The sports minister, Nigel Adams, has agreed to ask the English Football League to extend Friday’s 11:59pm deadline for the expulsion of Bury, following a request by the Bury North MP James Frith.
The EFL’s executive chair, Debbie Jevans, said on Thursday the deadline would be extended only if there is a “tangible” reason such as realistic takeover negotiations and even then only by a day or two. Steve Dale, who bought the indebted and overspending club for £1 in December, has failed to satisfy the EFL he has the funds to pay Bury’s debts and the £1.5m running costs for the season. Jevans said he must do so by the deadline or be in serious, “deep” talks to sell the club, otherwise Bury will be expelled.
Given Friday’s midnight deadline, the EFL board is expected to meet by telephone on Saturday morning if the deadline is not extended to consider Dale’s response and if it is deemed inadequate the club could be expelled after 125 years of Football League membership.
Jevans said that after the Bury crisis has been dealt with, the EFL’s review of its “fit and proper person” ownership rules and governance will examine how it came to happen, “and make sure it didn’t happen again”.
Frith, who wrote to Jevans on Monday pleading for an extension to save the club, said there were “interested parties preparing credible bids” and he asked Adams to intervene with the league. Jevans confirmed the EFL had put one such group in touch with Dale but Dale told the Guardian that discussions with that group had not moved further than requests for information and that negotiations with the former Port Vale owner Norman Smurthwaite had not resulted in any agreement.
Dale did not say how he was planning to satisfy the league by the deadline with the evidence it requires of his funding and thereby avoid the expulsion of the club, a prospect causing deep distress to lifelong supporters and the small Greater Manchester town.
Referring to the possibility of extending the deadline, Jevans said: “There has to be a tangible reason for a delay and a conversation [between Dale and a possible purchaser] would have to be very deep for that to happen.”
Even that could only be short, she said, given Bury’s first five League One matches have been suspended by the EFL because of its questions over Dale’s funding and would need to be replayed. The league cannot sanction excessive fixture congestion later in the season.
“It would be a very short delay – 24, maybe 48 hours,” Jevans said. “We can’t keep postponing matches. If there is a potential purchaser they would have to give us something tangible but time is running out and a long delay isn’t possible or practical, however much one wants this club to survive, however much there is empathy for the fans.”
Jevans said she would be “absolutely devastated” if Bury were expelled on these grounds but said: “If that does happen, I will also know the board has done everything.”
Devastated Bury supporters will, however, have some very challenging questions for the EFL and its processes if the club are dealt so dire a blow due to the actions of a £1 buyer in sole charge for nine months.
Dale agreed the Bury takeover rapidly in December with the former owner Stewart Day, a property developer who was facing several of his companies falling into multimillion-pound insolvencies leaving scores of investors unpaid. Dale said he had become involved in the football club for “philanthropic” reasons after suffering from illness but many Bury supporters were immediately concerned that his business record appeared to consist largely of buying failing companies, selling their assets and seeing them liquidated or dissolved.
The EFL then confirmed that although Dale passed its “owners and directors test” because he has no criminal convictions, he never provided proof of his “source and sufficiency of funding”, which league rules require of prospective owners before a takeover, or within 10 days afterwards.
Dale then formed two separate companies, one of which, Bury Heritage, was used to take ownership of the club’s historic trophies and memorabilia; Dale publicly denied this was “asset stripping”, saying it was for safekeeping, because “debt collectors” were seeking to seize them. The company voluntary arrangement passed in July, which promises to pay £4m of “non-football” creditors a quarter of what they are owed, stated that Dale’s company had paid for the trophies following an independent valuation. He formed the other company, Bury Leisure, to take ownership of the ground; Dale said his intention was to pay off a £3.2m mortgage on Gigg Lane, then have the club reimburse him by paying rent. That transfer has not happened and the mortgage taken out in stages by Day with Capital Bridging Finance Solutions remains in place.
In May last season’s promotion-winning squad revealed they had not been paid since February and called on Dale to go, then several club staff were sacked by a letter telling them the club was insolvent.
Although some payment has since been made to players and the Professional Footballers’ Association has provided loans for part of the players’ wages, Bury’s captain, Stephen Dawson, voiced extraordinary criticism of Dale during an interview on TalkSport last week, calling Dale a liar and accusing him of not having the necessary money. Following that on-air exchange the club secretary Jill Neville, mother of Gary, Phil and Tracey and wife of the club’s late commercial director Neville Neville, handed her resignation to Dale, after 35 years’ service.
Dale himself submitted a claim to the CVA process that the club owed him £3.86m, which was understood to be loans made by Day which had been assigned to Dale. The administrator of Mederco, one of Day’s insolvent property companies, then claimed it had loaned Bury more than £7m during Day’s five-year tenure. The administrator then sold that debt for a hundredth of its value, £70,000, to a newly formed company, RCR Holdings, based in Chadderton, Oldham. RCR and Dale wielded the crucial weight of their debts to vote through the CVA, which was opposed by HMRC, who were owed £1.1m in unpaid taxes, and several other creditors.
In his letter to Jevans, Frith called for an investigation into that deal, claiming it “raises serious questions as to the relationship between Mederco (and their administrators), RCR Holdings and the current owners [Steve Dale],” and suggested he may use parliamentary privilege to talk about it in the House of Commons.
Dale told the Guardian that RCR Holdings is looking for 25% of its £7m – £1.75m – in the CVA, although the minutes of the creditors’ meeting suggest the company’s representative said it was not seeking a return if “an increase in funds [for the CVA] be required.”
Dale therefore puts the total due to non-football creditors under the CVA as around £3.2m; Jevans, who was referring to the figure before the RCR claim, said it is around £1.2m. Dale must either show the EFL evidence that he has that money, and £1m for the former players and other “football creditors,” and £1.5m for the season, or a prospective purchaser must pay him his asking price for the club – or Bury football club faces extinction after 134 years.
