West Ham Unable To Hold Off Consortium Of Banks

Following a turbulent few months for the Premier League club, West Ham United has been unable to stop a consortium of banks from seizing the club’s assets from cash-strapped Icelandic owner Bjorgolfur Gudmundsson.

With the fallen investment bank Straumur, which had provided the majority of the funds for Gudmundsson to buy up the team in 2006, now nationalised by the Icelandic government, the owner’s ability to hang on to the club has been in doubt.

Although the Icelandic courts granted Gudmundsson a moratorium on his debts until June, Straumur’s banking creditors are looking to take advantage of covenants on the debt that allow for the club to change hands.

Media reports have speculated that the West Ham owner may admit defeat and step aside for these banks to take over.

If this happens, as many as six banks, nominated by more than 40 of Straumur’s ¬creditors, could take charge of West Ham and hold on to it through until the end of the 2010-2011 season.

Additionally, West Ham remains up for sale, with all interested parties apparently willing to wait it out until the issue of debt settles and Iceland’s economy heals.

With both the consortium on the horizon and the absence of a buyer, West Ham fans and players are left looking toward a shaky future. Manager Gianfranco Zola will receive no new investment to buy players and there will likely be added cutbacks this summer.

With six league games left, the club has held its own, despite the drama it has felt off the pitch. But uncertainty remains for all those involved in West Ham, especially if and when the consortium bumps Gudmundsson to the side.