Leeds' investors catch fingers in transfer window

Leeds United fans reacted with fury last week to the sale of two star players, Robbie Fowler and Jonathan Wood- gate. The team's manager, Terry Venables, could resign in protest.

But shareholders of the financially troubled club have another cause of discontent: the share price stayed at 4p, almost an all-time low, probably making Leeds the loser in the Uefa transfer window, which closed on Friday.

With debts of £78m and after a dismal performance in the Premier League, the club has had to raise cash and cut its wage bill. The sale of top players may therefore have been a necessity.

But Leeds' much-criticised chairman, Peter Ridsdale, has paid a heavy price. Last year the team parted company with its captain Rio Ferdinand, who was sold to Manchester United for a minimum of £26m. The controversial England midfielder Lee Bowyer was sold recently for peanuts.

Having sold players, Leeds should be able to reduce its debt to £41m, but the team's poor performance on the pitch means that revenues remain under pressure, until the end of next season at least.

"The loser in this transfer window has got to be Leeds, because they appear to be doing forced sales," said David Pope, an analyst at Brewin Dolphin Securities. "But they got a good price for Woodgate, and the [player] sales have alleviated the pressure."

Chelsea, another club under financial pressure, didn't sell a soul, despite debts of £81m, and its league performance has been far better in comparison.

The club's chairman, Ken Bates, appears to be banking on a mysterious deal announ- ced earlier this month, possibly to sell off property or new shares. "If he doesn't get the deal, he should probably sell players," said John Moore at stockbroker Bell Lawrie White.

But selling players is becoming difficult in the current climate. "Transfer fees are not as big as they once were," adds Mr Moore. "In the long term, that is good because player values were unsustainable."

One of the big buyers this January was Newcastle, which took Woodgate and is in confident mood after good performances in the Premier League this season.

Newcastle declared debts of £45m before it spent £5m on defender Titus Bramble and another £9m on Woodgate. This has put pressure on the club to get into the Champions League next season.

Among smaller clubs there is a trend to take players on loan rather than gambling on permanent contracts. Roughly half this January's deals were on loan, an unusually high level. This was the method used by Birmingham City to acquire three new players, although it also forked out over £4m for three more.

The collapse of relegated clubs such as Crystal Palace and Bradford City shows the cost of betting the farm on staying in the top division. Football has become more conservative.