Ken Bates: Time up!

It would seem the writing is on the wall for Ken Bates and his tenure at Elland Road is about to come to an end.  Here we take a look back at his time at Elland Road.  His love/hate relationship with his associates and why his time will end in bitterness with most fans, but perhaps with a twist in the tail!

It was in January 2005 when Ken Bates first arrived at Elland Road.  Leeds United, having been relegated from the Premiership and heavily in debt had been through a string of chairmen, consortiums and rescuers.  The Krasner consortium had done all they could to reduce the financial liabilities, but to put it quite simply, the money had run out.  Football Club income is not consistent, with large amounts of income generated through season ticket sales and the consortium, having invested their own money, now faced the very real prospect of HMRC closing on their debt and forcing the club into liquidation.

The debts totally a reported £17.7 million, substantially less than the £130m debt left behind by Ridsdale, but without the lucrative Premiership income, and with all avenues exhausted, there were very few options available.

Ken Bates is on record as saying that he ‘saved Leeds United’ and without him there would be no club.  A fact that many fans took as gospel and forgave him many sins in the early part of his time in charge at the club for this reason.  The reality is quite different.  It is more than likely that Krasner and co. would have sought the protection of Administration.  That other buyers would have come forward (there was rumoured to be four other interested parties waiting for the club to be placed into Administration at the time), that Leeds would have received a point deduction, exited administration with a clean start and moved forward with zero debt, although anyone watching the recent shenanigans at Glasgow Rangers will appreciate that nothing is ever guaranteed when courts, debts and football authorities become involved.

Did he save Leeds United?  No-one knows, including Ken Bates.

Bates did rescue the club though.  He avoided administration and kept us playing football, which was all the fans wanted and many can be forgiven for believing we had turned the corner and could look forward to a healthier future.  It must be remembered that Bates never got us into debt , but seemed prepared to get us out of it.

We were in it together though and Bates expected the fans to play their part – If we wanted Premiership football, we’d have to pay Premiership prices!

Bates set about restructuring the club, closing the shops, making long term employees redundant, yet somehow in it all, he managed to take on more debt through mysterious offshore investment companies and even opened up a radio station. It hindsight, it is fair to say a lot more attention was being paid to the accounts and structure that was been given to what was happening on the pitch.

Success did not come on the pitch though and when results did not come, Bates was quick to dispense of the services of manger, Kevin Blackwell, to be replaced by surrogate son, Dennis Wise.  That’s when things really started going bad.  Wise was unable to turn around results and Leeds headed down the table.  For the first time in our history, a spell in League 1 (which we all know is actually Division 3) seemed a real possibility. 

Meanwhile, in the background, it seemed our financial situation was somehow getting worse!  Having inherited a £17.7m just over a year earlier, our new debts with the obscure offshore companies saw our liabilities raised to £33m – and as the season drew to a close, and it became clear Leeds would be relegated, Bates called in the administrators. 

At the end of the 2006/07 season, Leeds United were relegated to the First Division for the first time in their history and found themselves in administration, and faced a summer of one of the most bitterly fought financial deals the football world had even seen.

KPMG announced debts of £38m but three specific creditors appeared that to the best of anyone’s knowledge, had no prior involvement in Leeds United until Bates  took over in Jan 2006.  These were Astor, Krato Trust and Forward Sports Fund.  These three companies were based offshore, who owned then was unclear and they had claims of around £18m in Leeds United.  Perhaps most surprising though was the fact that Astor were very quick to say they would not back anyone in a CVA other than Ken Bates.  As the Football League required a 75% majority, and Astor had around a third of the vote, they could effectively block anyone else from bidding to take control of Leeds during this process.   We leave it to the reader to decide if the process was being manipulated and how morally correct those involved were, but it worked for Bates.  He was able to offer just 1p in the pound to purchase Leeds – and the CVA was approved by 75.1%, despite others offering more.

Perhaps the turning point in terms of tolerance for many fans was the infamous quote from Ken Bates, telling creditors to back him, or there would be no Leeds United.  Had he manipulated the accounts, the fans, the Administrators and the FA?  Ken Bates was never very popular, but the way the administration process ran, turned even more against him and even led to a question raised in  Parliament.

HMRC were so infuriated, they eventually lodged a complaint about the process, centred around the fact that Yorkshire Radio, the station Ken Bates had set up, was being considered as a creditor.  The court case prevented the Administration process to complete and prevented the League from granting the golden share (the rights to play in the league) back to Leeds.

With no right to play, no chance of the court process completing by the start of the season and therefore Leeds very likely to go out of business, the Administrators had no option but to sell us to the highest bidder, with no guarantee of the ‘Golden Share’ – a sealed bid process started and once again, Bates was successful, despite again offing one of the lowest amounts, due largely to the fact that Astor were prepared to waive their right to their share of the debt for Bates.

