The plc chairman, Sir Rodney Walker, stormed out of a meeting on Friday after coming under attack from the plc chief executive, Barrie Pierpoint. The football club chairman, John Elsom, also walked out of the meeting after being criticised by the stadium development chairman, Roy Walker.
Last night O'Neill was quoted as saying: "This is a really serious matter, one of grave concern to me and the club. That is made clear by the fact that someone of Sir Rodney's standing both in sport and in society actually stormed out of a meeting. I am very concerned.
"I thought it was an inappropriate time for a meeting - I had to attend at 6pm on a Friday when I was trying to prepare for a game the next day."
The latest upheaval follows the ticket furore surrounding last season's Worthington Cup final against Tottenham. Friday's meeting was arranged to discuss the lack of communication between the commercial and playing sides of the club that led to 27 players and backroom staff being charged by the Football Association last month.
Sir Rodney said: "The divisions within the club are long-standing and deep-rooted. I consider it a personal disappointment that I have not been able to bring the parties together. I may only have a short time left at the club, and I now have to decide what information to share with the fans, the shareholders and the media."
Sir Rodney admitted he left Friday's meeting after being criticised by Pierpoint. "The chief executive made a statement about me personally which I found totally unacceptable," he said. "I collected my papers and left."
Last night Pierpoint said: "Like most boards, there are from time to time disagreements between directors, but it is this club's policy that such discussions remain private and confidential.
"It is not in the interests of shareholders, supporters, staff and especially the morale of the team to air these discussions in public. I shall be seeking an emergency meeting of the board of directors at the earliest possible convenience at which the directors will attempt to resolve these issues in private."
Watford have broken their transfer record by signing the 23-year-old Dutch striker Nordin Wooter from Real Zaragoza for pounds 950,000. His arrival almost doubles the previous club record of pounds 550,000, which was paid to Milan in 1984 to re-sign Luther Blissett.
Wooter has been capped by the Netherlands at both Under-18 and Under- 21 level. The Hornets cannot field him in tonight's Worthington Cup tie against Wigan, but they hope to receive international clearance in time to include the former Ajax player for the visit of Chelsea on Saturday.
The Aston Villa goalkeeper David James will be out of action for around a fortnight with the knee injury suffered during Saturday's 3-1 Premiership defeat at Arsenal. His understudy, the Finn Peter Enckelman, will make his full debut in tonight's Worthington Cup second-round first leg at Chester City.
The 22-year-old Enckelman, a pounds 200,000 capture from TPS Turku eight months ago, looks to have edged ahead of the former England Under-21 player Michael Oakes as Villa's second-choice keeper.
Michael Owen starts his first Liverpool match for five months tonight. The England striker will play in the Worthington Cup tie at Hull in front of Sky Sports cameras and what is expected to be a 13,000 full house at Boothferry Park.
It will be Owen's first full match since he suffered a hamstring injury at Leeds in April. "Maybe things like injuries tell you how many games you have played," he said. "Your body can't go on for ever and if that's a way of saying you need a break then that's what it has done."Reuse content