Mike Ashley wants Amanda Staveley to improve her offer for Newcastle United before he considers accelerating the pace of takeover talks.
A formal, near-£300m bid from Staveley’s Dubai-based financial advisory firm, PCP Capital Partners, lies on the Newcastle owner’s table but adjustments will need to be made and compromises reached before Ashley broadly accepts an offer to buy him out at St James’ Park.
Lawyers acting for Staveley and Ashley are locked in complex negotiations. Should the parties reach an agreement in principle, they would enter into a contract of exclusivity. That would represent the starting gun for a month-long period of formal due diligence during which serious haggling over the final price and a myriad of contractual sale clauses would really get under way.
Staveley’s representatives have conducted a month of preliminary due diligence on Newcastle’s finances after signing a non-disclosure agreement (NDA) with Ashley. PCP Capital Partners was one of five parties to do so but is understood to be the sole remaining credible bidder.
Ashley, after investing £134.4m in buying Newcastle a decade ago and pouring an extra £129m into the club in interest-free loans, had hoped to make a greater profit by selling for a sum somewhat closer to £400m. Although such an ambition looks highly unrealistic in the current market, the sports retail tycoon is anxious to see Staveley improve her offer before agreeing exclusivity. Ashley has been made aware that room for manoeuvre is fairly limited as Staveley’s bid is close to the maximum she is prepared to pay.
Much is believed to hinge on clauses relating to Operation Loom, the HMRC investigation into alleged tax evasion relating to past player transfers involving Newcastle. Staveley is anxious to protect herself against the possibility of future, potentially hefty, club fines if the allegations are founded.
With payments to Ashley likely to be staged in instalments the final sum would also be reduced were the team to be relegated this season. One way of circumventing the impasse would be for Staveley to make a one-off payment in the region of £300m. This is understood to be under consideration.
Against his desire for a significantly higher price, Ashley knows Staveley’s approach represents a rare chance to sell a concern he has been keen to part with for some time. With Rafael Benítez at the helm as manager, Newcastle are an attractive proposition but Ashley is reluctant to support Benítez in the transfer market and, without investment in players, the much coveted, and increasingly frustrated, Spaniard could well resign.
Staveley is keen to work with the former Champions League-winning Liverpool manager and, ideally, wants the takeover completed in time to allow Benítez to invest in desperately needed squad strengthening during the January transfer window.
The 44-year-old Yorkshire-born businesswoman – believed to be backed by investors in not only the Gulf but the Far East and United States – hopes to have reached the point at which an exclusivity arrangement can be signed by the end of this week.
Although the timetable would be tight, that would make a takeover by the New Year just about feasible. An exclusivity deal would also trigger the Premier League subjecting Staveley and PCP Capital Partners to its “fit and proper person test” , a generally month-long examination designed to assess the viability of prospective new club owners.
PCP Capital Partners has access to around £28bn of Middle Eastern wealth and its standing is testament to Staveley’s renown as a deal-maker.
Long known as a facilitator of football takeovers she helped broker the agreement which saw Sheikh Mansour bin Zayed al-Nahyan take control of Manchester City in 2009 and was heavily involved in Dubai International Capital’s attempt to buy Liverpool a year earlier.