Sheffield Wednesday reject Club 9 investment offer
Sheffield Wednesday have rejected Club 9 Sports' offer to invest in the relegated Championship club.
The Chicago-based sports investment firm have had an initial £2m offer for a 40% stake rejected by the Owls board.
BBC Radio Sheffield understands that the group's offer was reduced after one of their backers, Andell Holdings, withdrew their financial support.
Wednesday claim that Club 9 would have also charged £420,000 per year in management fees.
A statement on the club's website read: "The communication this week made it clear that Club 9 wanted to change the terms already agreed.
"The proposal was for an initial £2m investment. After expenses this would equate to no more than £1.6m.
"For this, Club 9 wished to gain control of circa 40% of the company's total share capital, by way of new shares, and to have majority control of the board.
"The board do not believe that the initial investment is significant enough to warrant giving away control of the board or of circa 40% of the company's total share capital.
"We do not believe that a company should pay inflated fees at this level. This position is one that is shared by the Co-operative Bank and as such the proposal has been rejected.
It added: "The board continues to engage with other serious potential investors."
Club 9 director John Pritchett said he was disappointed that their offer had been rejected.
"We think it is a very compelling offer and we think the fans and other interested parties should know the details because we think the portrayal of it has not been accurate," he told BBC Radio Sheffield.
"We offered £10m, we offered £2m at closing and then another £3m to be invested in the 2010/11 season as needed. Our commitment was £5m and £5m for a total of £10m over two years.
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