Sportsmail investigation has revealed the story surrounding takeover last year

Stewart Donald and Charlie Methven struck a deal with American Ellis Short

They committed £5million of their own money in the reported £40m takeover

If Sunderland beat Charlton on Sunday they will return to Championship

Methven and Donald have seduced fans with long-term strategy for the club

But they could sell and return to their Oxfordshire homes with a tidy profit

Sunderland's owners used £32million of Premier League parachute payments to buy the club from Ellis Short last year.

Evidence seen by Sportsmail has revealed that chairman Stewart Donald and executive director Charlie Methven committed only £5m of Donald’s money as part of the £37m takeover to secure control of the club a year ago.

They could now both make millions if they push through with plans to sell for £50m, although no rules will have been broken.

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Donald on Wednesday night confirmed that the takeover involved a payment of ‘£15m plus last summer’s parachute payment of £25m’, although evidence suggests close to £10m of that first payment was also parachute money.

The Sunderland chairman, a popular figure with fans, also insisted he is still committed to the club ahead of Sunday’s League One play-off final against Charlton. He said: ‘The notion that I am going to leave Sunderland in the short-term, having made a quick profit, is simply wrong.’

In correspondence seen by this newspaper, however, the desire to sell to a new owner is made clear.

Charlie Methven (left) and Stewart Donald (right) bought the club with only £5million

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If Sunderland secure promotion back to the Championship on Sunday with victory over Charlton at Wembley, the fans may salute two men they regard as the saviours of their club.

But, as a Sportsmail investigation reveals, Stewart Donald and Charlie Methven struck a deal with former owner Ellis Short to buy the club using Premier League parachute payments.

Only now — after being challenged by this newspaper — have they admitted this was central to an agreement that saw Donald commit only £5million of his own money in the £37m takeover.

If they succeed with their plan, which has broken no laws nor breached any regulations, to sell Sunderland only 12 months on, they stand to make a fortune. Donald would pocket some £37m if they achieve their £50m asking price, while Methven would make around £3m for his stake.

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This time last year, Donald and Methven arrived on Wearside, the former a 44-year-old insurance millionaire who sounds a little like David Brent, the latter a smooth-talking financial PR man and former journalist Private Eye recently described as a ‘Brylcreemed, perma-tanned, Thatcher-worshipping Old Etonian Hooray’.

They declared Sunderland ‘debt-free’ after succeeding Short as owners. Short did agree to write off most of the club’s £150m debt but Sportsmail can now confirm that almost £32million of that was covered by Sunderland via parachute payments — and not Donald and Methven — after the takeover was completed.

Donald took a 94 per cent share with Methven getting the remainder. They promised to re-engage with the club’s disenchanted supporters.

Ellis Short allowed the pair to buy the club using Premier League parachute payments

Oxford-educated Methven has been particularly masterful. He can stroll into the Colliery Tavern, a pub across the road from the Stadium of Light, in his red chinos on match days and enjoy a pint with the locals.

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The supporters see Donald and Methven as the antithesis of Short, the billionaire who came to be regarded as aloof, elusive and neglectful. The American lost some £250m in his bungled attempt to establish Sunderland as a Premier League powerhouse, only to see them drop to the third tier.

On May 21, 2018, only 24 hours after Short had fired manager Chris Coleman and declared he was off, too, Donald and Methven assured supporters in an interview with Sunderland fan podcast Roker Rapport that life would be different on their watch.

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This would no longer be a club where people could come in and ‘take the p***’ financially.

They invited supporters to help replace the stadium’s sun-scorched pink seats, that had become a source of some embarrassment, while feeding them burgers and beers. Donald’s insurance company offered discounts to Sunderland fans.

A one-time Samson the Cat, the club mascot, was appointed their new managing director. Tony Davison returned to the club he had supported since childhood, after working as a commercial director at Tottenham and Oxford United, as well as at Methven’s communications firm in London.

Sunderland director Juan Sartori (L) with fellow director Methven (right) and supporters

The host of the podcast was also hired after being one of those questioning the details of the takeover deal, in particular whether Donald planned to pay Short with Premier League parachute payments rather than his own money.

Executive director Methven responded at the time: ‘The way in which Ellis has allowed us to do it is to pay some of the £40m in stages, to help us with the cash flow requirement this summer.

‘The reality when you do this kind of deal, and there is still money outstanding on the deal, is that the person who has that money outstanding will want to take security against something so that if the owners then didn’t pay, he would have something to cover his money.

‘That money is secured against parachute payments but that is just him making sure he gets the full value of the £40m from us.’

This, however, does not exactly tally with the precise details of the deal that have now been uncovered by this newspaper.

According to evidence seen by Sportsmail, allied with a forensic examination of published accounts at Companies House, Donald committed only £5m in the form of a loan. The remaining part of the deal — just shy of £32million — was covered with parachute payment cash. While there are no Premier League regulations regarding how a club spends the money, the payments were introduced to protect clubs from the financial pressures of relegation from the top flight.

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Short did agree to accept the money in instalments, with Donald declaring in July 2018 that an initial £15m had been paid to the American. It was actually £14.6m, with £9.6m from the club accounts and a further £5m provided by the new majority shareholder owner.

The owners have only been in a year but could still flip the club for a handsome profit

Donald has endeared himself to the locals and insists he is still in it for the long haul

When contacted by Sportsmail, Methven did not deny any of this. He did not deny that parachute money was then used to cover the remaining part of the deal, with the final £8.4m of the £31.988m paid only last month.

