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Bankers take over Hammers
Jonathan Prynn17 Apr 2009
West Ham United's fate is set to be decided by a consortium of international banks that will take control of the club within weeks.
The half-dozen banks are creditors of stricken Icelandic investment bank Straumur, which provided most of the finance for the £85million takeover of West Ham by Icelandic entrepreneur Bjorgolfur Gudmundsson in 2006. Straumur was nationalised last month by the Icelandic government after it was declared "technically insolvent" by the Financial Services Authority in London.
The unnamed banks are now believed to be taking steps to protect their interests by effectively taking over at Upton Park, leaving manager Gianfranco Zola with little or no resources to add to his squad unless funded by player sales.
Despite a moratorium on Mr Gudmundsson's debts until June, won last month in the Icelandic courts, Straumur's banking creditors are now preparing to take advantage of covenants on the debt that allow for the club to be taken over.
Since the collapse in the Icelandic economy and the meltdown of his investment vehicle, Hansa, last year, Mr Gudmundsson's ability to maintain ownership has been in doubt.
It is believed that the banks will form a new board, with Mr Gudmundsson and the club's vice-chairman Asgeir Fridgeirsson almost certain to be ousted.
The consortium, nominated by 40 institutions who are creditors of Straumur, expect to remain in charge at Upton Park next season and probably well into 2011 as they wait for an improvement in economic conditions.
They will seek to sell the club to a single buyer for the highest possible price to recover money for creditors.
In the meantime there is likely to be pressure to make further cutbacks following the overspending of the previous chairman, Eggert Magnusson, which alarmed the Premier League club's owner so much he was sacked.
The Hammers have become the latest victims of a new tougher approach by the Icelandic authorities towards recovering investments lost in the financial meltdown that effectively bankrupted the country.
Reader views (3)
My condolences to all West Ham fans; the last thing you need now is Bankers running your club.
I am QPR myself; and we have F1 motor racing owners; we don’t win that often these days; but the car park is full of racing cars.
Good Luck West Ham; you still are a favourite other team; with me.
- Mickyinlondon, london, 17/04/2009 14:34
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So they will also sell within the next month or so to get their money back.... West Ham are doomed
- Dc, Ealing, London, 17/04/2009 11:54
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Awful as it may sound, this is likley to save WHU.
- Dave Davies, Basingstoke, 17/04/2009 10:28
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