The League says its has since carried out an “audit” of all other 71 League clubs - which found there was no such division of assets between companies anywhere in the country.
The League claims the errors did not breach its rules and regulations, claiming assets can straddle two companies - but it accepts it was not “ideal” and “should not have happened”.
The League has waited until now to publicly admit the mistakes.
It comes after the Football League on August 2 transferred the golden share - which had been suspended since March’s administration - to Sisu company Otium.
By then, Otium had been selected by administrator Paul Appleton as the buyer of minor assets in CCFC Ltd for £1.5million - which crucially excluded the sale of staff and players’ contracts held by Sisu company CCFC Holdings Ltd.
Other bidders and potential bidders who had hoped to take over the Sky Blues have told the Telegraph the sale was stacked in favour of Sisu-related companies as the major creditors - because they were not able to bid for the whole club.
Those bidders and potential bidders included US property investor Preston Haskell IV and Warwickshire businessman Michael Byng with potential Chinese investment.
Mr Byng complained the process would have meant them buying minor assets in CCFC Ltd - with no knowledge of whether they would get the golden share, or whether Sisu boss Joy Seppala would later be prepared to sell the players to them.
Other potential bidders, who wished to remain anonymous, have told the Telegraph they were also put off bidding because of the “messy” situation.
Expert Alan Limb, an insolvency practitioner of BRI (Business Recovery and Insolvency), who is also a Coventry City fan, said: “Had all the assets including players been in the company for which Paul Appleton was administrator (CCFC Ltd), the outcome could have been very different because he would have had the ability to sell the club as a whole.
“It raises questions as to whether people might have been prepared to bid for all of those assets at a price the administrator could accept.”
The revelation follows the Telegraph’ interview with Football League chairman Greg Clarke, in which he said he did not know if players’ contracts had been registered with Holdings, and that the information would have to come from the League’s lawyers.
He said: “I don’t know the answer to that question. It may be interesting to get to the bottom of - but it wouldn’t change anything. The club has been sold.
“To the best of our ability, we and the FA registered players in the right place within the corporate structure.. I am reasonably confident we did it right.”
He said the League had deferred to the court-appointed administrator, Mr Appleton, to decide who would buy the assets in CCFC Ltd.
Tim Fisher, Sky Blues boss and Otium director, has long argued the players were located in the Holdings company, that there was no wrongdoing or “transfer” of any assets between companies, and that Holdings had a “beneficial” claim to the assets in CCFC Ltd.
Mr Appleton has said the “beneficial ownership” argument could only be tested in the court, and that the process left him no option but to sell to Otium as the best offer available to discharge debts to non-connected creditors, including ACL.
Mr Appleton’s report to creditors in May stated CCFC Ltd was created as a subsidiary of Holdings (formerly called The Coventry City Football Club Limited) in May 1995, when the club was in the Premier League, established in 1992.
The club was relegated into the Championship, administered by the Football League, in 2001.
The club claims the assets in Holdings, including players’ contracts, have now been transferred to Otium following Mr Appleton’s sale - so that all the playing assets are now in one place.
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