Billionaire businessman Mike Ashley has launched a £133.1million takeover bid for Newcastle, buying out long-time owners the Hall family.
Ashley, owner of sportswear company Sport Direct International, has paid more than £55million to acquire a stake amounting to approximately 41.6% of the Tyneside club.
The holding represents those shares until now controlled by Metrocentre tycoon Sir John Hall and his family.
In a statement to the Stock Exchange, Ashley said: ‘I am delighted to have this opportunity to invest in Newcastle United.
‘The club has a fantastic infrastructure, for which Sir John and the board must take much of the credit.
‘I am pleased that Sir John has agreed to remain as life president of the club.
‘Newcastle United has a wonderful heritage and the passion of its fans is legendary.
‘I am sure that, like me, they are already excited about the prospects for next season under the new manager's (Sam Allardyce) stewardship.’
Newcastle were quick to issue a response, saying: ‘The Board of Newcastle United will meet to consider the offer shortly.
‘Newcastle United shareholders are urged to take no further action at this stage.
‘A further announcement will be made in due course.’
Stock Market rules demand that, having acquired a stake of more than 30%, Ashley now has to make an offer for the remaining shares, which he has done at the same price conditional on the acquisition of in excess of 50%.
If he were to gain a 75% holding, he would have control of the club and be able to delist it, at which point reaching 90% ownership and the point where the offer becomes unconditional is almost inevitable.
However, with current chairman Freddy Shepherd holding a stake of around 29.8%, that is by no means a foregone conclusion.
Shepherd has shown little sign of wanting to sell up, despite Sir John and his son Douglas, still deputy chairman, entering into talks with interested parties in recent months.
Indeed, the man who succeeded Hall Snr. at the helm in December 1997 has resisted takeover approaches from the Jersey-based Belgravia Group and the St James' Park Group.
This development came out of the blue in comparison to the speculation which surrounded earlier interest in the club, perhaps in keeping with Ashley, an intensely private man who has earned his reputed £1.9billion fortune away from the limelight.
As late as last week, Shepherd, who has insisted in the past he would not stand in the way of a ‘Geordie Abramovich’, said: ‘It is a plc matter, but none of these talks came to anything because I am not selling.
‘It is an impossible club to buy. If the Halls don't sell and I don't sell, there is no way anybody can buy this club.’
Shepherd's resolve to retain his holding will be tested to the full in the days and weeks ahead as Ashley makes his move.
However, the current chairman's critics will hope for a change of regime with the club servicing debts of around £80million and having announced an operating loss of £6.9million for the six months to December 31 last year in March.
Shepherd appointed Allardyce last week after Glenn Roeder resigned as the sixth manager of his reign as a disastrous Barclays Premiership campaign drew to a close.
Should Ashley succeed in gaining control of the club, the fans will hope for a significant cash injection to fund the new manager's transfer ambitions.
In the meantime, Sir John will maintain his involvement from afar after seeing his near 20-year involvement at boardroom level draw to a close.
It was he who put together the Magpie Group which assumed control back in 1992 to rescue Newcastle from the doldrums.
Hall appointed Kevin Keegan as manager and provided millions to fund a seemingly never-ending recruitment drive, which reached a pinnacle when the club smashed the world transfer record to bring £15million striker Alan Shearer home in 1996.
He said: ‘I have been associated with the direction of Newcastle United for nearly 20 years.
‘In that time, I have led the club and, before I retired, led the team responsible for the modernisation of the club we all see today.
‘It is now time for me to move on and let others take up the challenge of competing in the global market place.
‘Mike Ashley is a major player in the sporting world and I am convinced that he is the right person to take my place and take the club forward.’
