Administrators tackle Leighton over role in collapse of Leeds

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The Independent Online

Administrators to Leeds United plc have issued letters to the former directors of the collapsed football business as part of an investigation into their conduct when running the company.

The letter, issued under Sections 3 and 4 of the Insolvent Companies Rules 1996 and the Company Directors Disqualification Act 1986, includes a raft of questions about the trading of Leeds in the run-up to its recent administration. A report into directors' conduct is required under UK company law whenever a company goes into administration.

Recipients of the letter include Allan Leighton, the former deputy chairman of Leeds. He is now the chairman of Royal Mail, among several other high profile directorships including British Sky Broadcasting, and Bhs. Other former Leeds directors who have received the letter include Peter Ridsdale, the former chairman during the club's high-spending era who is now chairman of Barnsley football club.

During Mr Ridsdale's tenure the club reached the semi-final of the Champions League in Europe, guided by its manager David O'Leary. However, a subsequent rash of various on and off-field problems led to the company's cash crisis and debt problems. Mr Ridsdale said yesterday that he was "more than happy" to assist and co-operate with the administrator. He said the board "ran things properly and in line with corporate governance".

Professor John McKenzie, who took over as the chairman of Leeds from Mr Ridsdale, has also received the administrator's letter. Professor McKenzie was at the helm when Leeds reported the worst losses in British football history. The club unveiled a £49.5m pre-tax loss last October and the result was compounded by debts of more than £80m.

Trevor Birch, the former Chelsea executive drafted in by the Yorkshire club to be its chief executive after Roman Abramovich, the owner of Chelsea football club, dispensed of his services in south-west London, has also been asked to respond to the letter that includes a long questionnaire probing the company's affairs in the months leading up to administration. Answers to the questionnaire are required by the middle of next month.

Although the plc collapsed into administration, leaving shareholders likely to receive nothing from their investment, the football club itself was recently saved by a consortium of Yorkshire businessmen.

The letter has been sent by Brendan Guilfoyle, of administrators the P&A Partnership which is working alongside the accountants Ernst & Young. Under UK company law, the administrators compiling the report into directors' conduct write to everybody who has been a director within the previous three years.

The collapse of Leeds has been an embarrassing chapter in the careers of several high profile businessmen, tempted into the world of football finance by the glamour of the game at a time when television rights were booming.