Methven said the money was not, however, paid to Short but to SBC (the Security Benefit Corporation) in America.

Asked specifically if the parachute money had been paid to Short, Methven replied: ‘I don’t accept in so many words we have (paid Short) because effectively the money has never touched either us or Short. It’s gone straight to SBC, the bank.’ Asked then if that was part of the deal struck with Short, Methven replied: ‘Yes. To pay off the last bit of the debt he otherwise hadn’t paid off.’

The money was channelled through Madrox Partners Limited, a company incorporated on May 2, 2018 by Donald and Methven and used, in Methven’s words, as ‘an accounting route’ because ‘parachute payment money has to be paid into the club accounts’.

Methven insists it remains a great deal for a club which had debts of more than £150m.

He argued this week that a year in charge has cost Donald a further £10m, although he provided no evidence of this. The figure is disputed by sources given that an injection of cash was received as a result of selling a 20 per cent stake in the club to Uruguayan businessman Juan Sartori. Insiders believe the total expense for Donald is closer to £7m.

Donald just had to demonstrate he could finance running the club to take over

There is still £8.6m of parachute money due to Sunderland between August 2019 and July 2020. But an £11.92m loan from merchant banking group Close Brothers, which was secured in April, has enabled the payments up until August to be advanced and much of it paid out via Madrox Partners.

WHO ARE 'BATMAN AND ROBIN'? Stewart Donald: A multi-millionaire and lifelong Oxford United fan who owned National League club Eastleigh for six years. The former insurance man is now the Sunderland chairman who has enamoured himself with fans with soundbites like ‘the club is not a toy, it’s at the heart of the community’ and by appointing Jack Ross as manager. Charlie Methven: Smooth-talking executive director Methven was educated at Eton and Oxford, and previously worked for Sporting Life and the Daily Telegraph. He co-founded the PR firm Dragon Advisory and remains chairman. With his trademark slicked-back hairstyle, Methven is the main frontman for Sunderland.

Sportsmail can reveal that of the £56.5m of parachute money received between last June and next July, only £24.5m of it will have gone towards the working capital of the club.

Methven argued that, while it might have been more palatable for Short to have cleared all the debt and then demanded the full £40m from Donald, the end result would have been no different. But it would, because Donald would have been forced to find the money up front rather than commit future parachute payments to the deal. That was not feasible for a man Methven claims is worth ‘somewhere between 50m and 60m’, and it was not the deal on the table.

It was a deal that apparently made the English Football League nervous until Short made it clear to EFL chief Shaun Harvey and his executives that the alternative would be ruinous for Sunderland. In what has been described a tense exchange, Short is said to have stressed that he was losing so much money — reportedly as much as £500,000 a week — he was ready to simply pull the plug.

Sportsmail understands that Donald only had to demonstrate he could finance the running of the club to meet the EFL criteria for ownership. The EFL knew parachute money formed part of a deal and still allowed the takeover to go ahead. On Wednesday the EFL said they would not comment on specific details.

Sunderland overcame Portsmouth to reach the play-off final and they will take on Charlton

Donald and Methven have never provided any real clarity on the importance of the parachute money to the takeover. In September, Methven revealed in programme notes that the £25m due in summer parachute payments had been ‘ringfenced to pay down bank debt’, but there was no mention of it being used as part of the £40m owed to Short for the purchase of the club.

A month earlier Donald admitted money he was paying for the club to Short was being used to pay off debt, but failed to specify that the club’s parachute payments were being used.

On Wednesday, however, in a statement to Sportsmail, Donald said: ‘Madrox agreed a deal worth £40m with Ellis Short. This was £15m plus last summer’s parachute payment of £25m, which came in just after we took over and was ring-fenced to pay off the last bit of bank debt.

‘So together Ellis and I ensured that the club would be debt free. Ellis by writing off his own debt of £80m and then, with the assistance of that last parachute payment, paying off the £70m of bank debt the club had accrued. And me by refusing to “port” Ellis’ debt on to our books.

‘Instead of having last summer’s parachute payment to settle these debts, Juan Sartori and I have had to inject our own money and continue to do so even now, effectively writing down the £25m parachute payment that was advanced to Ellis. I am clear that I wish to retain a significant investment in the club for the long-term. The notion that I am going to leave Sunderland in the short-term, having made a quick profit, is simply wrong.’

But Sportsmail has seen evidence that £9.6m of that initial £15m payment was also financed using parachute money already sitting in Sunderland’s accounts.

Sunderland supporters were sold a long-term strategy by Methven and Donald

The concern, expressed by insiders, is whether Donald has the funds or inclination to continue financing Sunderland.

Methven insists Donald could yet remain as a shareholder, from anywhere from ‘25 to 55 per cent’, but Sportsmail has seen correspondence that makes clear Donald and Methven’s desire to sell for £50m.

No regulations will have been breached and no laws would have been broken. But two men who seduced Sunderland’s fans with their long-term vision for ‘a family club’ would return to their own family homes in Oxfordshire significantly richer.

On Sunday the focus will only be on Sunderland’s ability to beat Charlton. If they do so perhaps those two men in the Royal Box will be the toast of Wearside. But the club’s return to the second tier of English football will have come at a cost.

Sources say the Sunderland academy that has long been the club’s crown jewel is in danger of losing its Category One status.

A sizeable chunk of the parachute money has gone, meaning any new owner has to use their own money to finance the club.

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‘They have been portrayed as Batman and Robin,’ said one insider on Wednesday. ‘Well the deal is not quite what we thought it was and let’s see what happens now.’