Blues Saga: Bidder given two-year period to conclude club sale

THE potential bidder to take over Birmingham City FC has been given a two-year exclusivity agreement by receivers acting for the club’s parent, Birmingham International Holdings.

In a statement to the Hong Kong Stock Exchange, receivers from Ernst & Young acting for BIH said they had entered into an exclusivity agreement with Trillion Trophy Asia Ltd to enable it raise the cash necessary to make the purchase.

It means the sale of the club could be further drawn out, restricting any hopes of a quick sale.

Trillion is backed by a £12.8m (HK$153,000,000) facility and in an attempt to progress the bid has pledged cash collateral of £880,000 (HK$10.3m) as security for the loan or bank facilities granted by HSBC in the UK.

However, if it is unable to raise the necessary funding or it goes over the two-year period then the exclusivity deal will be terminated, the receivers have said.

In return, the receivers have said they will not talk to any third party unless or until the agreement lapses.

In addition, the receivers said that as collateral for the loan facility, BIH would grant Trillion a first legal charge over St Andrews and the land where the stadium is situated, a first floating charge over all the assets, goodwill, undertaking and uncalled capital, both present and future given by the club and a first fixed charge over all book and other debts given by the club.

The receivers also announced that BIH had entered into an additional loan agreement with Trillion for HK$10,000,000 (£820,000) which will form part of the agreed bank facility. Both loans bear interest at a rate of 8% per annum and were granted on an unsecured basis.

The loans will be repaid together with interest accrued on July 27, 2015.
In the meantime, shares in BIH remain suspended on the Hong Kong Stock Exchange.