Mike Ashley: Ex-Newcastle United owner takes over CBS Arena, home of Coventry City
- Published
Mike Ashley sold his stake in Newcastle to the Saudi Arabia-backed Public Investment Fund for £305m in 2021
Former Newcastle United owner Mike Ashley has taken over the Coventry Building Society Arena after buying its three operating companies.
Ashley's Frasers Group had been named as the preferred bidder after making a £17m bid for the businesses, which had been placed into administration.
Coventry City agreed a deal on Wednesday to sell an 85% stake in the club to businessman Doug King.
A court ruled his £25m offer to own the stadium had come too late.
The judge ruled there was "not enough substance" in King's bid to delay making the administration orders and had been told the Frasers Group would pull out if there was further delay.
Speaking prior to the hearing, King told the BBC his offer to buy the club, which is subject to English Football League approval, would go forward whatever the court's decision regarding ownership of the CBS Arena.
Joint administrator Andrew Sheridan said: "This is a pleasing outcome, which helps secure up to 1,000 jobs in Coventry and ensures that the venue will continue to play a major role in the city's economy as a world-class entertainment and hospitality venue and home for Coventry City Football Club."
The court heard that Arena Coventry Ltd (ACL), Arena Coventry (2006) Ltd and IEC Experience Ltd had only £1,201 in their bank accounts, with an energy bill for £2,000 due for payment on Friday.
Lawyers also told the court the companies would need £300,000 to continue trading beyond Friday and £645,000 to do so to the end of the month.
Coventry City Council owns the freehold for the stadium, which was known as the Ricoh Arena when the Sky Blues first played there in 2005.
It was acquired by Wasps rugby union club in 2014 but they went into administration last month.
Ashley funds have kept stadium going
Coventry City first moved to what was then the Ricoh Arena in 2005, before Wasps moved in nine years later
On Wednesday, Arena advisors FRP disclosed that only an advance payment from Frasers had saved the stadium from closure.
"Having conducted an accelerated sales process, the ACL board entered into an exclusivity agreement with a preferred bidder on 1 November, which, crucially included the payment of a non-refundable deposit to provide the necessary funding for the arena to continue to trade," FRP said in a statement.
"This was essential as the businesses are insolvent and had run out of cash. No other interested parties were willing to provide the required level of funding as set out in the bidding process, in the necessary timescales."
The deal agreed with King - a Norwich City supporter as a boy - by Coventry owners SISU will clear all the Sky Blues' debts, but the Stratford-upon-Avon-based businessman wanted to acquire both the club and the ground.
However, he confirmed: "We're in, whatever happens."
Speaking following the court hearing, he told BBC CWR: "We came in very late, we only got the deal done last night and obviously the judge made the call that there was too much uncertainty at this point for him to entertain we were serious.
"We were deadly serious, we had the interim funding, we would have certainly paid more than was on the table. So, all in all, it's a tough result, but it is what it is. I want to support the club and get it where it deserves to be.
"What I would obviously welcome is a discussion with the new owner (of the Arena), to get together and maybe get involved that way and obviously for him to honour our ability to play there through the length of lease we signed a couple of years ago. They're the critical things."
'Stability and continuity'
Ashley, 58, sold his stake in Newcastle for £305m in October 2021 - having paid £134m for the club in 2007.
He was in charge at St James' Park for 14 years, during which their best finish was fifth in the Premier League in 2011-12.
Ashley was reportedly interested in buying Derby County after they went into administration in September 2021, but the now League One club was eventually bought by businessman David Clowes in the summer.
His signed contract to buy the CBS Arena came into immediate effect as soon as the operating companies entered administration.
In his ruling, the judge said five other companies had also been interested in buying the stadium but had fallen away before the Frasers Group deal was agreed.
A Frasers Group spokesperson said: "Through the acquisition, we are pleased to have been able to secure a long-term future for the Arena, protecting jobs and supporting the local community. In particular, we are looking forward to working with Coventry City Football Club.
"This investment demonstrates Frasers Group's belief in the West Midlands as a key economic region and will create many mutual synergies that are aligned with the business' elevation strategy and the Group's potential development plans in the wider area.
"Frasers Group will continue to engage with local stakeholders at the site to ensure stability and continuity."
Questions remain after CBS Arena purchase
Analysis - BBC CWR political reporter Simon Gilbert
An incredible 24 hours has seen Coventry City and the stadium they play in left with new owners.
But, crucially, they're not the same owner.
And that's been at the root of the rows over the stadium for almost two decades.
So will the situation improve under the new structure? Or will the Sky Blues' future at the CBS Arena be under threat once again.
Just moments after the decision to hand the stadium's keys to Mike Ashley, Doug King was already talking about his history as a trader and hoping to do a deal to acquire the stadium from Ashley.
But what are Ashley's grand plans? And do they ultimately involve ownership of the football club?
It feels like we're still a long way from the final whistle being blown on this saga.
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- Published17 November 2022
