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Old 15th August 2007, 09:32   #1
TanyaT
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Default Ridsdale sued for £30m in dispute over loan

Ridsdale sued for £30m in dispute over loan
By David Bond
Telegraph 15/08/2007


The future of Cardiff City was thrown into fresh uncertainty last night after their chairman, Peter Ridsdale, was hit with a £30 million legal action from a Swiss investment company for allegedly breaching a loan agreement.

Ridsdale, who fronted a consortium who bought the Championship side from Sam Hammam in a £6.5 million deal in January, was accused of repeatedly ignoring communications with Langston, who claim to be the club's "principal financial backers".

Using the London law firm Hextalls, they issued a writ against Cardiff in the High Court yesterday and the club now have a month to prepare their defence against the claims, which appear to have taken Ridsdale by surprise.

Last night the former Leeds United chairman, who played a leading role in the spectacular financial collapse at Elland Road, issued a statement in which he denied Langston's claims and insisted that rather than ignoring requests for payment they have been trying for months to identify the fund's backers.

"We are astonished at the press release sent out today appearing to come from someone representing the Langston Corporation," said Ridsdale.

"The new board of Cardiff City Football Club and Cardiff City Council have for some time been trying to identify who Langston is and have continually come up against a brick wall. Far from refusing to talk to them, we don't know who they are.

"Mr Hammam, our previous chairman, had been acting as the intermediary with Langston and we have been in constant dialogue with him.

"Indeed, he has always refused to divulge the identity of Langston and therefore we could have never had any direct dialogue with them."

The dispute centres on a £24 million loan made to Hammam when he was still chairman of the club in 2004, which Ridsdale and his consortium believed had been "written off" when they completed their takeover eight months ago.

Langston insist they are still owed that money, adding that the size of the debt has increased to £30 million because of unpaid interest. Langston say the loan is due to be repaid in 2011.

It is believed that the row also relates to Cardiff's plans to move to a new £100 million stadium to be built on the site of the city's athletics stadium at Leckwith.

"Our client has serious and increasing concerns about the club's present administration and its ability to manage the club's financial affairs," said a statement from Langston's lawyers, Hextalls.

"In the event that the club cannot meet its liabilities to our client, then the alternative is for the current board of directors to resign and our client endorse the appointment of a new board and management.

"The situation has been compounded by the fact that for three months the club's chairman ignored repeated communications regarding the seriousness of the financial situation."

http://www.telegraph.co.uk/sport/mai.../sfnbon115.xml
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