New Leeds bid to beat legal challenge

Leeds have upped their offer to the Inland Revenue from £77,000 to £616,000 in a last-ditch attempt to avoid a legal challenge to the club being re-sold to Ken Bates.

The initial offer to creditors was only 1p in the pound, which meant the Inland Revenue would have received only 1% of the £7.7m owed in unpaid taxes and VAT.

Following talks between Leeds’ administrators KPMG and Inland Revenue officials, the club have increased their offer by an extra 7p in the pound.

The development came on the eve of the deadline for legal challenges to the Company Voluntary Arrangement (CVA) proposed by Bates and Leeds United Football Club Limited.

Leeds claim any legal challenge will cause the club to go into liquidation and until today’s offer the Inland Revenue had been viewed as the creditors most likely to go to court.

A statement released by Leeds said: “If the CVA is challenged the consequence will be liquidation and Leeds United will cease to exist and 500 jobs will be lost.

“It is our view that any challenge now will not be made on commercial grounds but is either politically or personally motivated.”

The statement says no alternative bidders came forward with firm offers and the one from Bates is the only one on the table.

The initial agreement included a promise of a further £5m payment to the creditors if the club regained top-flight status within five years, but under the new offer this timeframe has now been extended to 10 years.