Bahrain company leads takeover of Leeds

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DUBAI, United Arab Emirates (AP) -A Bahrain investment firm has signed an agreement to oversee the takeover of fallen English football club Leeds.

GFH Capital Limited, a 100 percent subsidiary of Gulf Finance House, said on Thursday it signed an exclusive agreement to "lead and arrange" the acquisition of Leeds.

The club has fallen on hard times since almost collapsing in 2001 after overspending to reach the Champions League semifinals. Once a powerhouse in the topflight, the club is 12th in the second-tier League Championship.

GFH did not provide any further details about its plans. It was unclear if GFH was purchasing the club for itself or on behalf of investors.

GFH is a Bahrain-based investment bank that operates in accordance with Islamic financial principles, which generally prohibit the charging of interest and bar investments that run contrary to the faith. Most of its ownership is traded on regional stock exchanges, though a number of public and private Gulf-based investors also own stakes in the company.

Like many Gulf firms that borrowed heavily as they expanded last decade, GFH faced financial challenges when the global financial crisis rocked the region. It completed the process of reworking the terms of a $45 million debt in July.

Gulf investors have increasingly put their money into European football clubs, with billions of dollars being poured into Manchester City by its Abu Dhabi-based owner Sheik Mansour bin Zayed bin Sultan Al Nahyan, and most recently the takeover of Paris Saint-Germain by a Qatari government-linked investment fund.

However, not all bids have gone well.

Bahrain-based investment firm Western Gulf Advisory made a bid for Blackburn before dropping out of contention while a bid by Dubai investors to buy Spanish club Getafe unraveled after the checks received by the club failed to clear. Several people claiming to represent the Dubai investors have been arrested.

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Adam Schreck in Dubai contributed to this report.

Copyright 2014 by STATS LLC and The Associated Press. Any commercial use or distribution without the express written consent of STATS LLC and The Associated Press is strictly prohibited.
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