Simon Jordan explains why next Sheffield Wednesday owner should take extra 15-point deduction
Simon Jordan has offered advice to the next owners of Sheffield Wednesday after the club’s prospective takeover collapsed.
The Owls’ administrators had named a consortium led by James Bord as their preferred bidder on Christmas Eve.
However, it was revealed on Wednesday that the group had withdrawn from proceedings and would not be buying the club.
The consortium had spent over £4million supporting the running of the Championship club since being named the preferred bidder.
Reaction to Wednesday’s collapsed takeover
Jordan reacted to the news of their takeover collapse on talkSPORT during Thursday’s White & Jordan.
The former Crystal Palace chairman explained: “They’ve got a £4million cash cow out of these people, these crypto clowns have spent £4million of their own money to get precisely nowhere.
“So they’ve got a £4million cushion against the backdrop of having another bidder come in.
“The bid was £47.8million, which is absolute madness for what they’re buying, and there is a whole box of tricks underneath the bonnet of costs.
“I actually think, probably, looking at it from a standaway position, that they probably jumped before they were pushed in terms of maybe not getting through compliance.
“They’ve taken the bull by the horns and realised that actually, they might not get through compliance, and it’s cost them £4million.
“It’s given the administrator a £4million cushion. £4million, I mean, what a way to burn cash.
“You’d like to think that they’ve got enough under the bonnet prior to being the preferred bidder, and prior to putting… I’m sorry, £50m for Sheffield Wednesday in the condition that it’s in, is madness.”
Wednesday were placed into administration in October, ending the chaotic reign of former owner Dejphon Chansiri.
As a result, the club were deducted 12 points before a further six-point penalty in December for failing to meet payment obligations.
The Owls were relegated to League One on Sunday following their defeat to Sheffield United in the Steel City derby.
It is the first time in EFL history that a club has been relegated in February.
Several parties remain interested in a potential takeover following the collapse of the consortium’s takeover.
Amongst them are former Newcastle United owner Mike Ashley, although his offer was below the administrators’ valuation.
Meanwhile, Jordan has ruled himself out of making an approach to buy the club.
The 58-year-old has explained why whoever does complete a takeover may consider taking a further points deduction next season, though.
Jordan’s advice to next Owls owners
Asked about source of funding for a possible takeover, he continued: “I don’t think that’s the issue. I think the issue is about a whole raft of other things.
“But the bottom line is they had the means, they proved the funding, they proved the principle of the cash, they’ve gone to the highest bidder, they put £4million which is now gone, they’ve kissed goodbye to £4million.
“And the administrator has other bids in town, and people are going to have to get a bit more realistic about this.
“It’s all well and good suggesting that you want to buy something, that’s why I wouldn’t get in with my guy into a bidding war.
“Do you want this? Go bid for yourselves, go pull your own arm off at the shoulder, you’re not going to me in an auction to pay twice what the price of this business should be bought for.
“Great football club, great potential, it’s going to take a hell of a lot of work, going to get relegated, might even take a 15-point sanction next year if people are sensible and don’t want to pay Chansiri 25p in the pound.
“Then you’ve got six years (of) hard work and hundreds of millions of quid to get it back to where you might want to get it back to, because anyone buying a football club that isn’t a Sheffield Wednesday fan, is buying it as an investment.”
Jordan admitted in November that he believed Wednesday were worth just £30million in their current state.
He added that this would also include the purchase of the club’s stadium, Hillsborough, as well as giving Chansiri ‘as little as possible’.
With relegation to the Championship already confirmed, the Owls host Southampton on Saturday.
What is the '25p in the pound' rule?
Under EFL rules (specifically the Insolvency Policy), the person or group buying the club is given a choice regarding how they pay back the ‘unsecured’ (non-football) creditors:
The 25p Rule: Pay the creditors at least 25p for every £1 owed as an immediate, lump-sum payment upon the transfer of the club’s ‘Golden Share’ (the right to play in the league).
The 35p Alternative: If they can’t pay it all at once, they must pay at least 35p in the pound spread over a maximum of three years.
If a new owner fails to meet these minimum repayment thresholds, the EFL triggers a sporting penalty.
If they don’t meet the 25p/35p rule, they are hit with a further 15-point deduction at the start of the next season.
It follows a midweek defeat at Norwich City in their first outfit since a return to League One was sealed.
Henrik Pedersen’s side sit bottom of the table on -7 points after winning just one of their 34 matches so far this season.
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