Back in control, Bates set about getting the Golden Share from the League to play football.  It was unprecedented to exit admin with no CVA in place and the Football League had to decide how to proceed.  The result was a return of the golden share but a further -15 point deduction,  a decision voted on by all other clubs, which was considered bizarre given many of them could benefit.

Although we were back playing football, the fallout from the whole administration process carried on with vigour.  Leeds Utd continued to dominate the front pages rather than the back pages although on the field, the fifteen point deduction gave the team and the fans a joint sense of purpose and the motivation to charge forward.  In the background, the club started legal proceedings against the League but for the first time, there was a sense that we were all in it together and under Wise and Poyet, the results started to come, and we started to climb the league.

Mid-Season, as the results started to dry up, Wise announced he was leaving to join Newcastle, paving the way for the return of Gary McAllister.   The results picked up and Leeds United would have been promoted if we had not been deduction 15 points.  The Appeal from Leeds was subsequently rejected, and dismissed quickly apparently when it was revealed we had happily signed away our rights to appeal when accepting the points.

Starting our second season in League 1, the fans were still expected to pay Premiership prices but it was starting to become clearer that we were not investing heavily on the pitch.  Despite our attendance and prices, good players were being sold and the money not reinvested.  Macca had an indifferent start and as we got to the Christmas transfer window, there was a promise of good signings and quality players arriving, followed swiftly by a sacking, a period of temporary managers before finally Simon Grayson was appointed – just as the window closed. 

The season ended with a play-off, but we lost and started a third year in League 1 – and still no substantial investment.

It was around this time that our rights to repurchase our training complex, Thorpe Arch, also expired.  The land, with a reported value of £12m could be repurchased by Leeds United for £5m, but Leeds United were unable to find the funds and no use the site as tenants only.  Thorpe Arch was our gem.  A unique training complex of the highest standard – but it slipped through our fingers.  Bates somehow try to blame the council but papers released since have revealed that Leeds were often unhelpful in trying the get the deal completed.  A false front perhaps.

Grayson brought the success demanded, achieving promotion to the Championship, but again, with little investment and the following summer, when fans expected the club to push on and build on the success, the club yet again maximised its efficiencies in the free transfer and loan market.

Off the field, Bates was being dragged into Court by former director, Melvyn Levi.  Bates had used the clubs programs and radio shows to publically criticise Levi, even publishing his address and telling Leeds fans he was damaging the club. Bates lost and received substantial costs, perhaps as high as £1m.  Money that could have been spent on football was going on court cases.

When money wasn’t being spent on the court case, it was invested in Elland Road, with new places for hotels, a shopping complex.  New bars and lately, new executive boxes have appeared, at a time the fans were desperate for money to be spent on the pitch.

Grayson didn’t achieve promotion, and towards the end of last season, he was replaced by Neil Warnock.  Bates meanwhile has been back in court with Levi again, and more costs, and plans continue to improve Elland Road for Banqueting and Retail purposes.

Leeds fans have fallen out of love with Ken Bates over the past seven years, and whilst there are a few die hard supporters who believe the club would not be here without him.  When and where they fell out of love differs.  Some never took to him with his Chelsea connection, others found the admin process too much to take.  The frequent change of managers, the court cases, the lack of playing funds, the building work – there are many points in his history that have tipped the fans over the edge but as we look forward to the start of the season, there is broad agreement that it is the time for change.  Patience has worn out and many will be glad to see the back of him.

Perhaps the biggest shame is that Ken Bates and Leeds United had the making of being a great fit.  Everyone hates Leeds, everyone hates Ken Bates and together, we could have become a force to be reckoned with.  Sadly, Ken Bates never treated the fans with the respect they deserve.  There has been so much secrecy, so much spin on the stories, so many decisions that the fans were not consulted on (and if he had, he’d have realised he’d get zero support) and so little emphasis based on delivering on field success.

Off the field, we are said to be in the strong financial position and for that many are grateful.  With our ticket prices, player  sales, TV money and the rest, we estimate that Ken Bates has had in excess of £150m income over the past seven years, and with very low running costs, it isn’t that hard to produce a financially sound business. In fact, we are surpirsed there is not more money left over in the bank!

As we end appears to near, we might soon be in a position to look back on the ‘Ken Bates Period’ – there have been highs – a couple of great games again Premiership teams in the cup, our -15 season, promotion to the Championship, but there have been many more lows. 

The Bates legacy though will not be football success, or even hotels and exec. Boxes.  The legacy will be based on who comes in.  If Bates finds us a mega-rich buyer, then many sins will be gone and forgotten.  Some may even forgive him everything and say it was all worth it. They say in football you are only as good as your last game – finding and securing a buyer for Leeds United is Ken Bates’ last game – let’s hope it’s a good one.