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A crucial creditors' meeting on the administration of Coventry City Football Club was today adjourned, the Telegraph understands.

It means the Sky Blues are likely to remain in administration for at least the next six weeks - four weeks after the new season starts - and unable to sign new players under a transfer embargo.

All eyes before today's meeting in London were on whether part-Coventry City Council-owned Ricoh firm Arena Coventry Limited (ACL) would accept terms offered by administrator Paul Appleton under a proposed Company Voluntary Arrangement (CVA) to pay back part of the debt owed to it as a creditor.

There was no such agreement when the meet was adjourned - three hours after all parties entered administrator Paul Appleton's offices for the long-awaited talks.

The Telegraph understands there was a series of challenges from ACL. All sides were asked by Mr Appleton to observe a "media blackout" preventing them from revealing the details, as fans anxiously awaited news.

A statement from Mr Appleton is awaited this evening.

Insolvency law dictates adjournments can take place for up to 14 days.

The club could come out of administration after a 28 day "cooling off" period - once a CVA is signed.

Mr Appleton's CVA proposal asks ACL to accept a £590,000 return for CCFC Ltd's non-payment of £1.3million annual rent for using the stadium, and the cancellation of the lease.

Today's creditors' meeting followed an investigation by Mr Appleton which concluded in a sale of the relatively minor assets in CCFC Ltd to Otium Entertainment Group Ltd, a company related to the Sky Blues' most recent owners Sisu.

More than 4,000 fans marched in Coventry city centre on Saturday in protest at Sisu/Otium's Football League-backed plan to play 'home' matches at Northampton Town for up to five years while building a new stadium in the Coventry area.

ACL - jointly owned by the council and the Alan Edward Higgs Charity - three weeks ago requested more information from Mr Appleton about how the proposed £1.5million sale to Otium was the best deal for creditors and the club. There had been three other final bids - including one from US property investor Preston Haskell IV.

ACL director Peter Knatchbull-Hugessen has already warned that there would be no further investigation into SISU’s companies should ACL sign the CVA

Some believe ending the administration would end fading hopes of any new investor taking over the club, who might also invest as a partner in the stadium and buy out the Higgs 50pc share.



Others argue a takeover could be easier once the complicated sale process of CCFC Ltd - one arm of the club - is fully completed - although Sisu/Otium insist the club is not for sale.

It remains to be seen if not signing the CVA is favoured by by council leaders or by other ACL directors - including Coventry City Council chief executive Martin Reeves and council finance director Chris West.

They may ultimately decide to sign the CVA with conditions attached. The law allows for further adjournments of up to14 days.

Mr Appleton has said the alternative to CCFC Ltd exiting administration via a CVA is liquidation - which could result in the team losing 15 points from its Division One campaign for the forthcoming season.

Liquidation under Mr Appleton's proposals would mean ACL gets next to no return on its debt.

The other creditors are mainly Sisu-related companies - Coventry City Football Club (Holdings) Limited (which continues to run the club), Sky Blue Sports and Leisure, and Cayman Islands-based Arvo Master Fund.

But ACL has the power to block the CVA as it is an unsecured, non-connected creditor. It would get a return on its debts of 25.95p in the pound under Mr Appleton's CVA proposals.

Mr Appleton's CVA proposal also states Sisu-related companies would be writing off around £60million if the CVA is signed, but only £32million of that if it is not.

At the date of the administration in March, there were three other non-connected unsecured creditors, owed small amounts - Coventry City Council (£773 - unpaid Council Tax), HM Revenue and Customs (owed £160,418 for a group VAT liability) and the Alan Higgs Centre Trust (£20,614 for use by the club's youth academy).

Alan Limb, a Sky Blues fan and insolvency expert of Business Recovery and Insolvency (BRI), which has offices in Coventry, speaking before the meeting, said: "I fear more playground posturing between Sisu and ACL.

"The meeting can be adjourned any number of times for up to 14 days in total. Normally this would be to allow time for extra negotiation to see if sufficient creditors can be persuaded to support the CVA proposal. It will be interesting to see what ACL do.

"Sadly, at present, I can't see the club playing at the Ricoh this season because the Football League appears unwilling to force them to do so, despite the public opposition to the groundshare. As ever, I am happy to be proved wrong."

Coventry MP Bob Ainsworth has called in the Commons for an investigation into the club's accounts, while Coventry South MP Jim Cunningham has called for sports minister Hugh Robertson to help initiate talks between Sisu/Otium and ACL.