Legal worries at the Blades

The high court in London has issued a winding-up order against Sheffied United’s former parent company, COH Sports Bidco Ltd, as a result of a dispute between United’s current owners, Steven Rosen and Helmy Eltoukhy, and their predecessor, Prince Abdullah’s United World, which claims it is owed £35m in unpaid fees after the £110m sale of United in December 2024.

The action was initiated after United World accused the current owners of transferring ownership from COH Sports Bidco Ltd to1919 Partners LLC in a bid to avoid paying the amount outstanding on the purchase price.  United World noted, “no defence was filed and the debt of more than £35m was not disputed”, adding that it had made “every effort to resolve this matter amicably”, but received no response.

They concluded, “It appears that Helmy Eltoukhy and Steven Rosen are simply not concerned about this means for the club. What happens to Sheffield United now is the result of their choices.”  For its part, the club issued a fairly bland response, “Sheffield United Football Club is aware of today’s hearing at the high court. This is a matter between the current owners and former owner.”

Such tedious issues would normally be of little interest to most supporters, but in this case there is the very real threat of a 12 point deduction, which would make United’s Championship challenge even more daunting.  On the face of it, this would appear to be a clear breach of the English Football League’s insolvency rules, which would imply a 12-point deduction.  However, it’s a little more nuanced, as it’s the parent company that has been wound-up, as opposed to the club itself.

As a pertinent comparison, Southampton were penalised 10 points by the EFL in 2009, after their parent company went into administration, as it was found that the football club and the parent company were “inextricably linked as one economic entity”.

Of course, this would not be the first time that Sheffield United have suffered a points penalty in recent times, as the EFL deducted two points in April 2024 after they defaulted on a number of payments to other clubs (and that was on Prince Abdullah’s watch).

There is also a legal case in Delaware brought by Tom Page, an English investor and entrepreneur now based in California, who claims that he set up Sheffield United’s latest takeover before being cut out of the final deal.  United’s owners have said that the complaint is “entirely without merit”, but it is another headache that the club could do without.

In addition, a potential ban looms for co-owner Steohen Rosen, due to the EFL rule that any individuals who have been involved in two insolvencies within a 10-year period cannot serve as directors of an English club or exercise any control over one.

This is because Rosen was a director of a US medical manufacturer, Invacare, that filed for bankruptcy in 2023.  This was obliquely referenced by the EFL, “We continue to consider other regulatory matters following changes to the club’s ownership structure and developments within the wider group.”

Finally, there have been reports that the club is considering selling a sizeable minority stake of around 20%, which adds another layer of uncertainty.

No deal has been announced, but Rosen confirmed, “We’re bringing in some new investment partners, which I think many clubs are trying to do.”