Why is Dejphon Chansiri holding up David Storch's Sheffield Wednesday takeover? | OneFootball

The soon-to-be former Sheffield Wednesday owner is the biggest impediment to the sale of the club being completed by the 1st May, as had been hoped.

The soon-to-be former owner of Sheffield Wednesday has become an obstacle to club being sold to Arise Capital by the 1st May deadline which had been anticipated.

With time now running out before the 1st May deadline which had been anticipated by the new owners, the sale of Sheffield Wednesday has still not been completed.

The club has now been in administration for more than six months, but every step of the process intended to rescue them as a going concern has proved complicated, and this remains the case, even as that date draws close.

The big question facing the club is whether they start next season with a 15-point deduction or not. EFL rules state that any club which doesn't exit administration with an agreement in place which pays unsecured creditors a minimum dividend of 25p in the pound for what they're owed will face such a deduction for the start of the following season.

The first successful bid for the club saw a consortium fronted by the professional gambler James Bord win out as the preferred bidder. This comfortably met the EFL's requirements, but the bid floundered over the source of the funding and failed at the end of February. The second preferred bidders are Arise Capital, fronted by the American entrepreneur Michael Storch, but this bid does not meet that threshold.

Dejphon Chansiri is now arguably the biggest single reason why the Sheffield Wednesday takeover still hasn't completed

The biggest single reason why the takeover of Sheffield Wednesday hasn't yet been completed has been the reported intransigence of soon-to-be former owner Dejphon Chansiri. Chansiri is the club's biggest single creditor as a result of the tens of millions of pounds that he put into the club over the course of his decade of ownership being in the form of loans.

Putting the club into administration took it out of Chansiri's hands on a day-to-day basis. The administrators, Begbies Traynor, are licensed insolvency practitioners, and have been running the club on a day-to-day basis since the club was put into administration. They're also completely responsible for the sale of the club, which is intended to give Wednesday a clean break and the opportunity to be reborn as a going concern.

Arise Capital had set a final date of the 1st May, by which time they expected the sale of the club to have been completed. This dovetailed neatly with both the end of the 2025-26 season and the formal arrival of the Independent Football Regulator (IFR), who will be taking over control of the governing process for the sale of football clubs.

But as that date draws closer, there have been reports that the former owner, who does still hold cards in terms of what happens to the club next, could be delaying the completion of the sale.

Chansiri's behaviour indicates that he doesn't understand how British incolvency law works

The sale of Sheffield Wednesday is complicated by the club's position being at the intersection of the law and football's own rules on insolvency. Arise Capital had been in talks with the EFL about getting the 15-point deduction reduced or replaced, but conceded that they had been unsuccessful in doing so, although they remained optimistic about getting their transfer embargo lifted. This, however, still left open a window of opportunity if the club's soon-to-be former owner could be persuaded to reduce the value of his claim.

It was initially reported that Chansiri was not even responding to contact from Arise seeking to talk, and this was followed by a report from journalist Alan Nixon, in which it was claimed that, "Chansiri has refused to come to an agreement amid shock claims that ANOTHER bidder has made contact with him, offering the 25p in the pound he was hoping for as the major creditor."

This was shock news in several different respects. Firstly, as an unsecured creditor, Chansiri has no right to be paid a higher dividend than any other. This would completely undermine the principle of 'pari-passu', which underpins the whole of insolvency law in this country through all unsecured creditors being treated equally by being repaid in equal fractional amounts.

And secondly, Chansiri's claims didn't seem to make any sense. Any queries regarding debts owed to a business in administration should be made to the administrators only. If someone did make this offer to him directly, why didn't they make it directly to the administrators themselves? If they made it directly to Chansiri, why didn't he simply say, "You'll need to speak to the administrators", and leave it at that? The latest claims raised substantially more questions than they answered.

All of this raises the question of why Chansiri could be stalling over completing the sale. It could be that he feels that he'll get a better deal once the IFR takes over governance of football club sales, or a blind hope that someone will step in at the last minute and attempt to gazump the Arise bid. It could be as simple as the former owner being unhappy at the fact that his debt is set to be largely wiped from existence by the club being sold from administration.

If the latter is the case, he's misguided. The whole point of the administration process is that it is better to rescue companies as going concerns than liquidate them, and the law is set up in the way that it is because even a relatively small dividend from administration will usually be more than a creditor would receive from funds received from the liquidation of the business. Indeed, one of the key roles of the administrator is that they are legally bound to act in the best interests of creditors.

The recent stories to emerge from Hillsborough on this subject indicate that Chansiri either doesn't understand UK insolvency law, or perhaps that he didn't understand what he was doing when he signed the paperwork putting the club into administration in the first place.

He will lose millions of pounds from this process. That much was always pretty much guaranteed. But it should be pointed out that these were financial risks that he took, and that the position in which the club eventually found itself came about on his watch. There will certainly be little sympathy from the blue and white half of Sheffield, when the sale is completed.

Sheffield Wednesday are ultimately in this position because of Chansiri's mismanagement of the club. There is no ethical or legal case as to why he should emerge from this mess in a better condition than anyone else, no matter what he may think himself. The good news for Wednesday's long-suffering fans is that it's unlikely to prevent the sale of the club from completing, and that it might even end up better just to swallow that 15-point deduction than have to deal with him any more.