In a relegation fight Sheffield Wednesday are bottom of the Championship table. Its administrators, Begbies Traynor, have given the club ‘preferred bidder’ status. The ruling brings to an end a controversial first round of bidding to save the deeply-indebted football team. The club’s uphill battle now grows more steep than ever after earning a total of nine negative points this season from an 18-point deduction during this season’s first half.
The US Ignite administrators’ve released an important signal of their intentions to proceed with an innovation consortium. This committee has put together, in the view of the administrators, the best overall proposal as a club. Today’s announcement is a big step toward a potential takeover. Don’t forget that just being awarded preferred bidder status doesn’t guarantee a change of ownership will happen.
Challenges Facing Sheffield Wednesday
Sheffield Wednesday’s predicament is severe, as they sit at the foot of the Championship with negative points weighing heavily on their performance. The club’s prior 18-point deduction has deepened the club’s crisis. At this point, new ownership will need to move swiftly in order to achieve stability in operations.
To a person the new administrators seemed painfully aware of the task before them. More importantly, though, they raised the point that any proposed acquisition requires complete legal documentation. Approval from the EFL, or English Football League, is required, including approval by the owners’ and directors’ test.
“Granting preferred bidder status does not mean a change of ownership is complete. Any proposed acquisition remains fully subject to the agreement of appropriate legal documentation and EFL approval, including the owners’ and directors’ test. The administrators will not complete a sale unless and until those requirements are satisfied.” – Sheffield Wednesday administrators
The Preferred Bidder Consortium
The consortium that was awarded preferred bidder status is said to be noted for making the strongest proposal and experience in football ownership. This experience touches on majority/minority club interests in leagues under regulated league systems. It argues instead that these learnings and approaches might have a profound positive impact on Sheffield Wednesday.
As of now, the administrators have voiced great optimism that the consortium has the knowledge and expertise to cut through the overwhelming intricacies of club administration and turnaround techniques. Their choice demonstrates a well considered best course of action to guide Sheffield Wednesday away from the present disarray.
“The consortium we intend to progress with has submitted the strongest overall proposal for the club,” stated the Sheffield Wednesday administrators.
EFL Review Process
To get there, the EFL, as part of the takeover process, will need to perform extensive due diligence on the consortium’s proposal. The new administrators have made clear that this review will be thorough and will not be bound by an arbitrary deadline.
“The EFL has advised the administrators that this review will be thorough and will not have a set timescale. That is appropriate and expected, and we fully support that process.” – Sheffield Wednesday administrators
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