Frasers Group, a British retail company owned by Mike Ashley, has today (Thursday) secured ownership of the Coventry Building Society Arena, home of Championship football club Coventry City.
CBS Arena’s operating companies – Arena Coventry Limited (ACL), Arena Coventry (2006) Limited and IEC Experience Limited – confirmed earlier this month that they had applied to be placed into administration, adding that a preferred bidder had been identified for the business.
Andrew Sheridan and Raj Mittal, partners at specialist business advisory firm FRP, were today appointed as joint administrators of the three companies and immediately completed the sale of the businesses to Frasers Group. According to the BBC, the bid was worth £17m (€19.4m/$20m).
Multiple reports had previously suggested that Ashley, the former owner of Premier League club Newcastle United, was in pole position for preferred bidder status.
Coventry shared the stadium with Premiership rugby union club Wasps, which was placed into administration last month. The future of the stadium has been up in the air since Wasps’ administration.
Yesterday, Coventry owners SISU Capital Ltd agreed to sell a majority stake in the club to local businessman Doug King, with the team also signalling its intention to make a late bid to acquire the stadium. Coventry confirmed this morning that a £25m bid had been submitted but a court ruled that it had come too late.
Prior to today’s hearing, King told the BBC that his offer to buy Coventry would go ahead irrespective of the decision regarding ownership of the stadium.
In a statement released this afternoon, 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.
“By agreeing to sign an exclusivity agreement before November 1, Frasers Group was the only interested party that was able to meet the terms of the sale process. This was essential in providing the necessary funding that enabled the Arena to continue trading beyond that date.
“Without this, and the collaborative and supportive approach taken by all key stakeholders throughout the process as well as the tireless efforts of the core management team, the Arena would have been forced to close on November 2 resulting in hundreds of job losses and a materially worse outcome for creditors. We wish Frasers Group and all involved in the Arena every success for the future.”
A spokesperson for Frasers Group added: “We are delighted with the acquisition of the CBS Arena which will complement the Group’s existing portfolio of brands and investments. 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.”
SISU’s sale of the club, which is subject to English Football League approval, will see King take an 85-per-cent share. Coventry said the deal will involve clearing all of its debts.
Coventry had said the structure of its bid for the CBS Arena would ensure the football club remains initially debt-free, adding that its bid was the only one which can “guarantee” its long-term future in the city.
King is chief executive of Yelo Enterprises and recently invested over £70m in the local region through the construction of an oilseed processing facility to generate renewable energy. He also co-founded and majority-owns RCMA Capital LLP, which oversees investments of over $400m.
In a statement released prior to the news that Frasers Group had acquired CBS Arena, King said: “It is no secret that Coventry City FC has faced challenges in recent years, and Joy (Seppala, chief executive of SISU Capital Ltd) and her team have done an exceptional job to bring the club back to Coventry and deliver on-field success.
“Working together we want to deliver a new start, beginning with securing our home in Coventry. We know fans, and others across the region, want long-term security and the guarantee of playing football in our city. This is critical to our ambition.”
SISU previously had a long-running dispute with Coventry City Council over the sale of the CBS Arena to Wasps in 2014. In February, the football club confirmed that it had ended all proceedings relating to the sale.