Leeds United chairman Ken Bates has entered talks with an American investor who would offer major funding to improve the first-team squad at Elland Road.

The new proposal has advanced rapidly with the principal attending Tuesday night's Championship loss to Hull City. Accompanied by legal and business advisers, the American - said to be worth $250million (Dh 918m) - is understood to have discussed the number of reinforcements required to bankroll promotion to the Premier League.

The deal would be for a percentage of Bates' majority shareholding in Leeds. The 80 year old former Chelsea owner will stay on as chairman with an agreement in place to sell the remainder of his stake when he ultimately decides to retire from football.

Bates - a Monaco resident whose time in the UK is limited by tax regulations - made an unscheduled visit to Elland Road on Wednesday. Accompanied by his wife and co-shareholder, Susannah, at some points he was spent long hours at the stadium on Thursday and Friday. According to sources close to the negotiations, he has excluded club solicitors from new investment discussions, taking direct control of what had become a fractious process.

At the Championship fixture with Nottingham Forest, Bates entertained four representatives of a Bahraini financial institution working on an alternative proposal, understood to involve a member of the Saudi Arabian royal family.

Speaking to Leeds United's in-house television station ahead of the game, Bates said: "We are well advanced with our discussions. There's a number of technical points to be resolved, some of the delays have been because of summer holidays. But we're making progress, we had a very positive meeting yesterday and the potential investors are looking now to get this matter concluded as soon as possible.

"Both parties regret that because of a lot of factors beyond our control we missed the August window, but we are already planning for the January transfer window. We had four of the top executives from the institution [here], we had one bit of bad luck because the chairman was coming here to meet me to resolve things chairman to chairman but unfortunately he had to pull out at the last minute for personal reasons. We're both disappointed but we're planning to get together as soon as possible when his personal situation had been resolved.

"The confidentiality agreements that were signed was very important to the investors. They are a banking institution and a public company so anything that was said can affect their share price, and they are under severe banking regulation. They are using London lawyers so there are certain logistical problems, but I've discussed things at length and we've agreed that we can make certain things public.

"Since we signed the agreement in June - and told people what we had done - there has been a lot of speculation and agitation, especially by ... LUST [Leeds United Supporters Trust], and I have to tell people that all the statements they have come out with are inaccurate."

If either of the new Arab or American offers is accepted, money will be immediately available to strengthen a squad that Leeds under-pressure manager Neil Warnock has consistently complained is undermanned. The Football League's 93-day emergency loan system is to be used to sign players with a view to permanent January transfers.

Warnock has been working on the signing of Reading centre forward Simon Church on loan. The Wales international scored seven times in 30 league games as Reading gained promotion last season. The 23 year old has yet to make a Premier League appearance this season with Reading employing Russia international Pavel Pogrebnyak as first-choice striker.

"As manager I've got to carry on and if new investment comes in then it might change my targets," said Warnock. "We're looking at targets but they're players we'd need to take on permanently. We'd sign them first for 93 days from around the 27th and that would take them through to January.

"That date's after this weekend's game but before the next league match hopefully. I'm assured that there are on-going talks and people are working hard to change the finances. Hopefully we'll get some good news in the next 10 days or couple of weeks."

There have been complications in Warnock's approach for the player, who is likely to be dropped from Leeds' recruitment plans should new investment be agreed this week.