League One side Coventry City have been ordered by the Football League to pay their former Ricoh Arena landlords nearly half-a-million pounds, as part of conditions that were set in the wake of the liquidation of one of their group companies last year. Coventry have been told to cough up £471,192 to stadium owners Arena Coventry Limited (ACL) by August 14th 2014, after the amount was disputed by the Sky Blues owners SISU.
The determination is the latest in a long running and very public war between ACL and SISU that has left Coventry City playing 35 miles away at Northampton Town's Sixfields ground. Having gone on a 'rent strike' that saw them pile up £1.3 million worth of money owed to ACL, the liquidation of that company also saw their lease agreement on the stadium terminated, leaving Coventry without a home, and with most Sky Blues fans boycotting the trip down the M1, seeing 'home' gates of under 2,000 during last season.
At first ACL were willing to negotiate a new agreement with SISU, but when the latter started taking legal action against the stadium landlords, all talks were called off, with ACL insisting that they were not prepared to discuss terms with a party that was taking such a course of action. SISU's court hearing - which was an attempt to suggest that Coventry City Council had acted illegally in taking over ACL's own debts - was thrown out, and that just left the Football League's judgement in terms of the funds it expected Coventry City to pay to its unsecured creditors in return for Coventry's 'Golden Share' that gave it Membership of the League to be transferred to a different operating company.
SISU then decided to appeal against that figure, claiming that ACL were already holding £300,000 as a bond guarantee, and that the final costs of liquidating the old Coventry City company had been higher than previously estimated. The Football League have thrown out the part of the appeal that relates to the bond guarantee, but have accepted some of the liquidation costs, reducing the final amount that SISU must pay to ACL to a final total of £471,192.
Assuming SISU don't appeal against this decision, or take further legal action, the closure of this case could pave the way for them to reopen negotiations with ACL over a return to the Ricoh Arena - something the Football League have previously said they would be willing to sanction mid-season provided it is done as a permanent solution, rather than as a yo-yo between Coventry and Northampton. Football League Chief Executive Shaun Harvey recognises the urgency of the situation:
"This has been a complex and unwelcome disagreement within a wider, more significant dispute. By concluding this matter, we can now allow all parties to concentrate on the more important issue of getting Coventry City playing its matches back in Coventry at the earliest opportunity".
Coventry City Chief Executive Tim Fisher has suggested that is also his aim, although still carries the claim that the Sky Blues want to own their own stadium in the long term, and speaks of 'agreeing terms' that are favourable to the football club - which may not be as simple as it sounds, given that was what sparked the original rent strike:
"We know that ACL saw the payment of this money as a barrier to agreeing terms to get the club back to Coventry. We can today put this obstacle behind us and get down to the business of negotiating a return to Ricoh Arena until we can own our own stadium. As we have said all along we want what is best for the long term future success of Coventry City FC. That means our job is to get the club back to Coventry, which is something every single supporter wants to see, whilst ensuring the financial stability of the club. A key element is for us to agree terms that are driven by Financial Fair Play, so that Steven Pressley can invest match day revenues in talent on the pitch."
Coventry City's Sky Blues Trust and the Coventry Evening Telegraph have been loudly campaigning to get the football club back into the city of Coventry, with the latter providing several front page 'splashes' drumming up support, whilst being critical of the club's owners. Jan Mokrzycki, who represents the Supporters Trust, told the paper that this new opportunity to resolve the Ricoh Arena dispute must not be missed:
"We call on (SISU representative) Ms Seppala to make it clear that they will not be throwing more good money after bad by continuing this fruitless and futile process by appealing direct to the Court of Appeal. Not only will further appeals costs thousands more but they will also preclude talks with ACL. ACL have justifiably stated that they will not negotiate with someone who is continuing to take legal action against them, so stop the legal proceedings and get talks started for the good of all Sky Blue supporters, Coventry City and the city of Coventry itself. Coventry City supporters have been continually let down during this long running dispute – this is an opportunity to act positively – don’t let us down again."
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