Debt-busting firm behind bid for Southampton

Southampton yesterday named the mystery bidder involved in preliminary takeover talks as Sisu Capital Limited, a hedge fund with headquarters in Mayfair, London, that specialises in the pursuit of debt-laden businesses. Sisu, which has previously failed in attempts to take over Derby County and Manchester City, is being advised by Ray Ranson, the former Manchester City defender, who was also involved in the mooted Derby and City deals, although it is unclear whether he would have any hands-on role at Southampton.

Sisu wants to take control of at least 55 per cent of Southampton, who have debts of £24m and face severe financial difficulties unless new investment is secure before next April. Sources close to the club said yesterday that players might be forced to take 50 per cent pay cuts to keep the club afloat if new backers are not found, and continue the sell-off of player assets. Gareth Bale and Kenwyne Jones were the most recent to go, to Tottenham and Sunderland, to balance the books.

It is understood Sisu would inject about £10m into the club immediately, and raise further funds with a share issue, albeit priced well below the current market value of stock. The deal will almost certainly hinge on the support of two former chairman, Rupert Lowe, who controls 29 per cent, and Michael Wilde, who speaks for 16 per cent.

"Any investment by Sisu would be a long-term commitment driven by its desire to place the company in a position to maximise the club's opportunity of promotion to the Barclays Premier League," said a statement to the Stock Exchange yesterday.

"If Sisu is to make a formal offer to the shareholders of the company, it has stated its desire to do so only with the full support of the board and shareholders of Southampton."

Southampton have been subject to takeover talk for much of the year, with the billionaire Microsoft co-founder, Paul Allen, among those who considered investment. Southampton said yesterday he had made no formal offer.