Source: Daily_Mail
£100m Hammer horror: Sullivan and Gold vow to dig West Ham out of mess
The staggering financial mismanagement of West Ham by their former Icelandic owners has been laid bare by new chairman David Sullivan after he revealed the club are £110million in the red.Lifelong Hammers fans Sullivan and business partner David Gold were at Upton Park yesterday to officially take control after purchasing of 50 per cent of the club from CB Holding for £50m, and Sullivan moved quickly to condemn the regime of Bjorgolfur Gudmundsson and Eggert Magnusson.He said: 'We would not buy this club at all if this wasn't West Ham. We bought this as supporters, not from a business point of view. It makes no commercial sense for anyone to buy this club. We've paid down some of the debt and injected some working capital, but there's still more than £100m of debt.'In that, there's £50m owed to banks, there's £40m owed to other clubs. In addition there's the club's settlement to (former manager) Alan Curbishley, so the real debt is about £110m. Happy Hammers: David Gold and David Sullivan at Upton Park'The Icelandic owners built up a business formula that did not work. So have Man City and Chelsea, but if you have an owner that is prepared to subsidise the club for £50m or £60m a year then it is not negligence. Clearly, Magnusson, or Mr Egghead, thought that the owner (Gudmundsson) would subsidise the club.'The task facing the new owners has been made all the more difficult after CB Holding chief executive Scott Duxbury was forced to borrow against the club's future income just to keep it afloat as a result of the mess that Gudmundsson and Magnusson left behind.VIDEO: Sullivan and Gold reveal huge debts.xxxxxxxxxxxxxxxxxxxThe collapse of Gudmundsson's business empire meant he was no longer able to fund the lavish spending which was the hallmark of Magnusson's spell as chairman. But despite jeopardising West Ham's future, Sullivan revealed that, Magnusson had contacted him about a return to the club.'Magnusson phoned us up six weeks ago and said that he would like to be involved again,' said the former Birmingham co-owner. 'I don't know what the man is thinking. Why do we need him and what would the fans think?'If we popped up and said that this is our new chief executive, they (the fans) would go mad.' Cloud cuckoo land: Magnusson sanctioned the signing of the lesser seen Freddie Ljungberg for £3millionSullivan and Gold have appointed former Birmingham chief executive Karren Brady as vice-chairman and will pay her out of their own pockets. Putting the club back on an even keel will not be easy given the emergency measures CB Holding, whose major stakeholder is stricken Icelandic Bank Straumur, had to take.'There's not a penny to come in, they (the previous owners) have borrowed against the next two years of season-ticket money,' said Sullivan. 'The sponsors have paid 70 per cent of their three-years up front.'The accounts will come out shortly and I'm sure they will show another £40m or £50m loss. It was £38m the previous year. Every stone you turn is a negative to the cash flow and viability of the club. They (the previous owners) have done a fantastic job of keeping the club alive, but the cost is we are taking over an incredibly bad situation. However, we will sort it out.'Part of that rescue plan will be to entice wealthy fans to purchase a chunk of CB Holding's remaining 50 per cent stake, although Sullivan has an option to buy them out any time in the next four years.And Sullivan revealed he will be talking to rival bidder and fellowsupporter Tony Fernandes, the Malaysian businessman, to ascertainwhether he wants to come on board.He said: 'The debts are solarge that most Englishmen can't carry them, so we'd like to share themwith others and help take West Ham to the next level. I'd like to havefour or five club supporters with lots of money to come in.'Ourpreferred option is that we find other people who want five or 10 percent and we will go to Tony Fernandes, who was one of the othersinterested in buying the club. We will raise more money and, with otherpeople, we'll dig the club out of the mess it is in.' There is little prospect of rival bidder, Cagliari president Massimo Cellino, wanting to be involved after he slammed the decision to sell to Sullivan and Gold, saying: 'We shouldn't be ashamed of our country, which is so maligned abroad, considering how they handle things here. I found things a lot less clean than (in Italy).'I'm not just disappointed. I'm amazed. I've never seen anything like it in all my years in football. It was all ready, I had everything stipulated to buy 100 per cent of the club and when I arrived in London today I learned they'd decided to sell to persons who had been negotiating for eight months and then only took 50 per cent. I was prepared to pay off the debts and I was ready to make major signings. I think England didn't want me.'As well as seeking more investment, the new co-owners are keen to pursue the possibility of renting the Olympic Stadium once the 2012 London Games are over and, in the meantime, have not ruled out selling the naming rights to Upton Park.Sullivan said: 'If we go to the Olympic Stadium we're at a different ground anyway. I think the fans would support anything which brings in money to buy players.' THE BIG THREE NOW AT THE UPTON PARK HELMDAVID SULLIVANSullivan, 60, is worth an estimated £600m, most of which he has made through property developing. But he is better known for his 40-year career in the pornography industry, producing magazines and films. He was the previous owner of Birmingham City.DAVID GOLDGold, 73, was Sullivan's chairman at Birmingham and also made money through owning a pornographic magazine. But Gold earned most of his cash through Gold Group International, the parent company for Ann Summers and lingerie shop Knickerbox.KARREN BRADYBrady is best known for being the first woman to hold a managing director post at a football club, taking on the role at Birmingham in 1993 when she was just 23. The 40-year-old, who was born in Edmonton in London, is married to former Birmingham striker Paul Peschisolido, with whom she has two children. David Sullivan and David Gold complete £105million takeover at West HamDavid Sullivan completes West Ham takeover deal: Full statementDavid Sullivan reveals staggering debts at West Ham after completing £105m takeover with David Gold WEST HAM UNITED FC