Birmingham City FC parent in talks with third party to ease liquidity problems
BIRMINGHAM City FC owner Birmingham International Holdings has confirmed it is in talks with a third party to try and ease the club’s financial situation.
Last month BIH announced it was delaying the release of its annual results – a move which heightened concerns the club could be on the verge of running out of funding.
Reports have been circulating for several weeks that the club is in the grip of a cash crisis and could be set for administration before the end of the year.
A statement released to the Hong Kong Stock Exchange and signed by Peter Pannu, executive director, CEO and managing director of BIH, said: “The company is in the late stages of discussions with third parties regarding possible fund raising exercises by way of debt and equity. Such is expected to address the group’s liquidity issues.”
The statement said a restructuring of the group’s debts was also being considered.
“Given current negotiations and subject to agreement on the terms and conditions, it is contemplated that signing of the relevant documents will take place by November 15, 2013,” it adds.
However, before any financial transactions and debt restructuring can proceed, BIH has to win the approval of its shareholders for the move.
The statement said: “On the basis that signing of all documents will take place by November 15, 2013, a general meeting to approve all relevant transactions is expected to be held in early January 2014. On that basis, barring unforeseen circumstances, resumption of trading in the (BIH) shares may take place by the end of 2013 or early 2014.”
The company also said that the draft audited results for Birmingham City FC plc for the year ended June 30, 2013 had been finalised and the consolidated results for Birmingham City Plc (the holding company of BCFC) for the year ended June 30, 2013 were being prepared.
“The company expects to be able to announce the results of the group for the year ended June 30, 2013 no later than November 29, 2013. Meanwhile, the despatch of the annual report of the group for the year ended June 30, 2013 will be delayed to no later than December 15, 2013,” added the statement.
The company added that club owner Carson Yeung had reiterated his intention to voluntarily suspend his management duties within the group until the conclusion of his ongoing court case, where he faces charges of money laundering.
