BusinessBusiness RecoveryLeeds United enters League without a CVA

Leeds United enters League without a CVA

Despite a lack of CVA, Leeds United is allowed to enter the Football League - albeit with a 15-point penalty

Leeds United has been given permission to play in Football League One despite
failing to enter into a company voluntary arrangement, as was required by the
league.

Adminstrators to the club, from KPMG, will liquidate the old Leeds business
and agree payments to its creditors. The

Football League
has agreed to transfer rights to enter the
league to the new Leeds company, however, with a 15-point penalty.

The league had insisted that Leeds should enter into a CVA, according to its
insolvency regulations, before the club could take part in the upcoming season.

But, in ‘exceptional circumstance’, it has let the club play despite a lack
of CVA.

The league, in following its priorities of the club continuing to exist, the
payment of football creditors in full and the best possible return for other
creditors has always insisted this is undertaken through a CVA.

But it acknowledged that in this situation a CVA was not possible.

‘This applies only in exceptional circumstances and is at the absolute
discretion of the board,’ said the league in a statement.

The club has appealed the penalty.

Further reading:

Administration is tactical victory
for relegated clubs

Premiership League FDs to increase
overdrafts

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