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Coventry City FC enter liquidation 2 August 2013

Coventry City Football Club Ltd has gone into liquidation, following the rejection of a Corporate Voluntary Agreement by stadium owners Arena Coventry Limited (ACL) today (2 August).

On the eve of the new football league season, a meeting of creditors in London lasted just 10 minutes as ACL rejected administrator Paul Appleton’s CVA proposal to exit administration.

A statement from Coventry City FC said: “It is with great regret that a proposed Company Voluntary Agreement (CVA) has been rejected by Arena Coventry Limited (ACL).

“It means CCFC Ltd is likely to be put into liquidation which is expected to result in a points penalty for the club going into the new season.

“The football club and the Alan Higgs Centre Trust accepted the administrator’s CVA, but the City Council, through ACL, have chosen to reject it – leading to possible liquidation and the risk of a 15-point deduction.

“The club will hold urgent meetings with the Football League this afternoon to go through the next steps for the football club.”

Appleton, managing partner at David Rubin & Partners LLP, is expected to be appointed club liquidator.

Coventry City will still start the new season tomorrow, although a 15-point penalty could be imposed by the Football Association for entering liquidation. The club was also handed a 10 point deduction last season for entering administration.

ACL’s rejection of the CVA, which would have brought the club out of administration, means ACL will not get a £590,000 return on the Sky Blues rent debt.

The club entered administration in March but have been embroiled in disagreement with ACL, owners of the Ricoh Arena where the club play, since last year.

Following the dispute, the club agreed a groundshare deal with Northampton Town FC, to play at the Sixfields Stadium for the next three seasons.

In June, Coventry City was sold to Otium Entertainment Group, but remained in administration until a CVA could be agreed by all parties.

 

 

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