Ruling opens door to sale of Newcastle United

Oct 3 2009 by Stuart Rayner, The Journal

YESTERDAY’S Premier League tribunal ruling removed another obstacle to the proposed sale of Newcastle United.

A three-man panel further discredited owner Mike Ashley’s already unpopular regime, but imposed only a £2m punishment for constructively dismissing former manager Kevin Keegan. That was good news for would-be buyer Barry Moat, who had been bracing himself for the possibility of a much bigger addition to the debts of Newcastle – who face Bristol City at St James’s Park today.

Ashley has been trying to sell the Magpies since May, with Moat heading the queue of suitors.

But negotiations were put on hold while Keegan’s claim was resolved by the Premier League Manager’s Arbitration Tribunal. The details made public yesterday at the request of both parties make it obvious why.

In total the two-time former Magpies manager was asking for over £27m to cover the compensation he was contractually entitled to, future earnings and “stigma damages” for the effect his departure would have on his post-Newcastle career.

But the tribunal decided he was entitled only to the first of these, a £2m payment plus the interest since it was due, just over a year ago. When a £25m compensation figure was first floated in the media it was amid reports that the financial burden could push the club into administration.

That was quickly denied by managing director Derek Llambias, although his reputation will be tainted as a result of the tribunal’s damning verdict on Newcastle’s dishonesty, in which he was name-checked.

What is beyond question, however, is that had Keegan received anywhere near the figure he was asking for, it would have had serious implications for a club working hard to cut its debts after relegation from the Premier League last season.