West Brom takeover news: Likely answer for unpaid Guochuan Lai loans emerges at The Hawthorns
The prospective buyers of West Brom look set to assume responsibility for returning the money to the club which Guochuan Lai hasn’t paid back, according to Steve Madeley.
The Athletic journalist reported via the outlet’s website on 15 January that it was now “likely” that the current majority shareholder would see the issue taken off his hands with the takeover heading for a conclusion in the next few months.
Lai has missed multiple deadlines to return both £5million leant to his company Wisdom Smart, as well as the £3.7m leant to the club’s holding company under Jeremy Peace which was inherited by the Chinese businessman, along with interest.
The Wisdom Smart money was “impaired” by auditors in the club’s most recent accounts, suggesting it was unlikely to be paid back, but with movement towards a buy-out of Lai’s shareholding the winning bid is now tipped to take on making the club whole, as well as paying off substantial debts.
In the past week Shilen Patel has emerged as the preferred bidder and frontrunner to take control of West Brom, with the American also thought to have the backing of MSD Holdings who have leant the club £27m in the past 13 months.
Handy for some
The missing money has been the source of no little frustration among Baggies fans and the prospect of Lai essentially having it paid back for him likely won’t satisfy many.
But in terms of the club’s financial health and accounts it would be a much-needed solution if Patel, or another bidder, puts that money back in.
Madeley’s story paints Lai as more of a naive figure than a malevolent one but either way his time at West Brom has not been a success for the club, or seemingly for him either.
He is set to make a significant loss on the long-awaited sale, having apparently overpaid originally in paying around £190m and seen the club head south in the years since, to the point where a £60m deal will only value the Albion at around £35m [Telegraph, 12 January].
But the financial hit would be that much greater if the money he had promised to repay but never has were also coming out of his pocket.
If the buyer is obliged to cover those costs then it is tempting to conclude that there are ultimately no winners from the situation, but it does at least appear a line should soon be drawn under the whole episode.
In other West Brom, the Baggies could be the ideal opportunity for a Hawthorns-linked forward target to get his career back on track this month.