Shearer deal in doubt as Ashley seeks buyer

Ashley appointed Keith Harris, chairman of Seymour Pierce, last week and the binding engagement letter which was signed is with a view to achieving a quick sale, with the sportswear tycoon braced for a substantial loss on his investment.

The asking price for a club that will be playing in the Championship next season is £100m at the very best and the Newcastle chief fears he may have to accept as little as £80m.

Even if Ashley was to receive the top price, the sale would still represent a £34m loss on the figure he paid for Newcastle two years ago, before even taking into account the £100m interest free loan he is prepared to write off, which was used to clear the debts when he first took control.

These are worrying times on Tyneside and the scale of the troubles struck home in brutal fashion on Friday when it emerged that 120 members of the administrative and commercial staff are to lose their jobs.

“It has been catastrophic for everybody,” said Ashley.

“I’ve lost my money and I’ve made terrible decisions. Now I want to sell it as soon as I can.”

It is a situation that has contributed to the lack of progress throughout the last week aimed at making Shearer the permanent manager after his initial eight-match contract expired last Monday.

And the developments offer an insight into the painstaking nature of some of the discussions that have been taking place, although Shearer is thought to have been unaware that Ashley had decided to sell.

But while Shearer is said to be relaxed, knowing his appointment would make Newcastle a more attractive proposition for a buyer, it appears difficult to imagine how Ashley could agree to meet the contract demands of the club’s record goalscorer – thought to be around £2.5m a year – in such times.

Understandably the negotiations between would be manager, owner and managing director Derek Llambias have been tense, but there is a collective acceptance the club would be in an even greater mess if a deal was not struck for Shearer.

But with a four-year contract for Shearer and his assistant Iain Dowie basically in the hands of the club’s bankers, the next five days will be crucial if Newcastle fans are to have their local hero leading them in the Championship.

The bankers are demanding a new business plan is put in place and that is thought to include a staggering 50 per cent reduction of the £40m working capital facility from Barclays.

It all means Shearer’s deal is on hold - for now.

Of equal importance to Ashley will be to find a buyer for the club, with former chairman Freddy Shepherd known to be one man looking to put together a consortium capable of taking control.

W h i l e it is unclear of the identity and Ashley is unaware of any interest from Shepherd, Seymour Pierce feel there is an interested party already waiting in the wings with a view to buying.

If he does find a buyer it will bring an end to an acrim o n i o u s t w o - y e a r stay in which he has had to deal with a series of protests and demonstrations after Kevin Keegan departed as manager in early September.

It was a f t e r those problems that Ashley put the club up for sale in the hope of clawing in around £400m, which would have earned him a considerable profit on his initial investment.

But having received no firm takeover offers during that time, Ashley had a rethink, and brought in Shearer for the final eight matches of an awful Premier League season - a decision that proved too little too late.

“Of course I regret it,” said Ashley. “I never said I was an expert in football clubs. I was just a fan – although a very wealthy fan. But I’m not so wealthy now. I put my money into it and tried my best. But I accept my best was woefully short. I am genuinely sorry for everybody about what has happened.”

Ashley landed a £929m pay day when he floated Sports Direct on the London Stock Exchange in 2007, but a string of ill-fated gambles have slashed his wealth from £1.4bn to £700m, according to this year’s Sunday Times Rich List.