Norwich City prepared to sue over false administration claim

PUBLISHED: 11:13 25 January 2010 | UPDATED: 16:56 10 September 2010

Norwich City chairman Alan Bowkett has slammed the report.

Norwich City chairman Alan Bowkett has slammed the report.

David Bale

Norwich City Football Club have written to the publishers of the News of the World calling for an apology and substantial damages after the paper claimed the club could go into administration by Thursday if it cannot find major new investors.

Norwich City Football Club have written to the publishers of the News of the World calling for an apology and substantial damages after the paper claimed the club could go into administration by Thursday if it cannot find major new investors.

The article by Martin Hardy said the Canaries were the latest club teetering on the brink of financial meltdown, and also claimed that financial experts Ernst Young and KPMG had been called in as potential administrators.

The article was also posted on the Sunday paper's website, where it remained accessible to the world at large yesterday afternoon.

The club responded immediately with both chairman Alan Bowkett and chief executive David McNally issuing statements, and a letter was sent by the club's legal representatives, Leathes Prior to News Group Newspapers Ltd, the publishers of the News of the World.

The letter states: “The remarks in the article are untrue and are without any foundation. They are also defamatory. The club is not on the brink of administration, it's not teetering on the brink of financial meltdown or about to go into administration by Thursday.

“Neither Ernst Young or KPMG has been called in as a potential administrator, and the club does not need new investment to stave off administration.”

The letter calls for a full apology in wording to be agreed, to be published in at least as prominent a position in the next edition of the News of the World and on its website, payment of a substantial sum in damages, payment of all costs incurred to date, and an undertaking not to republish the article or repeat its allegations.

Should the paper not satisfy these requirements, the club will start action for defamation.

The letter also calls for the immediate withdrawal of the article from the website and a full response within seven days.

Earlier, Mr Bowkett told canaries.co.uk: “In all my years in working in corporate finance I have never read such tosh and complete fabrication. The News of the World will be hearing from our lawyers and we look forward to claiming substantial damages.”

His comments came soon after the club's chief executive David McNally issued a statement calling the article “completely untrue”. Mr McNally said: “As far as the club is concerned we consider the story is defamatory and accordingly we have placed the matter in the hands of our solicitors, and will be pursuing for damages.”

The article said that despite City crowds averaging around 25,000, the club's 2009 accounts showed a £5m loss.

It also suggested that joint majority shareholder Delia Smith was unlikely to invest any more money after putting about £8m into the club in the past 13 years.

A spokeswoman for the News of the World said it would not be commenting.

The Eastern Daily Press reported earlier this month that Delia Smith said Carrow Road would “absolutely not” be sold to clear the club's debts.

The Canaries had announced they were considering selling the ground after debts hit a record £23m following a £5m loss last season.

On top of that City admitted they faced a £2.9m hole in their finances for the 2010/11 campaign.

Five solutions were suggested to plug the gap including the sale of Carrow Road valued at £34.5m and leasing the ground at a cost of at least £1m per year.

However, Delia Smith is loath to sell the place Norwich City have called home since 1935 to rectify the club's financial problems.

Last week the club announced season ticket prices were going up £1 a game next season.

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