Reading FC finance expert has given his insight after news broke that former CEO Nigel Howe has served the club with a winding up petition.
The Telegraph reported the news last week that Howe has served the Royals with a winding up petition relating to money that he believes he is owed in the region of £99,000.
Speaking to BBC Radio Berkshire, football finance expert Kieran Maguire said: “I don’t think fans should worry unduly. The amount of money involved is less than £100,000 and Reading have an annual wage bill of £14million so it’s not a significant amount of money by the overall standards of the club.
“It’s two people with very big egos who have fallen out. Rob Couhig the owner is an American lawyer and enjoys litigation. Nigel Howe clearly feels he is entitled to some money and has not been able to resolve it through the normal means.
“This does seem like an extreme step but there are ways and means of resolving this.
“I suspect his legal advisers have been in correspondence with the football club and have not made the progress they would like to. When I speak to lawyers they always say mediation is better than litigation because it’s cheaper for the two parties involved and tends to be quicker.
“It sounds as if both parties have dug in their heels here.
“It sounds a bit scary because if the judge grants a winding up order then effectively you can send the bailiffs around and it starts to get a bit unpleasant but we’re a long way from liquidation.
“That’s when the football club ceases and that’s not going to happen over £99,000. It’s scare tactics and clear the two participants don’t get on which is common in business.
“Unfortunately these things can drag on for years. Anybody who has been through a legal dispute knows you are talking months and it can drag on years. It’s not uncommon.
“The chances are it will be settled between the two parties who think winning is more important than the actual cost for them because it will cost both of them money to resolve this.”
