Coventry City owner SISU have agreed to sell a majority 85% stake in the Championship club to local Stratford-based businessman Doug King.
The club say that the deal, subject to English Football League approval, will clear all the Sky Blues’ debts.
Coventry say the club have also made a late bid to buy the CBS Arena.
Arena Coventry Limited, which has run the stadium since it opened in 2005 and is now owned by Wasps, is expected to enter administration on Thursday.
That followed the Premiership rugby union club, who took over as Arena landlords to the Sky Blues in 2014, entering administration themselves on 18 October.
Former Newcastle United owner Mike Ashley’s Frasers Group is regarded as the preferred bidder for ACL.
“We have made it a priority – and one of our first acts as majority owners – to submit a bid to acquire the CBS Arena,” said King.
“We are keen to meet with Coventry City Council representatives and others as soon as possible to set out our vision – which includes the regeneration of the area.”
Administrators are set to officially be appointed at 10:30 GMT on Thursday, with Ashley having agreed a deal to buy the company straight out of administration.
It is a reported £17m deal, including a £1.2m exclusivity payment up front to fund the ongoing operations of the arena.
This is how the stadium stayed open, allowing City to carry on playing home games.
FRP, the CBS Arena advisors expected to be named as administrators on Thursday, said in a statement that only Ashley’s advance payment saved the Coventry stadium from closure.
“Having conducted an accelerated sales process, the ACL board entered into an exclusivity agreement with a preferred bidder on 1 November, which, crucially included the payment of a non-refundable deposit to provide the necessary funding for the arena to continue to trade.
“This was essential as the businesses are insolvent and had run out of cash. No other interested parties were willing to provide the required level of funding as set out in the bidding process, in the necessary timescales.
“Without this, the arena would have been forced to close immediately on 2 November, at which point the businesses would have petitioned for their compulsory liquidation.
“All staff would have been made redundant, and likely resulting in no return at all for any class of creditor.”
Who is Doug King?
Former Loughborough University mathematical engineering graduate King, who has a background in trading grains, non-grain feeds and petroleum, is chief executive of Stratford-upon-Avon-based oilseed processing facility Yelo Enterprises, who have invested more than £70m in the region.
He previously co-founded investment firm RCMA Capital LLP – which has overseen investments of more than $400m (£337m) – and of which he remains majority owner.
“It is no secret that Coventry City has faced challenges in recent years,” said King. “Joy and her team have done an exceptional job to bring the club back to Coventry and deliver on-field success.
“We know fans, and others across the region, want long-term security and the guarantee of playing football in our city. This is critical to our ambition.”
The SISU years in Coventry
London-based hedge fund SISU rescued Coventry from being wound up when they took over the club with 20 minutes to spare in 2007 – but the past 15 years have not always been the smoothest ride.
A long-running row over ground rent twice forced the Sky Blues to seek temporary groundshare homes outside the city, first at Northampton in 2013, later followed by two seasons with Birmingham City before returning to Coventry in 2021.
SISU chief executive Joy Seppala said: “This is a fantastic moment for Coventry City – and the city. I know that Doug has long been an admirer of the Sky Blues.
“He shares our ambition to deliver the most successful football club possible, to climb the football pyramid, and invest both on and off the field.
“The sale of the CBS Arena does provide short-term uncertainty and with Doug on board we intend to set out a robust bid for the stadium which, if successful, will provide a platform for long-term success.”