Leeds paying a heavy price

By Paul Saffer

Less than three years ago, Leeds United AFC were on the verge of the UEFA Champions League final, only to lose to Valencia CF. Now Leeds face dropping out of the English Premiership and could be in administration by the end of the week unless a proposed takeover goes through.

Club revived
The roots of their financial collapse can be traced to their stunning form of a few years back. The reign of Howard Wilkinson, which ended in 1996 after a gradual slump following the league title success of 1991/92, bequeathed a youth policy which was beginning to bear fruit when David O'Leary took over as manager in 1998 under charismatic chairman Peter Ridsdale.

Heavy spending
With the likes of Harry Kewell and Alan Smith playing alongside the experienced Nigel Martyn and David Batty, Leeds hoped to emulate their glory days of the 1970s under Don Revie, when they reached the 1974/75 European Champion Clubs' Cup final. In 1999/00 they advanced to the UEFA Cup semi-finals and qualified for the Champions League, but they then began to spend heavily. A British-record €25.7m for Rio Ferdinand was the tip of a €50m-plus iceberg in 2000/01 alone.

Chairman's ambition
At the time, Ridsdale said: "While we are aware of our responsibilities as a public company, we will also fulfil our ambition to be a top quality Premiership and European side." That, though, depended on maintaining their winning form.

Collapse looms
In fact, the Champions League semi-final appearance was to prove a high point, as Leeds failed to make the tournament again, losing out on the financial influx they had gambled on receiving. Despite laying out a combined €26m for Robbie Fowler and Seth Johnson, their fortunes began to dip. Leeds recovered to finish fifth in the Premiership in 2001/02, but O'Leary was sacked and replaced by Terry Venables.

Players offloaded
The former England manager could do nothing about what was to unfold. As the extent of a debt in excess of €100m became plain, Ferdinand, Robbie Keane, Lee Bowyer, Fowler and Jonathan Woodgate were offloaded in an increasingly desperate manner. The club only just avoided relegation, but by then Venables and Ridsdale had gone. Their struggle has continued this term, with Venables and Ridsdale's replacements, Peter Reid and John McKenzie respectively, themselves now out of the club.

D-day nears
Inevitably, things have come to a head and the collapse of takeover bids has made administration a possibility. Bottom of the Premiership, relegation could prove a severe financial blow. Even Mark Viduka, one of the club's few saleable assets, would barely ease the burden as Leeds reportedly owe €10m from his original purchase due to a complicated leasing arrangement.

Ground sale
Indeed, nothing is now ruled out. The latest chairman, Trevor Birch, has even floated the idea of selling their Elland Road stadium. "It is in a prime industrial area and would be an ideal site for somewhere like an Asda [supermarket]," he said. The fate of Sheffield Wednesday FC, Nottingham Forest FC and Queen's Park Rangers FC, who all faced financial collapse after exiting the Premiership, is a salutary warning, as indeed was Leeds's own spell outside the top flight in the 1980s.

Worrying precedents
The two previous occupants of Elland Road, Holbeck Rugby Club and Leeds City FC, both fell foul of financial problems. Birch himself was the Chelsea FC chief executive this summer who was staving off bankruptcy when Roman Abramovich arrived to save the club. If Leeds United are not to follow Leeds City into history, a white knight may well be needed to ride to the rescue.