Fire sale on hold after Sullivan and Gold restore hope to West Ham

David Sullivan, in announcing his take­over of West Ham United, laid out his football credentials. "We're good at controlling things and we've left behind a pretty good team at Birmingham City," he said. The last club Sullivan owned with his business partner, David Gold, was certainly transformed unrecognisably during their near 17-year reign. But West Ham fans are streetwise enough to see the deception in dreaming of a push for European qualification any time soon. The task Gold and Sullivan are taking on at Upton Park is arguably as great as when they took control of a bankrupt Birmingham in the second tier in 1993. Sullivan listed his new club's £100m-plus debt burden: £50m owing to banks, £40m to other clubs and more than half of the next two years' season-ticket money already borrowed against. What Sullivan did not mention was that 18 months ago the club breached their banking covenants when their wage bill hit almost £65m on a turnover of only £81.5m. The pain of trying to work down those unsustainable salary demands will be felt for a number of years. Both Sullivan and Gold know that buying a club this badly in hock was not going to be a rational undertaking. "It makes no financial sense to buy this club. We bought this as fans," said Sullivan, resplendent in his claret velvet jacket and blue silk tie. So bad was the situation that Straumur, the club's 70% owner through their parent CB Holding, had a pressing deadline. If the takeover could not be concluded on Monday, then a fire sale of players would have to begin in an effort to raise the minimum £8m required to cover the still bloated wage bill beyond April. Although West Ham's survival chances have been significantly boosted by the takeover – since the sales of Robert Green, Matthew Upson, Scott Parker and Carlton Cole will not now be forced on them – they are by no means endowed with wealth. Indeed Sullivan does not attempt to hide it. "We haven't got £140m [in cash]. And even that, all that would do is pay the debt," he explained. "It wouldn't buy you a team. So you put in another £100m, or £250m, or £300m? Well, we just haven't got it. I'm not liquid to that extent." In taking over 50% of the club, now the largest single stake with the other half split between three Icelandic banks, Gold and Sullivan are understood to have put down £44m. Sources say that £22m of that goes to pay down some of the club's debt (Straumur and its partners are also in the unenviable position of being among the club's major creditors), and a similar sum goes in as working capital. But a large slice of the working capital will be swallowed by the club's cash-flow obligations between now and August, which are approaching £20m in total. Since the season-ticket money is already hocked, it is unlikely that good offers for any of those players can be turned down in future. But at least the proceeds can now broadly be released for reinvestment in the squad. Indeed other realities bite. Although Gianfranco Zola will be permitted to sign new players during the current transfer window, the club's league position does not make Upton Park an attractive destination. Sullivan is poised to take personal responsibility for transfers alongside the new vice-chairman, Karren Brady, and the likelihood is that any arrivals this month will be loaned in rather than purchased outright. "We will wheel and deal. We're good at it," said Sullivan. There should be no doubt about that. Although both were desperate to get out of Birmingham, they still managed to raise £81.5m in Grandtop International's takeover last year – way over the odds for a club that has for several years bounced between the top two leagues. That unlikely sale meant they could share about £40m between them, a sum that meant dozens of clubs were courting their investment. And the pair took a similarly uncompromising stance into negotiations to take over West Ham. They knew that, backed by hard cash and not easy promises, their bid was the most credible; and their tactics at times angered Straumur's selling agents at NM Rothschild. But West Ham fans should be encouraged that they succeeded on their own terms. Succour can also be drawn from the fact that they have looked into buying "about 20" clubs, ensuring they have very good intelligence on the state of those clubs' finances. This will be very useful when discussing potential deals for their players. But even if, as is still possible, West Ham slip out of the Premier League this season, the greatest relief for fans is knowing that it will not ring the death knell. "We're here to the end, till we die," said Sullivan. "We're not just going to bang it out to some Russian after five years. I've got a dodgy heart and David's 73. But his mum lived to 90-odd and my mum's still alive at 93. So maybe we'll beat the odds." If West Ham are to survive as a sustained force in the Premier League, they will have to.