THE former Chairman of Newcastle United football club Freddy Shepherd flew in to Majorca yesterday as the sale of Real Mallorca moves forward according to Mallorca chairman Vicente Grande.
Neither party locked in the negotiations is able to publicly speak about the deal because, as is standard practice, a confidentiality agreement was signed as soon as contact between the interested party and the club was made, but, as the Bulletin revealed on June 10, Shepherd expressed a serious interest in buying Real Mallorca at least three weeks ago and he is continuing to pursue his goal.
Yesterday he is understood to have spent much of the day in talks with his legal and financial advisors in Palma.
Shepherd, who sold his 28 percent share in Newcastle United for 43 million euros last summer, is understood to be offering 40 million euros for Vicente Grande's 93 percent stake in Real Mallorca.
The British multimillionaire who has owned a holiday home in Andratx for the past 20 years, is also said to be interested in securing 100 percent control of the football club.
But, Grupo Drac, the real estate company owned by Grande, filed for insolvency last week, following the bursting of Spain's real estate bubble and it is a subsidiary of the company which owns the 93 percent of the club and that is now in the hands of the court dealing with Grande's insolvency application.
And this is slowing down the sale of Real Mallorca.
Grupo Drac, which owns real estate assets, land and two hotels on the island, has a debt of between 600 million and 700 million euros, with assets worth about 1.2 billion euros. The company has about 400 million euros of debt with a group of banks, including Sa Nostra, Banco Sabadell and Caja de Ahorros del Mediterraneo (CAM).
Grupo Drac also owes about 200 million euros to suppliers and builders.
However, it is understood that the court will nominate an administrator to oversee the sale of Real Mallorca during the coming week as the court attempts to resolve Grande's financial problems and negotiations are expected to enter into their final phase.
The process may be taking rather longer than Shepherd would have anticipated but this has in no way dented the British businessman's interest in the club.
What is more, it would appear that Shepherd has made a concerted decision to purchase Real Mallorca after having apparently backed out of talks with Leeds United earlier this week.
Since his departure from Newcastle United, Shepherd has made no secret of his desire to return to football and over the past few months has considered a number of options in England with Leeds being his last.
He also looked at Bolton and Sheffield Wednesday.
On Monday Shepherd told Reuters: All I can say is that we're in discussions.
We live in Majorca most of the year. Mallorca has always been our second team.
According to Real Mallorca sources, the club has attracted interest from Russia and the United States but it would appear that it is Shepherd's bid which remains on the table and is gathering momentum.
He will also have to negotiate the purchase of the seven percent that Grande does not own if he is to secure the 100 percent control he apparently would like.
Real Mallorca finished seventh in La Liga last season - a point below the European slots and, ironically, Shepherd's former club Newcastle are playing in a four-team tournament hosted by Real Mallorca in early August.
Shepherd could be in the directors' box by then, hosting his former team.
But, Real Mallorca has already sold Navarro and is desperately trying to offload Dani Guiza for 15 million euros in a bid to raise vital funds.
Ibagaza also looks set to be on the move and any further sales will surely decrease Real Mallorca's value as a club and also make potential buyers think twice before purchasing the Palma outfit.
As the Bulletin has already commentated this week, Shepherd's purchase of the club will mark the dawn of a new era for Real Mallorca and also give the British community on the island a boost in a time when everyone is being hit by the credit crunch and economic crisis.
It will also show the Balearic business sector that British business continues to have great belief in the region and is not afraid to invest in Majorca.