Posted on Thursday August 16, 2018
The new football league season is underway and whilst everyone associated with Sheffield United has been focusing on their second season back at Championship level, behind the scenes a legal dispute between the club’s owners is threatening to cause havoc.
Since 2013, the club has been owned equally by Kevin McCabe and family and Saudi Arabian businessman Prince Abdullah.
Prince Abdullah paid £1 and invested £10 million into the then league 1 club in return for a 50 per cent stake, while McCabe kept the other half and full ownership of properties, including the stadium and training ground. Everything was great at first.
However, Prince Abdullah’s other commitments started to draw his focus and whilst he continued to play a key role in decisions he was rarely spotted at the club, prompting the working relationship to turn sour.
McCabe decided to end the partnership even if it resulted in ending his family’s long association with the club.
He offered to buy the prince’s 50 per cent share for a deliberately low price of £5 million, aware that this would trigger a clause in the original deal meaning the prince had to accept the offer or counter at the same price.
If the counteroffer was made it was bound to result in a sale. However, if the prince bought McCabe’s share for £5 million it would trigger another clause where one party owning 75 per cent of the club would be obliged to buy the properties owned by McCabe at market value.
Prince Abdullah served his intention to buy but not until two days after moving 80 per cent of his shares to a new company called Up the Blades (UTB). By parking shares in UTB, he could take full control without breaking through the 75 per cent barrier with one company thus avoiding the obligation.
McCabe realised this and refused to sign off the shares, which led to Prince Abdullah launching legal proceedings for breaking the terms of the agreement, McCabe responded with counterclaims.
They headed for the courtroom for an initial hearing this summer and following a number offers and counter-offers they reached an impasse. The club has been forced to sell players to cover costs and stay solvent.
With a court date months away it promises to be a testing season for the Blades with the power struggle likely to drag on for some time.