Reading FC: Sale of club needs at least a couple of months, says former CEO Nigel Howe
- Published
Nigel Howe was Reading chief executive from 1995 until 2020
Eight parties are interested in buying Reading but it will be at least a couple of months before any sale is completed, according to former chief executive Nigel Howe.
Howe, now property projects manager at the Royals, has been asked by owner Dai Yongge to oversee the sale of the club.
He told BBC Radio Berkshire that proposals would be put in front of Dai in the next few weeks.
But he added former Newcastle owner Mike Ashley had not followed-up his initial interest in buying the League One club.
Howe revealed Dai had been undecided about whether or not to sell or just allow new investment, but was now intent on selling.
"He's eventually got to the point where he thinks the best route is to go for a full disposal," Howe said.
"We've been contacted directly by a good seven or eight bidders."
EFL 'sound checked' potential investors
Howe said he had used contacts at the English Football League to "sound check" potential investors and there had been interest from around the world including North America and Europe.
"You'll get some pretty quick feedback," he added.
"Clearly they are not going to tell you who to choose until you go to them with a proposal but at least you get an initial sound check that means you're not going to waste time putting forward someone who won't pass their funding regulations or the fit and proper director test."
One of the declarations of interest came from billionaire businessman Ashley.
"We had a couple of conversations with Mike's people six or seven weeks ago - that's when we were really looking round to see what the opportunities were," Howe said.
"None of those really came to anything. At the time it looked like because the club wasn't being funded properly and Mr Dai was desperate to sell.
"We've gone into a much more transactional process now where we are talking to people in a proper way. At this stage Mr Ashley's people have not revisited."
Reading's game against Port Vale on 13 January was abandoned when home fans protested on the pitch against Dai Yongge
'Hopefully Mr Dai will agree'
Howe said it was going to take at least a couple of months to get the process fully complete once a deal had been agreed, and that the club's reported £1.2m monthly losses were tackled.
"There are lots of transactional issues that revolve around the real estate issues that need to be gone through," Howe said.
"With the EFL, it's not just about the owners' test, it's also about making sure the financial requirements are met as well and putting in place a business plan the EFL say is workable.
"Everybody that has shown interest we have given the opportunity to get a proposal to us. Once we have them we will them meet with Mr Dai and hopefully he will agree one of them.
"I think we will need at least a couple of months to get it ratified. There is no date (to meet Mr Dai) at the moment but I hope it's going to be in the next couple of weeks."
Despite rumours that the club could be asset stripped and sold off in parts, Howe said: "I think the thing only really works if you sell the whole entity as one.
"I think of late he's got to that view (of shifting the whole football club). I think the people who buy will buy them in their existing entities - that will not affect the club. It will make it an easier transaction."
Howe said his sole focus was on the sale of the club and he was not involved in the day-to-day running which has seen staff go unpaid, redundancies and reportedly players having to provide their own meals at the training ground.
"I've always found Mr Dai good to deal with," he added.
"He's very clear in what he wants and doesn't want. All I'm concentrating on is making sure we can get through a controlled transaction."
'A complex deal'
Analysis - BBC Radio Berkshire Sports Editor Tim Dellor
Nigel Howe needs all his political deftness and astute diplomacy to broker the sale of Reading FC.
He was chief executive at the club for 25 years of growth, working with Sir John Madejski. Under Dai Yongge he has moved away from this job and football to oversee the club's real estate.
This proved to be a crucial mistake because Howe is well connected in football, hugely experienced at managing the football club budget, and knows the profitability and sustainability rules.
He is also familiar with the workings of the EFL and more broadly how the business of football works.
Now he has been drafted in to facilitate the sale of the club. Dai and his sister Dai Xiu Li asked Howe last week to help find, select and then process the sale.
This is a complex deal, partly because of Reading's chaotic situation having fallen foul of so many EFL regulations and regular failure to pay bills, including to HMRC, but also because the stadium, training ground, club and car park are currently different entities, so under different company names.
Ignore the social media rumours - no deal will be completed until mid-March at the earliest. Spare a thought for Howe - trying to keep Yongge enthusiastic about a sale, prospective buyers interested, and fans patient.
The Dai Yongge Debacle: Reading FC's Ownership Crisis will air on BBC Radio Berkshire at 18:00 GMT on Friday.