Leeds could go into administration
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Leeds say they will continue 'constructive discussions.'
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LEEDS, England -- Leeds United, crippled by debts, could be forced to go into financial administration if negotiations with creditors fail to come up with a rescue package, the club has revealed.
The English Premier League club has debts of 79 million pounds ($134 million) and recently announced losses of 50 million pounds ($85 million) -- a record for a British club -- for the last financial year.
Leeds are bottom of the table and still looking for a full-time manager to succeed Peter Reid, who was fired on November 10.
Leeds have been negotiating a debt restructuring plan with their main creditors and hoped to announce a deal for shareholder approval before Christmas.
But Leeds said in a statement that the negotiations had failed so far. They said the club would continue "constructive discussions" with its creditors and proposed investors.
They owe American bondholders almost 60 million pounds ($101 million) , and a Guernsey based finance company, who helped fund player purchases, 21 million pounds ($35.65 million).
The Leeds statement said: "The directors remain of the view that, if all of these negotiations are concluded successfully, they will provide adequate funding for at least three months in which to conclude arrangements designed to achieve a more permanent refinancing of the group.
"But if the negotiations are unsuccessful, the directors may be forced to seek the protection of an administration order."
Financial administration is a last step before bankruptcy and involves putting a club in the hands of receivers to help wipe out its debts.
Their financial plight is likely to prevent them from trying to bring in former player Gordon Strachan, currently Southampton manager, as Reid's successor. A bid for Strachan would involve hefty compensation to the Saints for his services.
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Associated Press contributed to this report.
